Document:

Exhibit 4.1 

 

AAR CORP.

 

and

 

Computershare Trust Company, N.A., as
Rights Agent

 

 

 

Rights Agreement

 

Dated as of March 30, 2020

 

    

     

    

 

Table
of Contents

 

Page

 

	Section
    1.	Definitions	1
	 	 	 
	Section
    2.	Appointment
    of Rights Agent	7
	 	 	 
	Section
    3.	Issue
    of Right Certificates	7
	 	 	 
	Section
    4.	Form
    of Right Certificates	9
	 	 	 
	Section
    5.	Countersignature
    and Registration	9
	 	 	 
	Section
    6.	Transfer,
    Split Up, Combination and Exchange of Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates	10
	 	 	 
	Section
    7.	Exercise
    of Rights; Purchase Price; Expiration Date of Rights	11
	 	 	 
	Section
    8.	Cancellation
    and Destruction of Right Certificates	12
	 	 	 
	Section
    9.	Availability
    of Preferred Shares	13
	 	 	 
	Section
    10.	Preferred
    Shares Record Date	13
	 	 	 
	Section
    11.	Adjustment
    of Purchase Price, Number of Shares or Number of Rights	13
	 	 	 
	Section
    12.	Certificate
    of Adjusted Purchase Price or Number of Shares	19
	 	 	 
	Section
    13.	Consolidation,
    Merger or Sale or Transfer of Assets or Earning Power	20
	 	 	 
	Section
    14.	Fractional
    Rights and Fractional Shares	20
	 	 	 
	Section
    15.	Rights
    of Action	22
	 	 	 
	Section
    16.	Agreement
    of Right Holders	22
	 	 	 
	Section
    17.	Right
    Certificate Holder Not Deemed a Stockholder	23
	 	 	 
	Section
    18.	Concerning
    the Rights Agent	23
	 	 	 
	Section
    19.	Merger
    or Consolidation or Change of Name of Rights Agent	24
	 	 	 
	Section
    20.	Duties
    of Rights Agent	24
	 	 	 
	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	29
	 	 	 
	Section
    26.	Notices	30
	 	 	 
	Section
    27.	Supplements
    and Amendments	31

 

    -i-

     

    

 

Table
of Contents

(continued)

 

Page

 

	Section
    28.	Successors	31
	 	 	 
	Section
    29.	Benefits
    of this Agreement	31
	 	 	 
	Section
    30.	Severability	31
	 	 	 
	Section
    31.	Governing
    Law	32
	 	 	 
	Section
    32.	Counterparts	32
	 	 	 
	Section
    33.	Descriptive
    Headings	32
	 	 	 
	Section
    34.	Customer
    Identification Program	32
	 	 	 
	Section
    35.	Force
    Majeure	32

 

    -ii-

     

    

 

RIGHTS AGREEMENT

 

RIGHTS AGREEMENT,
dated as of March 30, 2020, between AAR CORP., a Delaware corporation (the “Company”), and Computershare Trust
Company, N.A., as rights agent (the “Rights Agent”).

 

The Board of Directors
of the Company has authorized and declared a dividend of one preferred share purchase right (a “Right”) for
each Common Share (as hereinafter defined) of the Company outstanding as of the Close of Business (as hereinafter defined) on April
9, 2020 (the “Record Date”), each Right representing the right to purchase one one-thousandth of a Preferred
Share (as hereinafter defined), upon the terms and subject to the conditions herein set forth, and has further authorized and directed
the issuance of one Right with respect to each Common Share that shall become outstanding between the Record Date and the earliest
of the Distribution Date, the Redemption Date and the Expiration Date (as such terms are hereinafter defined).

 

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

 

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

 

“Acquiring
Person” shall mean any Person who or which, together with all Affiliates and Associates of such Person, shall be the
Beneficial Owner of 10% or more of the Common Shares of the Company then outstanding, but shall not include the Company, any Subsidiary
of the Company, any employee benefit plan of the Company or any Subsidiary of the Company, or any entity holding Common Shares
for or pursuant to the terms of any such plan; provided, however, that no Person which, together with all Affiliates
and Associates of such Person, is the Beneficial Owner of Common Shares of the Company representing less than 20% of the Common
Shares of the Company then outstanding, and which is entitled to file, and files, a statement on Schedule 13G (“Schedule
13G”) pursuant to Rule 13d-1(b) or Rule 13d-1(c) of the General Rules and Regulations under the Exchange Act as in effect
at the time of the public announcement of the declaration of the Rights dividend with respect to the Common Shares Beneficially
Owned by such Person (a “13G Investor”), shall be deemed to be an “Acquiring Person”; provided,
further, however, that a Person who was deemed a 13G Investor shall no longer be deemed such if it files a statement
on Schedule 13D pursuant to Rule 13d-1(a), 13d-1(e), 13d-1(f) or 13d-1(g) of the General Rules and Regulations under the Exchange
Act as in effect at the time of the public announcement of the declaration of the Rights dividend with respect to the Common Shares
Beneficially Owned by such Person, and shall be deemed an Acquiring Person if it is the Beneficial Owner of 10% or more of the
Common Shares of the Company then outstanding at any point from the time it first files such a statement on Schedule 13D.

 

Notwithstanding the foregoing,

 

(a)            (i)
no Person who is not a 13G Investor and who Beneficially Owns, as of the time of the first public announcement of the
declaration of the Rights dividend, 10% or more of the Common Shares of the Company then outstanding and (ii) no Person who
is a 13G Investor and who Beneficially Owns, as of the time of the first public announcement of the declaration of the Rights
dividend, 20% or more of the Common Shares of the Company then outstanding, shall become an Acquiring Person unless such
Person shall, after the time of the public announcement of the declaration of the Rights dividend, increase its Beneficial
Ownership of the then-outstanding Common Shares (other than as a result of an acquisition of Common Shares by the Company) to
an amount equal to or greater than the greater of (x) 10% (in the case of a Person who is not then a 13G Investor) or 20% (in
the case of a Person who is then a 13G Investor) or (y) the sum of (i) the lowest Beneficial Ownership of such Person as
a percentage of the outstanding Common Shares as of any time from and after the time of the public announcement of the
declaration of the Rights dividend plus (ii) 0.001%;  

 

    1

     

    

 

(b)           
no Person shall become an “Acquiring Person” as the result of an acquisition of Common Shares by the Company
which, by reducing the number of Common Shares of the Company outstanding, increases the proportionate number of Common Shares
of the Company Beneficially Owned by such Person to 10% (20% in the case of a 13G Investor) or more of the Common Shares of the
Company then outstanding; provided, however, that, if a Person shall become the Beneficial Owner of 10% (20% in
the case of a 13G Investor) or more of the Common Shares of the Company then outstanding by reason of share purchases by the Company
and shall, after the public announcement of 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”;

 

(c)            
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, has become such inadvertently, and such Person divests as promptly
as practicable a sufficient number of Common Shares so that such Person would no longer be an “Acquiring Person,”
then such Person shall not be deemed to be an “Acquiring Person” for any purposes of this Agreement; and

 

(d)            
if a bona fide swaps dealer which would otherwise be an “Acquiring Person” has become so as a result of its
actions in the ordinary course of its business that the Board of Directors of the Company determines, in its sole discretion,
were taken without the intent or effect of evading or assisting any other Person to evade the purposes and intent of this Agreement,
or otherwise seeking to control or influence the management or policies of the Company, then, and unless and until the Board of
Directors shall otherwise determine, such Person shall not be deemed to be an “Acquiring Person” for any purposes
of this Agreement.

 

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 (i) acquiring, holding, voting or disposing of voting securities of the Company or (ii) 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 respective
decision-making processes and (ii) at least one additional factor supports a determination by the Board of Directors that
such Persons intended to act in concert or in parallel, which 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 required shall not include actions by an officer or director of the Company acting in
such capacities. 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 to more than 10 holders of shares of a class of stock of the Company registered under Section 12 of
the Exchange Act, or (ii) soliciting or being solicited for tenders of, 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. A Person who is Acting in Concert with another Person shall be deemed to be
Acting in Concert with any other Person who is Acting in Concert with such other Person.

 

    2

     

    

 

“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.

 

“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.

 

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);

 

(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 (i) is Acting in Concert or (ii) 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 in
clause (B) of subparagraph (ii) of this definition of Beneficial Owner) or disposing of any securities of the Company; or

 

    3

     

    

 

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

 

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

 

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

 

“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
are authorized or obligated by law or executive order to close.

 

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

 

“Common Shares”
when used with reference to the Company shall mean the shares of common stock, par value $1.00 per share, of the Company. “Common
Shares” when used with reference to any Person other than the Company shall mean the capital stock (or equity interest) with
the greatest voting power of such other Person or, if such other Person is a Subsidiary of another Person, the Person or Persons
which ultimately control such first-mentioned Person.

 

“Customer
Identification Program” shall have the meaning set forth in Section 34 hereof.

 

“Derivatives
Contract” means a contract between two parties (the “Receiving Party” and the
 “Counterparty”) that is designed to produce economic benefits and risks to the Receiving Party that
substantially correspond to the ownership by the Receiving Party of a number of Common Shares specified or referenced in such
contract (the number corresponding to such economic benefits and risks, the “Notional Common Shares”),
regardless of whether (i) obligations under such contract are required or permitted to be settled through the delivery of
cash, Common Shares or other property, or (ii) such contract conveys any voting rights in Common Shares, without regard to
any short position under the same or any other Derivatives Contract. For the avoidance of doubt, interests in broad-based
index options, broad-based index futures and broad-based publicly traded market baskets of stocks approved for trading by the
appropriate federal governmental authority shall not be deemed to be Derivatives Contracts.

 

    4

     

    

 

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

 

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

 

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

 

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

 

“NYSE”
shall mean the New York Stock Exchange.

 

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

 

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

 

“Preferred
Shares” shall mean shares of Series A Junior Participating Preferred Stock, par value $1.00 per share, of the Company
having the rights and preferences set forth in the Form of Certificate of Designations attached to this Agreement as Exhibit A.

 

“Purchase
Price” shall have the meaning set forth in Section 4 hereof.

 

“Record Date”
shall have the meaning set forth in the second paragraph hereof.

 

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

 

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

 

“Right”
shall have the meaning set forth in the second paragraph hereof.

 

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

 

“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.

 

“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.

 

    5

     

    

 

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

 

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

 

“Trust”
shall have the meaning set forth in Section 24(e) hereof.

 

“Trust Agreement”
shall have the meaning set forth in Section 24(e) hereof.

 

Section 2.              
Appointment of Rights Agent. The Company hereby appoints the Rights Agent to act as agent for the Company in
accordance with the express terms and conditions (and no implied terms and conditions) hereof, and the Rights Agent hereby accepts
such appointment. The Company may from time to time appoint such co-Rights Agents as it may deem necessary or desirable, upon ten
(10) days’ prior written notice to the Rights Agent. In the event the Company appoints one or more co-Rights Agents, the
respective duties of the Rights Agent and any co-Rights Agents shall be as the Company reasonably determines, provided that such
duties are consistent with the terms and conditions of this Agreement and that contemporaneously with such appointment the Company
shall notify, in writing, the Rights Agent and any co-Rights Agents of any such duties. The Rights Agent shall have no duty to
supervise, and shall in no event be liable for the acts or omissions of any such co-Rights Agent.

 

Section 3.              
Issue of Right Certificates. 

 

(a)           
Until the Close of Business on the tenth (10th) 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
(or by Book Entry Common Shares of the Company) registered in the names of the holders thereof (which certificates or book entry
notations shall also be deemed to be Right Certificates) and not by separate Right Certificates or book entry, and (y) the Rights
(and the right to receive Right Certificates therefor) 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, and upon
written request of the Company, the Rights Agent will countersign, and the Company will send or cause to be sent (and the Rights
Agent will, if requested and provided with all necessary information and documents at the expense of the Company, 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 (other than any Acquiring Person or any Associate or Affiliate of an Acquiring Person), at the address of such holder shown
on the records of the Company, a Right Certificate, in substantially the form of Exhibit B hereto (a “Right Certificate”),
evidencing one Right for each Common Share so held, subject to adjustment as provided herein.  As of the Distribution
Date, the Rights will be evidenced solely by such Right Certificates.  The Company shall promptly notify the Rights
Agent in writing upon the occurrence of the Distribution Date, the Redemption Date and/or the Expiration Date and, if such notification
is given orally, the Company shall confirm same in writing on or prior to the Business Day next following.  Until such
written notice is received by the Rights Agent, the Rights Agent may presume conclusively for all purposes that none of the Distribution
Date, the Redemption Date or the Expiration Date has occurred.

 

    6

     

    

 

(b)           
On the Record Date, or as soon as practicable thereafter, the Company will send (directly, or at the expense of the Company,
upon the written request of the Company and after providing all necessary information and documents, through the Rights Agent
or the Company’s transfer agent for the Common Shares) a copy of a Summary of Rights to Purchase Preferred Shares, in substantially
the form of Exhibit C 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 (other than any Acquiring Person or any Associate or Affiliate
of an Acquiring Person), at the address of such holder shown on the records of the Company.   With respect to certificates
for Common Shares of the Company or Book Entry Common Shares of the Company outstanding as of the Record Date, until the Distribution
Date, the Rights will be evidenced by such certificates or book entry notations 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 earliest of the
Redemption Date or the Expiration Date), the surrender for transfer of any certificate for Common Shares or the transfer of any
Book Entry Common Shares of the Company outstanding on the Record Date, with or without a copy of the Summary of Rights attached
thereto, shall also constitute the transfer of the Rights associated with the Common Shares of the Company represented thereby.

 

(c)           
Certificates for Common Shares (or Book Entry Common Shares) which become outstanding (including, without limitation, reacquired
Common Shares referred to in the penultimate sentence of this paragraph (c)) after the Record Date but prior to the earliest of
the Distribution Date, the Redemption Date or the Expiration Date shall 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 AAR CORP. (the “Company”)
and Computershare Trust Company, N.A., dated as of March 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 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 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 that are or were acquired or Beneficially Owned by any Person (as defined in the Agreement) who becomes
an Acquiring Person (as defined in the Agreement) or an Associate or Affiliate thereof (each as defined in the Agreement) become
null and void and non-transferable.

 

With respect to any Book Entry Common
Shares of the Company, such legend shall be included in the Ownership Statement in respect of such Common Share or in a
notice to the record holder of such Common Share in accordance with applicable law.  With respect to such
certificates containing the foregoing legend, or any notice containing the foregoing legend delivered to holders of Book
Entry Common Shares, until the earliest of the Distribution Date, the Redemption Date or the Expiration Date, the Rights
associated with the Common Shares of the Company represented by such certificates shall be evidenced by such certificates or
such Book Entry Common Shares (including any Ownership Statement) alone, and the surrender for transfer of any such
certificate or the transfer of any Book Entry Common Share 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 which are no longer outstanding.  Notwithstanding this Section
3(c), the omission of a legend shall not affect the enforceability of any part of this Rights Agreement or the rights of any
holder of the Rights.

 

    7

     

    

 

Section 4.              
Form of Right Certificates. The Right Certificates (and the forms of election to purchase Preferred Shares
and of assignment to be printed on the reverse thereof) shall be substantially the same as Exhibit B hereto, and may have such
marks of identification or designation and such legends, summaries or endorsements printed thereon as the Company may deem appropriate
(but which do not adversely 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 terms and conditions hereof, including but limited to the provisions of Section
22 hereof, the Right Certificates shall entitle the holders thereof to purchase such number of one one-thousandths of a Preferred
Share as shall be set forth therein at the price per one one-thousandth of a Preferred Share set forth therein (the “Purchase
Price”), but the number of such one one-thousandths of a Preferred Share 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 President and Chief Executive Officer or any Executive or Senior Vice President, either manually or by facsimile signature,
shall have affixed thereto the Company’s seal or a facsimile thereof, and shall be attested by the Secretary or an Assistant
Secretary of the Company, either manually or by facsimile signature.  The Right Certificates shall be countersigned,
either manually or by facsimile signature, by the Rights Agent and shall not be valid for any purpose unless countersigned. In
case any officer of the Company who shall have signed any of the Right Certificates shall cease to be such officer of the Company
before countersignature by the Rights Agent and issuance and delivery by the Company, such Right Certificates, nevertheless, may
be countersigned by the Rights Agent and issued and delivered by the Company with the same force and effect as though the individual
who signed such Right Certificates had not ceased to be such officer of the Company; and any Right Certificate may be signed on
behalf of the Company by any individual who, at the actual date of the execution of such Right Certificate, shall be a proper officer
of the Company to sign such Right Certificate, although at the date of the execution of this Agreement any such individual was
not such an officer.

 

Following the Distribution
Date, receipt by the Rights Agent of notice to that effect and all other relevant information and documents referred to in Section
3(a), the Rights Agent will keep or cause to be kept, at its office 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.

 

    8

     

    

 

Section
6.               Transfer,
Split Up, Combination and Exchange of Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates.
Subject to the terms and conditions hereof, including but limited 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 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 one one-thousandths of a Preferred Share 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.  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 Right Certificate until the registered holder
shall have properly completed and duly executed the certificate contained in the form of assignment on the reverse side of
such Right Certificate, shall have provided such additional evidence of the identity of the Beneficial Owner (or former
Beneficial Owner) thereof and of the Rights evidenced thereby and the Affiliates and Associates of such Beneficial Owner (or
former Beneficial Owner) thereof as the Company or the Rights Agent shall reasonably request and 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 hereunder.  Thereupon, the Rights Agent shall countersign (by manual or facsimile
signature) 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
Company may require from the holder of a Rights Certificate payment of a sum sufficient to cover any tax or charge that may
be imposed in connection with any transfer, split up, combination or exchange of Right Certificates.  The Rights
Agent shall promptly 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.

 

Upon receipt by the
Company and the Rights Agent of evidence reasonably satisfactory to them of the loss, theft, destruction or mutilation of a Right
Certificate, and, in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to them, and, at the
Company’s request, reimbursement to the Company and the Rights Agent of all reasonable expenses incidental thereto, and upon
surrender to the Rights Agent and cancellation of the Right Certificate if mutilated, the Company will issue, execute 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, the Company and the Rights Agent may amend this Rights Agreement to provide for uncertificated Rights
in addition to or in place of Rights evidenced by Right Certificates.

 

    9

     

    

 

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

 

(a)           
The registered holder of any Right Certificate may exercise the Rights evidenced thereby (except as otherwise provided
herein), in whole or in part, at any time after the Distribution Date, upon surrender of the Right Certificate, with the form
of election to purchase on the reverse side thereof properly completed and duly executed, to the Rights Agent at the office of
the Rights Agent designated for such purpose, together with payment of the Purchase Price for each one one-thousandth of a Preferred
Share as to which the Rights are exercised, and an amount equal to any tax or charge required to paid under this Section 9 hereof,
at or prior to the earliest of (i) the Close of Business on February 28, 2021 (the “Expiration Date”),
(ii) the time at which the Rights are redeemed as provided in Section 23 hereof (the “Redemption Date”)
or (iii) the time at which such Rights are exchanged as provided in Section 24 hereof.  From such time as the Rights
are no longer exercisable hereunder, the Rights Agent shall have no further duties, obligations or liabilities hereunder except
as expressly stated herein.

 

(b)           
The Purchase Price for each one one-thousandth of a Preferred Share purchasable pursuant to the exercise of a Right shall
initially be $100.00, 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.

 

(c)           
Upon receipt of a Right Certificate representing exercisable Rights, with the form of election to purchase properly completed
and duly executed, accompanied by payment of the Purchase Price for the shares 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 cash or by certified
check, cashier’s check or money order payable to the order of the Company, the Rights Agent shall thereupon promptly (i)
(A) requisition from any transfer agent of the Preferred Shares (or make available if the Rights Agent is the Transfer Agent)
certificates for the number of Preferred Shares to be purchased and the Company hereby irrevocably authorizes and directs any
such transfer agent to comply with all such requests, or (B) requisition from the depositary agent depositary receipts representing
such number of one one-thousandths of a Preferred Share as are to be purchased (in which case certificates for the Preferred Shares
represented by such receipts shall be deposited by the transfer agent of the Preferred Shares with such depositary agent) and
the Company hereby authorizes and directs such depositary agent to comply with such request; (ii) when necessary to comply with
this Agreement, 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.  In the event that the Company is obligated to issue securities of the Company other
than Preferred Shares (including Common Shares) of the Company pursuant to Section 11(a) hereof, the Company will make all arrangements
necessary so that such other securities are available for distribution by the Rights Agent.

 

    10

     

    

 

(d)           Notwithstanding
anything in this Agreement to the contrary, neither the Rights Agent nor the Company shall be obligated to undertake any
action with respect to a registered holder of Rights or other securities upon the occurrence of any purported transfer or
exercise as set forth in Section 6 hereof or this Section 7 unless such registered holder shall have (i) properly completed
and duly executed the certification following the form of election to purchase set forth on the reverse side of the Right
Certificate surrendered for such transfer or exercise, (ii) tendered the Purchase Price (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) to the
Company in the manner set forth in Section 7(c), and (iii) provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates thereof as the Company or the Rights Agent shall
reasonably request.

 

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

 

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

 

Section 9.              
Availability of Preferred Shares. The Company covenants and agrees that it will cause to be reserved and kept
available out of its authorized and unissued Preferred Shares or any Preferred Shares held in its treasury the number of Preferred
Shares 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 Preferred Shares (or Common
Shares and other securities as the case may be) delivered upon exercise of Rights shall, at the time of delivery of the certificates
for such Preferred Shares (or Common Shares and other securities, as the case may be) (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 Preferred Shares 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 Preferred Shares in a name other than that of, the registered holder of the Right Certificate
evidencing Rights surrendered for exercise or to issue or to deliver any certificates or depositary receipts for Preferred
Shares upon the exercise of any Rights until any such tax or charge shall have been paid (any such tax or charge 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 reasonable satisfaction that no such tax or charge is due.

 

    11

     

    

 

Section 10.          
Preferred Shares Record Date. Each Person in whose name any certificate for Preferred Shares or other securities
is issued upon the exercise of Rights shall for all purposes be deemed to have become the holder of record of the Preferred Shares or
other securities represented thereby on, and such certificate shall be dated, the date upon which the Right Certificate evidencing
such Rights was duly surrendered with the forms of election and certification properly completed and duly executed and payment
of the Purchase Price (and any applicable transfer taxes) was made; provided, however, that, if the date of such
surrender and payment is a date upon which the Preferred Shares or other securities transfer books of the Company are closed, such
Person shall be deemed to have become the record holder of such shares on, and such certificate shall be dated, the next succeeding
Business Day on which the Preferred Shares or other securities 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
Preferred Shares for which the Rights shall be exercisable, including, without limitation, the right to vote, to receive dividends
or other distributions or to exercise any preemptive rights, and shall not be entitled to receive any notice of any proceedings
of the Company, except as provided herein.

 

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

 

(a)            
 

 

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

 

    12

     

    

 

 

(ii)              Subject
to Section 24 hereof, 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 multiplied by the number of one
one-thousandths of a Preferred Share for which a Right is then exercisable, in accordance with the terms of this Agreement
and in lieu of Preferred Shares, such number of Common Shares of the Company as shall equal the result obtained by (A)
multiplying the then current Purchase Price by the number of one one-thousandths of a Preferred Share for which a Right is
then exercisable and dividing that product by (B) 50% of the then current per share market price of the Common Shares of the
Company (determined pursuant to Section 11(d) 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) shall be null and void without any further action, and any holder of such Rights shall thereafter
have no right to exercise such Rights under any provision of this Agreement or otherwise.  Neither the Company nor the
Rights Agent shall have liability to any holder of Right Certificates or other Person as a result of the Company’s or the
Rights Agent’s failure to make any determinations with respect to an Acquiring Person or its Affiliates, Associates or transferees
hereunder.  No Right Certificate shall be issued pursuant to Section 3 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;
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 to any nominee of such Acquiring Person, Associate
or Affiliate or with respect to any Common Shares otherwise deemed to be Beneficially Owned by any of the foregoing; and any Right
Certificate delivered to the Rights Agent for transfer to an Acquiring Person or other Person whose Rights would be null and void
pursuant to the preceding sentence shall be cancelled.  The Company shall give the Rights Agent written notice of the
identity of any such Acquiring Person, Associate or Affiliate, or the nominee of any of the foregoing, and the Rights Agent may
rely on such written notice in carrying out its duties under this Agreement and shall be deemed not to have any knowledge of the
identity of any such Acquiring Person, Associate or Affiliate, or the nominee of any of the foregoing, unless and until it shall
have received such written notice.

 

(iii)           
In the event that there shall not be sufficient Common Shares issued but not outstanding or authorized but unissued to permit
the exercise in full of the Rights in accordance with subparagraph (ii) above, the Company shall take all such action as may be
necessary to authorize additional Common Shares for issuance upon exercise of the Rights.  In the event the Company shall,
after good faith effort, be unable to take all such action as may be necessary to authorize such additional Common Shares, the
Company shall substitute, for each Common Share that would otherwise be issuable upon exercise of a Right, a number of Preferred
Shares or fraction thereof such that the current per share market price of one Preferred Share multiplied by such number or fraction
is equal to the current per share market price of one Common Share as of the date of issuance of such Preferred Shares or fraction
thereof.

 

    13

     

    

 

(b)          
In case the Company shall fix a record date for the issuance of rights, options or warrants to all holders of Preferred
Shares entitling them (for a period expiring within 45 calendar days after such record date) to subscribe for or purchase Preferred
Shares (or shares having the same rights, privileges and preferences as the Preferred Shares (“equivalent preferred shares”))
or securities convertible into Preferred Shares or equivalent preferred shares at a price per Preferred Share or equivalent preferred
share (or having a conversion price per share, if a security convertible into Preferred Shares or equivalent preferred shares)
less than the then current per share market price of the Preferred Shares (as defined in Section 11(d)) on such record date, the
Purchase Price to be in effect after such record date shall be determined by multiplying the Purchase Price in effect immediately
prior to such record date by a fraction, the numerator of which shall be the number of Preferred Shares outstanding on such record
date plus the number of Preferred Shares which the aggregate offering price of the total number of Preferred Shares and/or equivalent
preferred shares so to be offered (and/or the aggregate initial conversion price of the convertible securities so to be offered)
would purchase at such current market price and the denominator of which shall be the number of Preferred Shares outstanding on
such record date plus the number of additional Preferred Shares and/or equivalent preferred shares to be offered for subscription
or purchase (or into which the convertible securities so to be offered are initially convertible); provided, however,
that in no event shall the consideration to be paid upon the exercise of one Right be less than the aggregate par value of the
shares of capital stock of the Company issuable upon exercise of one Right.  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 written statement filed with
the Rights Agent and shall be binding on the Rights Agent and holders of the Rights.  Preferred Shares owned by or held
for the account of the Company or any Subsidiary of the Company shall not be deemed outstanding for the purpose of any such computation.  Such
adjustment shall be made successively whenever such a record date is fixed; and, in the event that such rights, options or warrants
are not so issued, the Purchase Price shall be adjusted to be the Purchase Price which would then be in effect if such record
date had not been fixed.

 

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

 

    14

     

    

 

(d)          
 

 

(i)              
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)(i)) 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 but not including
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 NYSE or, if the Security is not listed or admitted to trading on the NYSE, as reported in the principal consolidated
transaction reporting system with respect to securities listed 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 the 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.  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.

 

(ii)              For
the purpose of any computation hereunder, the “current per share market price” of the Preferred Shares shall be
determined in accordance with the method set forth in Section 11(d)(i).  If the Preferred Shares are not publicly
traded, the “current per share market price” of the Preferred Shares shall be conclusively deemed to be the
current per share market price of the Common Shares as determined pursuant to Section 11(d)(i) hereof (appropriately adjusted
to reflect any stock split, stock dividend or similar transaction occurring after the date hereof), multiplied by one
thousand.  If neither the Common Shares nor the Preferred Shares are publicly held or so listed or traded,
 “current per share market price” shall mean the fair value per share 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.

 

    15

     

    

 

(e)          
No adjustment in the Purchase Price shall be required unless such adjustment would require an increase or decrease of at
least 1% in the Purchase Price; provided, however, that any adjustments which by reason of this Section 11(e) are
not required to be made shall be carried forward and taken into account in any subsequent adjustment.  All calculations
under this Section 11 shall be made to the nearest cent or to the nearest one one-millionth of a Preferred Share or one ten-thousandth
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 date of the expiration of the right to exercise any Rights.

 

(f)          
If, as a result of an adjustment made pursuant to Section 11(a) hereof, the holder of any Right thereafter exercised shall
become entitled to receive any shares of capital stock of the Company other than Preferred Shares, thereafter the number
of such other shares so receivable upon exercise of any Right shall be subject to adjustment from time to time in a manner and
on terms as nearly equivalent as practicable to the provisions with respect to the Preferred Shares contained in Section 11(a)
through (c) hereof, inclusive, and the provisions of Sections 7, 9, 10 and 13 hereof with respect to the Preferred Shares shall
apply on like terms to any such other shares.

 

(g)           
All Rights originally issued by the Company subsequent to any adjustment made to the Purchase Price hereunder shall evidence
the right to purchase, at the adjusted Purchase Price, the number of one one-thousandths of a Preferred Share purchasable from
time to time hereunder upon exercise of the Rights, all subject to further adjustment as provided herein.

 

(h)          
Unless the Company shall have exercised its election as provided in Section 11(i) 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 one one-thousandths
of a Preferred Share (calculated to the nearest one one-millionth of a Preferred Share) obtained by (A) multiplying (x) the number
of one one-thousandths of a share covered by a Right immediately prior to this adjustment by (y) the Purchase Price in effect
immediately prior to such adjustment of the Purchase Price and (B) dividing the product so obtained by the Purchase Price in effect
immediately after such adjustment of the Purchase Price.

 

(i)           
The Company may elect, on or after the date of any adjustment of the Purchase Price, to adjust the number of Rights in
substitution for any adjustment in the number of one one-thousandths of a Preferred Share 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 one one-thousandths
of a Preferred Share for which a Right was exercisable immediately prior to such adjustment.  Each Right held of record
prior to such adjustment of the number of Rights shall become that number of Rights (calculated to the nearest one ten-thousandth)
obtained by dividing the Purchase Price in effect immediately prior to adjustment of the Purchase Price by the Purchase Price
in effect immediately after adjustment of the Purchase Price.  The Company shall make a public announcement (with prompt
written notice thereof to the Rights Agent) 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 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.

 

    16

     

    

 

(j)           
Irrespective of any adjustment or change in the Purchase Price or in the number of one one-thousandths of a Preferred Share
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 one one-thousandths of a Preferred Share which were expressed in the initial Right Certificates
issued hereunder.

 

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

 

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

 

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

 

    17

     

    

 

(n)          
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 one one-thousandths of a Preferred Share purchasable after
such event upon proper exercise of each Right shall be determined by multiplying the number of one one-thousandths of a Preferred
Share 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 or any event affecting
the Rights or their exercisability (including without limitation an event that causes Rights to become null and void) as provided
in Section 11 or 13 hereof, the Company shall promptly (a) prepare a certificate setting forth such adjustment or describing such
event and a brief statement of the facts accounting for such adjustment or describing such event, (b) file with the Rights
Agent and with each transfer agent for the Common Shares or the Preferred Shares a copy of such certificate and (c) if such adjustment
occurs at any time after the Distribution Date, mail a brief summary thereof to each holder of a Right Certificate in accordance
with Section 25 hereof.  The Rights Agent shall be fully protected in relying on any such certificate and on any adjustment
or statement therein contained and shall not be obligated or responsible for calculating any adjustment, nor shall it have any
duty or liability with respect to, or be deemed to have knowledge of any such adjustment or event unless and until it shall have
received such a certificate.

 

Section
13.           Consolidation,
Merger or Sale or Transfer of Assets or Earning Power. In the event, directly or indirectly, at any time after a
Person has become an Acquiring Person, (a) the Company shall effect a share exchange, consolidate with, or merge with
and into, any other Person, (b) any Person shall effect a share exchange, consolidate with the Company, or merge with and
into the Company and the Company shall be the continuing or surviving corporation of such share exchange or 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 50% or more of the assets or earning power of the Company and its Subsidiaries (taken as a whole)
to any other Person other than the Company or one or more of its wholly-owned Subsidiaries, then, and in each such case,
proper provision shall be made so that (i) each holder of a Right (except as otherwise provided herein) shall thereafter
have the right to receive, upon the exercise thereof at a price equal to the then current Purchase Price multiplied by the
number of one one-thousandths of a Preferred Share for which a Right is then exercisable, in accordance with the terms of
this Agreement and in lieu of Preferred Shares, such number of Common Shares of such other Person (including the Company as
successor thereto or as the surviving corporation) as shall equal the result obtained by (A) multiplying the then current
Purchase Price by the number of one one-thousandths of a Preferred Share 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 of the Company 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, share exchanges, or consolidations or sales or other transfers.

 

    18

     

    

 

Section 14.          
Fractional Rights and Fractional Shares.

 

(a)          
The Company shall not be required to issue fractions of Rights or to distribute Right Certificates which evidence fractional
Rights.  In lieu of such fractional Rights, there shall be paid to the registered holders of the Right Certificates
with regard to which such fractional Rights would otherwise be issuable, an amount in cash equal to the same fraction of the current
market value of a whole Right.  For purposes of this Section 14(a), the current market value of a whole Right shall
be the closing price of the Rights for the Trading Day immediately prior to the date on which such fractional Rights would have
been otherwise issuable.  The closing price for any day shall be the last sale price, regular way, or, in case no such
sale takes place on such day, the average of the closing bid and asked prices, regular way, in either case, as reported in the
principal consolidated transaction reporting system with respect to securities listed or admitted to trading on the NYSE or, if
the Rights are not listed or admitted to trading on the NYSE, as reported in the principal consolidated transaction reporting
system with respect to securities listed on the principal national securities exchange on which the Rights are listed or admitted
to trading or, if the Rights are not listed or admitted to trading on any national securities exchange, the last quoted price
or, if not so quoted, the average of the high bid and low asked prices in the over-the-counter market, as reported by the 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.

 

    19

     

    

 

(b)          
The Company shall not be required to issue fractions of Preferred Shares (other than fractions which are integral multiples
of one one-thousandth of a Preferred Share) upon exercise of the Rights or to distribute certificates which evidence fractional
Preferred Shares (other than fractions which are integral multiples of one one-thousandth of a Preferred Share).  Fractions
of Preferred Shares in integral multiples of one one-thousandth of a Preferred Share may, at the election of the Company, be evidenced
by depositary receipts, pursuant to an appropriate agreement between the Company and a depositary selected by it; provided
that such agreement shall provide that the holders of such depositary receipts shall have all the rights, privileges and preferences
to which they are entitled as beneficial owners of the Preferred Shares represented by such depositary receipts.  In
lieu of fractional Preferred Shares that are not integral multiples of one one-thousandth of a Preferred Share, 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 Preferred Share.  For the purposes of this Section 14(b),
the current market value of a Preferred Share shall be the closing price of a Preferred Share (as determined pursuant to the second
sentence of Section 11(d)(i) hereof) for the Trading Day immediately prior to the date of such exercise.

 

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

 

(d)          
Whenever a payment for fractional Rights or fractional shares or other securities is to be made by the Rights Agent, the
Company shall (i) promptly prepare and deliver to the Rights Agent a certificate setting forth in reasonable detail the facts
related to such payment and the prices or formulas utilized in calculating the amounts of 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 or other securities under any Section of this Agreement relating to
the payment of fractional Rights or fractional shares or other securities 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 pursuant to the terms of this Agreement, are vested in the respective registered holders of the Right Certificates
(and, prior to the Distribution Date, the registered holders of the Common Shares); and any registered holder of any Right Certificate
(or, prior to the Distribution Date, of the Common Shares), without the consent of the Rights Agent or of the holder of any other
Right Certificate (or, prior to the Distribution Date, of the Common Shares), may, in such holder’s own behalf and for such
holder’s own benefit, enforce, and may institute and maintain any suit, action or proceeding against the Company to enforce,
or otherwise act in respect of, such holder’s right to exercise the Rights evidenced by such Right Certificate in the manner
provided in such Right Certificate and in this Agreement.  Without limiting the foregoing or any remedies available to
the holders of Rights, it is specifically acknowledged that the holders of Rights would not have an adequate remedy at law for
any breach of this Agreement, and will be entitled to specific performance of the obligations under, and injunctive relief against
actual or threatened violations of the obligations of any Person subject to, this Agreement.

 

    20

     

    

 

Notwithstanding anything
in this Agreement to the contrary, the Rights Agent shall not have any liability to any holder of a Right or other Person as a
result of the inability of the Company or the Rights Agent 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 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; provided, however, that the Company shall use all reasonable efforts to have any such injunction, order,
judgment, decree or ruling lifted or otherwise overturned as soon as possible.

 

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

 

(a)          
prior to the Distribution Date, the Rights will be transferable only in connection with the transfer of the Common Shares;

 

(b)          
after the Distribution Date, the Right Certificates are transferable (subject to the provisions of this Agreement) only
on the registry books maintained by the Rights Agent if surrendered at the office of the Rights Agent designated for such
purpose, duly endorsed or accompanied by a proper instrument of transfer and with the appropriate forms and certificates properly
completed and duly executed, accompanied by a signature guarantee and such other documentation as the Rights Agent may reasonably
request; and

 

(c)          
the Company and the Rights Agent may deem and treat the person in whose name the Right Certificate (or, prior to the Distribution
Date, the associated Common Shares certificate (or Book Entry Common Share)) is registered as the absolute owner thereof and of
the Rights evidenced thereby (notwithstanding any notations of ownership or writing on the Right Certificate or the associated
Common Shares certificate (or Ownership Statements or other notices provided to holders of Book Entry Common Shares) 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 Stockholder. No holder, as such, of any Right shall be entitled to vote,
receive dividends or be deemed for any purpose the holder of the Preferred Shares or any other securities of the Company which
may at any time be issuable on the exercise or exchange of the Rights represented thereby, nor shall anything contained herein
or in any Right Certificate be construed to confer upon the holder of any Right Certificate, as such, any of the rights of a stockholder
of the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof,
or to give or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting stockholders
(except as provided in Section 25 hereof), or to receive dividends or subscription rights, or otherwise, until the Right or Rights
evidenced by such Right Certificate shall have been exercised or exchanged in accordance with the provisions hereof.

 

    21

     

    

 

Section 18.          
Concerning the Rights Agent. The Company agrees to pay to the Rights Agent reasonable compensation for all services
rendered by it hereunder, 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.  The Company also agrees to indemnify the Rights
Agent for, and to hold it harmless against, any loss, liability, damage, judgment, fine, penalty, claim, demand, settlement or
expense (including without limitation, the reasonable fees and expenses of legal counsel) incurred without gross negligence, bad
faith or willful misconduct on the part of the Rights Agent (each as determined by a final, nonappealable 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 acceptance,
administration, exercise and performance of its duties under this Agreement, including the costs and expenses of defending against
any claim of liability in connection herewith.  The reasonable costs and expenses incurred in enforcing this right of
indemnification shall be paid by the Company to the extent that the Rights Agent is successful in so enforcing its right of indemnification.

 

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 the Preferred Shares or Common Shares or for other securities of the
Company, instrument of assignment or transfer, power of attorney, endorsement, affidavit, letter, notice, direction, consent,
certificate, statement, or other paper or document believed by it to be genuine and to be signed, executed and, where necessary,
verified or acknowledged, by the proper person or persons, or otherwise upon the advice of counsel as set forth in Section 20 hereof.  Notwithstanding
anything in this Agreement to the contrary, in no event will the Rights Agent be liable for special, punitive, indirect, incidental
or consequential 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 and regardless of the form of action.  The Rights Agent shall not
be deemed to have knowledge of any event of which it was supposed to receive notice 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.

 

The provisions of this
Section 18 and Section 20 hereof shall survive the termination of this Agreement, the exercise, termination or expiration of the
Rights and the resignation, replacement or removal of the Rights Agent.

 

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 effect a share exchange or be consolidated, or any Person resulting from any merger,
share exchange, or consolidation to which the Rights Agent or any successor Rights Agent shall be a party, or any Person
succeeding to the stock transfer or shareowner 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 document or any
further act on the part of any of the parties hereto; provided that such Person would be eligible for appointment as a
successor Rights Agent under the provisions of Section 21 hereof.  In case at the time such successor Rights Agent
shall succeed to the agency created by this Agreement, any of the Right Certificates shall have been countersigned but not
delivered, any such successor Rights Agent may adopt the countersignature of the predecessor Rights Agent and deliver such
Right Certificates so countersigned; and, in case at that time any of the Right Certificates shall not have been
countersigned, any successor Rights Agent may countersign such Right Certificates either in the name of the predecessor
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.

 

    22

     

    

 

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

 

Section 20.          
Duties of Rights Agent. The Rights Agent undertakes to perform only the express duties and obligations imposed
by this Agreement and no implied duties or obligations shall be read into this Agreement against the Rights Agent.  The
Rights Agent shall perform those duties and obligations upon the following terms and conditions, by all of which the Company and
the holders of Right Certificates, by their acceptance thereof, shall be bound:

 

(a)           
The Rights Agent may consult with legal counsel (who may be legal counsel for the Company or an employee of the Rights
Agent), 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
the absence of bad faith and in accordance with such advice or opinion.

 

(b)          
Whenever in the performance of its duties under this Agreement the Rights Agent shall deem it necessary or desirable that
any fact or matter (including, without limitation, the identity of an Acquiring Person and the determination of the current per
share market price of any security) 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 any one of the President and Chief Executive Officer or any
Executive or Senior Vice President and by the Treasurer or any Assistant Treasurer or the Secretary or any Assistant Secretary
of 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 shall incur no liability for any action taken, suffered or omitted to be taken by it
in the absence of bad faith under the provisions of this Agreement in reliance upon such a certificate.

 

(c)          
The Rights Agent shall be liable hereunder to the Company and any other Person only for its own gross negligence, bad faith
or willful misconduct (each as determined by a final, nonappealable judgment of a court of competent jurisdiction).  Any
liability of the Rights Agent shall be limited to the amount of fees (but not including any reimbursed costs) 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.

 

    23

     

    

 

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

 

(e)          
The Rights Agent shall not have liability for nor be under any responsibility in respect of the validity of this Agreement
or the execution and delivery hereof (except the due execution hereof by the Rights Agent) or in respect of the validity or execution
of any Right Certificate (except its countersignature thereof); nor shall it be liable or responsible for any breach by the Company
of any covenant or condition contained in this Agreement or in any Right Certificate; nor shall it be liable or responsible for
any change in the exercisability of the Rights (including but not limited to the Rights becoming null and void pursuant to Section
11(a)(ii) hereof) or any adjustment in the terms of the Rights (including but not limited to the manner, method or amount thereof)
provided for in Section 3, 11, 13, 23 or 24 hereof, or the ascertaining of the existence of facts that would require any such
change or adjustment (except with respect to the exercise of Rights evidenced by Right Certificates after receipt of a certificate
furnished pursuant to Section 12 describing such change or adjustment upon which the Rights Agent may rely); nor shall it by any
act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any Preferred Shares
or other securities to be issued pursuant to this Agreement or any Right Certificate or as to whether any Preferred Shares or
other securities will, when so issued, be validly authorized and issued, fully paid and nonassessable.

 

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

 

(g)          
The Rights Agent is hereby authorized and directed to accept instructions with respect to the performance of its duties
hereunder from the President and Chief Executive Officer or any Executive or Senior Vice President or the Secretary or any Assistant
Secretary or the Treasurer or any Assistant Treasurer of the Company and to apply to such officers for advice or instructions
in connection with its duties, and such advice or instructions shall be full authorization and protection to the Rights Agent,
and the Rights Agent shall not be liable for any action taken, suffered or omitted to be taken by it in the absence of bad faith
in accordance with the 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 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 with respect to its duties and obligations
under this Agreement and the date on and/or after which such action shall be taken, suffered or such omission shall be effective.  The
Rights Agent shall not be liable for any action taken, suffered or omitted to be taken by it in accordance with a proposal included
in any such application on or after the date specified therein (which date shall not be less than three (3) Business Days after
the date indicated in such application unless any such officer shall have consented in writing to an earlier date) unless, prior
to taking, suffering or omitting to take any such action, the Rights Agent has received written instructions in response to such
application specifying the action to be taken, suffered or omitted to be taken.

 

    24

     

    

 

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

 

(i)            
The Rights Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty hereunder
either itself (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, default, neglect or misconduct of any such attorneys or agents or for any loss to
the Company resulting from any such act, default, neglect or misconduct, absent gross negligence, bad faith or willful misconduct
(each as determined by a final, nonappealable judgment of a court of competent jurisdiction) in the selection and continued employment
thereof.

 

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

 

(k)           
If, with respect to any Rights Certificate surrendered to the Rights Agent for exercise or transfer, the certificate attached
to the form of assignment or form of election to purchase, as the case may be, has not been properly completed, the Rights Agent
shall not take any further action with respect to such requested exercise or transfer without first consulting with the Company;
provided, however, that Rights Agent shall not be liable for any delays arising from the duties under this Section
20(k).

 

(l)            
The Rights Agent shall have no responsibility to the Company, the holders of the Rights or any other Person for interest
or earnings on any moneys held by the Rights Agent pursuant to this Agreement.

 

(m)         
The Rights Agent shall not be required to take notice or be deemed to have notice of any event or condition hereunder,
including any event or condition that may require action by the Rights Agent, unless the Rights Agent shall be specifically notified
in writing of such 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, and in
the absence of such receipt by the Rights Agent of such notice, the Rights Agent may conclusively assume that no such event or
condition exists.

 

(n)          
The Rights Agent may rely on and be fully authorized and protected in acting or failing to act upon (i) any guaranty of
signature by an “eligible guarantor institution” that is a member or participant in the Securities Transfer Agents
Medallion Program or other comparable “signature guarantee program” or insurance program in addition to, or in substitution
for, the foregoing or (ii) any law, act, regulation or any interpretation of the same.

 

    25

     

    

 

(o)           
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 shall promptly notify
the Company thereof, and the Rights Agent, may, 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 Right or any other Person for refraining from taking such
action, unless the Rights Agent receives written instructions signed by the Company that eliminate such ambiguity or uncertainty
to the satisfaction of the 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, in the event that the Rights Agent
or one of its Affiliates is not also the transfer agent for the Company, to each transfer agent of the Common Shares or Preferred
Shares by registered or certified mail.  In the event the transfer agency relationship in effect between the Company
and the Rights Agent terminates, the Rights Agent will be deemed to have resigned automatically and be discharged from its duties
as Rights Agent under this Agreement as of the effective date of such termination, and the Company shall be responsible for sending
any required notice.  The Company may remove the Rights Agent or any successor Rights Agent (with or without cause) upon
30 days’ notice in writing, mailed to the Rights Agent or successor Rights Agent, as the case may be, and to each transfer
agent of the Common Shares or Preferred Shares by registered or certified mail, and 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 incumbent Rights Agent or 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 either (a) a Person organized and doing business under
the laws of the United States or of the State of New York (or of any other state of the United States so long as such
Person is authorized to do business in such state), in good standing which is authorized under such laws to exercise corporate
trust or stock transfer or shareowner services powers and is subject to supervision or examination by federal or state authority
and which has at the time of its appointment as Rights Agent a combined capital and surplus of at least $50 million or (b) an Affiliate
or direct or indirect wholly-owned Subsidiary of such Person or its wholly-owning parent.  After appointment, the successor
Rights Agent shall be vested with the same powers, rights, duties and responsibilities as if it had been originally named as Rights
Agent without further act or deed; but the predecessor Rights Agent shall deliver and transfer to the successor Rights Agent any
property at the time held by it hereunder, and execute and deliver any further assurance, conveyance, act or deed necessary for
the purpose.  Not later than the effective date of any such appointment, the Company shall file notice thereof in writing
with the predecessor Rights Agent and each transfer agent of the Common Shares or Preferred Shares, and 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.

 

    26

     

    

 

Section 22.          
Issuance of New Right Certificates. Notwithstanding any of the provisions of this Agreement or of the Rights
to the contrary, the Company may, at its option, issue new Right Certificates evidencing Rights in such form as may be approved
by the Board of Directors of the Company to reflect any adjustment or change in the Purchase Price and the number or kind or class
of shares or other securities or property purchasable under the Right Certificates made in accordance with the provisions of this
Agreement.

 

Section 23.          
Redemption.

 

(a)          
The Board of Directors of the Company may, at its option, at any time prior to the occurrence of any Person becoming an
Acquiring Person, redeem all but not less than all the then outstanding Rights at a redemption price of $0.001 per Right, appropriately
adjusted to reflect any stock split, stock dividend or similar transaction occurring after the date hereof (such redemption price
being hereinafter referred to as the “Redemption Price”). The redemption of the Rights by the Board of Directors
of the Company may be made effective at such time, on such basis and with such conditions as the Board of Directors of the Company,
in its sole discretion, may establish.

 

(b)          
Immediately upon the action of the Board of Directors of the Company ordering the redemption of the Rights pursuant to
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); provided,
however, that the failure to give, or any defect in, any such notice shall not affect the validity of such redemption.  Within
ten (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.

 

Section 24.          
Exchange.

 

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

 

    27

     

    

 

(b)          
Immediately upon 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 Common Shares 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 (with prompt written notice thereof to the Rights Agent); provided, however, that the failure
to give, or any defect in, such notice shall not affect the validity of such exchange.  The Company promptly shall mail
a notice of any such exchange to all of the holders of such Rights at their last addresses as they appear upon the registry books
of the Rights Agent.  Any notice which is mailed in the manner herein provided shall be deemed given, whether or not
the holder receives the notice.  Each such notice of exchange will state the method by which the exchange of the Common
Shares 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.

 

(c)          
In the event that there shall not be sufficient Common Shares issued but not outstanding or authorized but unissued to
permit any exchange of Rights as contemplated in accordance with this Section 24, the Company shall take all such action as may
be necessary to authorize additional Common Shares for issuance upon exchange of the Rights.  In the event the Company
shall, after good faith effort, be unable to take all such action as may be necessary to authorize such additional Common Shares,
the Company shall substitute, for each Common Share that would otherwise be issuable upon exchange of a Right, a number of Preferred
Shares or fraction thereof such that the current per share market price of one Preferred Share multiplied by such number or fraction
is equal to the current per share market price of one Common Share as of the date of issuance of such Preferred Shares or fraction
thereof.

 

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

 

    28

     

    

 

(e)           Upon
declaring an exchange pursuant to this Section 24, or as promptly as reasonably practicable thereafter, the Company may
implement such procedures as it deems appropriate, in its sole discretion, for the purpose of ensuring that the Common Shares
(or such other consideration) issuable upon an exchange pursuant to this Section 24 is not received by holders of Rights that
have become null and void pursuant to Section 11(a)(ii) hereof.  Before effecting an exchange pursuant to this Section
24, the Board of Directors, at its sole option, may direct the Company to enter into a Trust Agreement in such form and with
such terms as the Board of Directors shall then approve (the “Trust Agreement”). If the Board of Directors
so directs, the Company shall enter into the Trust Agreement and the Company shall issue to the trust created by the Trust
Agreement (the “Trust”) all or a portion (as designated by the Board of Directors) of the Common Shares
and other securities, if any, distributable pursuant to the exchange, and all stockholders entitled to distribution of such
shares or other securities (and any dividends or distributions made thereon after the date on which such shares or other
securities are deposited in the Trust) shall be entitled to receive a distribution of such shares or other securities (and
any dividends or distributions made thereon after the date on which such shares or other securities are deposited in the
Trust) only from the Trust and solely upon compliance with all relevant terms and provisions of the Trust Agreement. Prior to
effecting an exchange and registering Common Shares (or other such securities) in any Person’s name, including any
nominee or transferee of a Person, the Company may require (or cause the trustee of the Trust to require), as a condition
thereof, that any holder of Rights provide evidence, including, without limitation, the identity of the Beneficial Owners
thereof and their Affiliates and Associates (or former Beneficial Owners thereof and their Affiliates and Associates) as the
Company reasonably requests in order to determine if such Rights are null and void. If any Person fails to comply with such
request, the Company shall be entitled conclusively to deem the Rights formerly held by such Person to be null and void
pursuant to Section 11(a)(ii) hereof and not transferable or exercisable or exchangeable in connection herewith. Any Common
Shares or other securities issued at the direction of the Board of Directors in connection herewith shall be validly issued,
fully paid and nonassessable Common Shares or of such other securities (as the case may be).

 

Section 25.          
Notice of Certain Events.

 

(a)           In
case the Company shall, at any time after the Distribution Date, propose (i) to pay any dividend payable in stock of any
class to the holders of the Preferred Shares or to make any other distribution to the holders of the Preferred Shares (other
than a regular quarterly cash dividend), (ii) to offer to the holders of the Preferred Shares rights or warrants to subscribe
for or to purchase any additional Preferred Shares or shares of stock of any class or any other securities, rights or
options, (iii) to effect any reclassification of the Preferred Shares (other than a reclassification involving only the
subdivision of outstanding Preferred Shares), (iv) to effect any share exchange, consolidation or merger into or with,
or to effect any sale or other transfer (or to permit one or more of its Subsidiaries to effect any sale or other transfer),
in one or more transactions, of 50% or more of the assets or earning power of the Company and its Subsidiaries (taken as a
whole) to, any other Person, (v) to effect the liquidation, dissolution or winding up of the Company, or (vi) to declare or
pay any dividend on the Common Shares payable in Common Shares or to effect a subdivision, combination or consolidation of
the Common Shares (by reclassification or otherwise than by payment of dividends in Common Shares), 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 share exchange, 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 Common
Shares and/or Preferred Shares, if any such date is to be fixed, and such notice shall be so given in the case of any action
covered by clause (i) or (ii) above at least 10 days prior to the record date for determining holders of the Preferred Shares
for purposes of such action, and, in the case of any such other action, at least 10 days prior to the date of the taking of
such proposed action or the date of participation therein by the holders of the Common Shares and/or Preferred Shares,
whichever shall be the earlier.

 

    29

     

    

 

(b)          
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, 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 to or on the Company shall be sufficiently given or made if sent by overnight delivery service or first-class mail,
postage prepaid, addressed (until another address is filed in writing with the Rights Agent) as follows:

 

AAR CORP.

1100 North Wood Dale Road

Wood Dale, Illinois 60191

Attention:  Secretary

 

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

 

Computershare Trust Company, N.A.

150 Royall Street

Canton, MA 02021

Attention: Client Services

 

With a copy to:

 

Computershare Trust Company, N.A.

150 Royall Street

Canton, MA 02021

Attention: Legal Department

 

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 shall be sufficiently given or made if sent by
first-class mail, postage prepaid, addressed to such holder at the address of such holder as shown on the registry books of the
Company.

 

Section
27.           Supplements
and Amendments. Subject to this Section, the Company may, and the Rights Agent shall, if directed by the Company,
from time to time supplement or amend this Agreement without the approval of any holders of Right Certificates in order to
cure any ambiguity, to correct or supplement any provision contained herein which may be defective or inconsistent with any
other provisions herein, or to make any other provisions with respect to the Rights which the Company may deem necessary or
desirable, any such supplement or amendment to be evidenced by a writing signed by the Company and the Rights Agent; 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.  For the avoidance of doubt, the Company shall
be entitled to adopt and implement such procedures and arrangements (including with third parties) as it may deem necessary
or desirable to facilitate the exercise, exchange, trading, issuance or distribution of the Rights (and Preferred Shares) as
contemplated hereby and to ensure that an Acquiring Person does not obtain the benefits thereof, and amendments in respect of
the foregoing shall not be deemed to adversely affect the interests of the holders of Rights.  Upon the delivery of
a certificate from an appropriate officer of the Company that 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 in this Agreement to the contrary, the Rights Agent may, but shall not be obligated to, enter into
any supplement or amendment that adversely affects the Rights Agent’s own rights, duties, obligations or immunities
under this Agreement.

 

    30

     

    

 

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.          
Benefits of this Agreement. Nothing in this Agreement shall be construed to give to any Person other than the
Company, the Rights Agent and the registered holders of the Right Certificates (and, prior to the Distribution Date, the Common
Shares) any legal or equitable right, remedy or claim under this Agreement; but this Agreement shall be for the sole and exclusive
benefit of the Company, the Rights Agent and the registered holders of the Right Certificates (and, prior to the Distribution Date,
the Common Shares).

 

Section 30.          
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 any such excluded term, provision, covenant or restriction shall adversely affect the rights, immunities,
duties or obligations of the Rights Agent, the Rights Agent shall be entitled to resign upon 10 Business Days’ written notice
to the Company pursuant to the requirements of Section 26 of this Agreement.

 

Section 31.          
Governing Law. This Agreement and each Right Certificate issued hereunder shall be deemed to be a contract made
under the laws of the State of Delaware and for all purposes shall be governed by and construed in accordance with the laws of
such state applicable to contracts to be made and performed entirely within such state.

 

Section 32.          
Counterparts. This Agreement may be executed in any number of counterparts and each of such counterparts shall
for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.  A
signature to this Agreement transmitted by facsimile or by e-mail delivery of a “.pdf” format data file shall have
the same authority, effect, and enforceability as an original signature.

 

    31

     

    

 

Section 33.          
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 34.          
Customer Identification Program. The Company acknowledges that the Rights Agent is subject to the customer identification
program (“Customer Identification Program”) requirements under the USA PATRIOT Act and its implementing regulations,
and that the Rights Agent must obtain, verify and record information that allows the Rights Agent to identify the Company.  Accordingly,
prior to accepting an appointment hereunder, the Rights Agent may request information from the Company that will help the Rights
Agent to identify the Company, including without limitation the Company’s physical address, tax identification number, organizational
documents, certificate of good standing, license to do business, or any other information that the Rights Agent deems necessary.  The
Company agrees that the Rights Agent cannot accept an appointment hereunder unless and until the Rights Agent verifies the Company’s
identity in accordance with the Customer Identification Program requirements.

 

Section 35.          
Force Majeure. Notwithstanding anything to the contrary contained herein, the Rights Agent shall not be liable
for any delays or failures in performance resulting from acts beyond its reasonable control including, without limitation, acts
of God, terrorist acts, shortage of supply, pandemics, breakdowns or malfunctions, interruptions or malfunctions of computer facilities,
or loss of data due to power failures or mechanical difficulties with information storage or retrieval systems, labor difficulties,
war, or civil unrest.  The Rights Agent shall provide the Company prompt notice as soon as practicable in the event that
any such delay or failure in performance occurs and keep the Company apprised of developments and mitigation effort with respect
thereto.

 

    32

     

    

 

 

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

 

	Attest:	AAR CORP.
	 	 
	By:	/s/
    Jessica Garascia	By:	/s/
    John M. Holmes
	Name: 	Jessica
    A. Garascia	Name: 	 John M. Holmes
	Title:	Vice
    President, General Counsel and Secretary	Title:	 President and Chief Financial Officer

 

	 	COMPUTERSHARE TRUST COMPANY, N.A.
	 	By:	/s/
    John H. Ruocco
	 	Name:	John
    H. Ruocco
	 	Title:	VP
    & Manager

 

    33

     

    

 

Exhibit A

 

FORM

 

of

 

CERTIFICATE OF DESIGNATIONS

 

of

 

SERIES A JUNIOR PARTICIPATING PREFERRED
STOCK

 

of

 

AAR CORP.

 

(Pursuant to Section 151 of the

Delaware General Corporation Law)

 

AAR Corp., a corporation
organized and existing under the General Corporation Law of the State of Delaware (hereinafter called the “Corporation”),
hereby certifies that the following resolution was adopted by the Board of Directors of the Corporation as required by Section
151 of the General Corporation Law at a meeting duly called and held on March 27, 2020:

 

RESOLVED, that pursuant
to the authority granted to and vested in the Board of Directors of this Corporation (hereinafter called the “Board of Directors”
or the “Board”) in accordance with the provisions of the Corporation’s Restated Certificate of Incorporation,
the Board of Directors hereby creates a series of Preferred Stock, par value $1.00 per share, of the Corporation (the “Preferred
Stock”), and hereby states the designation and number of shares, and fixes the relative rights, preferences, and limitations
thereof as follows:

 

Series A Junior Participating
Preferred Stock:

 

Section 1.        Designation
and Amount.  The shares of such series shall be designated as “Series A Junior Participating Preferred Stock”
(the “Series A Preferred Stock”) and the number of shares constituting the Series A Preferred Stock shall be 35,098.
Such number of shares may be increased or decreased by resolution of the Board of Directors; provided that no decrease shall
reduce the number of shares of Series A Preferred Stock to a number less than the number of shares then outstanding plus the number
of shares reserved for issuance upon the exercise of outstanding options, rights or warrants or upon the conversion of any outstanding
securities issued by the Corporation convertible into Series A Preferred Stock.

 

    A-1

     

    

 

Section 2.        Dividends
and Distributions.

 

(A)       Subject
to the rights of the holders of any shares of any series of Preferred Stock (or any similar stock) ranking prior and superior
to the Series A Preferred Stock with respect to dividends, the holders of shares of Series A Preferred Stock, in preference
to the holders of Common Stock, par value $1.00 per share (the “Common Stock”), of the Corporation, and of any
other junior stock, shall be entitled to receive, when, as and if declared by the Board of Directors out of funds legally
available for the purpose, quarterly dividends payable in cash on the first day of March, June, September and December in
each year (each such date being referred to herein as a “Quarterly Dividend Payment Date”), commencing on the
first Quarterly Dividend Payment Date after the first issuance of a share or fraction of a share of Series A Preferred Stock,
in an amount per share (rounded to the nearest cent) equal to the greater of (a) $1.00 or (b) subject to the provision for
adjustment hereinafter set forth, 1000 times the aggregate per share amount of all cash dividends, and 1000 times the
aggregate per share amount (payable in kind) of all non-cash dividends or other distributions, other than a dividend payable
in shares of Common Stock or a subdivision of the outstanding shares of Common Stock (by reclassification or otherwise),
declared on the Common Stock since the immediately preceding Quarterly Dividend Payment Date or, with respect to the first
Quarterly Dividend Payment Date, since the first issuance of any share or fraction of a share of Series A Preferred Stock. In
the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable in shares of Common
Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification
or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common
Stock, then in each such case the amount to which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event under clause (b) of the preceding sentence shall be adjusted by multiplying such amount
by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and
the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.

 

(B)       The
Corporation shall declare a dividend or distribution on the Series A Preferred Stock as provided in paragraph (A) of this Section
immediately after it declares a dividend or distribution on the Common Stock (other than a dividend payable in shares of Common
Stock); provided that, in the event no dividend or distribution shall have been declared on the Common Stock during the period
between any Quarterly Dividend Payment Date and the next subsequent Quarterly Dividend Payment Date, a dividend of $1.00 per share
on the Series A Preferred Stock shall nevertheless be payable on such subsequent Quarterly Dividend Payment Date.

 

(C)        Dividends
shall begin to accrue and be cumulative on outstanding shares of Series A Preferred Stock from the Quarterly Dividend Payment
Date next preceding the date of issue of such shares, unless the date of issue of such shares is prior to the record date for
the first Quarterly Dividend Payment Date, in which case dividends on such shares shall begin to accrue from the date of
issue of such shares, or unless the date of issue is a Quarterly Dividend Payment Date or is a date after the record date for
the determination of holders of shares of Series A Preferred Stock entitled to receive a quarterly dividend and before such
Quarterly Dividend Payment Date, in either of which events such dividends shall begin to accrue and be cumulative from such
Quarterly Dividend Payment Date.  Accrued but unpaid dividends shall not bear interest.  Dividends paid
on the shares of Series A Preferred Stock in an amount less than the total amount of such dividends at the time accrued and
payable on such shares shall be allocated pro rata on a share-by-share basis among all such shares at the time
outstanding.  The Board of Directors may fix a record date for the determination of holders of shares of Series A
Preferred Stock entitled to receive payment of a dividend or distribution declared thereon, which record date shall be not
more than 60 days prior to the date fixed for the payment thereof.

 

    A-2

     

    

 

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

 

(A)       Subject
to the provision for adjustment hereinafter set forth, each share of Series A Preferred Stock shall entitle the holder thereof
to 1000 votes on all matters submitted to a vote of the stockholders of the Corporation.  In the event the Corporation shall
at any time declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination
or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares
of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the number of votes per share
to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event shall be adjusted by multiplying
such number by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event
and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.

 

(B)       Except
as otherwise provided herein, in any other Certificate of Designations creating a series of Preferred Stock or any similar stock,
or by law, the holders of shares of Series A Preferred Stock and the holders of shares of Common Stock and any other capital stock
of the Corporation having general voting rights shall vote together as one class on all matters submitted to a vote of stockholders
of the Corporation.

 

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

 

Section 4.        Certain
Restrictions.

 

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

 

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

 

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

 

    A-3

     

    

 

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

 

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

 

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

 

Section 5.        Reacquired
Shares.  Any shares of Series A Preferred Stock purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and cancelled promptly after the acquisition thereof.  All such shares shall upon their cancellation
become authorized but unissued shares of Preferred Stock and may be reissued as part of a new series of Preferred Stock subject
to the conditions and restrictions on issuance set forth herein, in the Certificate of Incorporation, or in any other Certificate
of Designations creating a series of Preferred Stock or any similar stock or as otherwise required by law.

 

Section
6.        Liquidation, Dissolution or Winding Up.  Upon any
liquidation, dissolution or winding up of the Corporation, no distribution shall be made (1) to the holders of shares of
stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock
unless, prior thereto, the holders of shares of Series A Preferred Stock shall have received $10 per share, or an amount
equal to 1000 times the amount paid with respect to one share of common stock, whichever is greater, plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or not declared, to the date of such payment, provided that
the holders of shares of Series A Preferred Stock shall be entitled to receive an aggregate amount per share, subject to the
provision for adjustment hereinafter set forth, equal to 1000 times the aggregate amount to be distributed per share to
holders of shares of Common Stock, or (2) to the holders of shares of stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except distributions made ratably on the
Series A Preferred Stock and all such parity stock in proportion to the total amounts to which the holders of all such shares
are entitled upon such liquidation, dissolution or winding up.  In the event the Corporation shall at any time
declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in
shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the aggregate
amount to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event under the
proviso in clause (1) of the preceding sentence shall be adjusted by multiplying such amount by a fraction the numerator of
which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the
number of shares of Common Stock that were outstanding immediately prior to such event.

 

    A-4

     

    

 

Section 7.        Consolidation,
Merger, etc.  In case the Corporation shall enter into any consolidation, merger, combination or other transaction
in which the shares of Common Stock are exchanged for or changed into other stock or securities, cash and/or any other property,
then in any such case each share of Series A Preferred Stock shall at the same time be similarly exchanged or changed into an amount
per share, subject to the provision for adjustment hereinafter set forth, equal to 1000 times the aggregate amount of stock, securities,
cash and/or any other property (payable in kind), as the case may be, into which or for which each share of Common Stock is changed
or exchanged.  In the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable
in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares
of Common Stock, then in each such case the amount set forth in the preceding sentence with respect to the exchange or change of
shares of Series A Preferred Stock shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number
of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such event.

 

Section 8.        No Redemption.  The
shares of Series A Preferred Stock shall not be redeemable.

 

Section 9.        Rank.  The
Series A Preferred Stock shall rank, with respect to the payment of dividends and the distribution of assets, junior to all series
of any other class of the Corporation’s Preferred Stock.

 

Section 10.        Amendment.  The
Certificate of Incorporation of the Corporation shall not be amended in any manner which would materially alter or change the powers,
preferences or special rights of the Series A Preferred Stock so as to affect them adversely without the affirmative vote of the
holders of at least two-thirds of the outstanding shares of Series A Preferred Stock, voting together as a single class.

 

IN WITNESS WHEREOF, this
Certificate of Designations is executed on behalf of the Corporation by its President and Chief Executive Officer and attested
by its Secretary this _______ day of _______, 20__.

 

    A-5

     

    

 

	 	 
	 	By:
    John M. Holmes
	 	President
    and Chief Executive Officer

 

	Attest:	 
	 	 
	 	 
	Secretary	 

 

    A-6

     

    

 

Exhibit
B

 

Form of Right Certificate

 

	Certificate No. R-	____

Rights

 

NOT EXERCISABLE AFTER
THE EXPIRATION DATE (AS DEFINED IN THE AGREEMENT) OR EARLIER IF REDEMPTION OR EXCHANGE OCCURS.  THE RIGHTS ARE
SUBJECT TO REDEMPTION AT $0.001 PER RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE AGREEMENT.

 

AS SET FORTH IN THE AGREEMENT,
RIGHTS THAT ARE OR WERE BENEFICIALLY OWNED BY ANY PERSON (AS DEFINED IN THE AGREEMENT) WHO BECOMES AN ACQUIRING PERSON (AS DEFINED
IN THE AGREEMENT) OR AN ASSOCIATE OR AFFILIATE THEREOF (EACH AS DEFINED IN THE AGREEMENT) BECOME NULL AND VOID AND NON-TRANSFERABLE.

 

Right Certificate

 

AAR CORP.

 

This certifies that ____________,
or registered assigns, is the registered owner of the number of Rights set forth above, each of which entitles the owner thereof,
subject to the terms, provisions and conditions of the Agreement, dated as of March 30, 2020 (the “Agreement”), between
AAR Corp., a Delaware corporation (the “Company”), and Computershare Trust Company, N.A., as rights agent (the “Rights
Agent”), to purchase from the Company at any time after the Distribution Date (as such term is defined in the Agreement)
and prior to 5:00 P.M., New York, New York time, on February 28, 2021 at the office of the Rights Agent designated for such purpose,
or at the office of its successor as Rights Agent, one one-thousandth of a fully paid non-assessable share of Series A Junior Participating
Preferred Stock, par value $1.00 per share, of the Company (the “Preferred Shares”), at a purchase price of $100.00
per one one-thousandth of a Preferred Share (the “Purchase Price”), upon presentation and surrender of this Right Certificate
with the Form of Election to Purchase duly executed.  The number of Rights evidenced by this Right Certificate (and the
number of one one-thousandths of a Preferred Share 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 March 30, 2020, based on the Preferred Shares as constituted at
such date.  As provided in the Agreement, the Purchase Price and the number of one one-thousandths of a Preferred Share
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.

 

    B-1

     

    

 

This Right Certificate
is subject to all of the terms, provisions and conditions of the Agreement, which terms, provisions and conditions are hereby incorporated
herein by reference and made a part hereof and to which Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the Rights Agent, the Company and the holders of the Right
Certificates.  Copies of the Agreement are on file at the principal executive offices of the Company and the office of
the Rights Agent designated for such purpose.

 

This Right Certificate,
with or without other Right Certificates, upon surrender at the office of the Rights Agent designated for such purpose, 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 Preferred Shares as the Rights evidenced by the Right Certificate or Right Certificates surrendered
shall have entitled such holder to purchase.  If this Right Certificate shall be exercised in part, the holder shall
be entitled to receive upon surrender hereof another Right Certificate or Right Certificates for the number of whole Rights not
exercised.

 

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 $0.001
per Right or (ii) may be exchanged in whole or in part for Preferred Shares or shares of the Company’s Common Stock,
par value $1.00 per share.

 

No fractional Preferred
Shares will be issued upon the exercise of any Right or Rights evidenced hereby (other than fractions which are integral multiples
of one one-thousandth of a Preferred Share, which may, at the election of the Company, be evidenced by depositary receipts), but,
in lieu thereof, a cash payment will be made, as provided in the Agreement.

 

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

 

    B-2

     

    

 

WITNESS the facsimile
signature of the proper officers of the Company and its corporate seal. Dated as of ________, ____.

 

	[SEAL]
    ATTEST:	 	AAR
    CORP.
	 	 	 
	By:	 	By:	 
	 	Name:	 	 	Name:	 
	 	Title:	 	 	Title:	 

 

	Countersigned:	 
	 	 
	Computershare
    Trust Company, N.A.	 
	 	 
	By:	 	 
	 	Authorized
    Signatory	 
	 	Name:	 	 
	 	Title:	 	 

 

    B-3

     

    

 

Form of Reverse Side of Right Certificate

 

FORM
OF ASSIGNMENT

 

(To be executed by the holder if such holder
desires to transfer the Right Certificate.)

 

	FOR VALUE RECEIVED	 	  hereby sells, assigns and transfers unto	 
	 
	 
	 
	(Please print name and address of transferee)

 

this Right Certificate, together with all
right, title and interest therein, and does hereby irrevocably constitute and appoint ____________________ Attorney, to transfer
the within Right Certificate on the books of the within-named Company, with full power of substitution.

 

	Dated:  __________________ ____, 20__	
	 	Signature

 

Signature Guaranteed:

 

Signatures must be guaranteed by a member
or participant in a signature guarantee medallion program at a guarantee level acceptable to the Company’s Transfer 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) and are not issued with respect to Notional Common Shares related to a Derivatives
Contract described in clause (iv) of the definition of Beneficial Owner (as such terms are defined in the Agreement).

 

 

 

	 	 
	 	Signature

 

    B-4

     

    

 

Form of Reverse Side of Right Certificate
 – continued

 

FORM
OF ELECTION TO PURCHASE

 

(To be executed if holder desires to exercise

Rights represented by the Right Certificate.)

 

To:  AAR CORP.

 

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

 

Please insert social security or other
identifying number

 
	 
	(Please print name and address)

 
	 
	(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)

 
	 
	(Please print name and address)

 

Dated: _______________

 

	 	 
	 	Signature

 

    B-5

     

    

 

Signature Guaranteed:

 

Signatures must be guaranteed
by a member or participant in the Medallion Signature Guarantee Program at a guarantee level acceptable to the Company’s
Transfer 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) and are not issued with respect to Notional Common Shares related to a Derivatives
Contract described in clause (iv) of the definition of Beneficial Owner (as such terms are 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.

 

    B-6

     

    

 

Exhibit C

 

SUMMARY OF RIGHTS TO PURCHASE

 

PREFERRED SHARES

 

AS SET FORTH IN THE AGREEMENT (AS
DEFINED BELOW), RIGHTS THAT ARE OR WERE BENEFICIALLY OWNED BY ANY PERSON (AS DEFINED IN THE AGREEMENT) WHO BECOMES AN ACQUIRING
PERSON (AS DEFINED IN THE AGREEMENT) OR AN ASSOCIATE OR AFFILIATE THEREOF (EACH AS DEFINED IN THE AGREEMENT) BECOME NULL AND VOID
AND NON-TRANSFERABLE

 

Introduction

 

On March 27, 2020,
the Board of Directors of AAR CORP., a Delaware corporation (the “Company”), declared a dividend of one preferred
share purchase right (a “Right”) for each outstanding share of the Company’s common stock, par value $1.00 per
share.  The dividend is payable on April 9, 2020 to the stockholders of record on that date. The terms of the Rights
are set forth in the Rights Agreement entered into between the Company and Computershare Trust Company, N.A., as the Rights Agent,
on March 30, 2020.

 

Our Board adopted the
Rights Agreement to protect stockholders from coercive or otherwise unfair takeover tactics.  In general terms, it works
by imposing a significant penalty upon any person or group which acquires 10% (or 20% in the case of a “13G Investor,”
as defined in the Rights Agreement) or more of our outstanding common stock without the approval of our Board.  If a
stockholder’s beneficial ownership of our common stock as of the time of the public announcement of the rights plan and associated
dividend declaration is at or above the applicable threshold (including through entry into certain derivative positions), that
stockholder’s then-existing ownership percentage would be grandfathered, but the rights would become exercisable if at any
time after such announcement, the stockholder increases its ownership percentage by 0.001% or more.  The Rights Agreement
should not interfere with any merger or other business combination approved by our Board.

 

For those interested
in the specific terms of the Rights Agreement, we provide the following 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 Current Report on Form 8-K filed March 30, 2020 and a Registration Statement
on Form 8-A filed March 30, 2020.  A copy of the agreement is available free of charge from the Company.

 

The Rights.  Our
Board authorized the issuance of a Right with respect to each outstanding share of common stock as of April 9, 2020.  The
Rights will initially trade with, and will be inseparable from, the common stock.  The Rights are evidenced only by certificates
that represent shares of common stock.  New Rights will accompany any new shares of common stock we issue after April
9, 2020 until the Distribution Date described below.

 

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 10% (or 20% in the case of a “13G Investor”)
or more of our outstanding common stock. Certain synthetic interests in securities created by derivative positions —
whether or not such interests are considered to be ownership of the underlying common stock or are reportable for purposes of
Regulation 13D of the Securities Exchange Act — are treated as beneficial ownership of the number of shares of the
Company’s common stock equivalent to the economic exposure created by the derivative position, to the extent actual
shares of the Company’s common stock are directly or indirectly held by counterparties to the derivatives contracts.
Swaps dealers unassociated with any control intent or intent to evade the purposes of the rights plan are excepted from such
imputed beneficial ownership.

 

    C-1

     

    

 

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

 

Exercise Price.  Upon
becoming exercisable, each Right will allow its holder to purchase from the Company either one one-thousandth of a share of Series
A Junior Participating Preferred Stock (“Preferred Share”) for $100.00, or, following the time a person or group becomes
an Acquiring Person, $200.00 worth of common stock for $100.00.  The fraction of a Preferred Share will have approximately
the same dividend, voting, and liquidation rights as would one share of common stock.  Prior to exercise, the Right does
not give its holder any dividend, voting, or liquidation rights.

 

Consequences of a Person or Group Becoming an Acquiring
Person.

 

		·	Flip In. If a person or group becomes an Acquiring Person, all holders of Rights except
the Acquiring Person may, for $100.00, purchase shares of our common stock with a market value of $200.00 based on the market price
of the common stock prior to such acquisition.

 

		·	Flip Over. If the Company is later acquired in a merger or similar transaction after the
Rights Distribution Date, all holders of Rights except the Acquiring Person may, for $100.00, purchase shares of the acquiring
corporation with a market value of $200.00 based on the market price of the acquiring corporation’s stock, prior to such
merger.

 

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

 

Preferred Share Provisions.

 

Each Preferred Share, if issued:

 

		·	will not be redeemable,

 

		·	will entitle its holder to quarterly dividend payments of $1.00 per share, or an amount equal to
1000 times the dividend paid on one share of common stock, whichever is greater,

 

		·	will entitle its holder to quarterly dividend payments of $1.00 per share, or an amount equal to
1000 times the dividend paid on one share of common stock, whichever is greater,

 

		·	will entitle its holder upon liquidation to receive $10.00 per share, or an amount equal to 1000
times the amount paid with respect to one share of common stock, whichever is greater, plus in each case any accrued and unpaid
dividends,

 

    C-2

     

    

 

		·	will entitle its holder to 1000 votes on all matters submitted to a vote of the stockholders of the Company, and

 

		·	if shares of the Company common stock are exchanged via merger, consolidation, or a similar transaction, will entitle holders
to a per share payment equal to 1000 times the payment made on one share of common stock.

 

The value of one one-thousandth interest in a Preferred Share
should approximate the value of one share of common stock.

 

 

Expiration.  The
Rights will expire on February 28, 2021, unless earlier exchanged or redeemed.  

 

Redemption.  Our
Board may redeem the Rights for $0.001 per Right at any time before any person or group becomes an Acquiring Person.  If
our Board redeems any Rights, it must redeem all of the Rights.  Once the Rights are redeemed, the only right of the
holders of Rights will be to receive the redemption price of $0.001 per Right.  The redemption price will be adjusted
if we have a stock split or stock dividends of our common stock.

 

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

 

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

 

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

 

    C-3trilinc-ex43_264.htm

Exhibit 4.3 

 

DESCRIPTION OF TRILINC GLOBAL IMPACT FUND, LLC

SECURITIES REGISTERED PURSUANT TO SECTION 12(g)

OF THE SECURITIES EXCHANGE ACT OF 1934

The following is a summary of the material terms of the units of Trilinc Global Impact Fund, LLC registered pursuant to Section 12(g) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) as set forth in our operating agreement, as amended and supplemented from time to time. This summary is qualified in its entirety by reference to our operating agreement. References herein to “us,” “we,” “our,” or the “Company” refer to Trilinc Global Impact Fund, LLC. We were formed as a limited liability company under the laws of the State of Delaware. The rights of our unitholders are governed by Delaware law as well as our operating agreement. 

Units of Limited Liability Company Interest

All units of limited liability company interest having the same rights and privileges are considered by the Company to constitute one class of securities.  Accordingly, the Company has one class of securities that is registered pursuant to Section 12 of the Exchange Act, and it is registered pursuant to Section 12(g).  This class of securities is currently designated as Class A, Class C, Class I, Class W and Class Y units and will also include any further units of limited liability company interest which have the same rights and privileges. Although so designated, they are all part of the same class of securities and the sole differences between the Class A, Class C, Class I, Class W and Class Y units relate to the amount of upfront and/or ongoing underwriting compensation paid in connection with the sale of the units, including, without limitation, selling commissions, dealer manager fees and distribution fees. To the extent a unit is subject to an ongoing fee payable to a broker dealer following the initial purchase of the unit, such as an ongoing dealer manager fee or an ongoing distribution fee, it will reduce the amount of the regular operating distributions paid by the Company with respect to that unit, and will result in the holder of that unit receiving a lower distribution than a holder of a unit that is not subject to any ongoing fees.  

There is no public trading market for the units and none is likely to exist. The transferability of the units is subject to a number of restrictions. See “— Restrictions on Transfer,” below. Accordingly, the liquidity of the units is limited and our unitholders may not be able to liquidate their investments in the event of an emergency, except as described below.

Limited Liability of Unitholders

Our operating agreement prohibits mandatory assessments beyond a unitholder’s subscription amount.  Our unitholders are not responsible for the obligations of the Company beyond the amount of the capital contributions they have made and for any wrongful distributions made to them. 

Rights Upon Liquidation

In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, or any liquidating distribution of our assets, such assets, or the proceeds thereof, will be distributed among all the unitholders in proportion to the number of units held by such holder.

Voting Rights of the Unitholders

Our operating agreement provides that without a concurrence of a majority of the outstanding unitholder interests, our board of managers may not (a) amend our operating agreement except for amendments that do not adversely affect the rights of the unitholders, (b) sell all or substantially all of our assets other than in the ordinary course of our business or (c) cause our merger into another entity or other reorganization, provided that the board of managers, upon advice of the counsel, may restructure the Company and/or enter into any agreements the board of managers deems necessary, without the prior unitholder approval, if such activities are reasonably determined by our board of managers, in its sole discretion, to avoid the characterization of the Company as a “publicly traded partnership” within the meaning of Section 7704(b) of the Internal Revenue Code of 1986, as amended (the “Code”).

In addition, our unitholders have the right to take any of the following actions upon the affirmative vote or consent of the majority of the outstanding unitholder interests, without the concurrence of the board of managers: (a) amend our operating agreement; (b) dissolve the Company, (c) remove a manager and elect a new manager, and (d) approve or disapprove the sale of all or substantially all of our assets other than in the ordinary course of our business.

Capital Account

A capital account is established and maintained for each unitholder. Each unitholder’s capital account is adjusted to reflect allocations of our net profits or net losses. Capital accounts are also adjusted to reflect capital contributions, distributions and redemptions and other items in the nature of income or gain, or expenses and losses as required by the Code and the regulations promulgated thereunder.

Distributions

The payment of distributions is subject to our board of managers’ discretion and applicable legal restrictions and accordingly, there can be no assurance that we will continue to make distributions at a specific rate or at all. Our operating agreement permits us to pay distributions from any source, including borrowings and offering proceeds, provided, however that no funds may be advanced or borrowed for purpose of distributions, if the amount of such distributions exceeds our accrued and received revenues for the previous four quarters, less paid and accrued operating costs with respect to such revenues. Distributions are made on all classes of our units at the same time. Amounts distributed to each class of units are allocated among the unitholders in such class in proportion to their units. 

Distributions of in-kind property are not permitted, except for distributions of readily marketable securities, distributions of beneficial interests in a liquidating trust established for the dissolution of the Company or distributions in connection with the liquidation of the Company’s assets in accordance with the terms of the operating agreement unless: (i) our board of managers advises each unitholder of the risks associated with direct ownership of the property, (ii) our board of managers offers each unitholder the election of receiving in-kind property distributions, and (iii) the Company distributes in-kind property only to those unitholders who accept such offer by our board of managers.

Meetings of Unitholders

There are no regularly scheduled meetings of our unitholders. However, our board of managers may call meetings of the unitholders at any time and will call a meeting upon written request to the board of managers by unitholders holding at least 10% of the units. Upon receipt of a proper written request for a meeting, the board of managers will fix a date for such meeting and will, within ten days after receipt of such request, notify all of the unitholders of the meeting’s date and purpose. Meetings duly requested by unitholders will be held not less than fifteen and not more than 60 days following the receipt of the unitholders’ written request for the meeting. Unless otherwise specified in the notice for such meeting, meetings will be held at 2:00 p.m. at our offices. Our unitholders may vote in person or by proxy at the meeting, upon those proposals that are required to be voted on by unitholders under our operating agreement. A majority of the unitholders constitutes a quorum at meetings.

Accounting and Reports

We maintain our books and records on the accrual basis for bookkeeping and accounting purposes, and also use the accrual basis method of reporting income and losses for federal income tax purposes. We reserve the right to change such methods of accounting, provided that such change is disclosed in a report publicly filed with the Securities and Exchange Commission (the “SEC”) or is disclosed in a written notice sent to the unitholders. Our unitholders may inspect the books and records of the Company for a proper purpose at all reasonable times. Under our operating agreement and Delaware law, our unitholders are entitled to receive information regarding our business and financial condition, as well as a copy of our operating agreement and certificate of formation and all amendments to these documents as well as other information that is just and reasonable. We will provide this information to our unitholders through our publicly filed reports with the SEC. Any unitholder will be provided with a copy of any of the reports upon request without expense to him or her. In addition, each unitholder is entitled to receive a copy of the Company’s income tax returns as well as the Company’s annual and quarterly reports and other filings described in “— Regulatory and Administrative Reports” below. Our unitholders may also request a list of names and addresses of the unitholders of the Company, under the circumstances provided for, and pursuant to the provisions contained in our operating agreement. Our board of managers follows the policy of providing investors with these books and records, as required under the Delaware Limited Liability Company Act.

Regulatory and Administrative Reports

We cause our income tax returns to be prepared and timely filed with the appropriate authorities. We also cause to be prepared and filed, with appropriate federal and state regulatory and administrative bodies, all reports required to be filed with those entities under then current applicable laws, rules and regulations. Any unitholder will be provided with a copy of any of the reports upon request without expense to him or her. We file, with the securities administrators for the various states in which we are registered, as required by such states, a copy of each of the above reports.

Restrictions on Transfer

The operating agreement places substantial limitations upon our unitholders’ ability to transfer units. Any transferee must be a person that would have been qualified to purchase units in this offering. No unit may be transferred if, in the judgment of the managers, and/or their counsel, a transfer would jeopardize our status as a “partnership” for federal income tax purposes. Additional restrictions on transfers of units may be imposed under the securities laws of other states upon transfers occurring in or involving the residents of such states. In addition, our unitholders are not permitted to make any transfer or assignment of our unitholders’ units if we determine such transfer or assignment would result in the Company being classified as a “publicly traded partnership” within the meaning of Section 7704(b) of the Code or any rules, regulations or safe-harbor guidelines promulgated thereunder. Furthermore, our operating agreement requires the consent of our board of managers for a transferee to be substituted as a member of the Company, 

which consent will not be unreasonably withheld. We amend our records at least once each calendar quarter to effect the substitution of a substituted unitholder.

Term of Company

Our term commenced on the day the certificate of formation of the Company was filed with the Delaware Secretary of State, on April 30, 2012 and will continue until dissolution and termination of the Company.

Winding Up

Upon the occurrence of an event of dissolution, we will immediately be dissolved, but will continue until the Company’s affairs have been wound up. Upon our dissolution, our board of managers will wind up our affairs by liquidating our assets as promptly as is consistent with obtaining current fair market value of such assets, either by sale to third parties or by collecting loan payments under the terms of the loans. All funds we receive will be applied to satisfy or provide for our debts and the balance will be distributed to the unitholders in accordance with the terms of the operating agreement.

Amendment

Our operating agreement may be amended by the affirmative vote of unitholders holding a majority of our interests. In addition, our operating agreement may be amended by our board of managers provided that such amendments do not adversely affect the rights of the unitholders. No amendment is permitted if the effect of the amendment would be to increase the duties or liabilities of any manager or unitholder or diminish the rights or benefits to which any manager or unitholder is entitled under the operating agreement, without the affirmative vote or consent of a majority of the percentage interests held by the unitholders who would be adversely affected thereby (or the consent of a manager if it will be adversely affected thereby). The operating agreement will in no event be amended to change the limited liability of the unitholders without the affirmative vote or consent of all of the unitholders. Any amendment which affects the duties of the managers requires the consent of our board of managers. In addition, our board of managers has the right to amend our operating agreement, without the vote or consent of any of the unitholders, when:

	
 
	
•
	
there is a change in the name of the Company or the amount of the contribution of any unitholder;

	
 
	
•
	
a person is substituted as a unitholder;

	
 
	
•
	
an additional unitholder is admitted;

	
 
	
•
	
a person is admitted as a successor or additional manager in accordance with the terms of the operating agreement;

	
 
	
•
	
to cure any ambiguity, to correct or supplement any provision which may be inconsistent with any other provision, or to make any other provisions with respect to matters or questions arising under the operating agreement which are not inconsistent with the provisions of the operating agreement;

	
 
	
•
	
to delete or add any provision of the operating agreement required to be so deleted or added by the staff of the SEC or by a state “Blue Sky” administrator or similar official, which request will be accepted as a determination by such administrator or officer that such change is required by the administrator or official for the benefit or protection of the unitholders;

	
 
	
•
	
to elect for the Company to be governed by any successor Delaware statute governing limited liability companies;

	
 
	
•
	
to modify provisions of the operating agreement to cause the operating agreement to comply with Treasury Regulation Section 1.704-1(b); and

	
 
	
•
	
to improve, upon advice of counsel, the Company’s position in avoiding being treated as a publicly traded partnership taxable as a corporation under the Code.

The board of managers will notify the unitholders within a reasonable time of the adoption of any such amendment that is material, provided that such notice shall be deemed to have been given if the adopted amendment is disclosed in a report that the Company publicly files with the SEC.

Arbitration

Nothing in the operating agreement or the subscription agreement requires the mandatory arbitration of disputes between a unitholder and the Company or any manager.

Other rights

Our operating agreement does not provide for any preemptive or dissenting rights for our unitholders.

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