Document:

COLFAX CORPORATION

2008 OMNIBUS INCENTIVE PLAN

 

OUTSIDE DIRECTOR DEFERRED STOCK UNIT
AGREEMENT FOR ANNUAL GRANTS

(Elective Deferral of Stock Units)

 

Colfax Corporation, a Delaware corporation
(the “Company”), hereby grants stock units relating to shares of its common stock, $.001 par value (the “Stock”),
to the individual named below as the Grantee. The terms and conditions of the grant are set forth in this cover sheet and the attachment
(collectively, the “Agreement”), in the Colfax Corporation 2008 Omnibus Incentive Plan (the “Plan”), and
the Colfax Corporation Director Deferred Compensation Plan (the “Director DCP”).

 

Grant Date: _____________, 20__

 

Name of Grantee: ____________________________________

 

Grantee’s Social Security Number: _______-_______-______

 

Number of Stock Units Covered by Grant: ____________

 

Vesting Schedule:Vesting
DateVesting Percentage

 

1st anniversary
of Grant Date100%

			

 

By signing this cover sheet, you
agree to all of the terms and conditions described in this Agreement, in the Plan and the Director DCP, copies of which will be
provided on request. You acknowledge that you have carefully reviewed the Plan and the Director DCP and agree that the Plan and
the Director DCP will control in the event any provision of this Agreement should appear to be inconsistent with the terms of
the Plan or the Director DCP, as applicable. Certain capitalized terms used in this Agreement are defined in the Plan, and have
the meaning set forth in the Plan. 

 

	Grantee:	 	 
	 	(Signature)	 
	 	 	 
	Company:	 	 
	 	(Signature)	 
	 	 	 
	 	Title:	  	 
	 	 	 	 

 

Attachment

 

This is not a stock certificate or a
negotiable instrument.

 

    	 

    	 

    

COLFAX CORPORATION

2008 OMNIBUS INCENTIVE PLAN

 

OUTSIDE DIRECTOR DEFERRED STOCK UNIT
AGREEMENT FOR ANNUAL GRANTS

(Elective Deferral of Stock Units)

 

 

	Stock Unit Transferability	This grant is an award of stock units in the number of units set forth on the cover sheet, subject to the vesting conditions described below (“Stock Units”).  Your Stock Units may not be transferred, assigned, pledged or hypothecated, whether by operation of law or otherwise, nor may the Stock Units be made subject to execution, attachment, or similar process. 
	Vesting	Your Stock Unit grant shall vest according to the schedule set forth on the cover sheet; provided, that, you remain in Service on the relevant Vesting Date.  If your Service terminates for any reason other than death or Disability, you will forfeit any Stock Units in which you have not yet become vested. 
	Death	
        If your Service terminates because of your
        death, your Stock Units will immediately become 100% vested.

         

	Disability	
        If your Service terminates because of your
        Disability, your Stock Units will immediately become 100% vested.

         

	Delivery of Stock Pursuant to Units	
        Delivery of the shares of Stock represented
        by your vested Stock Units shall be made in accordance with your election under the Director DCP in accordance with your deferral
        election attached hereto as Exhibit A.

         

	Withholding Taxes	You agree, as a condition of this grant, that you will make acceptable arrangements to pay any withholding or other taxes that may be due as a result of vesting in Stock Units or your acquisition of Stock under this grant.  In the event that the Company determines that any federal, state, local, or foreign tax or withholding payment is required relating to this grant, the Company will have the right to: (i) require that you arrange such payments to the Company, (ii) withhold such amounts from other payments due to you from the Company or any Affiliate, or (iii) cause an immediate forfeiture of shares of Stock subject to the Stock Units granted pursuant to this Agreement in an amount equal to the withholding or other taxes due. 
	Retention Rights	This Agreement does not give you the right to be retained by the Company (or any Affiliates) in any capacity.
	Shareholder Rights	You do not have any of the rights of a shareholder with respect to the Stock Units unless and until the Stock relating to the Stock Units has been delivered to you. You will, however, be entitled to receive, upon the Company’s payment of a cash dividend on outstanding Stock, a dividend equivalent in deferred stock units for each Stock Unit that you hold as of the record date for such dividend equal to the per-share dividend paid on the Stock. Such dividend equivalents will be governed by your deferral election attached as Exhibit A.

    	 

    	 

    

 

	Adjustments	In the event of a stock split, a stock dividend, or a similar change in the Company stock, the number of Stock Units covered by this grant will be adjusted (and rounded down to the nearest whole number) in accordance with the terms of the Plan.  Your Stock Units shall be subject to the terms of the agreement of merger, liquidation, or reorganization in the event the Company is subject to such corporate activity in accordance with the terms of the Plan.
	Applicable Law	This Agreement will be interpreted and enforced under the laws of the State of Delaware, other than any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction.
	Consent to Electronic Delivery	The Company may choose to deliver certain statutory materials relating to the Plan in electronic form.  By accepting this grant you agree that the Company may deliver the Plan prospectus and the Company’s annual report to you in an electronic format.  If at any time you would prefer to receive paper copies of these documents, as you are entitled to receive, the Company would be pleased to provide copies.  Please contact the Corporate Secretary to request paper copies of these documents.
	The Plan	The texts of the Plan and the Director DCP are incorporated in this Agreement by reference.  This Agreement, the Plan, and the Director DCP constitute the entire understanding between you and the Company regarding this grant of Stock Units.  Any prior agreements, commitments, or negotiations concerning this grant are superseded. 
	 	 

By signing the cover sheet of this
Agreement, you agree to all of the terms and conditions described above, in the Plan, and in the Director DCP.

 

    	 

    	 

    

Exhibit A - Deferral ElectionSTANDSTILL
AGREEMENT

 

This STANDSTILL AGREEMENT (this “Agreement”)
is entered into as of this 7th day of August, 2012, by and among KIT digital, Inc., a Delaware corporation (“KIT”
or the “Company”) and each of the parties listed on the signature pages hereto as an Investor (each, an “Investor”
and collectively, the “Investors”).

 

WHEREAS, Costa Brava Partnership III L.P.
and the persons and entities affiliated with it listed on the signature pages hereto (collectively “Costa Brava”
and each person and entity so identified thereon being a “member of Costa Brava” or a “Costa Brava
member”) are the beneficial owner of approximately 6.9% of the outstanding shares of Common Stock of KIT;

 

WHEREAS, JEC Capital Partners, LLC and the
persons and entities affiliated with it and/or listed on the signature pages hereto (collectively “JEC” and
each person and entity so identified thereon being a “member of JEC” or a “JEC member”) are
the beneficial owner of approximately 7.7% of the outstanding shares of Common Stock of KIT; and

 

WHEREAS, the Company, JEC and Costa Brava
desire to enter into a global agreement to resolve certain proceedings, controversies and disputes pertaining or relating to the
Company’s 2012 annual meeting of shareholders, which the Company agrees to use its commercially reasonable efforts to hold
before December 31, 2012 (the “2012 Annual Meeting”).

 

NOW, THEREFORE, in consideration of the
foregoing and the covenants and agreements herein, the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:

 

1. Immediate
Reconstitution of, and appointment to, Board of Directors. The Company, JEC and Costa Brava hereby acknowledge and agree that:

 

(a)Effective
August 7, 2012, (i) the Company shall expand the size of the board of directors (the “Board”) to six (6) directors,
(ii) Joseph Mullin shall resign from the Board; (iii) Seth W. Hamot (the “Costa Brava Director”) shall be appointed
to serve as a director, (iv) K. Peter Heiland (the “JEC Director”) shall be appointed to serve as a director,
(v) the JEC Director shall be appointed a member of the Nominating and Corporate Governance Committee, which at such time also
shall include William Russell and Greg Petersen, and (vi) the Costa Brava Director shall be appointed a member of the Compensation
Committee, which at such time also shall include Mr. Petersen and Wayne Walker.

 

(b)The
Nominating and Corporate Governance Committee (or a duly constituted subcommittee thereof) (the “Nominating Committee”)
of the Board will recommend for nomination and the Board will nominate each of Mr. Hamot and Mr. Heiland (collectively, the “Investor
Nominees”) for election at the 2012 Annual Meeting and will recommend a vote for the Investor Nominees and solicit proxies
from the Company’s stockholders for the election of the Investor Nominees at the 2012 Annual Meeting.

 

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(c)The
Nominating Committee of the Board will recommend for nomination, and the Board will nominate each of, the Investor Nominees for
election at the 2013 annual meeting of shareholders (the “2013 Annual Meeting”) and any other Later Election Meeting
(as defined below) occurring in 2013 but earlier than the 2013 Annual Meeting and will recommend a vote for the Investor Nominees
and solicit proxies from the Company’s stockholders for the election of the Investor Nominees at such 2013 Annual Meeting
and any such other Later Election Meeting, provided with respect to each Investor Nominee that he continues to serve on the Board
at the time of the nominations for Director for such meeting. If either such Investor Nominee is not willing to serve or resigns
from the Board after such nomination, such recommendation need not be made and such proxies need not be solicited with respect
to such Investor Nominee.

 

(d)The
size of the Board shall be fixed at six (6), except as determined by a vote of the Board of Directors.

 

2. 2012
Annual Meeting and Other Election Matters. The Company agrees to use its commercially reasonable efforts to hold the 2012 Annual
Meeting no later than December 31, 2012. Each member of Costa Brava and each member of JEC agrees to vote and cause to be voted
all the shares which he or it owns as of the record date, either beneficially or as of record, for the 2012 Annual Meeting in favor
of each of those individuals recommended for nomination as directors by the Company’s Nominating and Corporate Governance
Committee and nominated for election as director by the Board. At any subsequent annual or special meeting of stockholders of the
Company (or adjournments thereof), with respect to each matter relating to directors or the election of directors (whether removal,
replacement, or otherwise, and whether at a meeting or through a written consent), each member of Costa Brava and each member of
JEC, to the extent a Standstill Period (as defined below) is applicable to them, agree to vote and cause to be voted all shares
which he or it owns as of the record date for such meeting or written consent, either beneficially or as of record, in favor of
the election to the Board of those director nominees recommended by the Board, against the removal of any directors whose removal
is not recommended by the Board, and all as otherwise recommended by the Board in relation to any matters relating to directors
or the Board, the members of the Board, the size of the Board, the constitution or composition of the Board, or otherwise relating
to any of the foregoing.

 

3. Settlement Expense Reimbursement.
The Company shall remit to JEC an amount not to exceed $300,000 and to Costa Brava an amount not to exceed $260,000, in each case
in consideration of certain of its costs in connection with the items described in the Schedules 13D and amendments thereto previously
filed by JEC and Costa Brava, respectively, provided that such amounts are in respect of documented actual third party out of pocket
expenses. The Company will pay such amounts by wire transfer of immediately available funds to an account designated in writing
by the relevant party no later than 12:00 p.m. (Eastern Time) on the date which is seven (7) calendar days after the Company’s
receipt of the relevant invoices, together with appropriately detailed backup or a certification of such costs by such third party,
provided to the Company by each of JEC and Costa Brava in respect of such expenses.

 

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4. Company Representations and Warranties.
The Company represents and warrants to each of JEC and Costa Brava as follows:

 

(a)The Company is a corporation
duly organized, validly existing and in good standing under the laws of the State of Delaware. The Company has the full power and
authority to execute, deliver and carry out the terms and provisions of this Agreement, and has taken all necessary action to authorize
the execution, delivery and performance of this Agreement; and

 

(b)This Agreement has been
duly and validly authorized by the Board, and executed and delivered by the Company and constitutes a valid and binding obligation
of the Company, enforceable in accordance with its terms, and no other proceeding on the part of the Company is necessary to authorize
the execution, delivery and performance of this Agreement.

 

(c)The Company acknowledges
that the parties are entering into this single agreement among all of them in the interest of simplicity.

 

5. Costa Brava Representations and
Warranties. Each member of Costa Brava represents and warrants to the Company as follows:

 

(a)To the extent that a member
of Costa Brava is an entity, it is duly organized, validly existing and in good standing under the laws of the state in which it
was incorporated or organized. It has the full power and authority to execute, deliver and carry out the terms and provisions of
this Agreement, and has taken all necessary action to authorize the execution, delivery and performance of this Agreement; and

 

(b)This Agreement has been
duly and validly authorized by each member of Costa Brava’s governing bodies, and executed and delivered by each member of
Costa Brava and constitutes its valid and binding obligation, enforceable against each member of Costa Brava in accordance with
its terms, and no other proceeding on its part is necessary to authorize the execution, delivery and performance of this Agreement.

 

(c)No Costa Brava member is
party to any agreement, arrangement, understanding or relationship, including any repurchase or similar so-called “stock
borrowing” agreement or arrangement, engaged in, directly or indirectly, whether by means of derivatives or otherwise, the
purpose or effect of which is to mitigate loss to, reduce the economic risk (of ownership or otherwise) of shares of any class
or series of the Company by, including but not limited to “short” positions in shares of common stock, “long”
puts, “short” calls, “short” forward or swap positions, manage the risk of share price changes for, or
increase or decrease the voting power of, such Investor with respect to the shares of any class or series of the Company, or which
provides, directly or indirectly, the opportunity to profit from any decrease in the price or value of the shares of any class
or series of the Company (collectively “Short Interests”).

 

(d)The responses to the questionnaire
titled “KIT digital, Inc. Questionnaire - Candidates for Director” delivered to the Company by the Costa Brava Director
are true and correct in all material respects.

 

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6. JEC Representations and Warranties.
Each member of JEC represents and warrants to the Company as follows:

 

(a)To the extent that a member
of JEC is an entity, it is duly organized, validly existing and in good standing under the laws of the state in which it was incorporated
or organized. It has the full power and authority to execute, deliver and carry out the terms and provisions of this Agreement,
and has taken all necessary action to authorize the execution, delivery and performance of this Agreement; and

 

(b)This Agreement has been
duly and validly authorized by each member of JEC’s governing bodies, and executed and delivered by each member of JEC and
constitutes its valid and binding obligation, enforceable against each member of JEC in accordance with its terms, and no other
proceeding on its part is necessary to authorize the execution, delivery and performance of this Agreement.

 

(c)No JEC member is party
to any Short Interests.

 

(d) The responses to the questionnaire
titled “KIT digital, Inc. Questionnaire - Candidates for Director” delivered to the Company by the JEC Director are
true and correct in all material respects.

 

7. Publicity. The Company, JEC
and Costa Brava will issue a joint press release before the financial markets in New York open on August 7, 2012 in the form attached
hereto as Exhibit A (the “Press Release”). Until the Press Release is issued, the Company, JEC and Costa
Brava shall keep the contents of this Agreement confidential other than as required by law. The Company, on the one hand, and JEC
and Costa Brava, each on the other hand, will each file an 8-K (in the case of the Company) and a Schedule 13D amendment (in the
case of each of JEC and Costa Brava) announcing this Agreement and attaching this Agreement and the Press Release as exhibits thereto,
all simultaneously with, or promptly following, the issuance of the Press Release.

 

8. Standstill Agreement.

 

(a) Initial Standstill Periods.
Each member of Costa Brava agrees that until immediately after the 2013 Annual Meeting or such earlier time, after the 2012 Annual
Meeting, that the Costa Brava Director ceases to serve on the Board, neither Costa Brava nor any of its Affiliates or Associates
(as such terms are defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”))
shall, directly or indirectly, in any manner, acting alone or in concert with others, take any of the actions set forth in Section
8(a)(i) through 8(a)(xi) below, except as expressly permitted by the Standstill Exception (as defined in Section 8(c) below) or
as otherwise permitted below; and each member of JEC agrees that until immediately after the 2013 Annual Meeting or such earlier
time, after the 2012 Annual Meeting, that the JEC Director ceases to serve on the Board, neither JEC nor any of its Affiliates
of Associates shall, directly or indirectly, in any manner, acting alone or in concert with others, take any of the actions set
forth in Section 8(a)(i) through 8(a)(xi) below, except as expressly permitted by the Standstill Exception or as otherwise permitted
below:

 

(i)nominate or propose any
candidates for the Board or seek to change or alter the composition or size or membership of the Board or the removal or replacement
of any director or call or seek the call of any meeting of stockholders;

 

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(ii)submit a shareholder proposal
under Rule 14a-8 of the Securities Exchange Act of 1934, directly or indirectly, to the Company or seek any referendum or the like
by the shareholders of the Company;

 

(iii)file a proxy or consent
statement in opposition to the Company or otherwise obtain or solicit proxies or consents from any shareholders of the Company
or be a participant in or make any solicitation for a matter relating to the Board;

 

(iv)enter into any contract,
arrangement or understanding with any person (other than an Affiliate or Associate, subject to the percentage ownership limitation
below, for which K. Peter Heiland (in the event of an Affiliate or Associate of a JEC member), or for which Seth Hamot (in the
event of an Affiliate or Associate of a Costa Brava member), has and maintains all voting and investment and other applicable authority
or which Affiliate or Associate signs a joinder to this Agreement agreeing to be bound by all the terms and conditions hereof as
a JEC member or a Costa Brava member as applicable) with respect to any securities of KIT, including but not limited to any acquisition
of any securities (or beneficial ownership thereof), joint venture, loan or option agreement, put or call, guarantee of loans,
guarantee of profits or division of losses or profits, it being understood that Costa Brava members’ and JEC members’
aggregate holdings in KIT’s securities shall not exceed 9.9% and 9.9% beneficial ownership under Section 13(d) of the Exchange
Act, respectively, of the common stock of the Company;

 

(v)commence or enter into
any tender offer or exchange offer, merger, acquisition or other business combination or extraordinary transaction involving the
Company or any of its subsidiaries;

 

(vi) form, join or in any
way participate in a “group” (as defined under the Exchange Act) with respect to the Company or its securities;

 

(vii)otherwise act, alone
or in concert with others, to seek to influence the management, Board or policies of KIT or take any action to seek the removal
of any member of the Board, change the size of the Board, obtain additional representation on the Board, or take any other action
related to the management or the Board;

 

(viii)disclose any intention,
plan, proposal or arrangement or other matter inconsistent with its obligations under this Section 8(a) (provided that this clause
(viii) shall not prohibit a confidential, non-public disclosure with respect to the matters for which a waiver may
be sought under clause (xi) below);

 

(ix)effect or seek (including,
without limitation, entering into any discussions, negotiations, agreements or understandings with any third person), offer or
propose (whether publicly or otherwise) to effect, or cause or participate in, or in any way, advise, assist or encourage any other
person or entity in connection with any action which it is prohibited from taking under this Section 8(a) or which is inconsistent
with its obligations under this Section 8(a) (including via any supporting public statement with respect thereto or any adverse
public statement regarding the Company or the Board or any of its members);

 

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(x)knowingly take any
action which would, or would reasonably be expected to, force the Company to make a public announcement (or result in the Company
making a public announcement) regarding any of the types of the foregoing matters; or

 

(xi)request, directly
or indirectly, any amendment or waiver or modification of, or deviation from, any provision of this Section 8 (including this sentence)
or any other provision of this Agreement by the Company or any of its agents or representatives (provided that this clause (xi)
shall not prohibit a JEC member or a Costa Brava member from confidentially requesting from the Board of the Company an amendment,
waiver or modification, or deviation, from this Section 8 to permit the JEC members or the Costa Brava members (respectively) to
engage in a transaction subject to clause (v) above or for them to exceed the ownership limitation set forth in clause (iv) above).

 

The period of restriction under this Section
8(a) shall be referred to herein as the “Standstill Period” in relation to the Costa Brava members and the JEC
members (it being understood that the Costa Brava members and the JEC members may have different Standstill Periods due to the
application of this Section 8).

 

(b) Cooling Off Period. In addition
to the foregoing (and not in limitation thereof), for a period of forty-five (45) days from and after the cessation of service
of the Costa Brava Director as a director of the Company, the restrictions set forth in Section 8(a) shall continue to apply to
each Costa Brava member as to any matter related to the election of directors, the removal or replacement of directors, the size,
constitution or composition of the Board, or any other matter related to the Board or any director. In addition to the foregoing
(and not in limitation thereof), for a period of forty-five (45) days from and after the cessation of service of the JEC Director
as a director of the Company, the restrictions set forth in Section 8(a) shall continue to apply to each JEC member as to any matter
related to the election of directors, the removal or replacement of directors, the size, constitution or composition of the Board,
or any other matter related to the Board or any director. For the avoidance of doubt, the obligations of the Costa Brava members
shall continue in full force and effect and not be affected by the provisions of this Section 8(b) in the event of the cessation
of service of the JEC Director and the obligations of the JEC members shall continue in full force and effect and not be affected
by the provisions of this Section 8(b) in the event of the cessation of service of the Costa Brava Director. The forty-five (45)
day period referred to in this paragraph (b) is sometimes referred to herein as a “Cooling Off Period” applicable to
them. For clarification, during the Cooling Off Period, no member of JEC and no member of Costa Brava shall, subject to their rights
under Section 8(d), publicly disparage the Board, the management of the Company or the Company.

 

(c) Special Standstill Exception.
In addition, notwithstanding anything in this Section 8 to the contrary, in the event that the Company affirmatively solicits,
after the date hereof, shareholder approval of any Extraordinary Matter (as defined below), the provisions of Sections 8(a) and
(b) above shall not apply with respect to the Investors’ solicitation in opposition to such Extraordinary Matter, it being
understood that all other provisions of this Agreement shall continue to apply to all other matters other than the Extraordinary
Matter, even if such other matters are part of the same solicitation as the Extraordinary Matter. For purposes hereof, an “Extraordinary
Matter” shall mean each of (x) a tender offer or other similar transaction initiated by a third party and (y) a shareholder
approval solicitation initiated by the Company (and not in response to any solicitation or similar action by any shareholder) for
a matter that is not related to election of directors, removal or replacement of directors, size or constitution or composition
of the Board, or any other Board or director related matters. For clarification purposes, it is understood and agreed that Company
solicitation of (i) shareholder approval of a merger under the General Corporation Law of the State of Delaware or (ii) shareholder
approval of a change of control transaction or financing required by Nasdaq’s shareholder approval rules shall be an Extraordinary
Matter. Further, if such a merger or change of control transaction or financing includes matters with respect to the Board which
would be approved merely by the approval of such merger or change of control transaction or financing (and not to be considered
separately by shareholders from such merger or change of control transaction or financing), then such merger, change of control
transaction or financing transaction shall nonetheless still be considered an Extraordinary Matter hereunder. For clarification
purposes, an “Extraordinary Matter” does not include a proxy or consent solicitation or other action with respect to
the election or removal or replacement of directors, except as set forth in the preceding sentence.

 

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(d)Acting in Capacity as
a Director. Nothing in this Section 8 shall in any way restrict or limit the JEC Director or the Costa Brava Director,
in each case confidentially (and without knowingly causing or leading to a public disclosure with respect thereto) and solely
in his capacity as a member of the Board, from expressing or advocating for his or her views to the Board, officers of
the Company, any other director, or at Board meetings and by voting on matters before the Board (or any committee of the
Board) in his capacity as a director. Each of the JEC Director and the Costa Brava Director acknowledge their fiduciary
duties as directors of the Company and that such fiduciary duties include a duty of confidentiality with respect to the
confidential information of the Company and that such information may not be used as a shareholder or by any other member of
JEC or Costa Brava (as applicable) and shall only be used by the JEC Director and the Costa Brava Director in his capacity as
a director. The Company represents that each of its current directors has made a substantially equivalent oral
acknowledgement in connection with the parties’ entry into this Agreement. Notwithstanding any other provision of this
Agreement to the contrary, nothing in this Agreement shall limit or prevent either the JEC Director or the Costa Brava
Director from resigning and stating generally in connection therewith in a letter or orally to the Board of Directors of the
Company (which to the extent required by applicable rules, will be disclosed by the Company in an 8-K filing and will be
disclosed by JEC or Costa Brava (as applicable) in a Schedule 13D amendment) (i) that he has a one or more disagreements with
one or more other Board members related to operations, policies, management, board composition, strategic transactions or the
like (generally disclosing each of such matters, but not the specifics thereof) and (ii) that he and the other members of JEC
or Costa Brava (as the case may be) may commence or intend to commence a consent solicitation or other election contest
following the end of the Standstill Period or Cooling Off Period, as applicable, to seek to remedy such disagreement.

 

(e) Affiliates and Related Parties.
Each member of Costa Brava shall cause each of its Affiliates and Associates to abide by the restrictions applicable to such Affiliates
and Associates under this Agreement and by all other provisions of this Agreement applicable to any member of Costa Brava as if
expressly applicable to such Affiliates and Associates. Each member of JEC shall cause each of its Affiliates and Associates to
abide by the restrictions applicable to such Affiliates and Associates under this Agreement and by all other provisions of this
Agreement applicable to any member of JEC as if expressly applicable to such Affiliates and Associates.

 

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(f)Limited Termination
of Cooling Off Period. Notwithstanding anything to the contrary in this Agreement, if the Board shall either (x) amend the
Bylaws of the Company with respect to shareholder nominations of directors for election at an annual or special meeting of shareholders
after the 2012 Annual Meeting (such annual or special meeting of shareholders at which directors are to be elected after the 2012
Annual Meeting being referred to as a “Later Election Meeting”) in a manner adverse to shareholders and in
a manner not required by applicable law or exchange regulation, (y) set the date for an annual meeting which is a Later Election
Meeting as a date more than thirty (30) days different from the anniversary of the prior year’s annual meeting of shareholders
or (z) fail to nominate and maintain the nomination of the Costa Brava Director and the JEC Director (in either case if still
on the Board) for election at the 2013 Annual Meeting and any earlier occurring Later Election Meeting in 2013, in the case of
each of clauses (x), (y) and (z) without the approval of the Costa Brava Director and the JEC Director (in either case if still
on the Board), with the result that the JEC Director or the Costa Brava Director shall not have notice of the adoption of such
amendment, establishment of such 2013 Annual Meeting date or failure to nominate in sufficient time to permit him to resign from
the Board, abide by the Cooling Off Period, and have at least sixty (60) days to secure and propose nominees to provide timely
notice of such shareholder’s intent to nominate one or more individuals to the Board under the Bylaws for such Later Election
Meeting, then following the resignation of the JEC Director or the Costa Brava Director who has not approved such matter in clause
(x), (y) or (z) above, as the case may be, the Cooling Off Period shall not apply (to the JEC members (in the event of such resignation
of the JEC Director) or the Costa Brava members (in the event of such resignation of the Costa Brava Director)).

  

9. Resignation.
Notwithstanding anything to the contrary contained herein or otherwise, by execution of this Agreement each of the Costa Brava
Director and the JEC Director does hereby irrevocably and automatically tender its resignation as a director of the Company (which
the Board may choose not to accept) effective, upon the earlier of (i) such time as the aggregate beneficial ownership of the Common
Stock by Costa Brava (in the event of the Costa Brava Director) or JEC (in the event of the JEC Director) shall be less than 1%
beneficial ownership of the Common Stock by such party, as applicable, as a whole (as calculated under 13(d)), (ii) after the date
hereof such party (or any of its members hereunder or its Affiliates or Associates) establishes, directly or indirectly, any Short
Interest, and (iii) material breach of this Agreement by Costa Brava or any of its members or Affiliates or Associates (in the
case of the Costa Brava Director) or JEC or any of its members or Affiliates or Associates (in the case of the JEC Director) and
written notice in respect of such breach to the applicable director by the Company. Costa Brava and JEC agree to certify to the
Company as to the number of shares of Common Stock beneficially owned by, and any Short Interest of, such party (and its members
and Affiliates and Associates) at such times and from time to time as reasonably requested by the Company. From and after the occurrence
of the earliest of (i), (ii) and (iii) above, as to Costa Brava or JEC, the Company shall have no further obligations under this
Agreement as to Costa Brava or JEC, as applicable. From and after the occurrence of a material breach of this Agreement by the
Company or any director (other than the Costa Brava Director or the JEC Director), provided that the Company and such director
have been given notice and a reasonable opportunity to cure for matters which can be cured, each of Costa Brava, JEC and all Costa
Brava members and JEC members and each of such parties’ respective Affiliates and Associates shall have no further obligations
under this Agreement.

 

    	8

    	 

    
 

10. Specific Performance. Each
of the parties acknowledges and agrees that the other party would be damaged irreparably in the event any of the provisions of
this Agreement are not performed in accordance with their specific terms or otherwise are breached. Accordingly, each party agrees
that, without posting bond or other undertaking, the other party shall be entitled to an injunction or injunctions to prevent breaches
of the provisions of this Agreement and to enforce specifically this Agreement and the terms and provisions hereof in any claim,
action, cause of action or suit, whether in contract or tort or otherwise, whether at law or in equity instituted in accordance
with Paragraph 16 below. Each party further agrees that, in the event of an action for specific performance in respect of such
breach, it shall not assert the defense that a remedy at law would be adequate. The foregoing is in addition to, and not limitation
of, any other remedies available at law or in equity.

 

11. Notice.
Any notices, consents, determinations, waivers or other communications required or permitted to be given under the terms of this
Agreement must be in writing and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon
receipt, when sent by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on
file by the sending party); or (iii) one (1) business day after deposit with a nationally recognized overnight delivery service,
in each case properly addressed to the party to receive the same. The addresses and facsimile numbers for such communications shall
be:

 

To the Company:

 

KIT digital, Inc.

26 West 17th Street, 2nd Floor

New York, NY 10011

Attention: Chairman of the Board

 

Tel: 646-553-4845

Fax: 212-730-4561

Email: wvrussell@yahoo.com

 

with a copy to:

 

Greenberg Traurig, LLP

77 West Wacker Drive, Suite 2500

Chicago, Illinois 60601

Attention: Peter H. Lieberman

Tel: 312-456-8417

Fax: 312-456-8435

Email: liebermanp@gtlaw.com

 

    	9

    	 

    
 

To the Investors:

 

Costa Brava Partnership III L.P.

222 Berkeley Street

Boston, MA 02116

Attention: Seth W. Hamot

Tel: 617-595-4400

Email: seth@rrhcap.com

 

with a copy to:

 

Ropes & Gray LLP

800 Boylston Street

Boston, MA 02199

Attention: Jeffrey R. Katz, Esq.

Tel: (617) 951-7072

Fax: (617) 235-0617

Email: jeffrey.katz@ropesgray.com

and

 

JEC Capital Partners, LLC

68 Mazzeo Drive

Randolph, MA 02368

Attention: K. Peter Heiland

Tel: (781) 326-5700

Fax: (781) 326-3004

Email: peter@jeccapital.com

 

with a copy to:

 

Nutter, McClennen & Fish LLP

155 Seaport Blvd.

Boston, MA 02210

Attention: James E. Dawson, Esq.

Tel: 617-439-2623

Fax: 617-310-9623

Email: jdawson@nutter.com

 

12. Amendments and Waivers; Interpretation.
No amendment or waiver of any provision of this Agreement will be valid and binding unless it is in writing and signed, in the
case of an amendment, by the Company, JEC and Costa Brava, or in the case of a waiver, by the party against whom the waiver is
to be effective. No waiver by any party of any breach or violation or, default under or inaccuracy in any representation, warranty
or covenant hereunder, whether intentional or not, will be deemed to extend to any prior or subsequent breach, violation, default
of, or inaccuracy in, any such representation, warranty or covenant hereunder or affect in any way any rights arising by virtue
of any prior or subsequent such occurrence. No delay or omission on the part of any party in exercising any right, power or remedy
under this Agreement will operate as a waiver thereof. It is agreed that the JEC Director may bind each other JEC member hereunder
and the Costa Brava Director may bind each other Costa Brava member hereunder. For avoidance of doubt, nothing herein shall preclude
the Board from itself at any time and from time to time increasing of decreasing the size of the Board or changing its own composition,
provided that such shall not affect or limit the obligations of the parties hereunder. Each of the parties has participated in
the drafting of this Agreement and this Agreement shall not be construed against any party hereto as the drafter hereof. As used
in this Agreement, the term including shall mean including without limitation.

 

    	10

    	 

    
 

13. Successors and Assigns. Except
as otherwise provided herein, the terms and conditions of this Agreement shall inure to the benefit of and be binding upon the
respective successors and permitted assigns of the parties. Nothing in this Agreement, express or implied, is intended to confer
upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities
under or by reason of this Agreement, except as expressly provided in this Agreement. Nothing in this Section 13 shall limit the
obligations hereunder of any of the parties hereto.

 

14. Counterparts. This Agreement
may be executed in any number of counterparts, which may be exchanged by PDF or facsimile each of which will be deemed an original,
but all of which together will constitute but one and the same instrument. This Agreement will become effective when duly executed
by each party hereto.

 

15. Severability. Any term or
provision of this Agreement that is invalid or unenforceable in any situation in any jurisdiction will not affect the validity
or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision
in any other situation or in any other jurisdiction. In the event that any provision hereof would, under applicable law, be invalid
or unenforceable in any respect, each party hereto intends that such provision will be construed by modifying or limiting it so
as to be valid and enforceable to the maximum extent compatible with, and possible under, applicable law.

 

16. Governing
Law. This Agreement, the rights of the parties and all actions arising in whole or in part under or in connection herewith,
will be governed by and construed in all respects, including validity, interpretation and effect, in accordance with the laws of
Delaware, applicable to contracts executed and to be performed wholly within such State without giving effect to any choice or
conflict of law provision or rule that would cause the application of the laws of any other jurisdiction. Each
party hereto agrees, on behalf of itself and its Affiliates and Associates, that any actions, suits or proceedings arising out
of or relating to this Agreement or the transactions contemplated hereby will be brought solely and exclusively in the Chancery
Court of the State of Delaware, or if such court does not accept jurisdiction then any federal court in the State of Delaware,
and the parties agree not to commence any action, suit or proceeding relating thereto except in such courts, and further agrees
that service of any process, summons, notice or document by U.S. registered mail to the respective addresses set forth in the notice
section hereof will be effective service of process for any such action, suit or proceeding brought against any party in any such
court. Each party, on behalf of itself and its Affiliates and Associates, irrevocably and unconditionally waives any objection
to the laying of venue of any action, suit or proceeding arising out of this Agreement or the transactions contemplated hereby,
in the Chancery Court of the State of Delaware or if such court does not accept jurisdiction then the federal courts in the State
of Delaware, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that
any such action, suit or proceeding brought in any such court has been brought in an improper or inconvenient forum.

 

17. Waiver of Jury Trial. To
the extent not prohibited by applicable law that cannot be waived, the parties hereby waive, and covenant that they will not assert
(whether as plaintiff, defendant or otherwise), any right to trial by jury in any action arising in whole or in part under or in
connection with this agreement or any of the contemplated transactions, whether now existing or hereafter arising, and whether
sounding in contract, tort or otherwise. The parties agree that any of them may file a copy of this Section with any court as written
evidence of the knowing, voluntary and bargained-for agreement among the parties irrevocably to waive its right to trial by jury
in any proceeding whatsoever between them relating to this agreement or any of the contemplated transactions will instead be tried
in a court of competent jurisdiction by a judge sitting without a jury.

 

    	11

    	 

    
 

18.Termination. If not sooner
terminated by mutual agreement of the parties, this Agreement and the respective obligations of the parties hereunder shall terminate
on the earlier of (x) immediately following the 2013 Annual Meeting and (y) December 31, 2013.

 

[Next page is the signature page.]

 

    	12

    	 

    
 

IN WITNESS WHEREOF, the undersigned parties
have duly executed this Agreement as of the date first written above.

 

	
         

         
	
        KIT digital, Inc.

        

        

         

        By: /s/ William V. Russell

        Name: William V. Russell

        Title: Chairman of the Board

 

    	13

    	 

    
 

INVESTORS:

 

	
         

         
	
        COSTA BRAVA MEMBERS:

         

        COSTA BRAVA PARTNERSHIP III L.P.

        

        By: Roark, Rearden & Hamot, LLC,

        its General Partner

         

        By: /s/ Seth W. Hamot

        Name: Seth W. Hamot

        Title: President

        

        ROARK, REARDEN & HAMOT, LLC

        

        By: /s/ Seth W. Hamot

        Name: Seth W. Hamot

        Title: President

        

        

        

        /s/ Seth W. Hamot

        Seth W. Hamot

         

         

         

        JEC MEMBERS:

        

        JEC II ASSOCIATES, LLC

        

        By: /s/ K. Peter Heiland

        Name: K. Peter Heiland

        Title: Manager

        

        JEC CAPITAL PARTNERS LLC

        

        By: /s/ K. Peter Heiland

        Name: K. Peter Heiland

        Title: Managing Partner

         

         

         

        /s/ K. Peter Heiland

        K. Peter Heiland

         

         

 

    	14

    	 

    
 

EXHIBIT A

[Press Release]

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