Document:

Exhibit 4.1

 

 

 

RIGHTS AGREEMENT

 

between

 

LIQUID HOLDINGS GROUP, INC.,

 

and

 

CONTINENTAL STOCK TRANSFER AND TRUST
COMPANY,

 

as Rights Agent

 

Dated as of December 11, 2014

 

 

 

    	 

    	 

    

 

TABLE OF CONTENTS

 

	 	Page
	 	 
	Section 1. Certain Definitions	1
	 	 
	Section 2. Appointment of the Rights Agent	8
	 	 
	Section 3. Issuance of Rights Certificates	9
	 	 
	Section 4. Form of Rights Certificates	11
	 	 
	Section 5. Countersignature and Registration	11
	 	 
	Section 6. Transfer, Split-Up, Combination, and Exchange of Rights Certificates; Mutilated, Destroyed, Lost, or Stolen Rights Certificates	12
	 	 
	Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights	12
	 	 
	Section 8. Cancellation and Destruction of Rights Certificates	15
	 	 
	Section 9. Reservation and Availability of Capital Stock	15
	 	 
	Section 10. Preferred Stock Record Date	16
	 	 
	Section 11. Adjustment of Purchase Price, Number and Kind of Shares, or Number of Rights	17
	 	 
	Section 12. Certificate of Adjusted Purchase Price or Number of Shares	25
	 	 
	Section 13. Consolidation, Merger, or Sale or Transfer of Assets or Earning Power	25
	 	 
	Section 14. Fractional Rights and Fractional Shares	27
	 	 
	Section 15. Rights of Action	28
	 	 
	Section 16. Agreement of Rights Holders	29
	 	 
	Section 17. Rights Certificate Holder Not Deemed a Stockholder	30
	 	 
	Section 18. Concerning the Rights Agent	30
	 	 
	Section 19. Merger or Consolidation or Change of Name of the Rights Agent	30
	 	 
	Section 20. Duties of the Rights Agent	31

 

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TABLE OF CONTENTS

(Continued)

 

	 	Page
	 	 
	Section 21. Change of the Rights Agent	33
	 	 
	Section 22. Issuance of New Rights Certificates	34
	 	 
	Section 23. Redemption and Termination	34
	 	 
	Section 24. Exchange of Rights	35
	 	 
	Section 25. Notice of Certain Events	37
	 	 
	Section 26. Notices	38
	 	 
	Section 27. Supplements and Amendments	38
	 	 
	Section 28. Successors	39
	 	 
	Section 29. Determinations and Actions by the Board	39
	 	 
	Section 30. Benefits of this Agreement	39
	 	 
	Section 31. Severability	39
	 	 
	Section 32. Governing Law	40
	 	 
	Section 33. Counterparts; Facsimiles and PDFs	40
	 	 
	Section 34. Descriptive Headings	40

 

	Exhibit A	Form of Certificate of Designation, Preferences, and Rights
	Exhibit B	Form of Rights Certificate
	Exhibit C	Form of Summary of Rights to Purchase Preferred Stock

 

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RIGHTS AGREEMENT

 

RIGHTS
AGREEMENT, dated as of December 11, 2014 (this “Agreement”), between Liquid Holdings Group, Inc., a Delaware
corporation (the “Company”), and Continental Stock Transfer and Trust Company (the “Rights Agent”).

 

RECITAL

 

WHEREAS,
on December 11, 2014 (the “Rights Dividend Declaration Date”), a duly authorized committee of the Board of Directors
of the Company authorized and declared a dividend distribution of one right (each, a “Right,” and together with
all other such rights distributed or issued pursuant hereto, the “Rights”) for each share of Common Stock outstanding
at the Close of Business on December 22, 2014 (the “Record Date”), and further authorized and directed the issuance
of one Right (as such number may hereinafter be adjusted pursuant hereto) with respect to each share of Common Stock issued between
the Record Date (whether originally issued or delivered from the Company’s treasury) and, except as otherwise provided in
Section 22, the earlier of the Distribution Date and the Expiration Date, each Right initially representing the right to purchase
one one-thousandth of a share of Preferred Stock, upon the terms and subject to the conditions hereinafter set forth.

 

AGREEMENT

 

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

 

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

 

(a)          “Acquiring
Person” shall mean any Person who or which, together with all Affiliates and Associates of such Person, shall be the
Beneficial Owner of 10% or more of the Common Stock then outstanding, but shall not include an Exempt Person. Notwithstanding the
foregoing:

 

(i)          any
Person who or which, together with all Affiliates and Associates of such Person, becomes the Beneficial Owner of 10% or more of
the Common Stock then outstanding as a result of a reduction in the number of shares of Common Stock outstanding due to the repurchase
of Common Stock by the Company shall not be deemed an “Acquiring Person” unless and until such Person, together with
all Affiliates and Associates of such Person, acquires Beneficial Ownership of any additional shares of Common Stock (other than
as a result of a stock dividend, stock split, or similar transaction effected by the Company in which all registered holders of
Common Stock are treated substantially equally) while the Beneficial Owner of 10% or more of the Common Stock then outstanding;

 

    	 

    	 

    

 

(ii)         if
the Board determines in good faith that a Person who would otherwise be an “Acquiring Person” has become such inadvertently
(including, without limitation, because (A) such Person was unaware that it beneficially owned a percentage of Common Stock
that would otherwise cause such Person to be an “Acquiring Person” or (B) such Person was aware of the extent
of its Beneficial Ownership of Common Stock but had no actual knowledge of the consequences of such Beneficial Ownership under
this Agreement and had no intention of changing or influencing control of the Company), and such Person divests within such timeframe
as the Board determines a sufficient number of shares of Common Stock (without exercising or retaining any power, including, without
limitation, voting power, with respect to such shares) (or, in the case solely of shares of Common Stock beneficially owned, directly
or indirectly, by such Person pursuant to Section 1(f)(v) hereof, such Person terminates the subject Derivatives Contract(s)
or disposes of the subject derivative security or securities, or establishes to the satisfaction of the Board that such shares
of Common Stock are not held with any intention of changing or influencing control of the Company) so that such Person is no longer
the Beneficial Owner of 10% or more of the Common Stock then outstanding, then such Person shall not be deemed to be or ever to
have been an “Acquiring Person” for any purposes of this Agreement as a result of such inadvertent acquisition;

 

(iii)        if
a bona fide swaps dealer who would otherwise be an “Acquiring Person” has become so as a result of its actions in the
ordinary course of its business that the Board 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 shall otherwise determine, such person shall not
be deemed to be an “Acquiring Person” for any purposes of this Agreement; and

 

(iv)        if
a Person would otherwise be deemed an “Acquiring Person” upon the execution of this Agreement, such Person (herein
referred to as a “Grandfathered Stockholder”) shall not be deemed an “Acquiring Person” for purposes
of this Agreement unless, subject to Section 1(a)(i) and Section 1(a)(ii) above, such Grandfathered Stockholder shall
at any time following execution of this Agreement be the Beneficial Owner of shares of Common Stock in an amount in excess of such
Person’s Reported Beneficial Ownership immediately prior to the execution of this Agreement (other than as a result of a
stock dividend, stock split, or similar transaction effected by the Company in which all registered holders of Common Stock are
treated substantially equally), in which case such Person shall no longer be deemed a Grandfathered Stockholder and shall be deemed
an “Acquiring Person.” For purposes of this Section 1(a)(iv), a Person’s “Reported Beneficial Ownership”
shall be such Person’s Beneficial Ownership of shares of Common Stock as expressly disclosed in such Person’s statement
on Schedule 13G, in Item 5 of such Person’s statement on Schedule 13D or in such Person’s statement on Form 4, as appropriate,
in each case as publicly on file with the U.S. Securities and Exchange Commission pursuant to the Exchange Act immediately prior
to the execution of this Agreement.

 

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For all purposes of this Agreement, any
calculation of the number of shares of Common Stock outstanding at any particular time, including for purposes of determining the
particular percentage of such outstanding Common Stock of which any Person is the Beneficial Owner, shall include the number of
shares of Common Stock not outstanding at the time of such calculation that such Person is otherwise deemed to beneficially own
for purposes of this Agreement. The number of shares of Common Stock not outstanding that such Person is otherwise deemed to beneficially
own for purposes of this Agreement shall be deemed to be outstanding for the purpose of computing the percentage of the outstanding
number of shares of Common Stock beneficially owned by such Person but shall not be deemed to be outstanding for the purpose of
computing the percentage of outstanding Common Stock beneficially owned by any other Person.

 

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

 

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

 

(d)          “Affiliate”
and “Associate” shall have the respective meanings ascribed to such terms in Rule 12b-2 of the General
Rules and Regulations under the Exchange Act as in effect on the date of this Agreement; provided, however, that
no director or officer of the Company shall be deemed an Affiliate or Associate of any other director or officer of the Company
solely as a result of his or her being a director or officer of the Company.

 

(e)          “Agreement”
shall have the meaning set forth in the preamble hereto.

 

(f)          A
Person shall be deemed the “Beneficial Owner” of, shall be deemed to have “Beneficial Ownership”
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 (as determined pursuant
to Rule 13d-3 of the General Rules and Regulations under the Exchange Act as in effect on the date of this Agreement);

 

(ii)         which
such Person or any of such Person’s Affiliates or Associates, directly or indirectly, has the right to acquire (whether such
right is exercisable immediately or only after the passage of time) pursuant to any agreement, arrangement, or understanding (whether
or not in writing) or upon the exercise of conversion rights, exchange rights, rights, warrants, or options, or otherwise; provided,
however, that a Person shall not be deemed the “Beneficial Owner” of, to have “Beneficial Ownership”
of, or to “beneficially own,” (A) securities tendered pursuant to a tender offer or exchange offer made in accordance
with the General Rules and Regulations under the Exchange Act 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, (B) securities issuable upon exercise
of Rights at any time prior to the occurrence of a Triggering Event, or (C) securities issuable upon exercise of Rights from
and after the occurrence of a Triggering Event, which Rights were acquired by such Person or any of such Person’s Affiliates
or Associates prior to the Distribution Date or pursuant to Section 3(a) or Section 22 hereof (the “Original
Rights”) or pursuant to Section 11(i) or Section 11(p) hereof in connection with an adjustment made with respect
to any Original Rights;

 

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(iii)        which
such Person or any of such Person’s Affiliates or Associates, directly or indirectly, has the right to vote or dispose
of, including pursuant to any agreement, arrangement, or understanding (whether or not in writing); provided, however,
that a Person shall not be deemed the “Beneficial Owner” of, to have “Beneficial Ownership” of, or to “beneficially
own,” any security as a result of an agreement, arrangement, or understanding (whether or not in writing) to vote such security
if such agreement, arrangement, or understanding: (A) arises solely from a revocable proxy (as such term is defined in Regulation 14A
under the Exchange Act) given in response to a public proxy or consent solicitation made pursuant to, and in accordance with, the
applicable provisions of the General Rules and Regulations under the Exchange Act, including the disclosure requirements of Schedule 14A
thereunder, and (B) is not also then reportable by such Person on Schedule 13D under the Exchange Act (or any comparable
or successor report);

 

(iv)        which
are beneficially owned, directly or indirectly, by any other Person (or any Affiliate or Associate thereof) with which such Person
(or any of such Person’s Affiliates or Associates) has any agreement, arrangement, or understanding (whether or not in writing)
for the purpose of acquiring, holding, voting (except pursuant to a revocable proxy as described in the proviso to Section 1(f)(iii)),
or disposing of any voting securities of the Company (in each case, other than the Grandfathered Agreement); or

 

(v)         which
are “beneficially owned” (within the meaning of clauses (i)-(iv) above), 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; provided, however, that the number of shares of Common Stock that a Person is deemed to beneficially
own pursuant to this clause (v) 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 (v)
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 to the contrary in this Section 1(f), nothing in this Section 1(f) shall cause a Person engaged in business
as an underwriter of securities to be the “Beneficial Owner” of, to have “Beneficial Ownership”
of, or to “beneficially own,” any securities acquired or which such Person has the right to acquire through such Person’s
participation in good faith in a firm commitment underwriting until the expiration of 40 days after the date of such acquisition,
and then only if such securities continue to be owned by such Person at such expiration of 40 days.

 

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(g)           “Board”
shall mean the Board of Directors of the Company or any duly authorized committee thereof.

 

(h)           “Book
Entry Share” shall mean an uncertificated share of Common Stock registered in book entry form.

 

(i)            “Business
Day” shall mean any day other than a Saturday, 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.

 

(j)            “Certificate
of Incorporation” shall mean the Company’s Certificate of Incorporation, as such may be amended, modified, or restated
from time to time.

 

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

 

(l)            “Common
Stock” shall mean the common stock, par value $0.0001 per share, of the Company, except that “Common
Stock” when used with reference to any Person other than the Company shall mean the capital stock (or equity interest)
of such Person with the greatest voting power, or the equity securities or other equity interests having power to control or direct
the management of such Person.

 

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

 

(n)           “Company”
shall have the meaning set forth in the preamble hereto, except as otherwise provided in Section 13(a) hereof.

 

(o)           “Counterparty”
shall have the meaning set forth in Section 1(r) hereof.

 

(p)           “Current
Market Price” shall have the meaning set forth in Section 11(d) hereof.

 

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

 

(r)            “Derivatives
Contract” shall mean a contract between two parties (the “Receiving Party” and the “Counterparty”)
that is designed to produce economic benefits and risks to the Receiving Party that correspond substantially to the ownership by
the Receiving Party of a number of shares of Common Stock specified or referenced in such contract (the number corresponding to
such economic benefits and risks, the “Notional Common Shares”), regardless of whether obligations under such
contract are required or permitted to be settled through the delivery of cash, Common Stock or other property, 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.

 

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

 

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

 

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

 

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

 

(w)          “Exempt
Person” shall mean (i) the Company, (ii) any Subsidiary of the Company, (iii) any employee benefit plan
of the Company or of any Subsidiary of the Company, or (iv) any Person or entity organized, appointed, or established by the
Company or any Subsidiary of the Company for or pursuant to the terms of any such employee benefit plan.

 

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

 

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

 

(z)           “Grandfathered
Agreement” shall mean that certain Put Option Agreement dated as of December 10, 2014 by and among Brian Ferdinand, the
Von Allmen Dynasty Trust and D&L Partners, L.P., filed as Exhibit 1 to Amendment 3 of the Schedule 13D of Brian Ferdinand filed
with the U.S. Securities and Exchange Commission on December 11, 2014.

 

(aa)         “Grandfathered
Stockholder” shall have the meaning set forth in Section 1(a)(iv) hereof.

 

(bb)         “Notional
Common Shares” shall have the meaning set forth in Section 1(r) hereof.

 

(cc)         “Original
Rights” shall have the meaning set forth in Section 1(f)(ii) hereof.

 

(dd)         “Person”
shall mean any individual, firm, corporation, partnership, limited liability company, limited liability partnership, association,
trust, syndicate, unincorporated organization, or other entity, and shall include any successor (by merger or otherwise) of such
entity.

 

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(ee)         “Preferred
Stock” shall mean shares of Series A Junior Participating Preferred Stock, par value $0.0001 per share, of
the Company having the rights and preferences set forth in the Certificate of Designation attached to this Agreement as Exhibit A,
and, to the extent that there are not a sufficient number of shares of Series A Junior Participating Preferred Stock authorized
to permit the full exercise of the Rights, any other series of preferred stock of the Company designated for such purpose containing
terms substantially similar to the terms of the Series A Junior Participating Preferred Stock.

 

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

 

(gg)        “Purchase
Price” shall have the meaning set forth in Section 7(b) hereof.

 

(hh)        “Receiving
Party” shall have the meaning set forth in Section 1(r) hereof.

 

(ii)           “Record Date” shall have the meaning set forth in the recital to this Agreement.

 

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

 

(kk)         “Reported
Beneficial Ownership” shall have the meaning set forth in Section 1(a)(iv) hereof.

 

(ll)           “Right” shall have the meaning set forth in the recital to this Agreement.

 

(mm)       “Rights
Agent” shall have the meaning set forth in the preamble hereto, except as otherwise provided in Section 19 and Section 21
hereof.

 

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

 

(oo)        “Rights
Dividend Declaration Date” shall have the meaning set forth in the recital to this Agreement.

 

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

 

(qq)        “Section 13
Event” shall mean any event described in Section 13(a)(i), Section 13(a)(ii), or Section 13(a)(iii) hereof.

 

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

 

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

 

(tt)          “Subsidiary”
shall mean, with reference to any Person, any other Person of which an amount of voting securities (or other ownership interests
having ordinary voting power) sufficient to elect or appoint at least a majority of the directors (or other persons performing
similar functions) of such other Person is beneficially owned, directly or indirectly, by such first-mentioned Person, or otherwise
controlled by such first-mentioned Person.

 

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

 

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

 

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

 

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

 

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

 

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

 

Section 2. Appointment of the Rights
Agent. The Company hereby appoints the Rights Agent to act as agent
for the Company and the registered holders of the Rights (who, in accordance with Section 3 hereof, shall prior to the Distribution
Date also be the registered holders of the Common Stock) in accordance with the terms and conditions hereof, and the Rights
Agent hereby accepts such appointment. The Company may from time to time appoint such co-rights agents as it may deem necessary
or desirable.

 

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Section 3. Issuance of Rights Certificates.

 

(a)          Until
the earlier of (i) the Close of Business on the 10th day after the Stock Acquisition Date (or, if the 10th day after the Stock
Acquisition Date occurs before the Record Date, the Close of Business on the Record Date) and (ii) the Close of Business on
the 10th Business Day (or such later date as the Board may determine prior to the occurrence of a Section 11(a)(ii) Event)
after the date of commencement by or on behalf of any Person (other than an Exempt Person) of a tender offer or exchange offer,
if upon consummation thereof, such Person would become an Acquiring Person (the earlier of (i) and (ii) being herein referred
to as the “Distribution Date”), (A) the Rights will be evidenced (subject to Section 3(b) and Section 3(c)
hereof) by the certificates for the Common Stock registered in the names of the holders of the Common Stock (which certificates
for shares of Common Stock shall be deemed also to be Rights certificates) or, in the case of Book Entry Shares, by notation in
book entry, and not by separate certificates, and the registered holders of shares of Common Stock shall also be the registered
holders of the associated Rights, and (B) the Rights will be transferable only in connection with the transfer of the underlying
Common Stock (including a transfer to the Company); provided, however, that, if a tender offer or exchange offer
is terminated prior to the occurrence of a Distribution Date, then no Distribution Date shall occur as a result of such tender
offer or exchange offer. As soon as practicable after the Distribution Date, the Company will prepare and execute, the Rights Agent
will countersign, and the Company will send or cause to be sent (and the Rights Agent, if so requested, will send), in accordance
with Section 26 hereof, to each record holder of the Common Stock as of the Close of Business on the Distribution Date (other
than an Acquiring Person or any Associate or Affiliate of an Acquiring Person), one or more rights certificates, in substantially
the form of Exhibit B hereto (the “Rights Certificates”), evidencing one Right for each share
of Common Stock so held, subject to adjustment as provided herein. In the event that an adjustment in the number of Rights per
share of Common Stock has been made pursuant to Section 11(i) or Section 11(p) hereof, at the time of distribution of
the Rights Certificates, the Company shall not be required to issue Rights Certificates evidencing fractional Rights but may, in
lieu thereof, make the necessary and appropriate rounding adjustments (in accordance with Section 14(a) hereof) so that Rights
Certificates evidencing only whole numbers of Rights are distributed and cash is paid in lieu of any fractional Rights. As of and
after the Distribution Date, the Rights will be evidenced solely by such Rights Certificates.

 

(b)          As
promptly as practicable following the Record Date, the Company shall send a copy of a Summary of Rights, in substantially the form
attached hereto as Exhibit C (the “Summary of Rights”), to each record holder of Common Stock
as of the Close of Business on the Record Date in accordance with Section 26 hereof. With respect to certificates representing
Common Stock and Book Entry Shares outstanding as of the Record Date, until the earlier of the Distribution Date and the Expiration
Date, the Rights associated with such Common Stock will be evidenced by such certificates for Common Stock registered in the names
of the holders thereof or Book Entry Shares, as applicable, in each case together with a copy of the Summary of Rights. Until the
earlier of the Distribution Date and the Expiration Date, the surrender for transfer of any share of Common Stock outstanding on
the Record Date (whether evidenced by certificates for Common Stock registered in the names of the holders thereof or Book Entry
Shares), with or without a copy of the Summary of Rights, shall also constitute the transfer of the Right associated therewith.

 

(c)          Rights
shall, without any further action, be issued in respect of all shares of Common Stock that are issued (whether originally issued
or delivered from the Company’s treasury) after the Record Date but prior to the earlier of the Distribution Date and the
Expiration Date and, to the extent provided in Section 22 hereof, in respect of Common Stock issued after the Distribution
Date. Certificates evidencing such Common Stock shall have printed or otherwise affixed to them a legend or statement substantially
in the following form:

 

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This
certificate also evidences and entitles the registered holder hereof to certain Rights as set forth in the Rights Agreement
between Liquid Holdings Group, Inc. (the “Company”) and the Rights Agent thereunder dated as of December 11, 2014 (the
“Rights Agreement”), the terms of which are hereby incorporated herein by reference and a copy of which is on file
at the principal offices of the Company. Under certain circumstances, as set forth in the Rights Agreement, such Rights will be
evidenced by separate certificates and will no longer be evidenced by this certificate. The Company will mail to the registered
holder of this certificate a copy of the Rights Agreement, as in effect on the date of mailing, without charge, promptly after
receipt of a written request therefor. Under certain circumstances set forth in the Rights Agreement, Rights beneficially owned
by any Person who is, was, or becomes an Acquiring Person or any Affiliate or Associate thereof (as such terms are defined in the
Rights Agreement), whether currently beneficially owned by or on behalf of such Person or by any subsequent beneficial owner, may
become null and void.

 

With
respect to any Book Entry Shares, a legend or statement in substantially the form of the foregoing shall be included in the confirmation
or account statement or other notice sent to the record holder of such shares in accordance with applicable law. Until the
earlier of the Distribution Date and the Expiration Date, the Rights associated with the Common Stock evidenced by such certificates
and such Book Entry Shares shall be evidenced by such certificates or the Book Entry Shares alone and the surrender for transfer
of any certificate or Book Entry Shares shall also constitute the transfer of the Rights associated with the Common Stock represented
thereby. In the event the Company purchases or otherwise acquires any Common Stock after the Record Date but prior to the Distribution
Date, any Rights associated with such Common Stock shall be deemed cancelled and retired so that the Company shall not be entitled
to exercise any Rights associated with such Common Stock that are no longer outstanding. Notwithstanding this Section 3(c),
the omission of a legend or statement shall not affect the enforceability of any part of this Rights Agreement or the rights of
any holder of the Rights.

 

After the Record Date but prior to the earlier
of the Distribution Date and the Expiration Date, if new certificate(s) representing shares of Common Stock are issued in connection
with the transfer, split up, combination, or exchange of certificate(s) representing shares of Common Stock, or if new certificate(s)
representing shares of Common Stock are issued to replace any certificate(s) that have been mutilated, destroyed, lost, or stolen,
then such new certificate(s) shall bear a legend or statement in substantially the form of the foregoing.

 

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Section 4. Form of Rights Certificates.
The Rights Certificates (and the forms of election to purchase and of assignment and the certificates contained therein to be
printed on the reverse thereof) shall each be substantially in the form attached hereto as Exhibit B and may
have such marks of identification or designation and such legends, summaries, or endorsements printed thereon as the Company may
deem appropriate and as are not inconsistent with the provisions of this Agreement, or as may be required to comply with any applicable
law or with any rule or regulation made pursuant thereto or with any rule or regulation of any stock exchange on which the Rights
may from time to time be listed, or to conform to usage. Subject to the provisions of Sections 7, 11, 13, 22, 23, 24 and
27 hereof, the Rights Certificates, whenever distributed, shall be dated as of the Record Date and on their face shall entitle
the registered holders thereof to purchase such number of one one-thousandths of a share of Preferred Stock as shall be set forth
therein at the Purchase Price, but the amount and type of securities or other assets that may be acquired upon the exercise of
each Right and the Purchase Price thereof shall be subject to adjustment as provided herein.

 

Section 5. Countersignature and Registration.

 

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

 

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

 

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

 

(a)          Subject
to the provisions of Section 7(e) and Section 14 hereof, at any time after the Close of Business on the Distribution
Date, and at or prior to the Close of Business on the Expiration Date, any Rights Certificate or Certificates (other than
Rights Certificates evidencing Rights that have become null and void pursuant to Section 7(e) or that have been redeemed or
exchanged pursuant to Section 23 or Section 24 hereof) may be transferred, split-up, combined, or exchanged for another
Rights Certificate or Certificates, entitling the registered holder to purchase a like number of one one-thousandths of a share
of Preferred Stock (or, following the occurrence of a Triggering Event, Common Stock, other securities, cash, or other assets,
as the case may be) as the Rights Certificate or Certificates surrendered then entitles such holder (or former holder in the case
of a transfer) to purchase. Any registered holder desiring to transfer, split-up, combine, or exchange any Rights Certificate or
Certificates shall make such request in writing delivered to the Rights Agent, and shall surrender the Rights Certificate or Certificates
to be transferred, split-up, combined, or exchanged, with the form of assignment and certificate contained therein duly executed,
at the principal office or offices of the Rights Agent designated for such purpose. Neither the Rights Agent nor the Company shall
be obligated to take any action whatsoever with respect to the transfer of any such surrendered Rights Certificate until the registered
holder shall have completed and signed the certificate contained in the form of assignment on the reverse side of such Rights Certificate
and shall have provided such additional evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates
or Associates thereof as the Company shall reasonably request. Thereupon the Rights Agent shall, subject to Section 7(e),
Section 14, and Section 24 hereof, countersign and deliver to the Person entitled thereto a Rights Certificate or Rights
Certificates, as the case may be, as so requested. The Company may require payment from a registered holder of a Rights Certificate
of a sum sufficient to cover any tax or governmental charge that may be imposed in connection with any transfer, split-up, combination,
or exchange of Rights Certificates.

 

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

 

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

 

(a)          Subject
to Section 7(e) hereof, at any time after the Distribution Date the registered holder of any Rights Certificate may exercise
the Rights evidenced thereby (except as otherwise provided herein including, without limitation, the restrictions on exercisability
set forth in Section 9(c) and Section 11(a)(iii) hereof) in whole or in part upon surrender of the Rights Certificate,
with the form of election to purchase and the certificate contained therein duly executed, to the Rights Agent at the principal
office or offices of the Rights Agent designated for such purpose, together with payment of the aggregate Purchase Price with respect
to the total number of one one-thousandths of a share of Preferred Stock (or, following the occurrence of a Triggering Event, Common
Stock, other securities, cash, or other assets, as the case may be) as to which such surrendered Rights are then exercisable, at
or prior to the earliest of (i) the Close of Business on December 10, 2015 (the “Final Expiration Date”),
(ii) the time at which the Rights are redeemed as provided in Section 23 hereof, and (iii) the time at which the
Rights are exchanged in full as provided in Section 24 hereof (the earliest of (i), (ii), and (iii) being herein referred
to as the “Expiration Date”).

 

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(b)          The
purchase price for each one one-thousandth of a share of Preferred Stock pursuant to the exercise of a Right initially shall be
$4.00, shall be subject to adjustment from time to time as provided in Section 11 and Section 13(a) hereof, and
shall be payable in accordance with Section 7(c) hereof (such purchase price, as so adjusted, the “Purchase Price”).

 

(c)          Upon
receipt of a Rights Certificate evidencing exercisable Rights, with the form of election to purchase and the certificate contained
therein duly executed, accompanied by payment, with respect to each Right so exercised, of the Purchase Price per one one-thousandth
of a share of Preferred Stock (or, following the occurrence of a Triggering Event, Common Stock, other securities, cash, or other
assets, as the case may be) to be purchased as set forth below and an amount equal to any applicable transfer tax or charge required
to be paid by the holder of such Rights Certificate in accordance with Section 9 hereof, or evidence satisfactory to the Company
of payment of such tax or charge, the Rights Agent shall, subject to Section 20(k) hereof, thereupon promptly (i) (A) requisition
from any transfer agent of the shares of Preferred Stock (or make available, if the Rights Agent is the transfer agent for such
shares) certificates for the total number of one one-thousandths of a share of Preferred Stock to be purchased and the Company
hereby irrevocably authorizes its transfer agent to comply with all such requests, or (B) if the Company shall have elected
to deposit the total number of shares of Preferred Stock issuable upon exercise of the Rights hereunder with a depositary agent,
requisition from the depositary agent depositary receipts evidencing such number of one one-thousandths of a share of Preferred
Stock as are to be purchased (in which case certificates for Preferred Stock evidenced by such receipts shall be deposited by the
transfer agent with the depositary agent) and the Company will direct the depositary agent to comply with such request, (ii) requisition
from the Company the amount of cash, if any, to be paid in lieu 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 Rights Certificate, registered in such name or names as may be designated by such holder, and (iv) after
receipt thereof, deliver such cash, if any, to or upon the order of the registered holder of such Rights Certificate. The payment
of the Purchase Price (as such amount may be reduced pursuant to Section 11(a)(iii) hereof) shall be made in cash or by certified
bank check or bank draft payable to the order of the Company. In the event that the Company is obligated to issue other securities
(including Common Stock) of the Company, pay cash, or distribute other property pursuant to Section 11(a) hereof, the Company
will make all arrangements necessary so that such other securities, cash, or other property are available for distribution by the
Rights Agent, if and when appropriate. The Company reserves the right to require prior to the occurrence of a Triggering Event
that, upon any exercise of Rights, a number of Rights be exercised so that only whole shares of Preferred Stock would be issued.

 

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(d)          In
case the registered holder of any Rights Certificate shall exercise less than all the Rights evidenced thereby, a new Rights Certificate
evidencing the Rights remaining unexercised shall be issued by the Rights Agent and delivered to, or upon the order of, the registered
holder of such Rights Certificate, registered in such name or names as may be designated by such holder, subject to the provisions
of Sections 6 and 14 hereof.

 

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

 

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

 

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Section 8. Cancellation and Destruction
of Rights Certificates. All Rights Certificates surrendered for the
purpose of exercise, transfer, split-up, combination, or exchange shall, if surrendered to the Company or any of its agents, be
delivered to the Rights Agent for cancellation or in cancelled form, or, if surrendered to the Rights Agent, shall be cancelled
by it, and no Rights 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 Rights Certificate purchased or acquired by the Company otherwise than upon the exercise thereof. The Rights
Agent shall deliver all cancelled Rights Certificates to the Company, or shall, at the written request of the Company, destroy
such cancelled Rights Certificates, and in such case shall deliver a certificate of destruction thereof to the Company.

 

Section 9. Reservation and Availability
of Capital Stock.

 

(a)          The
Company covenants and agrees that at all times prior to the Expiration Date it will cause to be reserved and kept available out
of its authorized and unissued shares of Preferred Stock and/or out of any shares of Preferred Stock held in its treasury (and
following the occurrence of a Triggering Event, out of the authorized but unissued shares of such other equity securities of the
Company as may be issuable upon exercise of the Rights and/or out of any shares of such securities held in its treasury), the number
of shares of Preferred Stock (and following the occurrence of a Triggering Event, the number of shares of such other equity securities
of the Company) that will be sufficient to permit the exercise in full of all outstanding Rights in accordance with Section 7
hereof. Upon the occurrence of any events resulting in the increase in the aggregate number of shares of Preferred Stock (or other
equity securities of the Company) issuable upon exercise of all outstanding Rights above the number then reserved, the Company
shall make appropriate increases in the number of shares so reserved.

 

(b)          So
long as the Preferred Stock (and, following the occurrence of a Triggering Event, Common Stock or other securities, as the case
may be) issuable and deliverable upon the exercise of the Rights may be listed on any national securities exchange or quoted on
a quotation system, the Company shall use its best efforts to cause, from and after such time as the Rights become exercisable
through the Expiration Date, all shares reserved for such issuance to be listed on such exchange or quoted on such quotation system,
as the case may be, upon official notice of issuance upon such exercise.

 

(c)          The
Company shall use its best efforts to (i) file, as soon as practicable following the earliest date after the first
occurrence of a Section 11(a)(ii) Event on which the consideration to be delivered by the Company upon exercise of the Rights
has been determined in accordance with Section 11(a) hereof, a registration statement on an appropriate form under the Act,
with respect to the securities purchasable upon exercise of the Rights, (ii) cause such registration statement to become effective
as soon as practicable after such filing, and (iii) cause such registration statement to remain effective (with a prospectus
at all times meeting the requirements of the Act) until the earlier of (A) the date as of which the Rights are no longer exercisable
for such securities, and (B) the date of the expiration of the Rights. The Company will also take such action as may be appropriate
under, or to ensure compliance with, the securities or “blue sky” laws of the various states in connection with the
exercisability of the Rights. The Company may temporarily suspend, for a period of time not to exceed 90 days after the date set
forth in clause (i) of the first sentence of this Section 9(c), the exercisability of the Rights in order to prepare
and file such registration statement and permit it to become effective. Upon any such suspension, the Company shall issue a public
announcement stating that the exercisability of the Rights has been temporarily suspended, as well as a public announcement at
such time as the suspension is no longer in effect. In addition, if the Company shall determine that a registration statement is
required following the Distribution Date, the Company similarly may temporarily suspend the exercisability of the Rights until
such time as a registration statement has been declared effective. Notwithstanding any provision of this Agreement to the contrary,
the Rights shall not be exercisable in any jurisdiction if the requisite qualification in such jurisdiction shall not have been
obtained, or the exercise thereof shall not be permitted under applicable law, or a registration statement shall not have been
declared effective.

 

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(d)          The
Company covenants and agrees that it will take all such action as may be necessary to ensure that all Preferred Stock (and,
following the occurrence of a Triggering Event, Common Stock or other securities, as the case may be) delivered upon exercise of
the Rights shall, at the time of delivery of such shares (subject to payment of the Purchase Price), be duly and validly authorized
and issued and fully paid and nonassessable.

 

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

 

Section 10. Preferred Stock Record Date.
Each person in whose name any certificate or entry in the book entry account system of the transfer agent for Preferred Stock
(or, following the occurrence of a Triggering Event, Common Stock or other securities, as the case may be) is issued upon the
exercise of Rights shall for all purposes be deemed to have become the holder of record of such Preferred Stock (or, following
the occurrence of a Triggering Event, Common Stock or other securities, as the case may be) evidenced thereby on, and such certificate
or entry in the book entry account system of the transfer agent shall be dated, the date upon which the Rights Certificate evidencing
such Rights was duly surrendered and payment of the Purchase Price (and all applicable transfer taxes) was made; provided,
however, that, if the date of such surrender and payment is a date upon which the Preferred Stock (or, following the occurrence
of a Triggering Event, Common Stock or other securities, as the case may be) transfer books of the Company are closed, such Person
shall be deemed to have become the record holder of such securities (fractional or otherwise) on, and such certificate or entry
in the book entry account system of the transfer agent shall be dated, the next succeeding Business Day on which the Preferred
Stock (or, following the occurrence of a Triggering Event, Common Stock or other securities, as the case may be) transfer books
of the Company are open. Prior to the exercise of the Rights evidenced thereby, the registered holder of a Rights Certificate
shall not be entitled to any rights of a stockholder of the Company with respect to shares for which the Rights shall be exercisable,
including, without limitation, the right to vote, to receive dividends or other distributions, or to exercise any preemptive rights,
and shall not be entitled to receive any notice of any proceedings of the Company, except as provided herein.

 

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Section 11. Adjustment of Purchase Price,
Number and Kind of Shares, or Number of Rights. The Purchase Price, the number and kind of shares, or fractions thereof, purchasable
upon exercise of 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 or pay a dividend on the shares
of Preferred Stock payable in shares of Preferred Stock, (B) subdivide or split the outstanding shares of Preferred Stock,
(C) combine or consolidate the outstanding shares of Preferred Stock into a smaller number of shares, or (D) issue any
shares of its capital stock in a reclassification of the shares of Preferred Stock (including any such reclassification in connection
with a consolidation or merger in which the Company is the continuing or surviving corporation), except as otherwise provided in
this Section 11(a) and Section 7(e) hereof, the Purchase Price in effect at the time of the record date for such dividend
or of the effective date of such subdivision, split, combination, consolidation, or reclassification, and the number and kind of
shares (or fractions thereof) of Preferred Stock (or other capital stock, as the case may be), issuable on such date, shall be
proportionately adjusted so that the registered holder of any Right exercised after such time shall be entitled to receive, upon
payment of the Purchase Price then in effect, the aggregate number and kind of shares (or fractions thereof) of Preferred Stock
(or other capital stock, as the case may be), which, if such Right had been exercised immediately prior to such date (whether or
not such Right was then exercisable) and at a time when the Preferred Stock (or other capital stock, as the case may be) 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, split, combination, consolidation, 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 (or fractions
thereof) of capital stock of the Company issuable upon the exercise of one Right. If an event occurs that would require an adjustment
under both this Section 11(a)(i) and Section 11(a)(ii) hereof, the adjustment provided for in this Section 11(a)(i)
shall be in addition to, and shall be made prior to, any adjustment required pursuant to Section 11(a)(ii) hereof.

 

(ii)          In
the event any Person shall become an Acquiring Person (a “Section 11(a)(ii) Event”), then, promptly
following the occurrence of such Section 11(a)(ii) Event, proper provision shall be made so that each registered holder of
a Right (except as provided below and in Section 7(e), Section 13 and Section 24 hereof) shall thereafter have the
right to receive, upon exercise thereof at a price equal to the then current Purchase Price in accordance with the terms of this
Agreement, in lieu of a number of one one-thousandths of a share of Preferred Stock, such number of shares of Common Stock as shall
equal the result obtained by (A) multiplying the then current Purchase Price by the then number of one one-thousandths of
a share of Preferred Stock for which a Right was exercisable immediately prior to the first occurrence of a Section 11(a)(ii)
Event, and (B) dividing that product (which, following such first occurrence, shall thereafter be referred to as the “Purchase
Price” for each Right and for all purposes of this Agreement other than Section 13 hereof) by 50% of the Current
Market Price per share of Common Stock on the date of such first occurrence (such number of shares of Common Stock, the “Adjustment
Shares”).

 

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(iii)         In
the event that (A) the number of shares of Common Stock authorized by the Certificate of Incorporation, but which are
not outstanding or reserved for issuance for purposes other than upon exercise of the Rights, are not sufficient to permit the
exercise in full of the Rights in accordance with Section 11(a)(ii) hereof or (B) the Board otherwise shall determine
to do so in its sole discretion, the Company, acting by resolution of the Board, shall (1) determine the value of the Adjustment
Shares issuable upon the exercise of a Right (the “Current Value”), and (2) with respect to each Right
(subject to Section 7(e) hereof), make adequate provision to substitute for the Adjustment Shares, upon the exercise of such
Right and payment of the applicable Purchase Price, (u) cash, (v) a reduction in the Purchase Price, (w) Common
Stock or other equity securities of the Company (including, without limitation, shares, or units of shares, of preferred stock,
such as the Preferred Stock, which the Board has deemed to have essentially the same value or economic rights as Common Stock (such
shares of preferred stock being referred to as “Common Stock Equivalents”)), (x) debt securities of the
Company, (y) other assets, or (z) any combination of the foregoing, having an aggregate value equal to the Current Value,
where such aggregate value has been determined by the Board based upon the advice of a nationally recognized investment banking
firm selected by the Board; provided, however, that, if, under the circumstances set forth in clause (A) above,
the Company shall not have made adequate provision to deliver value pursuant to clause (2) above within 30 days following
the first occurrence of a Section 11(a)(ii) Event, then the Company shall be obligated to deliver, upon the surrender for
exercise of a Right and without requiring payment of the Purchase Price, Common Stock (to the extent available) and then, if necessary,
cash, which shares and cash have an aggregate value equal to the Spread. For purposes of the preceding sentence, the term “Spread”
shall mean the excess of the Current Value over the Purchase Price. If the Board determines in good faith that it is likely that
sufficient additional Common Stock could be authorized for issuance upon exercise in full of the Rights, the 30-day period set
forth above may be extended to the extent necessary, but not more than 90 days following the first occurrence of a Section 11(a)(ii)
Event, in order that the Company may seek stockholder approval for the authorization of such additional shares (such 30-day period,
as it may be extended, is herein called the “Substitution Period”). To the extent that action is to be taken
pursuant to the first or third sentences of this Section 11(a)(iii), the Company shall provide, subject to Section 7(e)
hereof, that such action shall apply uniformly to all outstanding Rights, and the Company may suspend the exercisability of the
Rights until the expiration of the Substitution Period in order to seek such stockholder approval for such authorization of additional
shares or to decide the appropriate form of distribution to be made pursuant to such first sentence and to determine the value
thereof. In the event of any such suspension, the Company shall issue a public announcement stating that the exercisability of
the Rights has been temporarily suspended, as well as a public announcement at such time as the suspension is no longer in effect.
For purposes of this Section 11(a)(iii), the value of each Adjustment Share shall be the Current Market Price per share of
Common Stock on the date of the first occurrence of a Section 11(a)(ii) Event and the per share or per unit value of any Common
Stock Equivalent shall be deemed to equal the Current Market Price per share of Common Stock on such date.

 

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(b)          In
case the Company shall fix a record date for the issuance of rights, options, or warrants to all registered holders of Preferred
Stock entitling them to subscribe for or purchase (for a period expiring within 45 calendar days after such record date) Preferred
Stock (or shares having the same rights, privileges, and preferences as the shares of Preferred Stock (“Equivalent Preferred
Stock”)) or securities convertible into shares of Preferred Stock or Equivalent Preferred Stock at a price per share
of Preferred Stock or Equivalent Preferred Stock (or having a conversion price per share, if a security convertible into shares
of Preferred Stock or Equivalent Preferred Stock) less than the Current Market Price per share of Preferred Stock on such record
date, the Purchase Price to be in effect after such record date shall be determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the numerator of which shall be the number of shares of Preferred Stock outstanding
on such record date plus the number of shares of Preferred Stock that the aggregate subscription or offering price of the total
number of shares of Preferred Stock and/or Equivalent Preferred Stock so to be offered (and/or the aggregate initial conversion
price of the convertible securities so to be offered) would purchase at such Current Market Price, and the denominator of which
shall be the number of shares of Preferred Stock outstanding on such record date plus the number of additional shares of Preferred
Stock and/or Equivalent Preferred Stock to be offered for subscription or purchase (or into which the convertible securities so
to be offered are initially convertible). In case such subscription price may be paid by delivery of consideration, part or all
of which may be in a form other than cash, the value of such consideration shall be as determined in good faith by the Board, whose
determination shall be described in a statement filed with the Rights Agent and shall be binding and conclusive for all purposes
on the Rights Agent and the holder of the Rights. Preferred Stock owned by or held for the account of the Company or any Subsidiary
shall not be deemed outstanding for the purpose of any such computation. Such adjustments shall be made successively whenever such
a record date is fixed, and in the event that such rights, options, or warrants are not so issued, the Purchase Price shall be
adjusted to be the Purchase Price that would then be in effect if such record date had not been fixed.

 

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(c)          In
case the Company shall fix a record date for a distribution to all registered holders of Preferred Stock (including any such distribution
made in connection with a consolidation or merger in which the Company is the continuing or surviving corporation) of cash
(other than a regular periodic cash dividend out of the earnings or retained earnings of the Company), assets (other than a dividend
payable in shares of Preferred Stock, but including any dividend payable in stock other than Preferred Stock) or evidences of indebtedness,
or of subscription rights, options 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 Current Market Price per share of Preferred Stock on such record date,
less the fair market value (as determined in good faith by the Board, whose determination shall be described in a statement filed
with the Rights Agent and shall be binding and conclusive for all purposes on the Rights Agent and the holders of the Rights) of
the portion of the cash, assets or evidences of indebtedness so to be distributed, or of such subscription rights, options or warrants
applicable to a share of Preferred Stock, and the denominator of which shall be such Current Market Price per share of Preferred
Stock. 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 be adjusted to be the Purchase Price that would then be in effect if such record date
had not been fixed.

 

(d)          (i)          For
the purpose of any computation hereunder, other than computations made pursuant to Section 11(a)(iii) hereof, the “Current
Market Price” per share of Common Stock on any date shall be deemed to be the average of the daily closing prices per
share of Common Stock for the 30 consecutive Trading Days immediately prior to such date, and for purposes of computations made
pursuant to Section 11(a)(iii) hereof, the “Current Market Price” per share of Common Stock on any date
shall be deemed to be the average of the daily closing prices per share of Common Stock for the 10 consecutive Trading Days immediately
following such date; provided, however, that in the event that the Current Market Price per share of Common
Stock is determined during a period following the announcement by the issuer of (A) a dividend or distribution on such Common
Stock payable in shares of Common Stock or securities convertible into such Common Stock (other than the Rights), or (B) any
subdivision, combination, or reclassification of such Common Stock, and the ex-dividend date for such dividend or distribution,
or the record date for such subdivision, combination, or reclassification shall not have occurred prior to the commencement of
the requisite 30-Trading Day or 10-Trading Day period, as set forth above, then, and in each such case, the Current Market Price
shall be properly adjusted to take into account ex-dividend trading. The closing price for each day shall be the last sale price,
regular way, or, in case no such sale takes place on such day, the average of the closing bid and asked prices, regular way, in
either case as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted
to trading on The NASDAQ Global Market or, if the Common Stock is not listed or admitted to trading on The NASDAQ Global Market,
as reported in the principal consolidated transaction reporting system with respect to securities listed on the principal national
securities exchange on which the Common Stock is listed or admitted to trading or, if the Common Stock is 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 on a quotation system then in use, or, if on any such date the Common
Stock is not so quoted, the average of the closing bid and asked prices as furnished by a professional market maker making a market
in the Common Stock selected by the Board. If on any such date the Common Stock is not publicly held and is not so listed, admitted
to trading, or quoted, and no market maker is making a market in the Common Stock, the “Current Market Price”
per share of Common Stock shall mean the fair value per share on such date as determined in good faith by the Board, which determination
shall be described in a statement filed with the Rights Agent and shall be conclusive for all purposes. The term “Trading
Day” shall mean a day on which the principal national securities exchange on which the Common Stock is listed or admitted
to trading is open for the transaction of business or, if the Common Stock is not listed or admitted to trading on any national
securities exchange, a Business Day.

 

    	20

    	 

    

 

(ii)          For
the purpose of any computation hereunder, the “Current Market Price” per share of Preferred Stock shall be determined
in the same manner as set forth above for the Common Stock in Section 11(d)(i) hereof (other than the penultimate sentence
thereof). If the Current Market Price per share of Preferred Stock cannot be determined in the manner provided above or if the
shares of Preferred Stock are not publicly held or listed, admitted to trading, or quoted in a manner described in Section 11(d)(i)
hereof, the Current Market Price per share of Preferred Stock shall be conclusively deemed to be an amount equal to 1,000 (as such
number may be appropriately adjusted for such events as stock splits, stock dividends, and recapitalizations with respect to the
Common Stock occurring after the date of this Agreement) multiplied by the Current Market Price per share of Common Stock. If neither
the Common Stock nor the Preferred Stock is publicly held or listed, admitted to trading, or quoted, the “Current Market
Price” per share of Preferred Stock shall mean the fair value per share as determined in good faith by the Board, whose
determination shall be described in a statement filed with the Rights Agent and shall be conclusive for all purposes. For all purposes
of this Agreement, the Current Market Price of one one-thousandth of a share of Preferred Stock shall be equal to the Current Market
Price of one share of Preferred Stock divided by 1,000.

 

(e)          Anything
herein to the contrary notwithstanding, 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 ten-thousandth of a
share of Common Stock or other share or ten-millionth of a share of Preferred Stock, as the case may be. Notwithstanding the first
sentence of this Section 11(e), any adjustment required by this Section 11 shall be made no later than the earlier of
(i) three years from the date of the transaction that mandates such adjustment and (ii) the Expiration Date.

 

(f)          If
as a result of an adjustment made pursuant to Section 11(a)(ii) or Section 13(a) hereof, the registered holder of any
Right thereafter exercised shall become entitled to receive any shares of capital stock other than Preferred Stock, thereafter
the number of such other shares so receivable upon exercise of any Right and the Purchase Price thereof shall be subject
to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to
the Preferred Stock contained in Sections 11(a), (b), (c), (d), (e), (g), (h), (i), (j), (k), (l) and (m), and the provisions
of Sections 7, 9, 10, 13, and 14 hereof with respect to the Preferred Stock shall apply on like terms to any such other shares.

 

    	21

    	 

    

 

(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 share of Preferred Stock (or other securities
or amount of cash or combination thereof) purchasable from time to time hereunder upon exercise of the Rights, all subject to further
adjustment as provided herein.

 

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

 

    	22

    	 

    

 

(j)          Irrespective
of any adjustment or change in the Purchase Price or the number of one one-thousandths of a share of Preferred Stock issuable upon
the exercise of the Rights, the Rights Certificates theretofore and thereafter issued may continue to express the Purchase Price
per one one-thousandth of a share of Preferred Stock and the number of one one-thousandths of a share of Preferred Stock that were
expressed in the initial Rights Certificates issued hereunder.

 

(k)          Before
taking any action that would cause an adjustment reducing the Purchase Price below the then par value, if any, of the number of
one one-thousandths of a share of Preferred Stock issuable upon exercise of the Rights, the Company shall take any corporate action
that may, in the opinion of its counsel, be necessary in order that the Company may validly and legally issue, fully paid
and nonassessable, such number of one one-thousandths of a share of Preferred Stock 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 until the occurrence of such event the issuance to the registered
holder of any Right exercised after such record date of the number of one one-thousandths of a share of Preferred Stock and other
capital stock or securities of the Company, if any, issuable upon such exercise over and above the number of one one-thousandths
of a share of Preferred Stock and other 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
(fractional or otherwise) or securities upon the occurrence of the event requiring such adjustment.

 

(m)          Anything
in this Section 11 to the contrary notwithstanding, prior to the Distribution Date 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 in its good faith judgment the Board shall determine to be advisable in order that any (i) consolidation or
subdivision of the Preferred Stock, (ii) issuance wholly for cash of any Preferred Stock at less than the Current Market Price,
(iii) issuance wholly for cash of Preferred Stock or securities that by their terms are convertible into or exchangeable for
Preferred Stock, (iv) stock dividends, or (v) issuance of rights, options, or warrants referred to in this Section 11,
hereafter made by the Company to registered holders of its Preferred Stock shall not be taxable to such stockholders or shall reduce
the taxes payable by such holders.

 

    	23

    	 

    

 

(n)          The
Company covenants and agrees that in the event that a Section 11(a)(ii) Event occurs and the Rights shall then be outstanding,
it shall not, (i) consolidate with any other Person (other than a direct or indirect wholly owned Subsidiary of the Company
in a transaction that complies with Section 11(o) hereof), (ii) merge with or into any other Person (other than
a direct or indirect wholly owned Subsidiary of the Company in a transaction that complies with Section 11(o) hereof), or
(iii) sell or otherwise transfer (or permit any Subsidiary to sell or otherwise transfer), in one transaction, or a series
of related transactions, assets or earning power aggregating 50% or more of the assets or earning power of the Company and its
Subsidiaries (taken as a whole and calculated on the basis of the Company’s most recent regularly prepared financial statements)
to any other Person or Persons (other than the Company and/or any of its direct or indirect wholly owned Subsidiaries in one or
more transactions, each of which complies with Section 11(o) hereof), if (A) at the time of or immediately after such
consolidation, merger, sale, or transfer there are any charter or bylaw provisions, rights, warrants, or other instruments or securities
outstanding or agreements in effect that would substantially diminish or otherwise eliminate the benefits intended to be afforded
by the Rights or (B) prior to, simultaneously with, or immediately after such consolidation, merger, sale, or transfer the
stockholders of the Person who constitutes, or would constitute, the “Principal Party” for purposes of Section 13(a)
hereof shall have received a distribution of Rights previously owned by such Person or any of its Affiliates and Associates; provided,
however, this Section 11(n) shall not affect the ability of any Subsidiary of the Company to consolidate with, merge
with or into, or sell or transfer assets or earning power to, any other Subsidiary of the Company.

 

(o)          The
Company covenants and agrees that in the event that a Section 11(a)(ii) Event occurs and the Rights shall then be outstanding,
it will not, except as permitted by Section 23, Section 24, or Section 27 hereof, take (or permit any Subsidiary
to take) any action if at the time such action is taken it is reasonably foreseeable that such action will diminish substantially
or otherwise eliminate the benefits intended to be afforded by the Rights.

 

(p)          Anything
in this Agreement to the contrary notwithstanding, in the event that the Company shall at any time after the Rights Dividend Declaration
Date and prior to the Distribution Date (i) declare or pay a dividend on the outstanding Common Stock payable in shares
of Common Stock, (ii) subdivide or split the outstanding Common Stock, or (iii) combine or consolidate the outstanding
Common Stock into a smaller number of shares, the number of Rights associated with each share of Common Stock then outstanding,
or issued or delivered thereafter but prior to the Distribution Date (or issued or delivered on or after the Distribution Date
pursuant to Section 22 hereof), shall be proportionately adjusted so that the number of Rights thereafter associated with
each share of Common Stock following any such event shall equal the result obtained by multiplying the number of Rights associated
with each share of Common Stock immediately prior to such event by a fraction, the numerator of which shall be the total number
of shares of Common Stock outstanding immediately prior to the occurrence of the event and the denominator of which shall be the
total number of shares of Common Stock outstanding immediately following the occurrence of such event. The adjustment provided
for in this Section 11(p) shall be made successively whenever such a dividend is declared or paid or such a subdivision, split,
combination, or reclassification is effected. If an event occurs that would require an adjustment under Section 11(a)(ii)
and this Section 11(p), the adjustment provided for in this Section 11(p) shall be in addition and prior to any adjustment
required pursuant to Section 11(a)(ii).

 

    	24

    	 

    

 

Section 12. Certificate of Adjusted
Purchase Price or Number of Shares. Whenever an adjustment is made
as provided in Section 11 or Section 13 hereof, the Company shall (a) promptly prepare a certificate setting forth
such adjustment and a brief statement of the facts accounting for such adjustment, (b) promptly file with the Rights Agent,
and with each transfer agent for the Preferred Stock and the Common Stock, a copy of such certificate, and (c) if a Distribution
Date has occurred, mail a brief summary thereof to each registered holder of a Rights Certificate in accordance with Section 26
hereof. The Rights Agent shall be fully protected in relying on any such certificate and on any adjustment therein contained.

 

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

 

(a)          In
the event that, at any time after a Person has become an Acquiring Person, directly or indirectly,

 

(i)          the
Company shall consolidate with, or merge with and into, any other Person (other than a direct or indirect wholly owned Subsidiary
of the Company in a transaction that complies with Section 11(o) hereof), and the Company shall not be the continuing or surviving
corporation or other entity of such consolidation or merger;

 

(ii)         any
Person (other than a direct or indirect wholly owned Subsidiary of the Company in a transaction that complies with Section 11(o)
hereof) shall consolidate with, or merge with or into, the Company, and the Company shall be the continuing or surviving corporation
of such consolidation or merger and, in connection with such consolidation or merger, all or part of the outstanding Common Stock
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

 

(iii)        the
Company shall sell or otherwise transfer (or one or more of its Subsidiaries shall sell or otherwise transfer), in one transaction
or a series of related transactions, assets or earning power aggregating 50% or more of the assets or earning power of the Company
and its Subsidiaries (taken as a whole and calculated on the basis of the Company’s most recent regularly prepared financial
statements) to any Person or Persons (other than the Company or any of its direct or indirect wholly owned Subsidiaries in one
or more transactions, each of which complies with Section 11(o) hereof);

 

then, and in each such case, proper provision shall be made
so that: (A) each registered holder of a Right, except as provided in Section 7(e) hereof, shall thereafter have the
right to receive, upon the exercise thereof at the then current Purchase Price in accordance with the terms of this Agreement,
such number of validly authorized and issued, fully paid, non-assessable and freely tradeable Common Stock of the Principal Party,
not subject to any liens, encumbrances, rights of first refusal, or other adverse claims, as shall be equal to the result obtained
by (1) multiplying the number of one one-thousandths of a share of Preferred Stock for which a Right was exercisable immediately
prior to the first occurrence of a Section 11(a)(ii) Event by the Purchase Price in effect immediately prior to such first
occurrence of a Section 11(a)(ii) Event, and (2) dividing that product (which, following the first occurrence of a Section 13
Event, shall be referred to as the “Purchase Price” for each Right and for all purposes of this Agreement) by
50% of the Current Market Price per share of Common Stock of such Principal Party on the date of consummation of such Section 13
Event; (B) such Principal Party shall thereafter be liable for, and shall assume, by virtue of such Section 13 Event,
all the obligations and duties of the Company pursuant to this Agreement; (C) the term “Company” shall
thereafter be deemed to refer to such Principal Party, it being specifically intended that the provisions of Section 11 hereof
shall apply only to such Principal Party following the first occurrence of a Section 13 Event; (D) such Principal Party
shall take such steps (including, but not limited to, the reservation of a sufficient number of shares of Common Stock of such
Principal Party) in connection with the consummation of any such transaction as may be necessary to assure that the provisions
hereof shall thereafter be applicable, as nearly as reasonably may be, in relation to its shares of Common Stock thereafter deliverable
upon the exercise of the Rights; and (E) the provisions of Section 11(a)(ii) hereof shall be of no effect with respect
to events occurring at any time following the first occurrence of any Section 13 Event.

 

    	25

    	 

    

 

(b)          “Principal
Party” shall mean:

 

(i)          in
the case of any transaction described in Section 13(a)(i) or Section 13(a)(ii) hereof, (A) the Person (including
the Company as successor thereto or as the surviving entity) that is the issuer of any securities or other equity interests into
which shares of Common Stock of the Company are converted, changed, or exchanged in such merger or consolidation, or if there is
more than one such issuer, the issuer of Common Stock that has the greatest aggregate market value, or (B) if no securities
or other equity interests are so issued, the Person that is the other constituent party to such merger or consolidation, or, if
there is more than one such Person, the other Person that is a constituent party to such merger or consolidation, the Common Stock
of which has the greatest aggregate market value; and

 

(ii)         in
the case of any transaction described in Section 13(a)(iii) hereof, the Person that is the party receiving the greatest portion
of the assets or earning power transferred pursuant to such transaction or transactions or, if each Person that is a party to such
transaction or transactions receives the same portion of the assets or earning power transferred pursuant to such transaction or
transactions or if the Person receiving the largest portion of the assets or earning power cannot be determined, whichever of such
Persons is the issuer of Common Stock having the greatest aggregate value of shares outstanding; provided, however,
that, in any such case, (A) if the Common Stock of such Person is not at such time and has not been continuously over
the preceding 12-month period registered under Section 12 of the Exchange Act, and such Person is a direct or indirect Subsidiary
of another Person the Common Stock of which is and has been so registered, “Principal Party” shall refer to such other
Person; and (B) in case such Person is a Subsidiary, directly or indirectly, of more than one Person, the Common Stock of
two or more of which are and have been so registered, “Principal Party” shall refer to whichever of such Persons is
the issuer of the Common Stock having the greatest aggregate market value.

 

(c)          The
Company shall not consummate a Section 13 Event unless the Principal Party shall have a sufficient number of authorized
shares of Common Stock that have not been issued or reserved for issuance to permit the exercise in full of the Rights in accordance
with this Section 13 and unless prior thereto the Company and such Principal Party shall have executed and delivered to the
Rights Agent a supplemental agreement confirming that the requirements of Section 13(a) and Section 13(b) hereof shall
promptly be performed in accordance with their terms and further providing that, as soon as practicable after the date of any such
Section 13 Event, the Principal Party will:

 

    	26

    	 

    

 

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

 

(ii)         take
all such other action as may be necessary to enable the Principal Party to issue the securities purchasable upon exercise of the
Rights, including but not limited to the registration or qualification of such securities under all requisite securities
laws of jurisdictions of the various states and the listing of such securities on such exchanges and trading markets as may be
necessary or appropriate; and

 

(iii)        deliver
to registered holders of the Rights historical financial statements for the Principal Party and each of its Affiliates that
comply in all respects with the requirements for registration on Form 10 (or any successor form) under the Exchange Act.

 

The provisions
of this Section 13 shall similarly apply to successive mergers or consolidations or sales or other transfers. In the event
that a Section 13 Event shall occur at any time after the occurrence of a Section 11(a)(ii) Event, the Rights that have
not theretofore been exercised shall thereafter become exercisable in the manner described in Section 13(a) hereof.

 

Section 14. Fractional Rights and Fractional
Shares.

 

(a)          The
Company shall not be required to issue fractions of Rights, except prior to the Distribution Date as provided in Section 11(p)
hereof, or to distribute Rights Certificates that evidence fractional Rights. In lieu of such fractional Rights, the Company
shall pay to the registered holders of the Rights 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 of the Rights for any Trading 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 NASDAQ Global Market or, if the Rights are not listed or admitted to trading on The NASDAQ
Global Market, 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 a quotation system then in use or, if on any such date the
Rights are not so quoted, 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. If on any such date the Rights are not publicly held and are not so listed, admitted
to trading, or quoted, and no market maker is making a market in the Rights, the current market value of a Right shall mean the
fair value of a Right on such date as determined in good faith by the Board, which determination shall be described in a statement
filed with the Rights Agent and shall be conclusive for all purposes.

 

    	27

    	 

    

 

(b)          The
Company shall not be required to issue fractions of a share of Preferred Stock (other than fractions that are integral multiples
of one one-thousandth of a share of Preferred Stock) upon exercise of the Rights or to distribute certificates that evidence fractional
shares of Preferred Stock (other than fractions that are integral multiples of one one-thousandth of a share of Preferred Stock).
In lieu of fractional shares of Preferred Stock that are not integral multiples of one one-thousandth of a share of Preferred
Stock, the Company may pay to the registered holders of Rights 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 one-thousandth of a share of Preferred Stock.
For purposes of this Section 14(b), the current market value of one one-thousandth of a share of Preferred Stock shall be
one one-thousandth of the closing price of a share of Preferred Stock or, if unavailable, the appropriate alternative price (in
each case, as determined pursuant to Section 11(d)(ii) hereof) for the Trading Day immediately prior to the date of such
exercise.

 

(c)          Following
the occurrence of a Triggering Event, the Company shall not be required to issue fractions of Common Stock upon exercise of the
Rights or to distribute certificates or Book Entry Shares that evidence fractional shares of Common Stock. In lieu of fractional
shares of Common Stock, the Company may pay to the registered holders of Rights Certificates at the time such Rights are exercised
as herein provided an amount in cash equal to the same fraction of the current market value of one share of Common Stock. For
purposes of this Section 14(c), the current market value of one share of Common Stock shall be the closing price of one share
of Common Stock or, if unavailable, the appropriate alternative price (in each case, as determined pursuant to Section 11(d)(i)
hereof) on the Trading Day immediately prior to the date of such exercise.

 

(d)          The
registered holder of a Right by the acceptance of that Right expressly waives such holder’s right to receive any fractional
Rights or any fractional shares upon exercise of a Right, except as permitted by this Section 14.

 

Section
15.   Rights of Action.   All rights of action in respect of this Agreement, excepting the rights
of action given to the Rights Agent under Section 18 hereof, are vested in the respective registered holders of the Rights
Certificates (and, prior to the Distribution Date, of the Common Stock); and any registered holder of any Rights Certificate (and,
prior to the Distribution Date, of the Common Stock), without the consent of the Rights Agent or of the registered holder of any
other Rights Certificate (or, prior to the Distribution Date, of the Common Stock), may, on such first holder’s own behalf
and for such first 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 first holder’s right to exercise the Rights evidenced by such
Rights Certificate in the manner provided in such Rights Certificate and in this Agreement. Without limiting the foregoing or
any remedies available to the registered holders of Rights, it is specifically acknowledged that the registered holders of Rights
would not have an adequate remedy at law for any breach of this Agreement and shall be entitled to specific performance of the
obligations hereunder and injunctive relief against actual or threatened violations of the obligations hereunder of any Person
subject to this Agreement.

 

    	28

    	 

    

 

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

 

(a)          prior
to the Distribution Date, the Rights will be transferable only in connection with the transfer of Common Stock, and the Rights
will be evidenced by the balances indicated in the book entry account system of the transfer agent of the Common Stock registered
in the names of the holders of Common Stock or, in the case of certificated shares, the certificates for the Common Stock registered
in the names of the holders of the Common Stock;

 

(b)          after
the Distribution Date, the Rights Certificates are transferable only on the registry books of the Rights Agent if surrendered
at the principal office or offices of the Rights Agent designated for such purposes, duly endorsed or accompanied by a proper
instrument of transfer and with the appropriate forms and certificates contained therein duly executed;

 

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

 

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

 

    	29

    	 

    

 

Section
17.   Rights Certificate Holder Not Deemed a Stockholder.   No registered holder, as such, of
any Rights Certificate shall be entitled to vote, receive dividends, or be deemed for any purpose the registered holder of the
Preferred Stock or any other securities of the Company that may at any time be issuable on the exercise of the Rights evidenced
thereby, nor shall anything contained herein or in any Rights Certificate be construed to confer upon the registered holder of
any Rights 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 Rights Certificate shall have been
exercised in accordance with the provisions hereof.

 

Section
18.   Concerning the Rights Agent.

 

(a)          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, reimbursement for its reasonable expenses and counsel fees and disbursements and other disbursements
incurred in the administration and execution of this Agreement and the exercise and performance of its duties hereunder. The Company
also agrees to indemnify the Rights Agent for, and to hold it harmless against, any loss, liability, or expense, incurred without
negligence, bad faith, or willful misconduct on the part of the Rights Agent, for anything done or omitted by the Rights Agent
in connection with the acceptance and administration of this Agreement, including the costs and expenses of defending against
any claim of liability arising therefrom.

 

(b)          The
Rights Agent shall be protected and shall incur no liability for or in respect of any action taken, suffered, or omitted by it
in connection with its administration of this Agreement in reliance upon any Rights Certificate or certificate for Common Stock
or for other securities of the Company or 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 have been signed,
executed and, where necessary, verified or acknowledged, by the proper Person or Persons.

 

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

 

(a)          Any
Person into which the Rights Agent or any successor Rights Agent may be merged or with which it may be consolidated, or any Person
resulting from any merger or consolidation to which the Rights Agent or any successor Rights Agent shall be a party, or any Person
succeeding to the corporate trust, stock transfer, or other shareholder services business of the Rights Agent or any successor
Rights Agent, shall be the successor to the Rights Agent under this Agreement without the execution or filing of any paper or
any further act on the part of any of the parties hereto; but only if 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 Rights Certificates shall have been countersigned but not delivered, any such
successor Rights Agent may adopt the countersignature of an authorized signatory of a predecessor Rights Agent and deliver such
Rights Certificates so countersigned; and in case at that time any of the Rights Certificates shall not have been countersigned,
an authorized signatory of any successor Rights Agent may countersign such Rights Certificates either in the name of the predecessor
or in the name of the successor Rights Agent; and in all such cases such Rights Certificates shall have the full force provided
in the Rights Certificates and in this Agreement.

 

    	30

    	 

    

 

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

 

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

 

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

 

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

 

(c)          The
Rights Agent shall be liable hereunder only for its own negligence, bad faith, or willful misconduct.

 

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

 

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(e)          The
Rights Agent shall not be under any responsibility in respect of the validity of this Agreement or the execution and delivery
hereof (except the due execution and delivery hereof by the Rights Agent) or in respect of the validity or execution of any Rights
Certificate (except a countersignature by one of its authorized signatories on any such Rights Certificate); nor shall it be responsible
for any breach by the Company of any covenant or condition contained in this Agreement or in any Rights Certificate; nor shall
it be responsible for any adjustment required under the provisions of Section 11, Section 13, or Section 24 hereof
or responsible for the manner, method, or amount of any such adjustment or the ascertaining of the existence of facts that would
require any such adjustment (except with respect to the exercise of Rights evidenced by Rights Certificates after actual notice
of any such adjustment); nor shall it by any act hereunder be deemed to make any representation or warranty as to the authorization
or reservation of any shares of Common Stock or Preferred Stock to be issued pursuant to this Agreement or any Rights Certificate
or as to whether any shares of Common Stock or Preferred Stock 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 Chairman of the Board, the Chief Executive Officer, the President, any Vice President, the Secretary, any Assistant Secretary,
the Treasurer, or any Assistant Treasurer of the Company, and to apply to such officers for advice or instructions in connection
with its duties, and it shall not be liable for any action taken or suffered to be taken by it in good faith in accordance with
instructions of any such officer.

 

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

 

(i)          The
Rights Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty hereunder either itself
or by or through its attorneys or agents, 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; provided, however, that reasonable care was exercised in the selection and continued employment thereof.

 

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

 

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

 

Section
21.   Change of the 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 given to the Company in accordance with Section 26
hereof, and to each transfer agent of the Common Stock and Preferred Stock by registered or certified mail, and, if such resignation
occurs after the Distribution Date, to the registered holders of the Rights Certificates in accordance with Section 26 hereof.
The Company may remove the Rights Agent or any successor Rights Agent upon 30 days’ notice given to the Rights Agent or
successor Rights Agent, as the case may be, in accordance with Section 26 hereof, and to each transfer agent of the Common
Stock and Preferred Stock by registered or certified mail, and, if such removal occurs after the Distribution Date, to the registered
holders of the Rights Certificates in accordance with Section 26 hereof. 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 proper notice of such removal or after it has been properly notified
of such resignation or incapacity by the resigning or incapacitated Rights Agent or by the registered holder of a Rights Certificate
(who shall, with such notice, submit such holder’s Rights Certificate for inspection by the Company), then any registered
holder of any Rights Certificate may apply to any court of competent jurisdiction for the appointment of a new Rights Agent. Any
successor Rights Agent, whether appointed by the Company or by such a court, shall be (a) a legal business entity organized
and doing business under the laws of the United States or of any state of the United States, in good standing, which is authorized
under such laws to exercise corporate trust, stock transfer, or shareholder services powers 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 of a legal business entity
described in clause (a) of this sentence. After appointment, the successor Rights Agent shall be vested with the same powers,
rights, duties, and responsibilities as if it had been originally named as Rights Agent without further act or deed; but the predecessor
Rights Agent shall deliver and transfer to the successor Rights Agent any property at the time held by it hereunder, and execute
and deliver any further assurance, conveyance, act, or deed necessary for that purpose. Not later than the effective date of any
such appointment, the Company shall file notice thereof in writing with the predecessor Rights Agent and each transfer agent of
the Common Stock and the Preferred Stock, and, if such appointment occurs after the Distribution Date, give notice thereof to
the registered holders of the Rights Certificates in accordance with Section 26 hereof. Failure to give any notice provided
for in this Section 21, however, or any defect therein, shall not affect the legality or validity of the resignation or removal
of the Rights Agent or the appointment of the successor Rights Agent, as the case may be.

 

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

 

Section
23.   Redemption and Termination.

 

(a)          The
Board may, at its option, at any time prior to the earlier of (i) the occurrence of a Section 11(a)(ii) Event and (ii) the
Expiration Date, direct the Company to, and if directed the Company shall, redeem all but not less than all of the then outstanding
Rights at a redemption price of $0.01 per Right, as such amount may be 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 pursuant to this paragraph (a) may be made effective at such time,
on such basis, and with such conditions as the Board in its sole discretion may establish. The Company may, at its option, pay
the Redemption Price in cash, shares of Common Stock (based on the Current Market Price of the Common Stock at the time of redemption)
or any other form of consideration deemed appropriate by the Board.

 

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(b)          Immediately
upon the action of the Board directing the Company to redeem the Rights pursuant to paragraph (a) of this Section 23,
evidence of which shall have been filed with the Rights Agent, and without any further action and without any notice, the right
to exercise the Rights will terminate and the only right thereafter of the registered holders of Rights shall be to receive the
Redemption Price for each Right so held. Promptly after the action of the Board directing the Company to make the redemption of
the Rights pursuant to paragraph (a) of this Section 23, the Company shall give notice of such redemption to the Rights
Agent and the registered holders of the then outstanding Rights in accordance with Section 26 hereof; provided, however,
that failure to give, or any defect in, any such notice shall not affect the validity of such redemption. Any notice given in
accordance with Section 26 hereof 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.

 

Section
24.   Exchange of Rights.

 

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

 

(b)          Immediately
upon the action of the Board directing the Company to exchange any Rights pursuant to Section 24(a) hereof and without any
further action and without any notice, the right to exercise such Rights shall terminate and the only right thereafter of a registered
holder of such Rights shall be to receive that number of shares of Common Stock equal to the number of such Rights held by such
holder multiplied by the Exchange Ratio. The Company shall promptly give public notice of any such exchange; 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 give notice of any such exchange to all of the registered holders of such Rights in accordance with Section 26
hereof. Any notice given in accordance with Section 26 hereof 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 Stock for Rights will be effected
and, in the event of any partial exchange, the number of Rights that will be exchanged. Any partial exchange shall be effected
pro rata based on the number of Rights (other than Rights that have become null and void pursuant to the provisions of Section 7(e)
hereof) held by each registered holder of Rights.

 

(c)          In
any exchange pursuant to this Section 24, the Company, at its option, may substitute shares of Preferred Stock (or Equivalent
Preferred Stock, as such term is defined in Section 11(b) hereof) for Common Stock exchangeable for Rights, at the initial
rate of one one-thousandth of a share of Preferred Stock (or Equivalent Preferred Stock) for each share of Common Stock, as appropriately
adjusted to reflect stock splits, stock dividends, and other similar transactions after the date hereof.

 

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(d)          In
the event the number of shares of Common Stock authorized by the Certificate of Incorporation, but which are not outstanding or
reserved for issuance for purposes other than upon exercise of the Rights, is not sufficient to permit any exchange of Rights
as contemplated in accordance with this Section 24, the Company may take all such action as may be necessary to authorize
additional shares of Common Stock for issuance upon exchange of the Rights.

 

(e)          The
Company shall not be required to issue fractions of Common Stock or to distribute certificates that evidence fractional shares
of Common Stock. In lieu of such fractional shares of Common Stock, there shall be paid to the registered holders of the Rights
Certificates with regard to which such fractional shares of Common Stock would otherwise be issuable, an amount in cash equal
to the same fraction of the current market value of a whole share of Common Stock. For the purposes of this Section 24(e),
the current market value of a whole share of Common Stock shall be the closing price of a share of Common Stock (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.

 

(f)          Following
the action of the Board ordering the exchange of any Rights pursuant to this Section 24, the Company may implement such procedures
as it deems appropriate, in its sole discretion, for the purpose of ensuring that the Common Stock (or other consideration) issuable
upon an exchange pursuant to this Section 24 is not received by holder of Rights that have become null and void pursuant
to Section 7(e). Prior to effecting an exchange pursuant to this Section 24, the Board may direct the Company to enter
into a trust agreement in such form and with such terms as the Board shall then approve (the “Trust Agreement”).
If the Board so directs, the Company shall enter into the Trust Agreement and shall issue to the trust created by such agreement
(the “Trust”) all or a portion (as designated by the Board) of the Common Stock, fractional shares of Preferred
Stock, or other securities, if any, issuable pursuant to the exchange, and all Persons entitled to receive 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 such only from the Trust and solely upon compliance with the relevant terms and provisions
of the Trust Agreement. Prior to effecting an exchange and registering shares of Common Stock (or other 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 shall reasonably request in order to determine if such Rights are null and void. If any Person shall fail to comply
with such request, the Company shall be entitled to deem the Rights formerly held or exchangeable by such Person to be null and
void pursuant to Section 7(e) and not transferable or exercisable or exchangeable in connection herewith. Any shares of Common
Stock or other securities issued at the direction of the Board in connection herewith shall be validly issued, fully paid, and
non-assessable shares of Common Stock or of such other securities (as the case may be), and the Company shall be deemed to have
received as consideration for such issuance a benefit having a value that is at least equal to the aggregate par value of the
shares so issued.

 

    	36

    	 

    

 

Section
25.   Notice of Certain Events.

 

(a)          In
case the Company shall propose, at any time after the Distribution Date, (i) to pay any dividend payable in stock of any
class or series to the registered holders of Preferred Stock or to make any other distribution to the registered holders of Preferred
Stock (other than a regular periodic cash dividend out of earnings or retained earnings of the Company), or (ii) to offer
to the registered holders of Preferred Stock rights or warrants to subscribe for or to purchase any additional shares of Preferred
Stock or shares of stock of any class or any other securities, rights, or options, or (iii) to effect any reclassification
of its Preferred Stock (other than a reclassification involving only the subdivision of outstanding Preferred Stock), or (iv) to
effect any consolidation or merger into or with any other Person (other than a direct or indirect, wholly owned Subsidiary of
the Company in a transaction that complies with Section 11(o) hereof), 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 transaction or a series of related transactions,
of 50% or more of the assets or earning power of the Company and its Subsidiaries (taken as a whole and calculated on the basis
of the Company’s most recent regularly prepared financial statements) to any other Person or Persons (other than the Company
or any of its direct or indirect wholly owned Subsidiaries in one or more transactions, each of which complies with Section 11(o)
hereof), or (v) to effect the liquidation, dissolution, or winding up of the Company, then, in each such case, the Company
shall give to each registered holder of a Rights Certificate, to the extent feasible and in accordance with Section 26 hereof,
a notice of such proposed action, which shall specify the record date for the purposes of such stock dividend, distribution of
rights or warrants, or the date on which such reclassification, consolidation, merger, sale, transfer, liquidation, dissolution,
or winding up is to take place and the date of participation therein by the registered holders of the Preferred Stock, if any
such date is to be fixed, and such notice shall be so given in the case of any action covered by clause (i) or (ii) above
at least 20 days prior to the record date for determining registered holders of the Preferred Stock for purposes of such action,
and in the case of any such other action, at least 20 days prior to the date of the taking of such proposed action or the date
of participation therein by the registered holders of the Preferred Stock, whichever shall be the earlier; provided, however,
that no such action shall be taken pursuant to this Section 25(a) that will or would conflict with any provision of the Certificate
of Incorporation; provided, further, that no such notice shall be required pursuant to this Section 25, if
any Subsidiary of the Company effects a consolidation or merger with or into, or effects a sale or other transfer of assets or
earnings power to, any other Subsidiary of the Company.

 

(b)          In
case a Section 11(a)(ii) Event shall occur, then, in any such case, (i) the Company shall as soon as practicable thereafter
give to each registered holder of a Rights Certificate, to the extent feasible and in accordance with Section 26 hereof,
a notice of the occurrence of such event, which shall specify the event and the consequences of the event to registered holders
of Rights under Section 11(a)(ii) hereof, and (ii) all references in Section 25(a) to shares of Preferred Stock
shall be deemed thereafter to refer to shares of Common Stock or, if appropriate, other securities.

 

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Section
26.   Notices.  Notices or demands authorized by this Agreement to be given or made by the Rights
Agent or by the registered holder of any Rights Certificate to or on the Company shall be sufficiently given or made if sent by
(a) first-class mail, postage prepaid, (b) overnight delivery, or (c) courier or messenger service, in each case
addressed (until another address is filed in writing by the Company with the Rights Agent) as follows:

 

Liquid Holdings Group, Inc.

800 Third Avenue, 38th Floor

New York, NY 10022

Attention: Corporate 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 registered holder of any Rights Certificate
to or on the Rights Agent shall be sufficiently given or made if sent by (i) first-class mail, postage prepaid, (ii) overnight
delivery, or (iii) courier or messenger service, in each case addressed (until another address is filed in writing by the
Rights Agent with the Company) as follows:

 

Continental Stock Transfer and Trust Company

17 Battery Place, 8th Floor

New York, NY 10004

Attention: Administration Department

 

Notices or demands authorized by this Agreement
to be given or made by the Company or the Rights Agent to the registered holder of any Rights Certificate (or, if prior to the
Distribution Date, of the Common Stock) 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 Rights Agent (or, if prior to the Distribution
Date, of the transfer agent for the Common Stock).

 

Section
27.   Supplements and Amendments.  Except as otherwise provided in this Section 27, the Company,
by action of the Board, may from time to time and in its sole and absolute discretion, and the Rights Agent shall if the Company
so directs, supplement or amend any provision of this Agreement in any respect without the approval of any registered holders
of the Rights, including, without limitation, in order to (a) cure any ambiguity, (b) correct or supplement any provision
contained herein that may be defective or inconsistent with any other provisions herein, (c) shorten or lengthen any time
period hereunder, or (d) otherwise change, amend, or supplement any provisions hereunder in any manner that the Company may
deem necessary or desirable; provided, however, that, from and after the occurrence of a Section 11(a)(ii)
Event, no such supplement or amendment shall adversely affect the interests of the registered holders of Rights Certificates (other
than an Acquiring Person or an Affiliate or Associate of an Acquiring Person or certain of their transferees) or shall cause this
Agreement to become amendable other than in accordance with this Section 27. Without limiting the foregoing, the Company, by action
of the Board, may at any time before any Person becomes an Acquiring Person amend this Agreement to make provisions of this Agreement
inapplicable to a particular transaction by which a Person might otherwise become an Acquiring Person or to otherwise alter the
terms and conditions of this Agreement as they may apply with respect to any such transaction. 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, an authorized signatory of the Rights Agent shall execute such supplement or amendment; provided,
that any supplement or amendment that does not amend Section 18, Section 19, Section 20, or Section 21 hereof
in a manner adverse to the Rights Agent shall become effective immediately upon execution by the Company, whether or not also
executed by the Rights Agent.

 

    	38

    	 

    

 

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

 

Section
29.   Determinations and Actions by the Board.  The Board shall have the exclusive power and authority
to administer this Agreement and to exercise all rights and powers specifically granted to the Board or to the Company, or as
may be necessary or advisable in the administration of this Agreement, including, without limitation, the right and power to (a) interpret
the provisions of this Agreement and (b) make all determinations deemed necessary or advisable for the administration of
this Agreement (including a determination to redeem or not redeem the Rights or to amend this Agreement). All such actions, calculations,
interpretations, and determinations that are done or made by the Board in good faith, shall be final, conclusive, and binding
on the Company, the Rights Agent, the registered holders of the Rights, and all other parties.

 

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

 

Section
31.   Severability.  If any term, provision, covenant, or restriction of this Agreement is held by
a court of competent jurisdiction or other authority to be invalid, void, or unenforceable, the remainder of the terms, provisions,
covenants, and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired,
or invalidated; provided, however, that notwithstanding anything in this Agreement to the contrary, if any such
term, provision, covenant, or restriction is held by such court or authority to be invalid, void, or unenforceable and the Board
determines in its good faith judgment that severing the invalid language from this Agreement would adversely affect the purpose
or effect of this Agreement, the right of redemption set forth in Section 23 hereof shall be reinstated and shall not expire
until the Close of Business on the 10th day following the date of such determination by the Board.

 

    	39

    	 

    

 

Section
32.   Governing Law.  This Agreement, each Right, and each Rights 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 made and to be performed entirely within such State.

 

Section
33.   Counterparts; Facsimiles and PDFs.  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 facsimile or .pdf signature delivered electronically shall constitute an original signature
for all purposes.

 

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

 

[The remainder of this page is intentionally
left blank.]

 

    	40

    	 

    

 

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

 

	 	LIQUID HOLDINGS GROUP, INC.
	 	 
	 	By:	/s/ Brian M.
    Storms
	 	 	Name: Brian M. Storms
	 	 	Title:   Chief Executive Officer
	 	 
	 	CONTINENTAL STOCK TRANSFER & TRUST COMPANY
	 	 
	 	By:	/s/ Margaret Villani
	 	 	Name: Margaret Villani
	 	 	Title:  Vice President

 

Signature Page to Rights Agreement

 

    	 

    	 

    

 

EXHIBIT A

 

FORM OF

CERTIFICATE OF DESIGNATION, PREFERENCES, AND

RIGHTS OF SERIES A JUNIOR PARTICIPATING PREFERRED STOCK

 

of

 

LIQUID HOLDINGS GROUP, INC.

 

Pursuant to Section 151 of the
General Corporation Law of the State of Delaware

 

Liquid Holdings Group, Inc., a corporation
organized and existing under the General Corporation Law of the State of Delaware (the “Corporation”), in accordance
with the provisions of Section 103 thereof, DOES HEREBY CERTIFY:

 

That pursuant to the authority conferred
upon the Board of Directors of the Corporation (the “Board”) by the Certificate of Incorporation of the Corporation
(the “Certificate of Incorporation”), a duly authorized committee of the Board on December 11, 2014, adopted
the following resolution creating a series of Preferred Stock of the Corporation (the “Preferred Stock”) designated
as Series A Junior Participating Preferred Stock:

 

RESOLVED, that the committee hereby designates
100,000 shares of the preferred stock, par value $0.0001 per share, of the Corporation as “Series A Junior Participating
Preferred Stock” and the powers, designations, preferences, and relative, participating, optional, and other rights of the
Preferred Stock and the qualifications, limitations, and restrictions thereof, be, and they hereby are as follows:

 

Section 1. Designation and Amount.
The shares of such series shall be designated as “Series A Junior Participating Preferred Stock” and the number
of shares constituting such series shall be 100,000. Such number of shares may be increased or decreased by resolution of the
Board; provided, however, that no such decrease shall reduce the number of shares of the Series A Junior Participating
Preferred Stock to a number less than the number of shares then outstanding, plus the number reserved for issuance upon the exercise
of options, rights or warrants, or upon conversion of any outstanding securities issued by the Corporation convertible into Series
A Junior Participating Preferred Stock.

 

    	A-1

    	 

    

 

Section 2.   Dividends and
Distributions.

 

(a)          Subject
to the prior and superior rights of the holders of any shares of any other class or series of Preferred Stock ranking prior and
superior to the shares of Series A Junior Participating Preferred Stock with respect to dividends, the holders of shares
of Series A Junior Participating Preferred Stock, in preference to the holders of shares of Common Stock, par value $0.0001
per share, of the Corporation (the “Common Stock”), and of any other junior stock, shall be entitled to receive,
when, as and if declared by the Board out of funds legally available for the purpose, quarterly dividends payable in cash on the
last 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 Junior Participating Preferred Stock, in an amount per share (rounded to the nearest cent)
equal to the greater of (i) $10.00 or (ii) subject to the provision for adjustment hereinafter set forth, 1,000 times
the aggregate per share amount of all cash dividends, and 1,000 times the aggregate per share amount (payable in kind) of all
non-cash dividends or other distributions, other than a dividend payable in shares of Common Stock or a subdivision of the outstanding
shares of Common Stock (by reclassification or otherwise), declared on the Common Stock since the immediately preceding Quarterly
Dividend Payment Date, or, with respect to the first Quarterly Dividend Payment Date, since the first issuance of any share or
fraction of a share of Series A Junior Participating Preferred Stock. In the event the Corporation shall at any time after
December 11, 2014 (the “Rights Dividend Declaration Date”) (A) declare any dividend on Common Stock payable
in shares of Common Stock, (B) subdivide the outstanding Common Stock, or (C) combine the outstanding Common Stock into
a smaller number of shares, then in each such case the amount to which holders of shares of Series A Junior Participating
Preferred Stock were entitled immediately prior to such event under clause (ii) of the preceding sentence shall be adjusted
by multiplying such amount by a fraction the numerator of which shall be the number of shares of Common Stock outstanding immediately
after such event and the denominator of which shall be 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 Junior Participating Preferred Stock as provided in
Section 2(a) above 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 $10.00 per share on the Series A Junior Participating 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 Junior Participating Preferred Stock from the Quarterly
Dividend Payment Date next preceding the date of issue of such shares of Series A Junior Participating Preferred Stock, unless
the date of issue of such shares is prior to the record date for the first Quarterly Dividend Payment Date, in which case dividends
on such shares shall begin to accrue from the date of issue of such shares, or unless the date of issue is a Quarterly Dividend
Payment Date or is a date after the record date for the determination of holders of shares of Series A Junior Participating
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 Junior Participating Preferred Stock in an amount less
than the total amount of such dividends at the time accrued and payable on such shares shall be allocated pro rata on a share-by-share
basis among all such shares at the time outstanding. The Board may fix a record date for the determination of holders of shares
of Series A Junior Participating Preferred Stock entitled to receive payment of a dividend or distribution declared thereon,
which record date shall be no more than 30 days prior to the date fixed for the payment thereof.

 

    	A-2

    	 

    

 

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

 

(a)          Subject
to the provision for adjustment hereinafter set forth, each share of Series A Junior Participating Preferred Stock shall
entitle the holder thereof to 1,000 votes on all matters submitted to a vote of the stockholders of the Corporation. In the event
the Corporation shall at any time after the Rights Dividend Declaration Date (i) declare any dividend on Common Stock payable
in shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii) combine the outstanding Common Stock
into a smaller number of shares, then in each such case the number of votes per share to which holders of shares of Series A
Junior Participating 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 or by law or in any other Certificate of Designation creating a series of preferred stock, or any
similar stock, the holders of shares of Series A Junior Participating Preferred Stock, the holders of shares of Common Stock,
and the holders of any other class or series of capital stock of the Corporation entitled to vote generally together with the
Common Stock shall vote together as one class on all matters submitted to a vote of stockholders of the Corporation.

 

(c)          (i)          If
at any time dividends on any Series A Junior Participating Preferred Stock shall be in arrears in an amount equal to six
quarterly dividends thereon, the occurrence of such contingency shall mark the beginning of a period (herein called a “default
period”) that shall extend until such time when all accrued and unpaid dividends for all previous quarterly dividend
periods and for the current quarterly dividend period on all shares of Series A Junior Participating Preferred Stock then
outstanding shall have been declared and paid or set apart for payment. During each default period, all holders of Preferred Stock
(including holders of the Series A Junior Participating Preferred Stock) with dividends in arrears in an amount equal to
six quarterly dividends thereon, voting as a class, irrespective of series, shall have the right to elect two directors.

 

(ii)         During
any default period, such voting right of the holders of Series A Junior Participating Preferred Stock may be exercised initially
at a special meeting called pursuant to Section 3(c)(iii) or at any annual meeting of stockholders, and thereafter at annual
meetings of stockholders, provided, that such voting right shall not be exercised unless the holders of 10% in number of
shares of Preferred Stock outstanding shall be present in person or by proxy. The absence of a quorum of the holders of Common
Stock shall not affect the exercise by the holders of Preferred Stock of such voting right. At any meeting at which the holders
of Preferred Stock shall exercise such voting right initially during an existing default period, they shall have the right, voting
as a class, to elect directors to fill such vacancies, if any, in the Board as may then exist up to two directors or, if such
right is exercised at an annual meeting, to elect two directors. If the number that may be so elected at any special meeting does
not amount to the required number, the holders of Preferred Stock shall have the right to make such increase in the number of
directors as shall be necessary to permit the election by them of the required number. After the holders of Preferred Stock shall
have exercised their right to elect directors in any default period and during the continuance of such period, the number of directors
shall not be increased or decreased except by vote of the holders of Preferred Stock as herein provided or pursuant to the rights
of any equity securities ranking senior to or pari passu with the Series A Junior Participating Preferred Stock.

 

    	A-3

    	 

    

 

(iii)        Unless
the holders of Preferred Stock shall, during an existing default period, have previously exercised their right to elect directors,
the Board may order, or any stockholder or stockholders owning in the aggregate not less than 10% of the total number of shares
of Preferred Stock outstanding, irrespective of series, may request, the calling of a special meeting of the holders of Preferred
Stock, which meeting shall thereupon be called by the President, a Vice President, or the Secretary of the Corporation. Notice
of such meeting and of any annual meeting at which holders of Preferred Stock are entitled to vote pursuant to this Section 3(c)(iii)
shall be given to each holder of record of Preferred Stock by mailing a copy of such notice to such holder at such holder’s
last address as the same appears on the books of the Corporation. Such meeting shall be called for a time not earlier than 20
days and not later than 60 days after such order or request or in default of the calling of such meeting within 60 days after
such order or request, such meeting may be called on similar notice by any stockholder or stockholders owning in the aggregate
not less than 10% of the total number of shares of Preferred Stock outstanding. Notwithstanding the provisions of this Section 3(c)(iii),
no such special meeting shall be called during the period within 60 days immediately preceding the date fixed for the next
annual meeting of the stockholders.

 

(iv)        In
any default period, the holders of Common Stock, and other classes or series of stock of the Corporation if applicable, shall
continue to be entitled to elect the whole number of directors until the holders of Preferred Stock shall have exercised their
right to elect two directors voting as a class, after the exercise of which right (A) the directors so elected by the holders
of Preferred Stock shall continue in office until their successors shall have been elected by such holders or until the expiration
of the default period, and (B) any vacancy in the Board may (except as provided in Section 3(c)(ii)) be filled by vote
of a majority of the remaining directors theretofore elected by the holders of the class of stock that elected the director whose
office shall have become vacant. References in this Section 3(c) to directors elected by the holders of a particular class
of stock shall include directors elected by such directors to fill vacancies as provided in clause (B) of the foregoing sentence.

 

(v)         Immediately
upon the expiration of a default period, (A) the right of the holders of Preferred Stock as a class to elect directors shall
cease, (B) the term of any directors elected by the holders of Preferred Stock as a class shall terminate, and (C) the
number of directors shall be such number as may be provided for in the Certificate of Incorporation or Bylaws irrespective of
any increase made pursuant to the provisions of Section 3(c)(ii) (such number being subject, however, to change thereafter
in any manner provided by law or in the Certificate of Incorporation or Bylaws). Any vacancies in the Board effected by the provisions
of clauses (B) and (C) in the preceding sentence may be filled by a majority of the remaining directors.

 

    	A-4

    	 

    

 

(d)          Except
as set forth herein, holders of Series A Junior Participating 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 Junior Participating 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 Junior Participating Preferred Stock outstanding shall have been paid in full, the Corporation shall
not:

 

(i)          declare
or pay dividends on, 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 Junior Participating Preferred Stock;

 

(ii)         declare
or pay dividends on, or make any other distributions on, any shares of stock ranking on a parity (either as to dividends or upon
liquidation, dissolution, or winding up) with the Series A Junior Participating Preferred Stock, except dividends paid ratably
on the Series A Junior Participating 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;

 

(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 Junior Participating 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 Junior
Participating Preferred Stock; or

 

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

 

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

 

    	A-5

    	 

    

 

Section 5.   Reacquired Shares.
Any shares of Series A Junior Participating 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 to be
created by resolution or resolutions of the Board, subject to the conditions and restrictions on issuance set forth herein, in
the Certificate of Incorporation, or in any other Certificate of Designation creating a series of Preferred Stock or any similar
stock, or as otherwise required by law.

 

Section 6.   Liquidation,
Dissolution, or Winding Up.

 

(a)          Upon
any liquidation (voluntary or otherwise), dissolution, or winding up of the Corporation, no distribution shall be made to the
holders of shares of stock ranking junior (either as to dividends or upon liquidation, dissolution, or winding up) to the Series A
Junior Participating Preferred Stock unless, prior thereto, the holders of shares of Series A Junior Participating Preferred
Stock shall have received an amount equal to $1,000 per share of Series A Participating Preferred Stock, plus an amount equal
to accrued and unpaid dividends and distributions thereon, whether or not declared, to the date of such payment (the “Series A
Liquidation Preference”). Following the payment of the full amount of the Series A Liquidation Preference, no additional
distributions shall be made to the holders of shares of Series A Junior Participating Preferred Stock unless, prior thereto,
the holders of shares of Common Stock shall have received an amount per share (the “Common Adjustment”) equal
to the quotient obtained by dividing (i) the Series A Liquidation Preference by (ii) 1,000 (as appropriately adjusted
as set forth in Section 6(c) below) (such number in clause (ii), the “Adjustment Number”). Following
the payment of the full amount of the Series A Liquidation Preference and the Common Adjustment in respect of all outstanding
shares of Series A Junior Participating Preferred Stock and Common Stock, respectively, holders of Series A Junior Participating
Preferred Stock and holders of shares of Common Stock shall receive their ratable and proportionate share of the remaining assets
to be distributed in the ratio of the Adjustment Number to one with respect to such Preferred Stock and Common Stock, on a per
share basis, respectively.

 

(b)          In
the event, however, that there are not sufficient assets available to permit payment in full of the Series A Liquidation
Preference and the liquidation preferences of all other series of preferred stock, if any, which rank on a parity with the Series A
Junior Participating Preferred Stock, then such remaining assets shall be distributed ratably to the holders of such parity shares
in proportion to their respective liquidation preferences. In the event, however, that there are not sufficient assets available
to permit payment in full of the Common Adjustment, then such remaining assets shall be distributed ratably to the holders of
Common Stock.

 

    	A-6

    	 

    

 

(c)          In
the event the Corporation shall at any time after the Rights Dividend Declaration Date (i) declare any dividend on Common
Stock payable in shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii) combine the outstanding
Common Stock into a smaller number of shares, then in each such case the Adjustment Number in effect immediately prior to such
event shall be adjusted by multiplying such Adjustment 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.

 

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 converted into other stock or securities, cash, or any other property, then in
any such case the shares of Series A Junior Participating Preferred Stock shall at the same time be similarly exchanged for
or converted into an amount per share (subject to the provision for adjustment hereinafter set forth) equal to 1,000 times the
aggregate amount of stock, securities, cash, or any other property (payable in kind), as the case may be, into which or for which
each share of Common Stock is converted or exchanged. In the event the Corporation shall at any time after the Rights Dividend
Declaration Date (a) declare any dividend on Common Stock payable in shares of Common Stock, (b) subdivide the outstanding
Common Stock, or (c) combine the outstanding Common Stock into a smaller number of shares, then in each such case the amount
set forth in the immediately preceding sentence with respect to the exchange or conversion of shares of Series A Junior Participating
Preferred Stock shall be adjusted by multiplying such amount by a fraction, the numerator of which shall be the number of shares
of Common Stock outstanding immediately after such event and the denominator of which shall be the number of shares of Common
Stock that were outstanding immediately prior to such event.

 

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

 

Section 9.   Ranking.
The Series A Junior Participating Preferred Stock shall rank junior to all other series of the Corporation’s Preferred
Stock, and to any other class of preferred stock that hereafter may be issued by the Corporation, as to the payment of dividends
and the distribution of assets, unless the terms of any such series or class shall provide otherwise.

 

Section 10.   Amendment.
Except as set forth in Section 1 hereof, at any time when any shares of Series A Junior Participating Preferred Stock
are outstanding, neither the Certificate of Incorporation nor this Certificate of Designation shall be amended, either directly
or indirectly, or through merger or consolidation with another entity, in any manner that would materially alter or change the
powers, preferences, or special rights of the Series A Junior Participating Preferred Stock so as to affect them adversely
without the affirmative vote of the holders of two-thirds or more of the outstanding shares of Series A Junior Participating
Preferred Stock, voting separately as a class.

 

    	A-7

    	 

    

 

Section 11.   Fractional Shares.
The Series A Junior Participating Preferred Stock may be issued in fractions of a share that shall entitle the holder,
in proportion to such holder’s fractional shares, to exercise voting rights, receive dividends, participate in distributions,
and to have the benefit of all other rights of holders of Series A Junior Participating Preferred Stock.

 

[The remainder of this page is intentionally
left blank.]

 

    	A-8

    	 

    

 

IN WITNESS WHEREOF, Liquid Holdings Group,
Inc. has caused this Certificate of Designation to be signed by the undersigned this ___ day of ________________, 2014.

 

	 	Liquid Holdings Group, Inc.
    
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

    	A-9

    	 

    

 

EXHIBIT B

 

FORM OF RIGHTS CERTIFICATE

 

	Certificate No. R-	____________ Rights

 

NOT EXERCISABLE AFTER DECEMBER 10, 2015 OR EARLIER
IF REDEEMED OR EXCHANGED BY THE COMPANY. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT $0.01 PER RIGHT
ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN CIRCUMSTANCES SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS BENEFICIALLY
OWNED BY ANY PERSON WHO IS, WAS, OR BECOMES AN ACQUIRING PERSON OR ANY AFFILIATE OR ASSOCIATE THEREOF (AS SUCH TERMS ARE DEFINED
IN THE RIGHTS AGREEMENT), WHETHER CURRENTLY BENEFICIALLY OWNED BY OR ON BEHALF OF SUCH PERSON OR BY ANY SUBSEQUENT BENEFICIAL
OWNER, MAY BECOME NULL AND VOID.

 

Rights Certificate

 

LIQUID HOLDINGS GROUP, INC.

 

This certifies that ________________________,
or registered assigns, is the registered owner of the number of Rights set forth above, each of which entitles the owner thereof,
subject to the terms, provisions, and conditions of the Rights Agreement, dated as of December 11, 2014 (the “Rights
Agreement”), between Liquid Holdings Group, Inc., a Delaware corporation (the “Company”), and Continental
Stock Transfer and Trust Company (the “Rights Agent”), to purchase from the Company at any time prior to 5:00
p.m., New York City time, on December 10, 2015 at the office or offices of the Rights Agent designated for such purpose, or its
successors as Rights Agent, one one-thousandth of a fully paid, non-assessable share of Series A Junior Participating Preferred
Stock, par value $0.0001 per share, of the Company (the “Preferred Stock”), at a purchase price of $4.00 per
one one-thousandth of a share of Preferred Stock (such purchase price, as may be adjusted, the “Purchase Price”),
upon presentation and surrender of this Rights Certificate with the Form of Election to Purchase and related Certificate duly
executed. The number of Rights evidenced by this Rights Certificate (and the number of shares that may be purchased upon exercise
thereof) set forth above, and the Purchase Price per share set forth above, are the number and Purchase Price as of December 11,
2014, based on the Preferred Stock as constituted at such date. The Company reserves the right to require prior to the occurrence
of a Triggering Event (as such term is defined in the Rights Agreement) that a number of Rights be exercised so that only whole
shares of Preferred Stock will be issued.

 

    	B-1

    	 

    

 

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

 

As provided in the Rights Agreement, the
Purchase Price, the number and kind of shares of Preferred Stock or other securities issuable upon exercise of a Right, and the
number of Rights outstanding are subject to modification and adjustment upon the happening of certain events, including Triggering
Events.

 

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

 

This Rights Certificate, with or without
other Rights Certificates, upon surrender at the principal office or offices of the Rights Agent designated for such purpose,
may be exchanged for another Rights Certificate or Rights Certificates of like tenor and date evidencing Rights entitling the
holder to purchase a like aggregate number of one one-thousandths of a share of Preferred Stock as the Rights evidenced by the
Rights Certificate or Rights Certificates surrendered shall have entitled such holder to purchase. If this Rights Certificate
shall be exercised in part, the holder shall be entitled to receive upon surrender hereof another Rights Certificate or Rights
Certificates for the number of whole Rights not exercised.

 

Subject to the provisions of the Rights
Agreement, the Rights evidenced by this Rights Certificate may be redeemed by the Company at its option at a redemption price
of $0.01 per Right, payable at the Company’s option in cash or other securities or property of the Company, subject to adjustment
for certain events as provided in the Rights Agreement, at any time prior to the earlier of (i) the occurrence of a Section 11(a)(ii)
Event and (ii) the Expiration Date (as such terms are defined in the Rights Agreement). In addition, under certain circumstances
following the occurrence of a Section 11(a)(ii) Event but before any person acquires beneficial ownership of 50% or more
of the Common Stock (as such term is defined in the Rights Agreement), the Rights may be exchanged, in whole or in part, for Common
Stock, Preferred Stock, or shares of other preferred stock of the Company having essentially the same value or economic rights
as such shares. Immediately upon the action of the Board authorizing any such redemption or exchange, and without any further
action or any notice, the Rights (other than Rights that are not subject to such redemption or exchange) will terminate and the
Rights will only enable holders to receive the redemption price or the shares issuable upon such exchange, as applicable.

 

    	B-2

    	 

    

 

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

 

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

 

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

 

    	B-3

    	 

    

 

WITNESS the facsimile signature of the
proper officers of the Company and its corporate seal.

 

	Dated as of __________ _____, ___.	 
	 	 
	 	LIQUID HOLDINGS GROUP, INC.
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

	Countersigned:
	 
	Continental Stock Transfer and Trust
    Company

 

	By:	 	 
	 	Authorized Signature	 

 

    	B-4

    	 

    

 

[Form of Reverse Side of Rights Certificate]

 

FORM OF ASSIGNMENT

 

(To be executed by the registered holder
if such

holder desires to transfer the Rights Certificate.)

 

FOR VALUE RECEIVED ____________________________
hereby sells, assigns and transfers unto _______________________________________________________________________________________________________

	 
	(Please
    print name and address of transferee)

 

	 
	 

(Please spell out and include in numerals
the

number of Rights being transferred by this Assignment)

 

of the Rights evidenced by this Rights Certificate, together
with all right, title and interest therein, and does hereby irrevocably constitute and appoint _________________________ Attorney,
to transfer the number of Rights indicated above on the books of the within named Company, with full power of substitution.

 

	Dated:  ________________, ______	 
	 	 
	 	 
	 	Signature

 

Medallion Signature Guaranteed:

 

    	B-5

    	 

    

 

Certificate

 

The undersigned hereby certifies by checking
the appropriate boxes that:

 

(1)         the
Rights evidenced by this Rights Certificate [   ] are [   ] are not being sold, assigned,
and transferred by or on behalf of a Person who is or was an Acquiring Person or an Affiliate or Associate of any such Acquiring
Person (as such terms are defined pursuant to the Rights Agreement); and

 

(2)         after
due inquiry and to the best knowledge of the undersigned, he, she, or it [   ] did [   ] did
not acquire the Rights evidenced by this Rights Certificate from any Person who is, was, or subsequently became an Acquiring Person
or an Affiliate or Associate of an Acquiring Person.

 

	Dated:  ________________, ______	 
	 	Signature

 

Medallion Signature Guaranteed:

 

NOTICE

 

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

 

    	B-6

    	 

    

 

[Form of Reverse Side of Rights Certificate—continued]

 

FORM OF ELECTION TO PURCHASE

 

(To be executed by the registered holder
if such holder desires to

exercise any or all Rights evidenced by the Rights Certificate.)

 

		To:	Liquid Holdings Group, Inc.:

 

The undersigned hereby irrevocably elects
to exercise _______________________ (____________) Rights evidenced by this Rights Certificate to purchase the shares of Preferred
Stock issuable upon the exercise of the Rights (or such other securities of the Company or of any other person that may be issuable
upon the exercise of the Rights) and requests that certificates for such shares be issued in the name of and delivered to or that
such shares be credited to the book-entry account of:

 

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

 

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

 

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

 

	Dated:  ________________, ______	 
	 	 
	 	 
	 	Signature

 

Medallion Signature Guaranteed:

 

    	B-7

    	 

    

 

Certificate

 

The undersigned hereby certifies by checking
the appropriate boxes that:

 

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

 

(2)         after
due inquiry and to the best knowledge of the undersigned, he, she, or it [   ] did [   ] did
not acquire the Rights evidenced by this Rights Certificate from any Person who is, was or became an Acquiring Person or an Affiliate
or Associate of an Acquiring Person.

 

	Dated:  ________________, ______	 
	 	Signature

 

Medallion Signature Guaranteed:

 

NOTICE

 

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

 

    	B-8

    	 

    

 

EXHIBIT C

 

UNDER CERTAIN CIRCUMSTANCES SET FORTH IN THE RIGHTS
AGREEMENT, RIGHTS BENEFICIALLY OWNED BY ANY PERSON WHO IS, WAS, OR BECOMES AN ACQUIRING PERSON OR ANY AFFILIATE OR ASSOCIATE THEREOF
(AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT), WHETHER CURRENTLY BENEFICIALLY OWNED BY OR ON BEHALF OF SUCH PERSON OR BY
ANY SUBSEQUENT BENEFICIAL OWNER, MAY BECOME NULL AND VOID.

 

FORM OF SUMMARY OF RIGHTS

TO PURCHASE PREFERRED STOCK

 

On December 11, 2014, a duly authorized
committee of the Board of Directors (the “Board”) of Liquid Holdings Group, Inc., a Delaware corporation (the
“Company”), declared a dividend distribution of one right (each, a “Right” and together
with all such rights distributed or issued pursuant to the Rights Agreement (defined below), the “Rights”)
for each share of common stock, par value $0.0001 of the Company (the “Common Stock”) outstanding as of the
close of business on December 22, 2014 (the “Record Date”).

 

The following is a summary description
of the Rights and the Rights Agreement. This summary is intended to provide a general description only and is subject to the detailed
terms and conditions of the Rights Agreement (the “Rights Agreement”), dated as of December 11, 2014, by and
between the Company and Continental Stock Transfer and Trust Company, as rights agent (the “Rights Agent”).

 

The Company has filed a copy of the
Rights Agreement with the U.S. Securities and Exchange Commission as an exhibit to a Form 8-K on December [ ], 2014. In addition,
a copy of the Rights Agreement is available free of charge from the Company. This summary description of the Rights does not purport
to be complete and is qualified in its entirety by reference to the Rights Agreement.

 

		1.	Issuance
                                         of Rights

 

Each holder of Common Stock as of the Record
Date will receive a dividend of one Right per share of Common Stock. One Right will also be issued together with each share of
Common Stock issued by the Company after the Record Date and prior to the Distribution Date (as defined in Section 2 below),
and in certain circumstances, after the Distribution Date. New certificates for Common Stock issued after the Record Date will
contain a notation incorporating the Rights Agreement by reference.

 

Until the Distribution Date:

 

		·	the Rights will
                                         not be exercisable;

 

    	C-1

    	 

    

 

		·	the Rights will
                                         be evidenced by the certificates for Common Stock (or, in the case of book entry shares,
                                         by notation in book entry) and not by separate rights certificates; and

 

		·	the Rights will
                                         be transferable by, and only in connection with, the transfer of Common Stock.

 

		2.	Distribution
                                         Date; Beneficial Ownership

 

The Rights are not exercisable until the
Distribution Date. As of and after the Distribution Date, the Rights will separate from the Common Stock and each Right will become
exercisable to purchase one one-thousandth of a share of Series A Junior Participating Preferred Stock, par value $0.0001
per share, of the Company (each whole share, a share of “Preferred Stock”) at a purchase price of $4.00 (such
purchase price, as may be adjusted, the “Purchase Price”). This portion of a share of Preferred Stock would
give the holder thereof 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.

 

The “Distribution Date”
is the earlier of:

 

		·	ten days following
                                         a public announcement that a person has become an “Acquiring Person” by acquiring
                                         beneficial ownership of 10% or more of the Common Stock then outstanding other than as
                                         a result of repurchases of Common Stock by the Company or certain inadvertent acquisitions;
                                         and

 

		·	ten business days
                                         (or such later date as the Board shall determine prior to the time a person becomes an
                                         Acquiring Person) after the commencement of a tender offer or exchange offer by or on
                                         behalf of any person (other than the Company and certain related entities) that, if completed,
                                         would result in such person becoming an Acquiring Person.

 

If a person would otherwise be deemed an
“Acquiring Person” upon the execution of the Rights Agreement, such person (herein referred to as a “Grandfathered
Stockholder”) shall not be deemed an “Acquiring Person” for purposes of the Rights Agreement unless such
Grandfathered Stockholder shall at any time following execution of the Rights Agreement be the beneficial owner of shares of Common
Stock in an amount in excess of such person’s Reported Beneficial Ownership immediately prior to the execution of the Rights
Agreement, in which case such person shall no longer be deemed a Grandfathered Stockholder and shall be deemed an “Acquiring
Person.”  A person’s “Reported Beneficial Ownership” shall be such person’s beneficial ownership
of shares of Common Stock as expressly disclosed in such person’s statement on Schedule 13G, in Item 5 of such Person’s
statement on Schedule 13D or in such Person’s statement on Form 4, as appropriate, in each case as publicly on file with
the U.S. Securities and Exchange Commission pursuant to the Exchange Act immediately prior to the execution of the Rights Agreement.

 

    	C-2

    	 

    

 

A person will be deemed to “beneficially
own” any Common Stock if such person or any affiliated or associated person of such person:

 

		·	is considered
                                         a “beneficial owner” of the Common Stock under Rule 13d-3 of the General
                                         Rules and Regulations under the Securities Exchange Act of 1934, as amended and as in
                                         effect on the date of the Rights Agreement;

 

		·	has the right
                                         to acquire the Common Stock, either immediately or in the future, pursuant to any agreement,
                                         arrangement, or understanding (other than a customary underwriting agreement relating
                                         to a bona fide public offering of the Common Stock) or upon the exercise of conversion
                                         rights, exchange rights, rights, warrants or options, or otherwise, except that a person
                                         will not be deemed to be a beneficial owner of (a) securities tendered pursuant
                                         to a tender offer or exchange offer by or on behalf of such person or any affiliated
                                         or associated persons of such person until the tendered securities are accepted for purchase
                                         or exchange, (b) securities issuable upon exercise of a Right before the occurrence
                                         of a Triggering Event (as defined in Section 5 below), or (c) securities issuable
                                         upon exercise of a Right after the occurrence of a Triggering Event if the Rights are
                                         originally issued Rights or were issued in connection with an adjustment to originally
                                         issued Rights;

 

		·	has the right
                                         to vote or dispose of the Common Stock pursuant to any agreement, arrangement, or understanding
                                         (other than a right to vote arising from the granting of a revocable proxy or consent
                                         that is not also then reportable on a Schedule 13D); or

 

		·	has an agreement,
                                         arrangement, or understanding with another person who beneficially owns Common Stock
                                         and the agreement, arrangement, or understanding is for the purpose of acquiring, holding,
                                         voting, or disposing of any securities of the Company (in each case other than the Grandfathered
                                         Agreement and other than customary underwriting agreements relating to a bona fide public
                                         offering of Common Stock or a right to vote arising from the granting of a revocable
                                         proxy or consent that is not also then reportable on a Schedule 13D). The “Grandfathered
                                         Agreement” shall mean that certain Put Option Agreement dated as of December 10,
                                         2014 by and among Brian Ferdinand, the Von Allmen Dynasty Trust and D&L Partners,
                                         L.P., filed as Exhibit 1 to Amendment 3 of the Schedule 13D of Brian Ferdinand filed
                                         with the U.S. Securities and Exchange Commission on December 11, 2014.

 

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 on a Schedule 13D—are treated as beneficial ownership of the number of shares of Common Stock equivalent
to the economic exposure created by the derivative position, to the extent actual shares of 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-3

    	 

    

 

		3.	Issuance
                                         of Rights Certificates

 

As soon as practicable after the Distribution
Date, the Rights Agent will mail rights certificates to holders of record of Common Stock as of the close of business on the Distribution
Date and, thereafter, the separate rights certificates alone will evidence the Rights.

 

		4.	Expiration
                                         of Rights

 

The Rights will expire on the earliest
of (a) 5:00 p.m., New York City time, on December 10, 2015, (b) the time at which the Rights are redeemed (as described
in Section 6 below), and (c) the time at which the Rights are exchanged in full (as described in Section 7 below)
(the earliest of (a), (b) and (c) being herein referred to as the “Expiration Date”).

 

		5.	Change of
                                         Exercise of Rights Following Certain Events

 

The following described events are referred
to as “Triggering Events.”

 

(a)          Flip-In
Event. In the event that a person becomes an Acquiring Person, each holder of a Right will thereafter have the right to receive,
upon exercise, Common Stock (or, in certain circumstances, other securities, cash, or other assets of the Company) having a value
equal to two times the Purchase Price. Notwithstanding any of the foregoing, following the occurrence of a person becoming an
Acquiring Person, all Rights that are, or (under certain circumstances specified in the Rights Agreement) were, beneficially owned
by any Acquiring Person (or by certain related parties) will be null and void.

 

For example, at a purchase price of $4.00
per Right, following the occurrence of a person becoming an Acquiring Person, each Right not owned by the Acquiring Person (or
by certain related parties) would entitle its holder to purchase $8.00 worth of Common Stock (or other consideration, as noted
above) for $4.00. Assuming that the Common Stock has a per share value of $1.00 at such time, the holder of each valid Right would
be entitled to purchase 8 shares of Common Stock for $4.00.

 

(b)          Flip-Over
Events. In the event that, at any time after a person has become an Acquiring Person, (i) the Company engages in a merger
or other business combination transaction in which the Company is not the continuing or surviving corporation or other entity,
(ii) the Company engages in a merger or other business combination transaction in which the Company is the continuing or
surviving corporation and the Common Stock of the Company are changed or exchanged, or (iii) 50% or more of the Company’s
assets or earning power is sold or transferred, each holder of a Right (except Rights that have previously been voided as set
forth above) shall thereafter have the right to receive, upon exercise, common shares of the acquiring company having a value
equal to two times the Purchase Price.

 

    	C-4

    	 

    

 

		6.	Redemption

 

At any time prior to the earlier of (a)
a person becoming an Acquiring Person and (b) the Expiration Date (as defined in the Rights Agreement), the Board may direct the
Company to redeem the Rights in whole, but not in part, at a price of $0.01 per Right (payable in cash, Common Stock, or other
consideration deemed appropriate by the Board). Immediately upon the action of the Board directing the Company to redeem the Rights,
the Rights will terminate and the only right of the holders of Rights will be to receive the $0.01 redemption price.

 

		7.	Exchange
                                         of Rights

 

At
any time after a person becomes an Acquiring Person but before any person acquires beneficial ownership of 50% or more of the
outstanding Common Stock, the Board may direct the Company to exchange the Rights (other than Rights owned by such person or certain
related parties, which will have become null and void), in whole or in part, at an exchange ratio of one share of Common Stock
per Right (subject to adjustment). The Company may substitute shares of Preferred Stock (or shares of a class or series of the
Company’s preferred stock having equivalent rights, preferences, and privileges) for Common Stock at an initial rate of
one one-thousandth of a share of Preferred Stock (or of a share of a class or series of the Company’s preferred stock having
equivalent rights, preferences, and privileges) per share of Common Stock. Immediately upon the action of the Board directing
the Company to exchange the Rights, the Rights will terminate and the only right of the holders of Rights will be to receive the
number of shares of Common Stock (or one one-thousandth of a share of Preferred Stock or of a share of a class or series of the
Company’s preferred stock having equivalent rights, preferences, and privileges) equal to the number of Rights held by such
holder multiplied by the exchange ratio.

 

		8.	Adjustments
                                         to Prevent Dilution; Fractional Shares

 

The Board may adjust the Purchase Price,
the number of shares of Preferred Stock or other securities or assets issuable upon exercise of a Right, and the number of Rights
outstanding to prevent dilution that may occur (a) in the event of a stock dividend on, or a subdivision, combination, or
reclassification of, the Preferred Stock, (b) in the event of a stock dividend on, or a subdivision or combination of, the
Common Stock, (c) if holders of the Preferred Stock are granted certain rights, options, or warrants to subscribe for Preferred
Stock or convertible securities at less than the current market price of the Preferred Stock, or (d) upon the distribution
to holders of the Preferred Stock of evidences of indebtedness or assets (excluding regular periodic cash dividends) or of subscription
rights or warrants (other than those referred to above).

 

With certain exceptions, no adjustment
in the Purchase Price will be required until cumulative adjustments amount to at least 1% of the Purchase Price. No fractional
shares of Preferred Stock will be issued (other than fractions that are integral multiples of one one-thousandth of a share of
Preferred Stock), and in lieu thereof, an adjustment in cash may be made based on the market price of the Preferred Stock on the
last trading date prior to the date of exercise.

 

    	C-5

    	 

    

 

		9.	No Stockholder
                                         Rights Prior to Exercise; Tax Considerations

 

Until a Right is exercised, the holder
thereof, as such, will have no rights as a stockholder of the Company, including, without limitation, the right to vote or to
receive dividends. While the distribution of the Rights will not be taxable to stockholders or to the Company, stockholders may,
depending upon the circumstances, recognize taxable income in the event that the Rights become exercisable for Common Stock (or
other consideration) of the Company or for common shares of the acquiring company or in the event of the redemption of the Rights
as set forth in Section 6 above.

 

		10.	Amendment
                                         of Rights Agreement

 

The Company, by action of the Board, may
supplement or amend any provision of the Rights Agreement in any respect without the approval of any registered holder of Rights,
including, without limitation, in order to (a) cure any ambiguity, (b) correct or supplement any provision contained
in the Rights Agreement that may be defective or inconsistent with other provisions of the Rights Agreement, (c) shorten
or lengthen any time period under the Rights Agreement, or (d) otherwise change, amend, or supplement any provisions of the
Rights Agreement in any manner that the Company deems necessary or desirable; provided, however, that no supplement
or amendment made after a person becomes an Acquiring Person shall adversely affect the interests of the registered holders of
rights certificates (other than an Acquiring Person or any affiliated or associated person of an Acquiring Person or certain of
their transferees) or shall cause the Rights Agreement to become amendable other than in accordance with the amendment provision
contained therein. Without limiting the foregoing, the Company may at any time before any person becomes an Acquiring Person amend
the Rights Agreements to make provisions of the Rights Agreement inapplicable to a particular transaction by which a person might
otherwise become an Acquiring Person or to otherwise alter the terms and conditions of the Rights Agreement as they may apply
with respect to any such transaction.

 

    	C-6SVP Severance Plan

Exhibit 10.1

UNIVERSAL TECHNICAL INSTITUTE, INC.
SEVERANCE PLAN

THIS DOCUMENT CONSTITUTES THE OFFICIAL PLAN DOCUMENT

AS WELL AS THE SUMMARY PLAN DESCRIPTION OF THIS PLAN. 

AS AMENDED DECEMBER 2014

UNIVERSAL TECHNICAL INSTITUTE, INC.
SEVERANCE PLAN
THIS UNIVERSAL TECHNICAL INSTITUTE, INC. SEVERANCE PLAN (the “Plan”) was originally established on October 1, 2009.  The purpose of the plan is to provide financial assistance to Participants whose employment is terminated under certain conditions as defined below.
By execution of this document, Universal Technical Institute, Inc. (“UTI”) hereby amends and restates the Plan in its entirety, effective as of December 9, 2014 (the “Effective Date”).  This amended and restated Plan document applies only to an Eligible Employee who receives a written notice of Layoff on or after the Effective Date or a Senior Vice President (“SVP”) whose employment is terminated without Cause following the Effective Date.  
This booklet describes the benefits available to Participants under the Plan.  It is both the official plan document and the Summary Plan Description that is required by the Employee Retirement Income Security Act of 1974 (“ERISA”).  You should read this booklet for future reference.  If you have any questions not answered here, contact your People Services representative for further information.  The Employer has retained the right to amend, modify or terminate the Plan in accordance with its terms and no such amendment, modification, suspension or termination shall require the consent of any Participant.
ARTICLE 1
DEFINITIONS
For purposes of the Plan, the following terms, when used with an initial capital letter, shall have the meaning set forth below unless a different meaning is plainly required by the context.
1.1Affiliate:  This means (a) any corporation which is a member of the same controlled group of corporations (within the meaning of Code Section 414(b)) as UTI; and (b) any other trade or business (whether or not incorporated) under common control (within the meaning of Code Section 414(c)) with UTI.
1.2    Board:  This means the Board of Directors of UTI.
1.3    Cause:  This means any one or more of the following: 
(a)the SVP’s conviction of, or plea of guilty or nolo contendere to, any felony or a crime involving embezzlement, conversion of property or moral turpitude;
(b)a finding by a majority of the Board of SVP’s fraud, embezzlement or conversion of property of UTI or its Affiliates;
(c)the SVP’s conviction of, or plea of guilty or nolo contendere to, a crime involving the acquisition, use or expenditure of federal, state or local government funds relating to the business and affairs of UTI or its Affiliates;
(d)a finding by a majority of the Board (A) that SVP committed fraud or any other violation of law involving federal, state or local government funds relating to the business and affairs of UTI or its Affiliates, and (B) that when SVP committed fraud or such violation of law, SVP did not do so in a good faith belief that the related action(s) or failure(s) to act was in the best interests of UTI or its Affiliates;
(e)a finding by a majority of the Board of SVP’s knowing breach of any of SVP’s fiduciary duties to UTI or any of its Affiliates or UTI’s stockholders or making of an intentional misrepresentation or omission which breach, misrepresentation or omission would reasonably be expected to have a material adverse effect on the business 

2

relationship, the business, properties, assets, operations, condition (financial or other) or prospects of UTI or any of its Affiliates;
(f)the SVP’s alcohol or substance abuse, which materially interferes with SVP’s ability to discharge the duties, responsibilities and obligations of SVP’s position, as determined by a majority of the Board;
(g)the SVP’s material and knowing failure to observe or comply with law applicable to the business of UTI or its Affiliates as an officer or employee of UTI or its Affiliates which would reasonably be expected to have a material adverse effect on the business relationship, the business, properties, assets, operations, condition (financial or other), or prospects of UTI or its Affiliates as determined by a majority of the Board;
(h)the SVP’s willful gross misconduct relating to the business of UTI or its Affiliates that results in significant harm to UTI or its Affiliates or its operation, properties, reputation, goodwill or business relationships as determined by a majority of the Board;
(i)a finding by a majority of the Board of SVP’s willful and material violation of any written code of conduct or written code of ethics of UTI or its Affiliates applicable to SVP; 
provided that (i) any finding or determination made by the Board concerning the existence of Cause must be made in good faith and not for purposes of evading UTI’s obligations hereunder; and (ii) a finding or determination of Cause by the Board may not be made unless, prior to determining that Cause exists, the SVP shall be given written notice stating in reasonable detail the facts and circumstances deemed by UTI to constitute Cause, and thirty (30) days from receipt of such notice the SVP has failed to cure the facts and circumstances set forth in such notice.
1.4    Code:  This means the Internal Revenue Code of 1986, as amended.
1.5    Eligible Employee:  This means an individual who is employed by the Employer on a regular basis.  For purposes of this Plan, individuals in the following categories will not be considered Eligible Employees:
(a)individuals who are covered by a collective bargaining agreement, unless the terms of the collective bargaining agreement require that the individuals be covered by the Plan; 
(b)individuals who are seasonal employees, leased employees, independent contractors, temporary employees, or consultants; 
(c)individuals whose employment with the Employer is covered under the terms of an employment contract or agreement between the individual and the Employer; 
(d)corporate officers of any Employer who are on the Board of UTI; or
(e)employees who are SVPs.
The decision of who is an Eligible Employee for purposes of this Plan shall be made by the Plan Administrator in its sole discretion, and any individual who is excluded from being considered an Eligible Employee by the Plan Administrator shall be excluded from the definition of Eligible Employee regardless of the individual’s reclassification by the Internal Revenue Service for tax withholding purposes.
1.6    Employer:  This means UTI and any current or future Affiliate thereof that adopts the Plan pursuant to Article 4 of the Plan.  
1.7    ERISA:  This means the Employee Retirement Income Security Act of 1974, as amended.

3

1.8    Layoff:  This means an Eligible Employee’s employment is involuntarily terminated by the Eligible Employee’s Employer and all Affiliates, following a written notice of Layoff, on a date determined by the Eligible Employee’s Employer, for any of the following reasons:
(a)a reduction in force;
(b)a lack of work;
(c)a reorganization of work; or
(d)as a result of the sale of assets, or the transfer of the job, function or service which the Eligible Employee was performing to a company, person or other legal entity which is neither the Employer nor any Affiliate.
An Eligible Employee will not be considered to be subject to a Layoff if:
(e)the Eligible Employee resigns or give notices of resignation to be effective on a date prior to the effective date of Layoff;
(f)the Eligible Employee’s employment is terminated because the Eligible Employee failed to accept, within seven calendar days from it being offered by the Employer or any Affiliate, the same or a different job for which (in the Plan Administrator’s sole judgment) the Eligible Employee is suited, even if such offer is made after receiving notice of Layoff, whether at the same or at a different location within 50 miles of the Eligible Employee’s job at the time of the offer, at wages or salary of at least 90% of the Eligible Employee’s current Weekly Salary, or the Eligible Employee accepts such employment regardless of the amount of wages or salary;
(g)the Eligible Employee dies prior to the effective date of Layoff; or
(h)the Eligible Employee’s Employer is acquired by another company, person or other legal entity.
1.9    Participant:  This means an Eligible Employee who has satisfied the requirements of Section 2.1(a) or an SVP who has satisfied the requirements of Section 2.2(a).
1.10    Plan Administrator:  This means UTI, or such other person designated in Resolutions of the Board of Directors to act as the Plan Administrator.
1.11    Rehire Date:  This means the date a Participant accepts reemployment with any Employer.
1.12    Separation from Service:  This means either (a) the termination of a Participant’s employment with the Employer all Affiliates due to death, retirement, or other reasons, or (b) a permanent reduction in the level of bona fide services the Participant provides to the Employer and all Affiliates to an amount that is 20% or less of the average level of bona fide services the Participant provided to the Employer and all Affiliates in the immediately preceding 36 months, with the level of bona fide service calculated in accordance with Treas. Reg. § 1.409A-1(h)(1)(ii).  A Participant’s employment relationship is treated as continuing while a Participant is on military leave, sick leave, or other bona fide leave of absence (if the period of such leave does not exceed six months, or if longer, so long as a Participant’s right to reemployment with the Employer or an Affiliate is provided either by statute or contract).  If a Participant’s period of leave exceeds six months and a Participant’s right to reemployment is not provided either by statute or by contract, the employment relationship is deemed to terminate on the first day immediately following the expiration of such six-month period.  Whether a termination of employment has occurred will be determined based on all of the facts and circumstances and in accordance with regulations issued by the United States Treasury Department pursuant to Section 409A of the Code.
1.13    Severance Benefits:  This means (a) the Severance Pay, (b) the reimbursement of COBRA premiums provided pursuant to Section 2.1(d) for Eligible Employees, and (c) the outplacement services provided pursuant to Section 2.3 to a Participant under this Plan.  

4

1.14    Severance Pay:  This means the cash payments an Eligible Employee is eligible to receive under Section 2.1(b) of the Plan upon his or her Layoff or the cash payments that an SVP is entitled to receive under Section 2.2(b) of the Plan.
1.15    Severance Period:  This means the period of time during which a Participant is eligible to receive Severance Pay.
1.16    SVP:  This means an officer of UTI with a title of Senior Vice President.
1.17    Weekly Salary:  This means, (a) with respect to a salaried Eligible Employee, 1/52 of the Eligible Employee’s annual base salary (as determined by the Employer), as of the date of the Eligible Employee’s Layoff, and (b) with respect to an Eligible Employee paid on an hourly basis, the hourly wage rate of the Eligible Employee as of the date of the Eligible Employee’s Layoff multiplied by the Eligible Employee’s regularly scheduled number of hours of service per week (as determined by the Employer), not in excess of 40 hours.  Weekly Salary shall exclude any overtime, incentive, and bonus payments.
1.18    Year of Service:  This means each 12-month period during which the Eligible Employee was employed on a full-time basis by the Employer, commencing with the Eligible Employee’s most recent hire date, as reflected in the records of the Employer. For purposes of determining Years of Service, if an Eligible Employee has any fractional year of full-time employment, that fractional year of full-time employment shall be rounded up or down to the nearest whole number to determine the Eligible Employee’s Years of Service.  If an Eligible Employee who had been employed on a full-time basis by the Employer for at least 12 consecutive months terminated voluntarily and was re-employed within twelve (12) months of the employment termination date, the Eligible Employee’s prior period of full-time employment will be credited towards the total period of full-time employment for the purpose of determining Years of Service.
ARTICLE 2
SEVERANCE PAY AND BENEFITS
2.1    (a)    Eligibility.  An Eligible Employee will be eligible to receive benefits under this Plan if:
i.You are an Eligible Employee on your date of Layoff;
ii.You have completed one Year of Service on your date of Layoff;
iii.You are terminated from employment in a Layoff; and
iv.You are not excluded pursuant to Section 2.11 below.  
(b)Severance Pay.  Subject to Section 2.4, the Severance Pay payable to an Eligible Employee will be determined by the Employer in its sole discretion, using guidelines that take into account the Eligible Employee’s grade level and Years of Service, as set forth below:
	
									
	Grade Level
	 
	Title
	 
	Number of Weeks of Weekly Salary per Year of Service
	 
	Minimum Number of Weeks
	 
	Maximum Number of Weeks

	 
	 
	 
	 
	 
	 
	 
	 
	 

	1-9, F-I
	 
	Non-exempt
	 
	2
	 
	4
	 
	26

	10-14, C12-C14, J-O
	 
	Manager/Exempt
	 
	2
	 
	4
	 
	26

	15-19, C15-C19, P-Q
	 
	Director/Manager
	 
	2
	 
	8
	 
	26

	N/A
	 
	Vice President
	 
	3
	 
	12
	 
	36

5

(c)Severance Pay Adjustment.  Notwithstanding anything in the Plan to the contrary and in the sole discretion of the Plan Administrator, in the event the Eligible Employee previously received severance payments from the Employer or an Affiliate, the Plan Administrator may reduce the Eligible Employee’s Years of Service for purposes of applying the severance formula by the Years of Service for which severance pay was previously paid to the Eligible Employee.  
(d)Reimbursement of COBRA Premiums.  As of the date of an Eligible Employee’s termination of employment, the Eligible Employee’s active participation in the medical and dental plans sponsored by the Employer may be continued in accordance with Code Section 4980B(f) (“COBRA”).  If the Eligible Employee executes and does not revoke the Release of Claims described in Section 2.4, the Employer will pay the COBRA premiums for such coverage under the medical and dental plans as the Eligible Employee had elected prior to the Eligible Employee’s termination of employment with the cost of such premiums to be shared by the Employer and the Eligible Employee on the same basis as in effect prior to the Eligible Employee’s termination of employment, provided the Eligible Employee timely and properly elects COBRA.  The Employer shall pay the COBRA premiums described in the preceding sentence based on the Eligible Employee’s “Years of Service” with the Employer as set forth below:
	
			
	Length of Service
	 
	COBRA Subsidy Duration

	 
	 
	 

	1 Year
	 
	1 month

	2 Years
	 
	2 months

	3-6 Years
	 
	3 months

	7 or More Years
	 
	6 months

2.2    (a)    SVP Eligibility.  An SVP who is terminated by the Employer without Cause shall be eligible for Severance Benefits, provided the SVP satisfies the remaining terms and conditions of this Plan (including the requirement to execute and not revoke a Release of Claims) and is not excluded from receiving benefits under the Plan pursuant to Section 2.11.
(b)SVP Severance Pay.  An SVP who satisfies the requirements of Section 2.2(a) shall be entitled to receive the following Severance Pay:
i.Severance Pay.  A cash payment in an amount equal to the SVP’s base salary at the highest rate in effect at any time during the twelve (12) months immediately preceding the date on which the SVP’s employment is terminated, which shall be payable for a period of twelve (12) months in equal bi-weekly installments in accordance with the Employer’s regular payroll periods beginning at the time specified in Section 2.4 below.  
ii.Additional Severance Pay.  The SVP also shall receive an additional cash severance payment equivalent to the Employer-paid portion of the SVP’s medical and dental benefits that the SVP had elected as of the date of the SVP’s termination, plus an additional 40% of that amount for a period of twelve months in equal bi-weekly installments in accordance with the Employer’s regular payroll periods beginning at the time specified in Section 2.4 below.  For example, if the SVP had elected family coverage as of the SVP’s termination date and if the Employer-paid portion of the family medical and dental benefits equaled $500 per month, the SVP would be entitled to receive an additional $323.08 per payroll period for the next twelve (12) months.  This additional severance pay shall be paid regardless of whether the SVP elects COBRA continuation coverage.  
iii.Bonus Pay for Fiscal Year in which Termination Date Occurs.  If the SVP’s employment is terminated during a fiscal year, the SVP will be eligible for a pro rata bonus during the fiscal year in which the Termination Date occurs under the Universal Technical Institute, Inc. Management Incentive Plan or a successor bonus plan, provided the bonus is approved by the Board, based upon parameters set by the Board.  The amount of any such bonus will be pro-rated based on the date of the SVP’s termination date and will be paid in a lump sum at the time other employees are paid the bonus.  In no event will the bonus be paid later than March 15 of the calendar year following the close of the fiscal year to which the bonus relates.

6

iv.Bonus Pay for Fiscal Year Ended Prior to Termination Date.  To the extent an SVP’s employment is terminated prior to the date on which the Employer has paid any bonus to which the SVP may be entitled for the fiscal year immediately preceding the termination date (i.e., between the end of the fiscal year and the bonus payout), the SVP will receive such bonus in a lump sum on the same date as the SVP would have received such bonus had the SVP remained continuously employed by the Employer.  In no event will the bonus due pursuant to this Section be paid later than March 15 of the calendar year following the calendar year in which the SVP’s employment is terminated.
2.3    Outplacement Services.  Outplacement Services available to a Participant shall be determined by the Employer in its sole discretion.  If Outplacement Services are included in the Severance Benefits, the Employer shall select the vendor, the level or services provided, and pay for the services.  To determine the length of such services, the Employer shall use the following guidelines that take into account the Participant’s grade level, as set forth below:
	
							
	 
	 
	 
	 
	Program Length

	Grade Level
	 
	Title
	 
	Minimum
	 
	Maximum

	 
	 
	 
	 
	 
	 
	 

	1-9, F-I
	 
	Non-exempt
	 
	1 month
	 
	2 months

	10-14, C12-C14, J-O
	 
	Manager/Exempt
	 
	2 months
	 
	3 months

	15-19, C15-C19, P-Q
	 
	Director/Manager
	 
	3 months
	 
	6 months

	VP
	 
	Vice President
	 
	6 months
	 
	1 year

	SVP
	 
	Senior Vice President
	 
	1 year
	 
	1 year

2.4    Release Requirement and Form of Payment.  To be eligible for Severance Benefits under the Plan, a Participant must timely execute and deliver, a Release of Claims form (in the form specified by the Employer from time to time, which may include, but is not limited to, a non-compete clause, a non-disparagement clause, a non-solicitation clause and a confidentiality clause) within the applicable time periods described below.  In the event a Participant is entitled to Severance Benefits, the Severance Benefits shall be paid following the Participant’s Separation from Service as follows:
(a)Commencement of Payment for Participant’s Aged 40 or Older.  With respect to a Participant aged 40 or older on the date that the Participant executes the Release of Claims form (an “ADEA Participant”), the Release of Claims form must be executed and delivered within the time period specified under the terms of the applicable Release of Claims form; provided, however, in no event will Severance Benefits be paid in the event a Release of Claims form is executed later than sixty (60) days following the Participant’s Separation from Service.  For purposes of waiving any potential claims under the Age Discrimination in Employment Act (the “ADEA”) and for purposes of compliance with Section 7(f) of the ADEA (commonly known as the Older Workers’ Benefit Protection Act) and the applicable guidance thereunder, no Severance Benefits shall commence prior to a period ending seven (7) days following the execution of the Release of Claims form (the “Revocation Period”).  In no event will Severance Benefits be paid with respect to an ADEA Participant if the Release of Claims form is revoked during the Revocation Period.  Severance Benefits shall commence with respect to an ADEA Participant as soon as feasible following expiration of the Revocation Period, which generally shall be the first regularly scheduled payroll date following the expiration of the Revocation Period, and shall thereafter be paid in accordance with the Employer’s regular payroll practice, except as provided in Section 2.6, below.  Notwithstanding the foregoing, in no event shall Severance Benefits commence later than sixty (60) days following the date of the ADEA Participant’s Separation from Service.
(b)Commencement of Payment for Participants Younger than Age 40.  With respect to a Participant younger than age 40 on the date that the Participant executes a Release of Claims form (a “Non-ADEA Participant”), Severance Benefits shall commence as soon as administratively feasible, which generally shall be the first regularly scheduled payroll date following the date on which the Participant submits an executed Release of Claims form to the Employer, and shall thereafter be paid in accordance with the Employer’s regular payroll practice, except as provided in Section 2.6, below.  Notwithstanding the foregoing, in no event shall Severance Benefits commence later than sixty (60) days following the date of the Non-ADEA Participant’s Separation from Service.  

7

(c)Withholding.  Any payment of Severance Benefits to a Participant shall be subject to normal withholding for local, state and federal income taxes and Social Security taxes.
(d)Death.  Upon the death of the Participant who has not received all Severance Pay payable under the Plan, the benefits otherwise payable under Section 2.1 or 2.2 of the Plan shall be paid in the form of a lump sum to the Participant’s estate as soon as practicable, but in no event later than 60 days following death.
2.5    Conditions on Payment of Severance Pay.  Payment of the benefits provided in Section 2.1 and Section 2.3 of the Plan shall be subject to and conditioned upon the following:
(a)to the extent an Eligible Employee receives notice of a date selected by the Employer (in its sole discretion) on which the Eligible Employee’s Layoff shall occur (a “Designated Termination Date”), the Eligible Employee must continue to work in a satisfactory manner until his or her Designated Termination Date; and
(b)the Eligible Employee must cooperate in transitioning all of the Eligible Employee’s work in consultation with the Eligible Employee’s supervisor or other designated employee.
2.6    Maximum Severance Pay.  Notwithstanding any other provisions to the contrary, benefits paid hereunder to an Eligible Employee shall (a) not exceed two times the lesser of (i) the Eligible Employee’s Compensation (as defined in this Section 2.6) during the calendar year immediately preceding the Eligible Employee’s Separation from Service, or (ii) the maximum amount that may be taken into account under a qualified plan pursuant to Section 401(a)(17) of the Code for the calendar year in which the Eligible Employee’s Separation from Service occurs and (b) shall be paid in full within twenty-four (24) months after the date the Eligible Employee’s Separation from Service occurs.  In the event that any Severance Pay payable to an Eligible Employee would exceed the twenty-four (24) month period provided in the foregoing sentence if the Severance Pay continued to be paid in accordance with the Employer’s regular payroll practice, any Severance Pay that would otherwise exceed the twenty-four (24) month time period will be paid to the Eligible Employee in a lump sum on the last regular payroll date within the twenty-four (24) month period.  For purposes of this Section 2.6, “Compensation” shall mean the lesser of the Eligible Employee’s (A) total compensation, including wages, salary, and any other benefit of monetary value, whether paid in the form of cash or otherwise, which was paid as consideration for the Eligible Employee’s service during the year, or which would have been so paid at the Eligible Employee’s usual rate of compensation if the Eligible Employee had worked a full year, or (B) annualized compensation, based upon the annual rate of pay for services provided to the Employer for the calendar year preceding the calendar year in which the Eligible Employee’s Separation from Service occurs, adjusted for any increase that was expected to continue indefinitely if the Eligible Employee had not had a Separation from Service.  For the avoidance of doubt, this Section 2.6 does not apply to an SVP. 
2.7    Vacation.  The pay-out of accrued vacation not previously used shall be determined under the terms of the Employer’s normal vacation policy.  
2.8    Cessation of Severance Pay Upon Reemployment.  If a Participant who is receiving Severance Benefits thereafter accepts reemployment with any Employer and/or Affiliate during the Severance Period, such Participant’s Severance Benefits shall cease on the Rehire Date.  
2.9    Options.  All stock awards (as defined in any applicable plan), including stock options or restricted stock, shall vest and be paid according to the terms and provisions of the applicable plan and the grant agreement under which such award was granted.
2.10    Benefits Not Vested.  No one under any circumstance is automatically entitled to Severance Benefits.  Notwithstanding anything in the Plan to the contrary, the Employer reserves the right, at its sole discretion, to increase, decrease, or eliminate Severance Benefits under this Plan.

8

2.11    Excluded Employees.  You will not be eligible to receive benefits under this Plan if:
(a)You receive benefits under any other Layoff plan or program of the Employer other than this Plan;
(b)You receive Layoff or termination pay under a negotiated working agreement or collective bargaining agreement;
(c)You receive benefits under any other severance, retention or change in control plan or arrangement sponsored by UTI or an Affiliate of UTI, including an employment agreement;
(d)You are an Eligible Employee paid on an hourly basis and covered by a collective bargaining agreement or a working policy and you have not exhausted your rights to displace less senior employees in your work unit; 
(e)The facility or operation in which you are working, or the job, function, or service you are performing for the Employer, is acquired by an employer other than the Employer or any Affiliate and you are offered employment by the successor employer (or its subsidiary or affiliate) at wages or a salary equal to or greater than 80 percent of the Weekly Salary you had with the Employer; or you accept such employment regardless of the amount of wages or salary;
(f)Your employment with UTI or its Affiliates is terminated due to your death or disability; or 
(g)You do not terminate employment with UTI and all of its Affiliates.  
Further, you will not be entitled to receive benefits under the Plan if, at the time you would otherwise be paid under the Plan, you have any outstanding obligation to the Employer and no arrangement has been made to repay such obligation which is acceptable to the Employer:
ARTICLE 3
ADMINISTRATION OF THE PLAN
3.1    Control and Administration.  The Plan Administrator shall administer this Plan.  The Plan Administrator shall have the sole and final discretionary authority to construe the terms of the Plan and all facts surrounding claims for benefits under the Plan and shall determine all questions arising in the administration, interpretation and application of the Plan, including, but not limited to, those concerning eligibility for benefits.  Accordingly, benefits under the Plan will be paid only if the Plan Administrator decides in its discretion that an applicant is entitled to benefits.  All determinations of the Plan Administrator shall be conclusive and binding on all parties.  The Plan Administrator shall be the named fiduciary of this Plan for purposes of ERISA.
3.2    Claim Procedures.
A Participant or his or her duly authorized representative must follow the Plan’s claim procedures as described below, including the rules relating to appeals, before initiating any legal action with respect to a claim for benefits under the Plan.  
(a)Procedure for Granting or Denying Claims.  A Participant, or his or her duly authorized representative, may file a claim for payment of benefits under the Plan.  Such a claim must be made in writing and be delivered to the Plan Administrator, in person or by mail, postage paid.  Within 90 days after receipt of such claim, the Plan Administrator shall notify the claimant of the granting or denying, in whole or in part, of such claim, unless special circumstances require an extension of time for processing the claim.  In no event may the extension exceed 90 days from the end of the initial 90-day period.  If such extension is necessary, the claimant will be given a written notice to this effect prior to the expiration of the initial 90-day period.  The Plan Administrator shall have full discretion to deny or grant a claim in whole or in part.

9

(b)Requirement for Notice of Claim Denial.  The Plan Administrator shall provide to every claimant who is denied a claim for benefits a written or electronic notice setting forth in a manner calculated to be understood by the claimant:
i.The specific reason or reasons for the denial;
ii.Specific reference to pertinent Plan provisions on which the denial is based; 
iii.A description of any additional material or information necessary for the claimant to perfect the claim and an explanation of why such material is necessary; and  
iv.An explanation of the Plan’s claim review procedures and the time limits applicable to such procedures, including a statement of the claimant’s right to bring a civil action under Section 502(a) of ERISA following an adverse determination on review.
(c)Right to Request Hearing on Claim Denial.  Within 60 days after receipt by the claimant of written or electronic notification of the denial (in whole or in part) of his or her claim, the claimant or his or her duly authorized representative may make a written application to the Senior Vice President of People Services, in person or by certified mail, postage prepaid, to be afforded a full and fair review of such denial.  The claimant or his or her duly authorized representative may submit written comments, documents, records, and other information relating to the claim for benefits.  Moreover, the claimant or his or her duly authorized representative shall be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the claimant’s claim for benefits.
(d)Disposition of Disputed Claims.  Upon receipt of a request for review, the Senior Vice President of People Services shall make a decision on the claim.  The review shall take into account all comments, documents, records, and other information submitted by the claimant relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.  The decision on review shall be made not later than 60 days after the Senior Vice President of People Services’ receipt of a request for a review, unless special circumstances require an extension of time for processing, in which case a decision shall be rendered not later than 120 days after receipt of the request for review.  If an extension is necessary, the claimant shall be given written notice of the extension prior to the expiration of the initial 60-day period.  
The Senior Vice President of People Services shall provide the claimant with written or electronic notification of the Plan’s determination on review.  In the case of an adverse determination, the notification shall set forth, in a manner calculated to be understood by the claimant, the specific reason or reasons for the decision as well as specific references to the Plan provisions on which the decision was based.  The decision shall also include a statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the claimant’s claim for benefits.  Moreover, the decision shall contain a statement of the claimant’s right to bring an action under Section 502(a) of ERISA.  
3.3    Bar to Legal Action.  No legal action may be commenced or maintained against the Plan prior to the claimant’s exhaustion of the claims procedures set forth in Section 3.2 of the Plan.  In addition, no legal action may be commenced against the Plan more than ninety (90) days after the Senior Vice President of People Services’ decision on review pursuant to Section 3.2(d) of the Plan.
ARTICLE 4
ADOPTION OF PLAN BY AFFILIATES
Any Affiliate of UTI, if authorized to do so by Resolutions of the Board of Directors of UTI, may adopt the Plan in a manner satisfactory to UTI, provided such entity is directly or indirectly owned by UTI.  Each participating entity other than UTI may terminate its participation in the Plan upon notice to UTI.

10

ARTICLE 5
MISCELLANEOUS
5.1    Amendment or Termination.  This Plan may be amended or terminated at any time in writing by the Board or any committee or individual designated by the Board to take such actions.
5.2    Choice of Law.  The validity, interpretation, construction and performance of the obligations created under this Plan shall be governed by ERISA, and to the extent not preempted by federal law, the laws of the State of Arizona without regard to its conflicts of law principles.
5.3    Validity.  The invalidity or unenforceability of any provision of this Plan shall not affect the validity or enforceability of any other provision of this Plan, which shall remain in full force and effect.
5.4    Plan Exclusive Source of Rights.  This Plan contains all of the terms and conditions with respect to the benefits provided hereunder, and no Participant or former Participant may rely on any other communication or representation, whether oral or written, of the Employer or any of its subsidiaries, or any officer or Participant thereof, as creating any right or obligation not expressly provided by this Plan.
5.5    Nonassignability.  No benefit which shall be payable under the Plan to any Participant shall be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, or charge (except as required by law), and any attempt to anticipate, alienate, sell, transfer, assign, pledge, encumber, or charge a benefit shall be null and void.  No benefit shall in any manner be liable for, or subject to, the debts, contracts, liabilities, engagements, or torts of any Participant.  No benefit shall be subject to legal attachment or legal process for, or against, the Participant and the same shall not be recognized under the Plan.  Notwithstanding the preceding sentence, the Employer retains the discretion, in accordance with federal and/or state laws, to reduce the amount of benefits payable under the Plan to any Participant to recover any amounts which the Participant owes to the Employer.
5.6    No Employment Rights.  The Plan shall not give any Participant any right or claim except to the extent that the right is specifically fixed under the terms of the Plan.  The establishment of the Plan shall not be construed (a) to give any Participant a right to continue in the employ of the Employer or (b) to interfere with the right of the Employer to terminate the employment of any Participant at any time.
5.7    Headings.  Article and section headings are for convenience only and the language of the Plan itself will be controlling.
5.8    Gender and Numbers.  Masculine pronouns include the feminine as well as the neuter genders, and the singular shall include the plural, unless indicated otherwise by the context.
5.9    Code Section 409A.  The benefits provided under the terms of the Plan are intended to fall within an exception to the application of Section 409A of the Code and the applicable guidance issued thereunder.  To the extent the benefits provided under the Plan become subject to Code Section 409A and applicable guidance issued thereunder, the Plan shall be construed, and benefits paid hereunder, as necessary to comply with such Code Section and such guidance.  Further, to the extent that an Participant becomes entitled to receive Severance Pay under the terms of the Plan, and, at the time of the Participant’s Separation from Service, he or she is a “specified employee” within the meaning of Treasury Regulation Section 1.409A-1(i), any portion of Severance Pay payable to such Participant that is subject to Code Section 409A and applicable guidance thereunder shall be paid after the date that is six months following the date of the Participant’s Separation from Service.  Although this Plan has been designed to comply with Section 409A of the Code or to fit within an exception to the requirements of Section 409A of the Code, the Employer specifically does not warrant such compliance.  Each Participant is fully responsible for any and all taxes or other amounts imposed by Section 409A or any other provision of the Code.  Under no circumstances may the time or schedule of any payment made or benefit provided pursuant to this Plan be accelerated or subject to a further deferral except as otherwise permitted or required pursuant to regulations and other guidance issued pursuant to Section 409A of the Code.  A Participant does not have any right to make any election regarding the time or form of any payment 

11

due under this Plan.  For purposes of Section 409A, the right to a series of installment payments under this Plan shall be treated as a right to a series of separate payments under Treasury Regulation Section 1.409A-2(b)(2)(iii).  If the Employer determines, in the exercise of its discretion, that all or a portion of the benefits provided under the Plan are subject to Section 409A of the Code, and if the Release of Claims consideration period and revocation period (as described in Section 2.4), spans two calendar years, the Severance Pay shall not begin until the second calendar year.  A Participant may not elect the taxable year of the distribution.
ARTICLE 6
ERISA RIGHTS
As a Participant in the Plan, you are entitled to certain rights and protections under ERISA, which provides that all Plan Participants shall be entitled to:
Receive information about your Plan and benefits.
		
	•
	Examine, without charge, at the Plan Administrator’s office and at other specified locations, such as worksites, all documents governing the Plan and a copy of the latest annual report (Form 5500 series) filed by the Plan with the U.S. Department of Labor, and available at the Public Disclosure Room of the Employee Benefits Security Administration.

		
	•
	Obtain, upon written request to the Plan Administrator, copies of all documents governing the operation of the Plan, and copies of the latest annual report (Form 5500 series) and updated summary plan description.  The Plan Administrator may make a reasonable charge for the copies.

		
	•
	Receive a summary of the Plan’s annual financial report.  The Plan Administrator is required by law to furnish each participant with a copy of this summary annual report.

Prudent actions by the Plan fiduciaries.
In addition to creating rights for Plan Participants, ERISA imposes obligations upon the people who are responsible for the operation of the Plan.  The people who operate the Plan, called “fiduciaries” of the Plan, have a duty to do so prudently and in the interest of you and other Plan Participants and beneficiaries.  No one, including your Employer or any other person, may fire you or otherwise discriminate against you in any way to prevent you from obtaining benefits or exercising your rights under ERISA.
Enforce your rights.
If your claim for a benefit is denied or ignored, in whole or in part, you have a right to know why this was done, to obtain copies of documents relating to the decision without charge, and to appeal any denial, all within certain time frames.
Under ERISA, there are steps you can take to enforce the above rights.  For instance, if you request a copy of Plan documents or the latest annual report from the Plan Administrator and do not receive them within 30 days, you may file suit in a Federal court.  In such a case, the court may require the Plan Administrator to provide the materials and pay you up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the Plan Administrator.  If you have a claim for benefits which is denied or ignored, in whole or in part, you may file suit in a state or Federal court subsequent to exhausting the Plan’s claims procedures.  If it should happen that the Plan fiduciaries misuse the Plan’s money, or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor, or you may file suit in a Federal court.  The court will decide who should pay court costs and legal fees.  If you are successful, the court may order the person you have sued to pay these costs and fees.  If you lose, the court may order you to pay these costs and fees, for example, if it finds that your claim is frivolous.

12

Assistance with your questions.
If you have any questions about the Plan, you should contact the Plan Administrator.  If you have any questions about this statement or about your rights under ERISA, or if you need assistance in obtaining documents from the Plan Administrator, you should contact the nearest office of the Employee Benefits Security Administration, U.S. Department of Labor, listed in your telephone directory, or the Division of Technical Assistance and Inquiries, Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue, NW, Washington, D.C. 20210.  You may also obtain certain publications about your rights and responsibilities under ERISA by calling the publications hotline of the Employee Benefits Security Administration.
ARTICLE 7
GENERAL INFORMATION
Employer and Plan Sponsor:            Universal Technical Institute, Inc.
16220 N. Scottsdale Road, Suite 100
Scottsdale, AZ  85254
(623) 445-9500
Participants and beneficiaries may receive from the Plan Administrator, upon written request, information as to whether a particular employer is an Employer, and, if the employer is an Employer, the Employer’s address.  
		
	Employer Identification Number: 
	86-0226984

		
	Plan Year:
	The Plan Year begins on October 1st, and ends on September 30th.

		
	Type of Welfare Plan:
	The Plan is a severance pay plan.

Type of Administration:                The Plan is administered by the Plan Administrator.  
		
	Plan Number:
	501

Plan Administrator:                Universal Technical Institute, Inc.
16220 N. Scottsdale Rd., Suite 100
Scottsdale, AZ  85254
(623) 445-9500
Attn:    Gail Paul, VP of Total Rewards & Compliance
Services
		
	Funding:
	Benefits are provided from the general assets of the Employer.

Agent for Service:                 Gail Paul, VP of Total Rewards & Compliance Services
Universal Technical Institute, Inc. 
16220 N. Scottsdale Rd, Suite 100
Scottsdale, AZ  85254

13

IN WITNESS WHEREOF, UTI has caused this Plan to be executed on its behalf by a duly authorized officer on this 9th day of December, 2014.
UNIVERSAL TECHNICAL INSTITUTE, INC.

By:      /s/ Rhonda R. Turner                                
Title:      Senior Vice President of People Services                

ATTEST:

By: /s/ Gail Paul                        

Title: VP of Total Rewards & Compliance Services                    

14

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