Document:

EXHIBIT 4.1

 

 

 

 

SECTION 382 RIGHTS AGREEMENT

 

dated as of October 18, 2016

 

between

 

OCULUS INNOVATIVE SCIENCES, INC.

 

and

 

COMPUTERSHARE INC.,

 

as Rights Agent

 

 

 

    	 	 	 

     

    

 

 

 

Table of Contents

Page

 

	SECTION 1.	 	Certain Definitions	1
	SECTION 2.	 	Appointment of Rights Agent	8
	SECTION 3.	 	Issue of Rights and Right Certificates	9
	SECTION 4.	 	Form of Right Certificates	10
	SECTION 5.	 	Execution, Countersignature and Registration	10
	SECTION 6.	 	
        Transfer, Split-Up, Combination and Exchange
        of Right Certificates; Mutilated,

        Destroyed, Lost or Stolen Right Certificates;
        Uncertificated Rights
	11
	SECTION 7.	 	Exercise of Rights, Expiration Date of Rights	11
	SECTION 8.	 	Cancelation and Destruction of Right Certificates	13
	SECTION 9.	 	Reservation and Availability of Preferred Shares	13
	SECTION 10.	 	Preferred Shares Record Date	14
	SECTION 11.	 	
        Adjustments in Rights After There Is an
        Acquiring Person; Exchange of Rights for Shares;

        Business Combinations
	14
	SECTION 12.	 	Certain Adjustments	17
	SECTION 13.	 	Certificate of Adjustment	18
	SECTION 14.	 	Additional Covenants	18
	SECTION 15.	 	Fractional Rights and Fractional Shares	18
	SECTION 16.	 	Rights of Action	19
	SECTION 17.	 	Transfer and Ownership of Rights and Right Certificates	19
	SECTION 18.	 	Right Certificate Holder Not Deemed a Stockholder	20
	SECTION 19.	 	Concerning the Rights Agent	20
	SECTION 20.	 	Merger or Consolidation or Change of Rights Agent	20
	SECTION 21.	 	Duties of Rights Agent	21
	SECTION 22.	 	Change of Rights Agent	22
	SECTION 23.	 	Issuance of Additional Rights and Right Certificates	23
	SECTION 24.	 	Redemption and Termination	23
	SECTION 25.	 	Notices	24
	SECTION 26.	 	Supplements and Amendments	24
	SECTION 27.	 	Successors	25
	SECTION 28.	 	Benefits of Rights Agreement; Determinations and Actions by the Board, etc.	25
	SECTION 29.	 	Process to Seek Exemption	25
	SECTION 30.	 	Tax Benefits Review	26
	SECTION 31.	 	Severability	26
	SECTION 32.	 	Governing Law	26
	SECTION 33.	 	Counterparts; Effectiveness	26
	SECTION 34.	 	Descriptive Headings	26
	SECTION 35.	 	Force Majeure	27

 

Exhibits

 

A       Form
of Certificate of Designation

B       Form
of Right Certificate

C       Summary
of Rights

 

 

 

 

    	 	 	 

     

    

 

SECTION 382 RIGHTS AGREEMENT dated
as of October 18, 2016 (the “Rights Agreement”), between OCULUS INNOVATIVE SCIENCES, INC., a Delaware corporation
(the “Company”), and COMPUTERSHARE INC., as Rights Agent (the “Rights Agent”).

 

WHEREAS, the Company has generated NOLs
and other Tax Benefits (as such terms are hereinafter defined) for United States Federal income tax purposes; and such NOLs and
other Tax Benefits may potentially provide valuable tax benefits to the Company; the Company desires to avoid an “ownership
change” within the meaning of Section 382 and the Treasury Regulations (as such terms are hereinafter defined) promulgated
thereunder, and thereby preserve the ability to utilize fully such NOLs and other Tax Benefits; and, in furtherance of such objective,
the Company desires to enter into this Rights Agreement; and

 

WHEREAS, on October 18, 2016 (the “Rights
Dividend Declaration Date”) the Board of Directors of the Company (the “Board”) has authorized and
declared a dividend of one Right (as hereinafter defined) for each share of Common Stock, par value $0.0001 per share, of the Company
(the “Common Stock”) outstanding at the Close of Business (as hereinafter defined) on November 1, 2016 (the
“Record Date”), and has authorized the issuance of one Right (as such number may hereafter be adjusted pursuant
to the provisions of this Rights Agreement) with respect to each share of Common Stock that shall become outstanding (whether originally
issued or delivered from the Company’s treasury) between the Record Date and the earliest of the Distribution Date, the Redemption
Date or the Expiration Date (as such terms are hereinafter defined); provided, however, that Rights may be issued with respect
to shares of Common Stock that shall become outstanding after the Distribution Date (whether originally issued or delivered from
the Company’s treasury) and prior to the earlier of the Redemption Date or the Expiration Date only in accordance with the
provisions of Section 23. Each Right shall initially represent the right to purchase one one-thousandth (1/1,000th) of a
share of Series B Preferred Stock, par value $0.0001 per share, of the Company (the “Preferred Shares”), having
the powers, rights and preferences set forth in the Certificate of Designation attached hereto as Exhibit A.

 

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 Rights Agreement, the following terms have the meanings indicated:

 

“Acquiring Person” shall
mean any Person who or which, alone or together with all Affiliates and Associates of such Person, shall be the Beneficial Owner
of 4.99% or more of the Common Shares then outstanding, but not including

 

		(a)	the Company, any Subsidiary of the Company, any employee benefit or compensation plan of the Company
or of any of its Subsidiaries or any Person organized, appointed or established by the Company and holding Common Shares for or
pursuant to the terms of any such employee benefit or compensation plan,

 

		(b)	any Grandfathered Person, unless such Grandfathered Person becomes the Beneficial Owner of a percentage
of Common Shares then outstanding exceeding such Grandfathered Person’s Grandfathered Percentage by 0.5% or more or

 

		(c)	any Exempt Person;

 

provided, however, that no Person
who or which, alone or together with all Affiliates and Associates of such Person, has become and is the Beneficial Owner of 4.99%
or more (or in the case of a Grandfathered Person, has exceeded and is exceeding such Grandfathered Person’s Grandfathered
Percentage by 0.5% or more) of the Common Shares at the time outstanding, will be deemed to have become an Acquiring Person solely
as the result of (i) a change in the aggregate number of Common Shares outstanding since the last date on which such Person acquired
Beneficial Ownership of any Common Shares, including pursuant to a dividend or distribution of shares by the Company made on a
pro rata basis to all holders of Common Shares or the issuance of shares by the Company pursuant to a split or subdivision of the
outstanding Common Shares; (ii) equity compensation awards granted to such Person by the Company or as a result of an adjustment
to the number of Common Shares represented by such equity compensation award pursuant to the terms thereof, unless and until such
time, in the case of clause (i) and clause (ii), as such Person or one or more of its Affiliates or Associates thereafter acquires
Beneficial Ownership of one additional Common Share (other than any Common Shares acquired as described in clause (i) or (ii) above);
or (iii) the acquisition by such Person or one or more of its Affiliates or Associates of Beneficial Ownership of additional Common
Shares if the Board determines that such acquisition was made in good faith without the knowledge by such Person or one or more
of its Affiliates or Associates that such Person would thereby become an Acquiring Person (including because (A) such Person was
unaware that it Beneficially Owned a percentage of then-outstanding Common Shares that would otherwise cause such Person, together
with all Affiliates and Associates of such Person, to become an “Acquiring Person” or (B) such Person was aware of
the extent of its Beneficial Ownership but was unaware of the consequences of such Beneficial Ownership under this Rights Agreement),
which determination of the Board shall be conclusive and binding on such Person, the Rights Agent, the holders of the Rights and
all other Persons.

 

 

 

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Notwithstanding clause (iii) of the proviso
in the prior sentence, unless the Board determines pursuant to the definition of “Exempt Person” that an Inadvertent
Acquiror is an Exempt person, if any Person that is not an Acquiring Person due to such clause (iii) does not reduce its, together
with all of its Affiliates and Associates, percentage of Beneficial Ownership of Common Shares to less than 4.99% by the Close
of Business on the tenth calendar day after notice from the Company (the date of notice being the first day) that such Person’s
Beneficial Ownership of Common Shares would make it an Acquiring Person, such Person shall, at the end of such ten calendar day
period, become an Acquiring Person (and such clause (iii) shall no longer apply to such Person). If any Person that is not an Acquiring
Person due to such clause (iii) and the requirements of the prior sentence shall again become the Beneficial Owner of 4.99% or
more of the Common Shares then outstanding, such Person shall be deemed an “Acquiring Person”, subject to the
exceptions set forth in this definition.

 

Notwithstanding the foregoing, no Person
shall become an “Acquiring Person” solely as a result of an Exempt Transaction.

 

“Affiliate” and “Associate”,
when used with reference to any Person, 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 Rights Agreement, and to the extent not included
within the foregoing, shall also include with respect to any Person, any other Person whose Common Shares would be deemed to be
constructively owned by such first Person, owned by a single “entity” as defined in Section 1.382-3(a)(1) of the Treasury
Regulations, or otherwise aggregated with shares owned by such first Person, pursuant to the provisions of the Code, or any successor
or replacement provision, and the Treasury Regulations promulgated thereunder.

 

A Person shall be deemed the “Beneficial
Owner” of, and shall be deemed to “Beneficially Own”, and shall be deemed to have “Beneficial
Ownership” of, any securities:

 

		(a)	that such Person or any of such Person’s Affiliates or Associates is deemed to “beneficially
own” within the meaning of Rule 13d-3 of the General Rules and Regulations under the Exchange Act, as in effect on the date
of this Rights Agreement; provided, however, that a Person shall not be deemed the Beneficial Owner of, or to Beneficially Own,
or to have Beneficial Ownership of, any Common Shares by virtue of owning securities or other interests (including rights, options
or warrants) that are convertible or exchangeable into, or exercisable for, such Common Shares, except to the extent that upon
the acquisition or transfer of such securities or other interests, such securities or other interests would be treated as exercised
under Section 1.382-4(d) or other applicable sections of the Treasury Regulations;

 

		(b)	that such Person or any of such Person’s Affiliates or Associates has, directly or indirectly,
the legal, equitable or contractual right or obligation to acquire (whether such right is exercisable immediately or only after
the passage of time, compliance with regulatory requirements, fulfillment of a condition or otherwise, or whether within the control
of such Person) pursuant to any agreement, arrangement or understanding (written or oral), or upon the exercise of conversion rights,
exchange rights, other rights (other than the Rights), warrants or options, or otherwise; provided, however, that a Person shall
not be deemed under this clause (b) to be the Beneficial Owner of, or to Beneficially Own, or to have Beneficial Ownership of (i)
any Common Shares by virtue of owning securities or other interests (including rights, options or warrants) that are convertible
or exchangeable into, or exercisable for, such Common Shares, except to the extent that upon the acquisition or transfer of such
securities or other interests, such securities or other interests would be treated as exercised under Section 1.382-4(d) or other
applicable sections of the Treasury Regulations or (ii) any securities tendered pursuant to a tender or exchange offer made by
or on behalf of such Person or any of such Person’s Affiliates or Associates until such tendered securities are accepted
for purchase or exchange thereunder or cease to be subject to withdrawal by the tendering security holder;

 

		(c)	that such Person or any of such Person’s Affiliates or Associates has the right to vote pursuant
to any agreement, arrangement or understanding (written or oral); provided, however, that a Person shall not be deemed under this
clause (c) to be the Beneficial Owner of, or to Beneficially Own, or to have Beneficial Ownership of, any security if (i) the agreement,
arrangement or understanding to vote such security arises solely from a revocable proxy or consent given to such Person in response
to a public proxy or consent solicitation made generally to all holders of Common Shares of the Company pursuant to, and in accordance
with, the applicable rules and regulations under the Exchange Act and (ii) the beneficial ownership of such security is not also
then reportable on Schedule 13D or 13G under the Exchange Act (or any comparable or successor report);

 

 

 

    	 	2	 

     

    

 

		(d)	that such Person or any of such Person’s Affiliates or Associates has the right to dispose
of, pursuant to any agreement, arrangement or understanding (written or oral);

 

		(e)	that are beneficially owned, directly or indirectly, by any other Person (or an Affiliate or Associate
thereof) with which such Person (or any of such Person’s Affiliates or Associates) has any agreement, arrangement or understanding
(written or oral) for the purpose of acquiring (except pursuant to a tender or exchange offer subject to withdrawal as described
in the proviso to clause (b) of this definition) such securities, but only if the effect of such agreement, arrangement or understanding
is to treat such Persons as an “entity” under Section 1.382-3(a)(1) or other applicable sections of the Treasury Regulations;
or

 

		(f)	which are the subject of, or the reference securities for, or that underlie, any derivative security
(as defined under Rule 16a-1 under the Exchange Act) Beneficially Owned by such Person or any of such Person’s Affiliates
or Associates, with the number of Common Shares deemed Beneficially Owned being the notional or other number of Common Shares specified
in the documentation evidencing such derivative security as being subject to be acquired upon the exercise or settlement of such
derivative security or as the basis upon which the value or settlement amount of such derivative security is to be calculated in
whole or in part or, if no such number of Common Shares is specified in such documentation, as determined by the Board in its sole
discretion to be the number of Common Shares to which such derivative security relates, to the extent that such derivative security
is being used to evade the ownership change rules under Section 382.

 

Notwithstanding the foregoing, nothing
contained in this definition shall cause a Person to be deemed the “Beneficial Owner” of, or to “Beneficially
Own”, or to have “Beneficial Ownership” of, securities (A) if the Person is ordinarily engaged in business as
an underwriter of securities and has acquired such securities in a bona fide firm commitment underwriting pursuant to an underwriting
agreement with the Company until the expiration of 40 calendar days (or such later date as the Board may determine in any specific
case) after the date of such acquisition, and then only if such securities continue to be owned by such Person at such expiration
of 40 calendar days (or such later date as the Board may determine in any specific case), or (B) if such Person is a “clearing
agency” (as defined in Section 3(a)(23) of the Exchange Act) and has acquired such securities solely as a result of such
status.

 

Notwithstanding anything in this Rights
Agreement to the contrary, to the extent not contained in this definition, a Person shall be deemed the “Beneficial Owner”
of and shall be deemed to “Beneficially Own” or have “Beneficial Ownership” of, Common Shares that such
Person would be deemed to constructively own or that otherwise would be aggregated with shares owned by such Person pursuant to
Section 382, or any successor provision or replacement provision of the Code and the Treasury Regulations promulgated thereunder.

 

“Board” shall have the
meaning set forth in the introductory paragraph of this Rights Agreement.

 

“Book Value”, when used
with reference to Common Shares issued by any Person, shall mean the amount of equity of such Person applicable to each Common
Share, determined (a) in accordance with generally accepted accounting principles in effect on the date as of which such Book Value
is to be determined, (b) using all the consolidated assets and all the consolidated liabilities of such Person on the date as of
which such Book Value is to be determined, except that no value shall be included in such assets for goodwill arising from consummation
of a business combination, and (c) after giving effect to (i) the exercise of all rights, options and warrants to purchase such
Common Shares (other than the Rights), and the conversion of all securities convertible into such Common Shares, that have an exercise
or conversion price, per Common Share, which is less than such Book Value before giving effect to such exercise or conversion (whether
or not exercisability or convertibility is conditioned upon occurrence of a future event), (ii) all dividends and other distributions
on the capital stock of such Person declared prior to the date as of which such Book Value is to be determined and to be paid or
made after such date, and (iii) any other agreement, arrangement or understanding (written or oral), or transaction or other action
contemplated prior to the date as of which such Book Value is to be determined that would have the effect of thereafter reducing
such Book Value.

 

 

 

    	 	3	 

     

    

 

“Business Combination”
shall have the meaning set forth in Section 11(c)(i).

 

“Business Day” shall
mean each Monday, Tuesday, Wednesday, Thursday and Friday that is not a day on which banking institutions in the State of New York
are authorized or obligated by law or executive order to close.

 

“Certificate of Designation”
shall mean the Certificate of Designation of Series B Preferred Stock of the Company, substantially in the form of Exhibit
A hereto.

 

“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, “Close of Business” shall mean 5:00 p.m., New York City time, on the next succeeding Business
Day.

 

“Code” shall mean Internal
Revenue Code of 1986, as amended.

 

“Common Shares”, when
used with reference to the Company prior to a Business Combination, shall mean the shares of Common Stock or any other shares of
capital stock of the Company into which the Common Stock shall be reclassified or changed and any other interest that would be
treated as “stock” of the Company for purposes of Section 382 (including but not limited to Treasury Regulation Section
1.382-2T(f)(18)) in this Section 1 and all other provisions of this Rights Agreement in which such meaning is necessary
in order to ensure that this Rights Agreement is effective in carrying out its stated purpose and intent of preserving the Company’s
NOLs and other Tax Benefits; “Common Shares”, when used with reference to any Person (other than the Company
prior to a Business Combination), shall mean shares of capital stock of such Person (if such Person is a corporation) of any class
or series, or units of equity interests in such Person (if such Person is not a corporation) of any class or series, the terms
of which do not limit (as a maximum amount and not merely in proportional terms) the amount of dividends or income payable or distributable
on such class or series or the amount of assets distributable on such class or series upon any voluntary or involuntary liquidation,
dissolution or winding up of such Person and do not provide that such class or series is subject to redemption at the option of
such Person, or any shares of capital stock or units of equity interests into which the foregoing shall be reclassified or changed,
and if there shall be more than one class or series of such shares of capital stock or units of equity interests of such Person,
then “Common Shares” of such Person shall mean the class or series of capital stock of such Person or units
of equity interests in such Person having voting power (being the power under ordinary circumstances (and not merely upon the happening
of a contingency) to vote in the election of directors of such Person (if such Person is a corporation) or to participate in the
management and control of such Person (if such Person is not a corporation)), or in the case of multiple classes or series having
such voting power, having the greatest voting power.

 

“Common Stock” shall
have the meaning set forth in the introductory paragraph of this Rights Agreement.

 

“Company” shall have
the meaning set forth in the heading of this Rights Agreement; provided, however, that if there is a Business Combination,
“Company” shall have the meaning set forth in Section 11(c)(iii).

 

The term “control” with
respect to any Person shall mean the power to direct the management and policies of such Person, directly or indirectly, by or
through stock ownership, agency or otherwise, or pursuant to or in connection with an agreement, arrangement or understanding (written
or oral) with one or more other Persons by or through stock ownership, agency or otherwise; and the terms “controlling”
and “controlled” shall have meanings correlative to the foregoing.

 

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

 

 

 

    	 	4	 

     

    

 

“Exchange Act” shall
mean the Securities Exchange Act of 1934, as in effect on the date in question, unless otherwise specifically provided.

 

“Exchange Consideration”
shall have the meaning set forth in Section 11(b)(i).

 

“Exempt Person” shall
mean any Person, alone or together with all Affiliates and Associates of such Person, whose Beneficial Ownership of 4.99% or more
of the then outstanding Common Shares, as determined by the Board in its sole discretion, or a duly constituted committee of Independent
Directors, in its sole discretion, including a determination pursuant to Section 29, (a) would not jeopardize or endanger
the availability to the Company of its NOLs or other Tax Benefits, taking into account all relevant facts and circumstances, including
the potential for the Company to issue a reasonable amount of equity in the future without jeopardizing the availability of its
NOLs and other Tax Benefits or (b) is otherwise in the best interests of the Company; provided, however, that the Board,
or a duly constituted committee of Independent Directors, makes such determination either (x) before the time such Person otherwise
would have become an Acquiring Person, or (y) after the time such Person otherwise would have become an Acquiring Person if the
Board has determined that such Person is an Inadvertent Acquiror; provided, further, that such Person will cease to be an
“Exempt Person” if the Board, in its sole discretion, or a duly constituted committee of Independent Directors,
makes a contrary determination with respect to the effect of such Person’s Beneficial Ownership (together with all Affiliates
and Associates of such Person) with respect to the availability to the Company of its NOLs or other Tax Benefits, taking into account
all relevant facts and circumstances, including the potential for the Company to issue a reasonable amount of equity in the future
without jeopardizing the availability of its NOLs and other Tax Benefits. In granting an exemption under this definition, the Board
may require any Person who would otherwise be an Acquiring Person to make certain representations, undertakings or covenants or
to agree that any violation or attempted violation of such representations, undertakings or covenants will result in such consequences
and be subject to such conditions as the Board, or a duly constituted committee of Independent Directors, may determine in its
sole discretion, including that any such violation shall result in such Person becoming an Acquiring Person.

 

“Exempt Transaction”
shall mean any transaction that the Board determines, or a duly constituted committee of Independent Directors determines, is exempt
from this Rights Agreement, which determination shall be made in the sole discretion of the Board (or any such committee) prior
to the date of such transaction, including if the Board determines that (a) neither the Beneficial Ownership of Common Shares by
any Person, directly or indirectly, as a result of such transaction nor any other aspect of such transaction would jeopardize or
endanger the availability to the Company of the NOLs or other Tax Benefits, taking into account all relevant facts and circumstances,
including the potential for the Company to issue a reasonable amount of equity in the future without jeopardizing the availability
of its NOLs and other Tax Benefits or (b) such transaction is otherwise in the best interests of the Company. In granting an exemption
under this definition, the Board may require any Person who would otherwise be an Acquiring Person to make certain representations,
undertakings or covenants or to agree that any violation or attempted violation of such representations, undertakings or covenants
will result in such consequences and be subject to such conditions as the Board, or a duly constituted committee of Independent
Directors, may determine in its sole discretion, including that any such violation shall result in such Person becoming an Acquiring
Person.

 

“Exemption Request”
shall have the meaning set forth in Section 29.

 

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

 

“Final Expiration Date”
shall mean the Close of Business on October 18, 2026.

 

“Further Subsequent Transferee”
shall have the meaning set forth in Section 7(e).

 

“Grandfathered Percentage”
shall mean, with respect to any Grandfathered Person, the percentage of the outstanding Common Shares of the Company that such
Grandfathered Person, together with all Affiliates and Associates of such Grandfathered Person, Beneficially Owns as of the Rights
Dividend Declaration Date; provided that, in the event any Grandfathered Person shall sell, transfer, or otherwise dispose
of any outstanding Common Shares of the Company after the Rights Dividend Declaration Date, the Grandfathered Percentage shall,
subsequent to such sale, transfer or disposition, mean, with respect to such Grandfathered Person, the lesser of (a) the Grandfathered
Percentage as in effect immediately prior to such sale, transfer or disposition or (b) the percentage of outstanding Common Shares
of the Company that such Grandfathered Person Beneficially Owns immediately following such sale, transfer or disposition.

 

 

 

    	 	5	 

     

    

 

“Grandfathered Person”
shall mean any Person who or which, together with all Affiliates and Associates of such Person, is, as of the Rights Dividend Declaration
Date, the Beneficial Owner (as disclosed in public filings with the Securities and Exchange Commission on the Rights Dividend Declaration
Date) of 4.99% or more of the Common Shares of the Company then outstanding. Notwithstanding anything to the contrary provided
in this Rights Agreement, any Grandfathered Person who after the Rights Dividend Declaration Date becomes the Beneficial Owner
of less than 4.99% of the Common Shares of the Company then outstanding shall cease to be a Grandfathered Person and shall be subject
to all of the provisions of this Rights Agreement in the same manner as any Person who or which is not and was never a Grandfathered
Person.

 

“including” shall mean
including, without limitation.

 

“Inadvertent Acquiror”
shall mean any Person who would be an Acquiring Person but for clause (iii) of the proviso in the definition of “Acquiring
Person”.

 

“Independent Director”
shall mean an independent director as defined under Listing Rules of the NASDAQ Stock Market.

 

“Major Part”, when used
with reference to the assets of the Company and its Subsidiaries as of any date, shall mean assets (a) having a fair market value
aggregating 50% or more of the total fair market value of all the assets of the Company and its Subsidiaries (taken as a whole)
as of the date in question, (b) accounting for 50% or more of the total value (net of depreciation and amortization) of all the
assets of the Company and its Subsidiaries (taken as a whole) as would be shown on a consolidated or combined balance sheet of
the Company and its Subsidiaries as of the date in question, prepared in accordance with generally accepted accounting principles
then in effect, or (c) accounting for 50% or more of the total amount of earnings before interest, taxes, depreciation and amortization
or of the revenues of the Company and its Subsidiaries (taken as a whole) as would be shown on, or derived from, a consolidated
or combined statement of income or net earnings of the Company and its Subsidiaries for the period of 12 months ending on the last
day of the Company’s monthly accounting period immediately preceding the date in question, prepared in accordance with generally
accepted accounting principles then in effect.

 

“Market Value”, when
used with reference to Common Shares on any date, shall mean the average of the daily closing prices, per share, of such Common
Shares for the period which is the shorter of (a) 10 consecutive Trading Days ending on the Trading Day immediately prior to the
date in question or (b) the number of consecutive Trading Days beginning on the Trading Day immediately after the date of the first
public announcement of the event requiring a determination of the Market Value of Common Shares and ending on the Trading Day immediately
prior to the record date of such event. The closing price for each Trading Day shall be the closing price quoted on the principal
consolidated transaction reporting system with respect to securities listed or admitted to trading on the NASDAQ Stock Market,
or, if the Common Shares or other relevant securities are not quoted on the NASDAQ Stock Market, on the principal United States
securities exchange registered under the Exchange Act (or any recognized foreign stock exchange) on which such securities are listed
or admitted to trading, or, if such securities are not listed or admitted to trading on any such exchange, the closing price (or,
if no sale takes place on such Trading Day, the average of the closing bid and asked prices on such Trading Day) as quoted on any
reputable quotations system specified by the Board, or if no such quotations are available, the average of the closing bid and
asked prices as furnished by a professional market maker making a market in such securities selected by the Board, or if on any
such Trading Day no market maker is making a market in such securities, the closing price of such securities on such Trading Day
shall be deemed to be the fair value of such securities 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 on the Rights Agent, the holders of Rights and all other
Persons); provided, however, that if a Trading Day occurs during a period following an announcement of any action of the
type described in Section 12(a) that would require an adjustment thereunder by the issuer of the securities the closing
price of which is to be determined, then, and in each such case, the closing price of such securities shall be appropriately adjusted
to reflect the effect of such action on the market price of such securities; and provided further, however, that for the
purpose of determining the closing price of the Preferred Shares for any Trading Day on which there is no market maker for the
Preferred Shares, the closing price on such Trading Day shall be deemed to be the Formula Number (as defined in the Certificate
of Designation) multiplied by the closing price of the Common Shares of the Company on such Trading Day.

 

 

 

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“NOLs” shall mean the
Company’s net operating loss carryforwards.

 

“Person” shall mean
an individual, firm, corporation, partnership, limited liability company, joint venture, association, trust, unincorporated organization
or other entity, or a group of Persons making a “coordinated acquisition” of shares or otherwise treated as an entity
within the meaning of Section 1.382-3(a)(1) of the Treasury Regulations, and shall include any successor (by merger or otherwise)
of such individual or entity, but shall not include a Public Group (as defined in Section 1.382-2T(f)(13) of the Treasury Regulations).

 

“Post Transferee” shall
have the meaning set forth in Section 7(e).

 

“Preferred Shares” shall
have the meaning set forth in the introductory paragraph of this Rights Agreement. Any reference in this Rights Agreement to Preferred
Shares shall be deemed to include any authorized fraction of a Preferred Share, unless the context otherwise requires.

 

“Principal Party” shall
mean the Surviving Person in a Business Combination; provided, however, that, (i) if such Surviving Person is a direct or
indirect Subsidiary of any other Person, “Principal Party” shall mean the Person which is the ultimate parent
of such Surviving Person, and (ii) in the event ultimate control of such Surviving Person is shared by two or more Persons, “Principal
Party” shall mean that Person that is immediately controlled by such two or more Persons.

 

“Prior Transferee” shall
have the meaning set forth in Section 7(e).

 

“Purchase Price” with
respect to each Right shall mean $10.00, as such amount may from time to time be adjusted as provided in this Rights Agreement,
and shall be payable in lawful money of the United States of America. All references herein to the Purchase Price shall mean the
Purchase Price as in effect at the time in question.

 

“Record Date” shall
have the meaning set forth in the introductory paragraph of this Rights Agreement.

 

“Redemption Date” shall
have the meaning set forth in Section 24(a).

 

“Redemption Price” with
respect to each Right shall mean $0.0001, as such amount may from time to time be adjusted in accordance with Section 12.
All references herein to the Redemption Price shall mean the Redemption Price as in effect at the time in question.

 

“Registered Common Shares”
shall mean Common Shares that are, as of the date of consummation of a Business Combination, and have continuously been for the
12 months immediately preceding such date, registered under Section 12 of the Exchange Act, and if a Person has multiple classes
or series of Registered Common Shares outstanding, “Registered Common Shares” of such Person shall mean the
class or series of Registered Common Shares of such Person having voting power (being the power under ordinary circumstances (and
not merely upon the happening of a contingency) to vote in the election of directors of such Person (if such Person is a corporation)
or to participate in the management and control of such Person (if such Person is not a corporation)), or in the case of multiple
classes or series having such voting power, having the greatest voting power.

 

“Requesting Person”
shall have the meaning set forth in Section 29.

 

“Right Certificate”
shall mean a certificate evidencing a Right in substantially the form attached hereto as Exhibit B.

 

“Rights” shall mean
the rights to purchase Preferred Shares (or other securities) as provided in this Rights Agreement.

 

“Rights Dividend Declaration Date”
shall have the meaning set forth in the introductory paragraph of this Rights Agreement.

 

“Section 382” shall
mean Section 382 of the Code, or any successor provision or replacement provision.

 

 

 

    	 	7	 

     

    

 

“Securities Act” shall
mean the Securities Act of 1933, as in effect on the date in question, unless otherwise specifically provided.

 

“Share Acquisition Date”
shall mean the date on which the Company learns that a Person has become an Acquiring Person; provided, however that, if
such Person is determined by the Board (a) to be an Exempt Person or (b) not to have become an Acquiring Person pursuant to clause
(iii) of the proviso in the definition of “Acquiring Person”, then in the case of each of clause (a) and (b), the Share
Acquisition Date shall be deemed not to have occurred; but only for so long as such Person (i) in the case of clause (a), remains
an Exempt Person or (ii) in the case of clause (b), does not thereafter become an Acquiring Person pursuant to the second sentence
of the definition of “Acquiring Person”, unless, in the case of each of clause (i) and clause (ii), the Distribution
Date shall have occurred.

 

“Subsidiary” of another
Person shall mean a Person, at least a majority of the total outstanding voting power (being the power under ordinary circumstances
(and not merely upon the happening of a contingency) to vote in the election of directors of such Person (if such Person is a corporation)
or to participate in the management and control of such Person (if such Person is not a corporation)) of which is owned, directly
or indirectly, by such other Person or by one or more other Subsidiaries of such other Person or by such other Person and one or
more other Subsidiaries of such other Person.

 

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

 

“Surviving Person” shall
mean (a) the Person which is the continuing or surviving Person in a consolidation, merger, share exchange or other business combination
specified in Section 11(c)(i)(A) or (b) the Person to which the Major Part of the assets of the Company and its Subsidiaries
is sold, leased, exchanged or otherwise transferred or disposed of in a transaction specified in Section 11(c)(i)(B); provided,
however, that, if the Major Part of the assets of the Company and its Subsidiaries is sold, leased, exchanged or otherwise
transferred or disposed of in one or more related transactions specified in Section 11(c)(i)(B) to more than one Person,
the “Surviving Person” in such case shall mean the Person that acquired assets of the Company and/or its Subsidiaries
with the greatest fair market value in such transaction or transactions.

 

“Tax Benefits” shall
mean the net operating loss carryovers, capital loss carryovers, general business credit carryovers, alternative minimum tax credit
carryovers, foreign tax credit carryovers, research and development credit carryovers and any loss or deduction attributable to
a “net unrealized built-in loss” within the meaning of Section 382, and the Treasury Regulations promulgated thereunder,
of the Company or any of its Subsidiaries.

 

“Trading Day” shall
mean a day on which the principal United States securities exchange (or principal recognized foreign stock exchange, as the case
may be) on which the Rights or securities in question are listed or admitted to trading is open for the transaction of business
or, if the Rights or securities in question are not listed or admitted to trading on any United States securities exchange (or
recognized foreign stock exchange, as the case may be), a Business Day.

 

“Treasury Regulations”
shall mean final, temporary and proposed tax regulations promulgated under the Code, as amended.

 

“Trust” shall have the
meaning set forth in Section 11(b)(ii).

 

“Trust Agreement” shall
have the meaning set forth in Section 11(b)(ii).

 

SECTION 2.     
Appointment of Rights Agent. The Company hereby appoints the Rights Agent to act as agent for the Company in accordance
with the terms and conditions hereof, and the Rights Agent hereby accepts such appointment. The Company may from time to time appoint
one or more co-rights agents as it may deem necessary or desirable, upon ten days’ prior written notice to the Rights Agent.
The Rights Agent shall have no duty to supervise, and shall in no event be liable for, the acts or omissions of any such co-rights
agent. In the event the Company appoints one or more co-rights agents, the respective duties of the Rights Agent and any co-rights
agents shall be as the Company shall reasonably determine, and shall be provided in writing to the Rights Agent.

 

 

 

    	 	8	 

     

    

 

SECTION 3.     
Issue of Rights and Right Certificates.

 

(a) One Right shall be associated with
each Common Share outstanding on the Record Date, each additional Common Share that shall become outstanding between the Record
Date and the earliest of the Distribution Date, the Redemption Date or the Expiration Date and each additional Common Share with
which Rights are issued after the Distribution Date but prior to the earlier of the Redemption Date or the Expiration Date as provided
in Section 23, subject to adjustment as provided in this Rights Agreement.

 

(b) Until the earlier of the Close of Business
on (i) the tenth calendar day after the Share Acquisition Date and (ii) such date, if any, as may be designated by the Board following
the commencement of, or first public disclosure of an intent to commence, a tender or exchange offer by any Person (other than
the Company, any Subsidiary of the Company, any employee benefit or compensation plan of the Company or of any of its Subsidiaries,
or any Person organized, appointed or established by the Company and holding Common Shares for or pursuant to the terms of any
such employee benefit or compensation plan) for outstanding Common Shares, if upon consummation of such tender or exchange offer
such Person could be the Beneficial Owner of 4.99% or more of the outstanding Common Shares (the Close of Business on the earlier
of such dates being the “Distribution Date”), (x) the Rights shall, except as otherwise provided in Section
3(c), be evidenced by the certificates for Common Shares registered in the names of the holders thereof, or, in the case of
Common Shares held in uncertificated form, by the transaction statement or other record of ownership of such Common Shares, and
not by separate Right Certificates, and (y) the Rights, including the right to receive Right Certificates, shall be transferable
only in connection with the transfer of the underlying Common Shares. As soon as practicable after the Distribution Date, the Rights
Agent (at the expense of the Company and upon receipt of all relevant and information, including the names and addresses of all
relevant holders if the Rights Agent is not also the transfer agent and registrar of the Common Shares) shall send by first-class,
postage-prepaid mail, to each record holder of Common Shares as of the Close of Business on the Distribution Date, at the address
of such holder shown on the records of the Company or the transfer agent or registrar for the Common Shares, one or more Right
Certificates evidencing one whole Right for each Common Share held by such record holder, subject to the provisions of Section
15 and to adjustment as provided in this Rights Agreement. As of and after the Distribution Date, the Rights shall be
evidenced solely by such Right Certificates.

 

(c) As soon as practicable after the Record
Date, the Company will send a copy of a Summary of Rights to Purchase Preferred Shares, in substantially the form attached hereto
as Exhibit C (the “Summary of Rights”), by first-class, postage-prepaid mail, to each record holder
of Common Shares as of the Close of Business on the Record Date at the address of such holder shown on the records of the Company
or the transfer agent or registrar for the Common Shares. With respect to any Common Shares outstanding as of the Record Date,
and until the earliest of the Distribution Date, the Redemption Date or the Expiration Date, (i) in the case of certificated shares,
(A) the Rights associated with the Common Shares represented by any certificate shall be evidenced by such certificate for the
Common Shares with a copy of the Summary of Rights attached thereto and the registered holders of the Common Shares shall also
be the registered holders of the associated Rights and (B) the surrender for transfer of any such certificate, even without a copy
of the Summary of Rights attached thereto, shall also constitute the transfer of the Rights associated with the Common Shares represented
thereby, and (ii) in the case of Common Shares held in uncertificated form, (A) the Rights associated with the Common Shares shall
be evidenced by the balances indicated in the book-entry account system of the transfer agent for such Common Shares and the registered
holders of the Common Shares shall also be the registered holders of the associated Rights and (B) the transfer of any Common Shares
in the book-entry account system of the transfer agent for such Common Shares shall also constitute the transfer of the Rights
associated with such Common Shares.

 

(d) In the case of certificated Common
Shares, certificates issued for Common Shares after the Record Date (including upon transfer or exchange of outstanding Common
Shares), but prior to the earliest of the Distribution Date, the Redemption Date or the Expiration Date, shall have printed on,
written on or otherwise affixed to them a legend in substantially the following form:

 

This certificate also evidences and
entitles the holder hereof to certain Rights as set forth in a Rights Agreement dated as of October 18, 2016 (as it may be amended
from time to time (the “Rights Agreement”)), between OCULUS INNOVATIVE SCIENCES, INC. (the “Company”)
and COMPUTERSHARE INC., as Rights Agent (or any successor rights agent, the “Rights
Agent”), the terms of which (including restrictions on the transfer of such Rights) are hereby incorporated herein by reference
and a copy of which is on file at the principal executive offices of the Company. Under certain circumstances, as set forth in
the Rights Agreement, such Rights shall be evidenced by separate certificates and shall no longer be evidenced by this certificate.
The Company shall mail to the holder of this certificate a copy of the Rights Agreement without charge after receipt of a written
request therefor. RIGHTS THAT ARE OR WERE, AT ANY TIME ON OR AFTER THE DATE AN ACQUIRING PERSON BECOMES SUCH, BENEFICIALLY OWNED
BY SUCH ACQUIRING PERSON OR ANY AFFILIATE OR ASSOCIATE OF SUCH ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT)
AND BY ANY SUBSEQUENT HOLDER OF SUCH RIGHTS ARE NULL AND VOID AND NONTRANSFERABLE.

 

 

 

    	 	9	 

     

    

 

Notwithstanding this Section 3(d),
neither the omission of a legend nor the inclusion of a legend that makes reference to a rights agreement other than the Rights
Agreement shall affect the enforceability of any part of this Rights Agreement or the rights of any holder of Rights.

 

(e) In the case of Common Shares held in
uncertificated form, the Company shall cause the confirmation and account statements sent to holders of Common Shares in book-entry
form (including upon transfer or exchange of outstanding Common Shares) prior to the earliest of the Distribution Date, the Redemption
Date or the Expiration Date to bear a legend in substantially the following form:

 

Each share of Common Stock, par value
$0.0001 per share, of OCULUS INNOVATIVE SCIENCES, INC. (the “Company”) entitles the holder thereof to certain
Rights as set forth in a Rights Agreement dated as of October 18, 2016 (as it may be amended from time to time (the “Rights
Agreement”)), between the Company and COMPUTERSHARE INC., as Rights Agent (or any successor rights agent, the “Rights
Agent”), the terms of which (including restrictions on the transfer of such Rights) are hereby incorporated herein by
reference and a copy of which is on file at the principal executive offices of the Company. Under certain circumstances, as set
forth in the Rights Agreement, such Rights shall be evidenced by separate certificates and shall no longer be evidenced by the
shares to which this statement relates. The Company shall mail to the holder of shares to which this statement relates a copy of
the Rights Agreement without charge after receipt of a written request therefor. RIGHTS THAT ARE OR WERE, AT ANY TIME ON OR AFTER
THE DATE AN ACQUIRING PERSON BECOMES SUCH, BENEFICIALLY OWNED BY SUCH ACQUIRING PERSON OR ANY AFFILIATE OR ASSOCIATE OF SUCH ACQUIRING
PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) AND BY ANY SUBSEQUENT HOLDER OF SUCH RIGHTS ARE NULL AND VOID AND NONTRANSFERABLE.

 

Notwithstanding this Section 3(e),
neither the omission of a legend nor the inclusion of a legend that makes reference to a rights agreement other than the Rights
Agreement shall affect the enforceability of any part of this Rights Agreement or the rights of any holder of Rights.

 

SECTION 4.     
Form of Right Certificates. The Right Certificates (and the form of election to purchase and form of assignment to be printed
on the reverse side thereof) shall be in substantially the form set forth as Exhibit B hereto and may have such marks
of identification or designation and such legends, summaries or endorsements printed thereon as the Company may deem appropriate
and as are not inconsistent with the provisions of this Rights Agreement (but which do not affect the rights, duties, liabilities
or responsibilities of the Rights Agent), 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 or interdealer quotation system on which the Rights
may from time to time be listed or traded, or to conform to usage. Subject to the other provisions of this Rights Agreement (including
Sections 7, 11 and 24), the Right Certificates, whenever issued, shall be dated as of the Distribution Date and shall
entitle the holders thereof to purchase such number of Preferred Shares as shall be set forth therein for the Purchase Price set
forth therein, subject to adjustment as provided in this Rights Agreement.

 

SECTION 5.     
Execution, Countersignature and Registration.

 

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

 

 

 

    	 	10	 

     

    

 

(b) Following the Distribution Date, the
Rights Agent shall keep or cause to be kept, at its office designated for such purpose, books for registration and transfer of
the Right Certificates issued hereunder. Such books shall show the names and addresses of the respective holders of the Right Certificates,
the number of Rights evidenced by each of the Right Certificates, the certificate number of each of the Right Certificates and
the date of each of the Right Certificates.

 

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

 

(a) Subject to Section 15, at any
time after the Distribution Date, and at or prior to the Close of Business on the earlier of the Redemption Date or the Expiration
Date, any Right Certificate or Right Certificates (other than Right Certificates representing Rights that have become null and
void pursuant to Section 7(e)) may be transferred, split-up, combined or exchanged for another Right Certificate or Right
Certificates representing, in the aggregate, the same number of Rights as the Right Certificate or Right Certificates surrendered
then represented. The Right Certificates are transferable only on the registry books of the Rights Agent. Any registered holder
desiring to transfer, split-up, combine or exchange any Right Certificate or Right Certificates shall make such request in writing
delivered to the Company and the Rights Agent and shall surrender the Right Certificate or Right Certificates to be transferred,
split-up, combined or exchanged at the office of the Rights Agent designated for such purpose accompanied by a signature guarantee
and such other documentation as the Rights Agent may reasonably request; provided, however, that neither the Rights Agent nor the
Company shall be obligated to take any action whatsoever with respect to the transfer of any Right Certificate surrendered for
transfer until the registered holder shall have properly completed and duly signed the certification contained in the form of assignment
on the reverse side of such Right 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 or the Rights Agent shall reasonably request.
Thereupon the Rights Agent shall, subject to Sections 7(e) and 15, countersign and deliver to the Person entitled
thereto a Right Certificate or Right Certificates, as the case may be, as so requested. The Company or the Rights Agent may require
payment 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 Right Certificates. The Rights Agent shall not have any duty or obligation to take any action under
any section of this Rights Agreement that requires the payment of taxes and/or charges unless and until it is satisfied that all
such payments have been made.

 

(b) Subject to Sections 7(e) and
15, upon receipt by the Company and the Rights Agent of evidence reasonably satisfactory to them of the loss, theft, destruction
or mutilation of a valid Right Certificate, and, in case of loss, theft or destruction, of indemnity or security reasonably satisfactory
to them, and, at the Company’s request, reimbursement to the Company and the Rights Agent of all reasonable expenses incidental
thereto, and upon surrender to the Rights Agent and cancelation of the Right Certificate if mutilated, the Company shall execute
a new Right Certificate of like tenor and deliver such new Right Certificate to the Rights Agent for countersignature and delivery
to the registered owner in lieu of the Right Certificate so lost, stolen, destroyed or mutilated.

 

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

 

SECTION 7.     
Exercise of Rights, Expiration Date of Rights.

 

(a) Subject to the other provisions of
this Rights Agreement (including Section 7(e) and Section 11), each Right shall entitle the registered holder thereof,
upon exercise thereof as provided in this Rights Agreement, to purchase for the Purchase Price one one-thousandth (1/1,000th)
of a Preferred Share, subject to adjustment as provided in this Rights Agreement, at any time after the Distribution Date
and at or prior to the earliest of (i) the Final Expiration Date, (ii) the Redemption Date, (iii) the Close of Business on the
effective date of the repeal of Section 382 or any successor statute if the Board determines that this Rights Agreement is no longer
necessary or desirable for the preservation of NOLs or other Tax Benefits, or (iv) the Close of Business on the first day of a
taxable year of the Company to which the Board determines that no NOLs or other Tax Benefits may be carried forward (the earliest
of the events described in clauses or (i), (iii), and (iv) being herein referred to as the “Expiration Date”).

 

 

 

    	 	11	 

     

    

 

(b) Subject to the other provisions of
this Rights Agreement (including Section 7(e)), the registered holder of any Right certificate may exercise the Rights evidenced
thereby (except as otherwise provided in this Rights Agreement) in whole or in part at any time after the Distribution Date
and at or prior to the earlier of (i) the Expiration Date and (ii) the Redemption Date, upon surrender of the Right Certificate,
with the form of election to purchase on the reverse side thereof properly completed and duly executed, to the Rights Agent at
the office of the Rights Agent designated for such purpose, accompanied by a signature guarantee and such other documentation as
the Rights Agent may reasonably request, together with payment of the Purchase Price for each one one-thousandth (1/1,000th) of
a Preferred Share (as such fraction may be adjusted as provided in this Rights Agreement) as to which the Rights are exercised,
together with an amount equal to any applicable transfer tax, in the manner required hereby.

 

(c) Subject to the other provisions of
this Rights Agreement (including Section 7(e)), upon receipt of a Right Certificate representing exercisable Rights, with
the form of election to purchase properly completed and duly executed, accompanied by payment of the Purchase Price for the Preferred
Shares to be purchased together with an amount equal to any applicable transfer tax, in lawful money of the United States of America,
in cash or by certified check or money order payable to the order of the Company, the Rights Agent shall thereupon promptly (i)
either (A) requisition from any transfer agent of the Preferred Shares (or make available, if the Rights Agent is the transfer
agent for such shares) certificates for the total number of Preferred Shares 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 Preferred
Shares with a depositary agent under a depositary arrangement, requisition from the depositary agent depositary receipts representing
the number of one one-thousandths (1/1,000ths) of a Preferred Share (as such fraction may be adjusted as provided in this
Rights Agreement) to be purchased (in which case certificates for the Preferred Shares to be represented by such receipts shall
be deposited by the transfer agent with the depositary agent) and the Company shall direct the depositary agent to comply with
all such requests, (ii) when necessary to comply with this Rights Agreement (or otherwise when appropriate, as determined by the
Company with written notice to the Rights Agent), requisition from the Company the amount of cash, if any, to be paid in lieu of
issuance of fractional shares in accordance with Section 15, (iii) after receipt of such certificates or depositary receipts,
cause the same to be delivered to or, upon the order of the registered holder of such Right Certificate, registered in such name
or names as may be designated by such holder and (iv) when necessary to comply with this Rights Agreement (or otherwise when appropriate,
as determined by the Company with written notice to the Rights Agent), after receipt thereof, deliver such cash, if any, to or
upon the order of the registered holder of such Right Certificate.

 

(d) In case the registered holder of any
Right Certificate shall exercise fewer than all the Rights evidenced thereby, a new Right Certificate evidencing Rights equivalent
to the Rights remaining unexercised shall be issued by the Rights Agent and delivered to the registered holder of such Right Certificate
or to such holder’s duly authorized assigns, subject to the provisions of Section 15.

 

(e) Notwithstanding anything in this Rights
Agreement to the contrary, any Rights that are at any time Beneficially Owned by (i) an Acquiring Person or an Affiliate or Associate
of an Acquiring Person, (ii) a transferee of an Acquiring Person (or of any Associate or Affiliate of such Acquiring Person) who
becomes a transferee after the Acquiring Person becomes such (a “Post Transferee”), (iii) a transferee of an
Acquiring Person (or of any Associate or Affiliate of such Acquiring Person) 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 from such Affiliate or Associate) to holders of equity interests in such Acquiring Person or to any
Person with whom the Acquiring Person (or such Affiliate or Associate) has any continuing agreement, arrangement or understanding
(written or oral) regarding the transferred Rights or (B) a transfer which the Board has determined is part of a plan, arrangement
or understanding which has as a primary purpose or effect the avoidance of this Section 7(e) (a “Prior Transferee”),
or (iv) any subsequent transferee receiving transferred Rights from a Post Transferee or a Prior Transferee, either directly or
through one or more intermediate transferees (a “Further Subsequent Transferee”), shall become null and void
without any further action and no holder of such Rights shall have any rights whatsoever with respect to such Rights, whether under
any provision of this Rights Agreement 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 any Right Certificate or any other
Person as a result of its failure to make any determinations with respect to an Acquiring Person or its Affiliate or Associate,
or any transferee thereof, hereunder.

 

 

 

    	 	12	 

     

    

 

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

 

SECTION 8.     
Cancelation and Destruction of Right Certificates. All Right Certificates surrendered or presented for the purpose of exercise,
transfer, split-up, combination or exchange shall, and any Right Certificate representing Rights that have become null and void
and nontransferable pursuant to Section 7(e) surrendered or presented for any purpose shall, if surrendered or presented
to the Company or to any of its agents, be delivered to the Rights Agent for cancelation or in canceled form, or, if surrendered
or presented to the Rights Agent, shall be canceled by it, and no Right Certificates shall be issued in lieu thereof except as
expressly permitted by this Rights Agreement. The Company shall deliver to the Rights Agent for cancelation and retirement, and
the Rights Agent shall so cancel and retire, any Right Certificate purchased or acquired by the Company. Subject to applicable
law and regulation, the Rights Agent shall maintain in a retrievable database electronic records of all cancelled or destroyed
Rights Certificates which have been canceled or destroyed by the Rights Agent. The Rights Agent shall maintain such electronic
records for the term of this Rights Agreement and any additional time period required by applicable law and regulation. Upon written
request of the Company (and at the expense of the Company), the Rights Agent shall provide to the Company or its designee copies
of such electronic records relating to Rights Certificates canceled or destroyed by the Rights Agent and shall certify to the Company
the accuracy of such records.

 

SECTION 9.     
Reservation and Availability of Preferred Shares.

 

(a) The Company shall cause to be reserved
and kept available out of its authorized and unissued Preferred Shares (or any authorized and issued Preferred Shares held in its
treasury), free from preemptive rights or any right of first refusal, a number of Preferred Shares sufficient to permit the exercise
in full of all outstanding Rights.

 

(b) If there are not sufficient Preferred
Shares authorized but unissued (or authorized and issued Preferred Shares held by the Company in its treasury) to permit the exercise
of Rights in accordance with this Rights Agreement, the Company shall take all such action as may be necessary to authorize additional
Preferred Shares for issuance upon the exercise of Rights pursuant to this Rights Agreement; provided, however, that if
the Company is unable to cause the authorization of additional Preferred Shares then the Company shall, or, if action by the Company’s
stockholders is necessary to cause such authorization, in lieu of seeking any authorization, the Company may, to the extent necessary
and permitted by applicable law and any agreements or instruments to which it is a party in effect prior to the Distribution Date,
(i) upon surrender of a Right, pay cash equal to the Purchase Price in lieu of issuing Preferred Shares and requiring payment therefor
or (ii) upon due exercise of a Right and payment of the Purchase Price for each Preferred Share as to which such Right is exercised,
distribute cash, Preferred Shares (including fractions thereof), Common Shares (including fractions thereof) or other equity or
debt securities (or any combination of any of the foregoing) having an aggregate value equal to the value of the Preferred Shares
(including fractions thereof) that otherwise would have been issuable pursuant to this Rights Agreement, which value shall be determined
by a nationally recognized investment banking firm selected by the Board. To the extent that any legal or contractual restrictions
(pursuant to agreements or instruments to which it is party in effect prior to the Distribution Date) prevent the Company from
paying the full amount payable in accordance with the foregoing sentence, the Company shall pay to holders of the Rights as to
which such payments are being made all amounts that are not then restricted on a pro rata basis as such payments are or become
permissible under such legal or contractual restrictions until such payments have been paid in full.

 

 

 

    	 	13	 

     

    

 

(c) The Company shall take all actions
as may be necessary to ensure that all Preferred Shares and Common Shares delivered upon exercise or exchange of Rights shall,
at the time of delivery of the certificates for such Preferred Shares and Common Shares (subject to payment of the Purchase Price),
be duly and validly authorized and issued and fully paid and nonassessable shares.

 

(d) The Company shall pay when due and
payable any and all Federal and state transfer taxes and charges which may be payable in respect of the issuance or delivery of
Right Certificates or of any Preferred Shares or Common Shares or other securities upon the exercise or exchange of the Rights.
The Company shall not, however, be required to pay any transfer tax or charge which may be payable in respect of any transfer or
delivery of Right Certificates to a Person other than, or in respect of the issuance or delivery of certificates or depositary
receipts for the Preferred Shares or Common Shares or other securities, as the case may be, in a name other than that of, the registered
holder of the Right Certificate evidencing Rights surrendered for exercise or exchange or to issue or deliver any certificates
or depositary receipts for Preferred Shares or Common Shares or other securities, as the case may be, upon the exercise or exchange
of any Rights until any such tax or charge shall have been paid (any such tax or charge being payable by the holder of such Right
Certificate at the time of surrender) or until it has been established to the Company’s and the Right’s Agent’s
satisfaction that no such tax or charge is due.

 

SECTION 10.  Preferred Shares
Record Date. Each Person in whose name any certificate for Preferred Shares or Common Shares or other securities is issued
upon the exercise or exchange of Rights shall for all purposes be deemed to have become the holder of record of the Preferred Shares
or Common Shares or other securities, as the case may be, represented thereby on, and such certificate shall be dated, the date
on which the Right Certificate evidencing such Rights was duly surrendered and payment of any Purchase Price (and any applicable
transfer taxes) was made; provided, however, that, if the date of such surrender and payment is a date upon which the transfer
books of the Company for the Preferred Shares or Common Shares or other securities, as the case may be, are closed, such Person
shall be deemed to have become the record holder of such Preferred Shares or Common Shares or other securities, as the case may
be, on, and such certificate shall be dated, the next succeeding Business Day on which the transfer books of the Company for the
Preferred Shares or Common Shares or other securities, as the case may be, are open.

 

SECTION 11.  Adjustments
in Rights After There Is an Acquiring Person; Exchange of Rights for Shares; Business Combinations.

 

(a) Subject to the other provisions of
this Rights Agreement (including Section 7(e)), upon the occurrence of the Share Acquisition Date, each holder of a Right
shall thereafter have a right to receive, upon exercise thereof for the Purchase Price in accordance with the terms of this Rights
Agreement, such number of one one-thousandths (1/1,000ths) of a Preferred Share (as such fraction may be adjusted as provided
in this Rights Agreement) as shall equal the result obtained by multiplying the Purchase Price by a fraction, the numerator of
which is the number of one one-thousandths (1/1,000ths) of a Preferred Share (as such fraction may be adjusted as provided
in this Rights Agreement) for which such Right is then exercisable and the denominator of which is 50% of the Market Value of the
Common Shares on the date on which such Person became an Acquiring Person.

 

(b) (i) The Board may, at its option, at
any time after the Share Acquisition Date, mandatorily exchange all or part of the then outstanding and exercisable Rights (which
shall not include Rights that shall have become null and void and nontransferable pursuant to Section 7(e)) for consideration
per Right consisting of either (A) one-half of the Preferred Shares (or fractions thereof) that would be issuable at such time
upon the exercise of one Right in accordance with Section 11(a) or (B) cash, Preferred Shares (including fractions thereof),
Common Shares (including fractions thereof) or other equity or debt securities (or any combination of any of the foregoing) having
an aggregate value equal to one-half of the value of Preferred Shares (including fractions thereof) that would be issuable at such
time upon the exercise of one Right in accordance with Section 11(a), which values shall be determined by a nationally recognized
investment banking firm selected by the Board (such consideration in this Section 11(b)(i) being the “Exchange
Consideration”). If the Board elects to exchange all the Rights for Exchange Consideration pursuant to this Section
11(b)(i) prior to the physical distribution of the Right Certificates, the Company may distribute the Exchange Consideration
in lieu of distributing Right Certificates, in which case for purposes of this Rights Agreement holders of Rights shall be deemed
to have simultaneously received and surrendered for exchange Right Certificates on the date of such distribution. If the Board
elects to exchange Rights for Exchange Consideration consisting all or in part of Preferred Shares, the Company may elect to deposit
such Preferred Shares with a depositary agent under a depositary arrangement, and, in such event the Company shall cause the depositary
agent to issue, in lieu of certificates for such Preferred Shares, depositary receipts representing the number of such Preferred
Shares (or fractions thereof) to be exchanged (in which case the certificates for such Preferred Shares to be represented by such
receipts shall be deposited by the transfer agent with the depositary agent). Notwithstanding the foregoing, the Board may not
effect such exchange at any time after any Person (other than the Company, any Subsidiary of the Company or any employee benefit
plan of the Company or any of its Subsidiaries or any Person holding Common Shares for or pursuant to the terms of any such employee
benefit or compensation plan), together with all Affiliates and Associates of such Person, becomes the Beneficial Owner of more
than 50% of the Common Shares then outstanding.

 

 

 

    	 	14	 

     

    

 

(ii) If the Board elects to mandatorily
exchange any Rights under Section 11(b)(i), the Board may, at its option and without limiting any rights the Company may
have under Section 26, cause the Company to enter into such arrangements or implement such procedures as it deems necessary
or appropriate, in its sole discretion, for the purpose of ensuring that the Exchange Consideration is not received by holders
of Rights that have become null and void pursuant to Section 7(e), including entering 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 Exchange Consideration distributable pursuant to the exchange, and all holders
of Rights entitled to receive such Exchange Consideration pursuant to the exchange shall be entitled to receive such Exchange Consideration
(and any dividends paid or distributions made with respect to any securities constituting such Exchange Consideration after the
date on which such securities are deposited in the Trust) only from the Trust and solely upon compliance with the relevant terms
and provisions of the Trust Agreement. Prior to effecting an exchange and distributing such Exchange Consideration, 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 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 conclusively to deem the Rights formerly
held by such Person to be null and void pursuant to Section 7(e) hereof and not transferable, exercisable or exchangeable
in connection herewith. Any securities issued at the direction of the Board in connection herewith shall be validly issued, fully
paid and nonassessable securities, 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 securities so issued.

 

(iii) Any action of the Board ordering
the exchange of any Rights pursuant to Section 11(b)(i) shall be irrevocable and, immediately upon the taking of such action
and without any further action and without any notice, the right to exercise any such Right so exchanged pursuant to Section
11(a) shall terminate and the only right thereafter of a holder of such Right shall be to receive the Exchange Consideration
in exchange for each such Right held by such holder or, if the Exchange Consideration shall not have been paid or issued, to exercise
any such Right pursuant to Section 11(c)(i). The Company shall promptly give public notice (with prompt written notice to
the Rights Agent) 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 shall promptly mail a notice of any such exchange to all holders of the Rights
to be exchanged at their last addresses as they appear upon the registry books of the Rights Agent. Any notice which is mailed
in the manner herein provided shall be deemed given, whether or not the holder receives the notice. Each such notice of
exchange shall state the method by which the exchange of the Rights for the Exchange Consideration will be effected and, in the
event of any partial exchange, the number of Rights which will be exchanged. Any partial exchange shall be effected pro rata based
on the number of Rights (other than Rights which shall have become null and void and nontransferable pursuant to the provisions
of Section 7(e)) held by each holder of Rights.

 

(c) (i) In the event that, directly or
indirectly, any transactions specified in the following clause (A) or (B) of this Section 11(c)(i) (each such transaction
being a “Business Combination”) shall be consummated:

 

		A.	the Company shall consolidate with, merge with and into, or effect a share exchange with any Acquiring
Person or any Affiliate or Associate of an Acquiring Person, any Acquiring Person or any Affiliate or Associate of an Acquiring
Person shall merge with and into the Company or the Company shall otherwise effect any business combination or similar transaction
with any Acquiring Person or any Affiliate or Associate of an Acquiring Person;

 

 

 

    	 	15	 

     

    

 

		B.	the Company shall sell, lease, exchange or otherwise transfer or dispose of (or one or more of
its Subsidiaries shall sell, lease, exchange or otherwise transfer or dispose of), in one or more transactions, the Major Part
of the assets of the Company and its Subsidiaries to any Acquiring Person or any Affiliate or Associate of an Acquiring Person,
then, in each such case, proper provision shall be made so that each holder of a Right, except as provided in Section
7(e), shall thereafter have the right to receive, upon the exercise thereof for the Purchase Price in accordance with the terms
of this Rights Agreement, the securities specified below (or, at such holder’s option, the securities specified in Section
11(a) if the Company is the surviving Person in such Business Combination):

 

		(1)	if the Principal Party in such Business Combination has Registered Common Shares outstanding, each
Right shall thereafter represent the right to receive, upon the exercise thereof for the Purchase Price in accordance with the
terms of this Rights Agreement, such number of Registered Common Shares of such Principal Party, free and clear of all liens, encumbrances
or other adverse claims, as shall have an aggregate Market Value as of the time of exercise thereof equal to the result obtained
by multiplying the Purchase Price by two;

 

		(2)	if the Principal Party in such Business Combination does not have Registered Common Shares outstanding,
each Right shall thereafter represent the right to receive, upon the exercise thereof for the Purchase Price in accordance with
the terms of this Rights Agreement, at the election of the holder of such Right at the time of the exercise thereof, any of:

 

		(i)	if the Principal Party in such Business Combination has Common Shares listed or admitted to trading
on any recognized foreign stock exchange, such number of Common Shares of such Principal Party, free and clear of all liens, encumbrances
or other adverse claims, as shall have an aggregate Market Value as of the time of exercise thereof equal to the result obtained
by multiplying the Purchase Price by two;

 

		(ii)	such number of Common Shares of the Surviving Person in such Business Combination (if the Principal
Party is also the Surviving Person in such Business Combination) as shall have an aggregate Book Value immediately after giving
effect to such Business Combination equal to the result obtained by multiplying the Purchase Price by two;

 

		(iii)	such number of Common Shares of the Principal Party in such Business Combination (if the Principal
Party is not also the Surviving Person in such Business Combination) as shall have an aggregate Book Value immediately after giving
effect to such Business Combination equal to the result obtained by multiplying the Purchase Price by two; or

 

		(iv)	if the Principal Party in such Business Combination is an Affiliate of one or more Persons that
has Registered Common Shares outstanding, such number of Registered Common Shares of whichever of such Affiliates of the Principal
Party has Registered Common Shares with the greatest aggregate Market Value on the date of consummation of such Business Combination
as shall have an aggregate Market Value on the date of such Business Combination equal to the result obtained by multiplying the
Purchase Price by two.

 

(ii) The Company shall not consummate any
Business Combination unless each issuer of Common Shares for which Rights may be exercised, as set forth in this Section 11(c),
shall have sufficient authorized Common Shares that have not been issued or reserved for issuance (and which shall, when issued
upon exercise thereof in accordance with this Rights Agreement, be validly issued, fully paid and nonassessable and free of preemptive
rights, rights of first refusal or any other restrictions or limitations on the transfer or ownership thereof) to permit the exercise
in full of the Rights in accordance with this Section 11(c) and unless prior thereto:

 

		A.	a registration statement under the Securities Act on an appropriate form, with respect to the Rights
and the Common Shares of such issuer purchasable upon exercise of the Rights, shall be effective under the Securities Act; and

 

 

 

    	 	16	 

     

    

 

		B.	the Company and each such issuer shall have:

 

		(1)	executed and delivered to the Rights Agent a supplemental agreement providing for the assumption
by such issuer of the obligations set forth in this Section 11(c) (including the obligation of such issuer to issue Common
Shares upon the exercise of Rights in accordance with the terms set forth in Sections 11(c)(i) and 11(c)(iii)) and
further providing that such issuer, at its own expense, shall use its best efforts to:

 

		(i)	cause a registration statement under the Securities Act on an appropriate form, with respect to
the Rights and the Common Shares of such issuer purchasable upon exercise of the Rights, to remain effective (with a prospectus
at all times meeting the requirements of the Securities Act) until the Expiration Date;

 

		(ii)	qualify or register the Rights and the Common Shares of such issuer purchasable upon exercise of
the Rights under the blue sky or securities laws of such jurisdictions as may be necessary or appropriate; and

 

		(iii)	list the Rights and the Common Shares of such issuer purchasable upon exercise of the Rights on
each national securities exchange on which the Common Shares were listed prior to the consummation of the Business Combination
or, if the Common Shares were not listed on a national securities exchange prior to the consummation of the Business Combination,
on a national securities exchange;

 

		(2)	furnished to the Rights Agent a written opinion of independent counsel stating that such supplemental
agreement is a valid, binding and enforceable agreement of such issuer; and

 

		(3)	filed with the Rights Agent a certificate of a nationally recognized firm of independent accountants
setting forth the number of Common Shares of such issuer that may be purchased upon the exercise of each Right after the consummation
of such Business Combination.

 

(iii) After consummation of any Business
Combination, (A) each issuer of Common Shares for which Rights may be exercised as set forth in this Section 11(c) shall
be liable for, and shall assume, by virtue of such Business Combination, all the obligations and duties of the Company pursuant
to this Rights Agreement, (B) the term “Company” shall thereafter be deemed to refer to such issuer, (C) each
such issuer shall take such steps in connection with such consummation as may be necessary to assure that the provisions of this
Rights Agreement (including Sections 11(a) and 11(c)) shall thereafter be applicable, as nearly as reasonably may
be, in relation to its Common Shares thereafter deliverable upon the exercise of the Rights, (D) the number of Common Shares of
each such issuer thereafter receivable upon exercise of any Right shall be subject to adjustment from time to time in a manner
and on terms as nearly equivalent as practicable to the provisions of Sections 11 and 12 and (E) the other provisions
of this Rights Agreement (including Sections 7, 9 and 10) with respect to the Preferred Shares shall apply, as nearly
as reasonably may be, on like terms to any such Common Shares. The rights, duties, liabilities or responsibilities of the Rights
Agent shall not be amended or otherwise modified without its prior written consent.

 

SECTION 12.  Certain Adjustments.

 

(a) To preserve the actual or potential
economic value of the Rights, if at any time after the date of this Rights Agreement there shall be any change in the Common Shares
or the Preferred Shares, including any change in the number of Common Shares or Preferred Shares outstanding, whether by reason
of stock dividends, stock splits, reclassifications, recapitalizations, mergers, consolidations, combinations or exchanges of securities,
split-ups, split-offs, spin-offs, liquidations, other similar changes in capitalization, any distribution or issuance of cash,
assets, evidences of indebtedness or subscription rights, options or warrants to holders of Common Shares, or Preferred Shares,
as the case may be (other than distribution of the Rights or regular quarterly cash dividends), or otherwise, then, in each such
event the Board shall make such appropriate adjustments in the number of Preferred Shares (or the number and kind of other securities)
issuable upon exercise of each Right, the Purchase Price and Redemption Price in effect at such time and the number of Rights outstanding
at such time (including the number of Rights or fractional Rights associated with each Common Share) such that following such adjustment
such event shall not have had the effect of reducing or limiting the benefits the holders of the Rights would have had absent such
event.

 

(b) If, as a result of an adjustment
made pursuant to Section 12(a), the holder of any Right thereafter exercised shall become entitled to receive any securities
other than Preferred Shares, thereafter the number of such securities so receivable upon exercise of any Right shall be subject
to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions of Sections
11 and 12 and the other provisions of this Rights Agreement (including Sections 7, 9 and 10) with respect
to the Preferred Shares shall apply, as nearly as reasonably may be, on like terms to any such other securities.

 

(c) All Rights originally issued by the
Company subsequent to any adjustment made to the amount of Preferred Shares or other securities relating to a Right shall evidence
the right to purchase, for the Purchase Price, the adjusted number and kind of securities purchasable from time to time hereunder
upon exercise of the Rights, all subject to further adjustment as provided in this Rights Agreement.

 

 

 

    	 	17	 

     

    

 

(d) Irrespective of any adjustment or change
in the Purchase Price or the number of Preferred Shares or number or kind of other securities issuable upon the exercise of the
Rights, the Right Certificates theretofore and thereafter issued may continue to express the terms that were expressed in the initial
Right Certificates issued hereunder.

 

(e) In any case in which action taken pursuant
to Section 12(a) requires that an adjustment be made effective as of a record date for a specified event, the Company may
elect to defer until the occurrence of such event the issuing to the holder of any Right exercised after such record date the Preferred
Shares and/or other securities, if any, issuable upon such exercise over and above the Preferred Shares and/or other securities,
if any, issuable before giving effect 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 securities upon the
occurrence of the event requiring such adjustment.

 

SECTION 13.  Certificate
of Adjustment. Whenever an adjustment is made or any event occurs affecting the Rights or their exercisability (including an
event which causes the Rights to become null and void) as provided in Section 11 or 12, the Company shall
(a) promptly prepare a certificate setting forth such adjustment or describing such event and a brief, reasonably detailed statement
of the facts, computations and methodology accounting for such adjustment, (b) promptly file with the Rights Agent and with each
transfer agent for the Preferred Shares, a copy of such certificate and (c) mail a brief summary thereof to each holder of a Right
Certificate (or, if prior to the Distribution Date, to each holder of Common Shares) in accordance with Section 25, provided
that the failure to prepare, file or mail such certificate or summary shall not affect the validity of such adjustment. The Rights
Agent shall be fully protected and indemnified by the Company for any and all losses, liabilities or costs, of any nature, incurred
in relying on any such certificate and on any adjustment or statement therein contained.

 

SECTION 14.  Additional
Covenants.

 

(a) Notwithstanding any other provision
of this Rights Agreement, no adjustment to the number of Preferred Shares (or fractions of a share) or other securities for which
a Right is exercisable or the number of Rights outstanding or associated with each Common Share or any similar or other adjustment
shall be made or be effective if such adjustment would have the effect of reducing or limiting the benefits the holders of the
Rights would have had absent such adjustment, including the benefits under Sections 11 and 12, unless the terms of
this Rights Agreement are amended so as to preserve such benefits.

 

(b) The Company covenants and agrees that,
after the Distribution Date, except as permitted by Section 26, it shall not take (or permit any Subsidiary of the Company
to take) any action if at the time such action is taken it is intended or reasonably foreseeable that such action will reduce or
otherwise limit the benefits the holders of Rights would have had absent such action, including the benefits under Sections
11 and 12. Any action taken by the Company during any period after any Person becomes an Acquiring Person but prior
to the Distribution Date shall be null and void unless such action could be taken under this Section 14(b) from and after
the Distribution Date. The Company shall not consummate any Business Combination if any issuer of Common Shares for which Rights
may be exercised after such Business Combination in accordance with Section 11(c) shall have taken any action that reduces
or otherwise limits the benefits the holders of Rights would have had absent such action, including the benefits under Sections
11 and 12.

 

SECTION 15.  Fractional
Rights and Fractional Shares.

 

(a) The Company may, but shall not be required
to, issue fractions of Rights or distribute Right Certificates which evidence fractional Rights. In lieu of such fractional Rights,
the Company may pay to the registered holders of the Right Certificates with regard to which such fractional Rights would otherwise
be issuable an amount in cash equal to the same fraction of the current market value of a whole Right. For purposes of this Section
15(a), the current market value of a whole Right shall be the closing price of the Rights (as determined pursuant to the second
sentence of the definition of Market Value contained in Section 1) for the Trading Day immediately prior to the date on
which such fractional Rights would have been otherwise issuable.

 

 

 

    	 	18	 

     

    

 

(b) With respect to one one-thousandths
(1/1,000ths) of a Preferred Share (as such fraction may be adjusted as provided in this Rights Agreement), or any integral
multiple thereof, represented by one or more whole Rights immediately prior to their exercise, the Company shall be required and,
with respect to other fractions of a Preferred Share the Company may, but shall not be required, to (i) issue fractions of Preferred
Shares upon exercise of the Rights or distribute certificates that evidence such fractional Preferred Shares or (ii) utilize a
depositary arrangement as provided by the terms of this Rights Agreement and the Preferred Shares. Except with respect to
one one-thousandths (1/1,000ths) of a Preferred Share (as such fraction may be adjusted as provided in this Rights Agreement),
or any integral multiple thereof, represented by one or more whole Rights immediately prior to their exercise, the Company, in
lieu of issuing fractional shares, may elect to pay to the registered holders of Right Certificates at the time such Rights are
exercised as herein provided an amount in cash equal to the same fraction of the current market value of one Preferred Share,
if any are outstanding and publicly traded (or the same fraction of the current market value of one Common Share times the Formula
Number (as defined in the Certificate of Designation) if the Preferred Shares are not outstanding and publicly traded). For purposes
of this Section 15(b), the current market value of a Preferred Share (or Common Share) shall be the closing price of a Preferred
Share (or Common Share) (as determined pursuant to the second sentence of the definition of Market Value contained in Section
1) for the Trading Day immediately prior to the date of such exercise. If, as a result of an adjustment made pursuant to Section
12(a), the holder of any Right thereafter exercised shall become entitled to receive any securities other than Preferred Shares,
the provisions of this Section 15(b) shall apply, as nearly as reasonably practicable, on like terms to such other securities.

 

(c) The Company may, but shall not be required
to, issue fractions of Common Shares upon exchange of Rights pursuant to Section 11(b), or to distribute certificates that
evidence fractional Common Shares. In lieu of such fractional Common Shares, the Company may pay to the registered holders of the
Right Certificates with regard to which such fractional Common Shares would otherwise be issuable an amount in cash equal to the
same fraction of the current Market Value of one Common Share as of the date on which a Person became an Acquiring Person.

 

(d) Each holder of Rights by the acceptance
of such Rights expressly waives such holder’s right to receive any fractional Rights or any fractional shares upon exercise
of a Right except as provided in this Section 15.

 

(e) Whenever a payment for fractional Rights
or fractional shares is to be made by the Rights Agent under any section of this Rights Agreement, the Company shall (i) promptly
prepare and deliver to the Rights Agent a certificate setting forth in reasonable detail the facts related to such payments and
the prices and formulas utilized in calculating such payments, and (ii) provide sufficient monies to the Rights Agent in the form
of fully collected funds to make such payments. The Rights Agent shall be fully protected in relying upon such a certificate and
shall have no duty with respect to, and shall not be deemed to have knowledge of, any payment for fractional Rights or fractional
shares under any section of this Rights Agreement relating to the payment of fractional Rights or fractional shares unless and
until the Rights Agent shall have received such a certificate and sufficient monies.

 

SECTION 16.  Rights of Action.

 

(a) All rights of action in respect of
this Rights Agreement, excepting the rights of action given to the Rights Agent under Sections 19 and 21, are vested
in the respective registered holders of the Right Certificates (and, prior to the Distribution Date, the registered holders of
the Common Shares); and any registered holder of any Right Certificate (or, prior to the Distribution Date, of the Common Shares),
without the consent of the Rights Agent or of the holder of any other Right Certificate (or, prior to the Distribution Date, of
the Common Shares) may, on such holder’s own behalf and for such holder’s own benefit, enforce, and may institute and
maintain any suit, action or proceeding against the Company to enforce, or otherwise act in respect of, such holder’s right
to exercise the Rights evidenced by such Right Certificate in the manner provided in such Right Certificate and in this
Rights Agreement. Without limiting the foregoing or any remedies available to the holders of Rights, it is specifically acknowledged
that the holders of Rights would not have an adequate remedy at law for any breach of this Rights Agreement by the Company and
shall be entitled to specific performance of the obligations of the Company under, and injunctive relief against actual or threatened
violations of the obligations of the Company. Notwithstanding anything in this Rights Agreement to the contrary, neither the Company
nor the Rights Agent shall have any liability to any holder of a Right or other Person as a result of each of its inability to
perform any of its obligations under this Rights Agreement by reason of any preliminary or permanent injunction or other order,
judgment, decree or ruling (whether interlocutory or final) issued by a court of competent jurisdiction or by a governmental, regulatory,
self-regulatory or administrative agency or commission, or any statute, rule, regulation or executive order promulgated or enacted
by any governmental authority, prohibiting or otherwise restraining performance of such obligation; provided, however, the
Company must use reasonable efforts to have any such injunction, order, judgment, decree or ruling lifted or otherwise overturned
as soon as possible.

 

(b) Any holder of Rights who prevails in
an action to enforce the provisions of this Rights Agreement shall be entitled to recover the reasonable costs and expenses, including
attorneys’ fees, incurred in such action.

 

SECTION 17.  Transfer and
Ownership of Rights and Right Certificates.

 

(a) Prior to the Distribution Date, the
Rights shall be transferable only in connection with the transfer of the Common Shares and the Right associated with each such
Common Share shall be automatically transferred upon the transfer of each such Common Share.

 

 

 

    	 	19	 

     

    

 

(b) After the Distribution Date, the Right
Certificates shall be transferable, subject to Section 7(e), only on the registry books of the Rights Agent if surrendered
at the principal office of the Rights Agent, duly endorsed or accompanied by a proper instrument of transfer and with the appropriate
forms and certificates properly completed and duly executed.

 

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

 

SECTION 18.  Right Certificate
Holder Not Deemed a Stockholder. No holder, as such, of any Right Certificate shall be entitled to vote or receive dividends
or other distributions or be deemed, for any purpose, the holder of the Preferred Shares or of any other securities of the Company
which may at any time be issuable on the exercise of the Rights represented thereby, nor shall anything contained herein or in
any Right Certificate be construed to confer upon the holder of any Right Certificate, as such, any of the rights of a stockholder
of the Company, including 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,
or to receive dividends or other distributions or subscription rights, or otherwise, until the Right or Rights evidenced by such
Right Certificate shall have been exercised in accordance with the provisions hereof.

 

SECTION 19.  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,
its reasonable expenses and counsel fees and other disbursements incurred in the preparation, delivery, negotiation, amendment,
administration and execution of this Rights Agreement and the exercise and performance of its duties hereunder, including any taxes
or governmental charges imposed as a result of the action taken by it hereunder (other than any taxes on the fees payable to it).

 

(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 acceptance
and administration of this Rights Agreement and the exercise and performance of its duties hereunder in reliance upon any Right
Certificate or certificate for the Common Shares, or for other securities of the Company (including in the case of uncertificated
securities, by notation in book entry accounts reflecting ownership), instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent, certificate, statement, or other paper or document believed by it
to be genuine and to be signed, executed and, where necessary, verified, guaranteed or acknowledged, by the proper Person or Persons
or otherwise upon the advice of counsel as set forth in Section 21 hereof. The Rights Agent shall not be deemed to have knowledge
of any event of which it was supposed to receive notice thereof hereunder, and the Rights Agent shall be fully protected and shall
incur no liability for failing to take action in connection therewith, unless and until it has received such notice in writing.

 

(c) The provisions of this Section 19,
Section 21 and any other provisions hereunder concerning indemnification of the Rights Agent hereof shall survive the termination
of this Rights Agreement, the exercise or expiration of the Rights and the resignation, replacement or removal of the Rights Agent.
The costs and expenses incurred by the Rights Agent in enforcing this right of indemnification shall be paid by the Company.

 

SECTION 20.  Merger or Consolidation
or Change of 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 or stockholder
services business of the Rights Agent or any successor Rights Agent, shall be the successor to the Rights Agent under this Rights
Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto; provided,
however, that such Person would be eligible for appointment as a successor Rights Agent under the provisions of Section
22. In case, at the time such successor Rights Agent shall succeed to the agency created by this Rights Agreement, any of the
Right Certificates shall have been countersigned but not delivered, any such successor Rights Agent may adopt the countersignature
of the predecessor Rights Agent and deliver such Right Certificates so countersigned; and, in case at that time any of the Right
Certificates shall not have been countersigned, any successor Rights Agent may countersign such Right Certificates either in the
name of the predecessor Rights Agent or in the name of the successor Rights Agent; and in all such cases such Right Certificates
shall have the full force provided in the Right Certificates and in this Rights Agreement.

 

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

 

 

 

    	 	20	 

     

    

 

SECTION 21.  Duties of Rights
Agent. The Rights Agent undertakes to perform the duties and obligations imposed by this Rights Agreement upon the following
terms and conditions (and no implied duties or obligations shall be read into this Rights Agreement against the Rights Agent),
by all of which the Company and the holders of Right Certificates (or, prior to the Distribution Date, of the Common Shares), 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 advice or opinion of such counsel shall be full and complete authorization and protection to the Rights Agent as to any action
taken, suffered or omitted by it in the absence of bad faith and in accordance with such advice or opinion.

 

		(b)	Whenever in the performance of its duties under this Rights Agreement the Rights Agent shall deem
it necessary or desirable that any fact or matter (including the identity of any Acquiring Person) be proved or established by
the Company prior to taking, suffering or omitting to take any action hereunder, such fact or matter (unless other evidence in
respect thereof shall 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 or Secretary of the Company and delivered to the
Rights Agent; and such certificate shall be full authorization and protection to the Rights Agent and the Rights Agent shall incur
no liability for or in respect of any action taken, suffered or omitted by it under the provisions of this Rights Agreement in
reliance upon such certificate. The Rights Agent shall have no duty to act without such a certificate as set forth in this Section
21(b).

 

		(c)	The Rights Agent shall be liable hereunder to the Company and any other Person only for its own
gross negligence, bad faith or intentional misconduct (which gross negligence, bad faith or intentional misconduct must be determined
by a final nonappealable judgment of a court of competent jurisdiction). Notwithstanding anything in this Rights Agreement to the
contrary, in no event will the Rights Agent be liable for special, punitive, indirect, incidental or consequential loss or damage
of any kind whatsoever (including, but not limited to, lost profits), even if the Rights Agent has been advised of the likelihood
of such loss or damages and regardless of the form of action. Notwithstanding anything in this Rights Agreement to the contrary,
any liability of the Rights Agent under this Rights Agreement will be limited to the amount of annual fees paid by the Company
to the Rights Agent (but not including reimbursed expenses) during the twelve (12) months immediately preceding the event for which
recovery from the Rights Agent is being sought

 

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

 

		(e)	The Rights Agent shall not have any liability for or be under any responsibility in respect of
the validity of this Rights Agreement or the execution and delivery hereof (except the due execution and delivery hereof by the
Rights Agent) or in respect of the legality or validity or execution of any Right Certificate, including in the case of Common
Shares held in book-entry form, (except its countersignature thereof); nor shall it be liable or responsible for any breach by
the Company of any covenant or condition contained in this Rights Agreement or in any Right Certificate; nor shall it be responsible
for any adjustment required under the provisions of Section 11 or 12 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 Right Certificates after actual written 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 Preferred Shares
or Common Shares to be issued pursuant to this Rights Agreement or any Right Certificate or as to whether any Preferred Shares
or Common Shares will, when so issued, be validly authorized and issued, fully paid and nonassessable.

 

		(f)	The Company agrees that it shall 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 Rights 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 or Secretary of the Company
of the Company in connection with its duties and it shall not be liable for any action taken, suffered or omitted by it in the
absence of bad faith in accordance with instructions of any such instruction. In the event the Rights Agent believes any ambiguity
or uncertainty exists hereunder or in any notice, instruction, direction, request or other communication, paper or document received
by the Rights Agent hereunder, the Rights Agent, may, in its sole discretion, refrain from taking any action, and shall be fully
protected and shall not be liable in any way to Company, the holder of any Right Certificate or any other Person for refraining
from taking such action, unless the Rights Agent receives written instructions signed by the Company which eliminates such ambiguity
or uncertainty to the satisfaction of the Rights Agent.

 

		(h)	The Rights Agent and any stockholder, member, affiliate, director, officer, employee, agent or
representative 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 or its Subsidiaries may be interested, or contract with or lend money to the
Company or its Subsidiaries or otherwise act as fully and freely as though it were not the Rights Agent under this Rights Agreement.
Nothing herein shall preclude the Rights Agent or any stockholder, member, affiliate, director, officer, employee, agent or representative
from acting in any other capacity for the Company or for any other Person.

 

 

 

    	 	21	 

     

    

 

		(i)	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 the form of election to purchase set forth on the reverse thereof, as the
case may be, has either not been properly completed, the certification set forth therein has been altered or any other change to
such form has been made (other than with respect to the information that the form requires the executor thereof to furnish in the
blank spaces provided for such purpose), the Rights Agent shall not take any further action with respect to such requested
exercise or transfer without first consulting with the Company.

 

		(j)	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 or for any loss to the Company resulting from any such act, default, neglect or misconduct of any such attorneys or
agents absent gross negligence, bad faith or willful misconduct in the selection and continued employment thereof (which gross
negligence or bad faith must be determined by a final, non-appealable judgment of a court of competent jurisdiction).

 

		(k)	The Company shall indemnify the Rights Agent for, and hold the Rights Agent harmless against, any
loss, liability, damage, judgment, fine, penalty, claim demand, settlement, cost or expense (including reasonable fees and expenses
of legal counsel) that the Rights Agent may pay, incur or suffer in connection with the execution, acceptance, administration,
exercise and performance of its duties under this Agreement, including the costs and reasonable expenses of defending against any
claim of liability arising therefrom, directly or indirectly and the costs and reasonable expense of enforcing this right of indemnification;
provided, however, that the Rights Agent shall not be indemnified or held harmless with respect to any such loss, liability,
damage, judgment, fine, penalty, claim demand, settlement, cost or expense incurred by the Rights Agent as a result of, or arising
out of, its own gross negligence, bad faith or intentional misconduct (each as determined by a final non appealable judgment of
a court of competent jurisdiction) in the performance of its duties hereunder. The Rights Agent agrees to promptly notify the Company
of the assertion of any action, proceeding, suit or claim against the Rights Agent, provided, however, that failure by the Rights
Agent to provide such notice shall not relieve the Company of any liability hereunder. The costs and expenses incurred in enforcing
this right of indemnification shall be paid by the Company.

 

		(l)	The Rights Agent shall not be deemed to have knowledge of any event of which it was supposed to
receive notice thereof hereunder, and the Rights Agent shall be fully protected and shall incur no liability for failing to take
action in connection therewith, unless and until it has received such notice in writing.

 

		(m)	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 any of its rights
or powers if it believes that repayment of such funds or adequate indemnification against such risk or liability is not reasonably
assured to it.

 

SECTION 22.  Change of Rights
Agent. The Rights Agent or any successor Rights Agent may resign and be discharged from its duties under this Rights Agreement
upon 30 days’ notice in writing mailed to the Company and, in the event that the Rights Agent or one of its Affiliates is
not also the transfer agent for the Company, to each transfer agent of the Common Shares and the Preferred Shares. In the event
the transfer agency relationship in effect between the Company and the Rights Agent terminates, the Rights Agent will be deemed
to have resigned automatically and be discharged from its duties under this Rights Agreement as of the effective date of such termination,
and the Company shall be responsible for providing notice of such resignation to each transfer agent of the Common Shares and the
Preferred Shares. The Company may remove the Rights Agent or any successor Rights Agent upon 30 days’ notice in writing,
mailed to the Rights Agent or successor Rights Agent, as the case may be, and to each transfer agent of the Common Shares and the
Preferred Shares by registered or certified mail, and to the holders of the Right Certificates (or, prior to the Distribution Date,
of the Common Shares) by first-class mail. If the Rights Agent shall resign or be removed or shall otherwise become incapable of
acting, the Company shall appoint a successor to the Rights Agent. If the Company shall fail to make such appointment within a
period of 30 days after giving notice of such removal or after it has been notified in writing of such resignation or incapacity
by the resigning or incapacitated Rights Agent, then the registered holder of any Right Certificate (or, prior to the Distribution
Date, of the Common Shares) 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 Person organized and doing business under the
laws of the United States or any state of the United States, in good standing, which is authorized under such laws to exercise
corporate trust or stockholder services powers and is subject to supervision or examination by Federal or state authority and which
has at the time of its appointment as Rights Agent a combined capital and surplus of at least $50,000,000 or (b) any Affiliate
of a Person 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 the purpose; provided, that the predecessor
Rights Agent shall not be required to incur any additional expenses or assume any additional liability in connection with the foregoing.
Not later than the effective date of any such appointment, the Company shall mail notice thereof in writing to the predecessor
Rights Agent and each transfer agent of the Common Shares and the Preferred Shares, and mail a notice thereof in writing to the
registered holders of the Right Certificates (or, prior to the Distribution Date, of the Common Shares). Failure to give any notice
provided for in this Section 22, however, or any defect therein shall not affect the legality or validity of the
resignation or removal of the Rights Agent or the appointment of the successor Rights Agent, as the case may be.

 

 

 

    	 	22	 

     

    

 

SECTION 23.  Issuance of
Additional Rights and Right Certificates. Notwithstanding any of the provisions of this Rights Agreement or of the Rights to
the contrary, the Company may, at its option, issue new Right Certificates evidencing Rights in such form as may be approved by
the Board to reflect any adjustment or change made in accordance with the provisions of this Rights Agreement. In addition, in
connection with the issuance or sale of Common Shares following the Distribution Date and prior to the earlier of the Redemption
Date and the Expiration Date, the Company (a) shall, with respect to Common Shares so issued, granted or sold pursuant to the exercise
of stock options or under any employee plan or arrangement (whether or not subject to vesting or other restrictions), or upon the
exercise, conversion or exchange of securities, notes or debentures issued by the Company, and (b) may, in any other case, if deemed
necessary or appropriate by the Board, issue Right Certificates representing the appropriate number of Rights in connection with
such issuance or sale; provided, however, that (i) no such Right 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 Right Certificate would be issued, (ii) no such Right Certificate shall be issued if,
and to the extent that, appropriate adjustment shall otherwise have been made in lieu of the issuance thereof and (iii) no such
Right Certificate shall be issued to an Acquiring Person or an Affiliate or Associate of an Acquiring Person.

 

SECTION 24.  Redemption
and Termination.

 

(a) The Board may, at its option, at any
time prior to the earlier of (i) the Share Acquisition Date and (ii) the Expiration Date, order the redemption of all, but not
fewer than all, the then outstanding Rights at the Redemption Price (the date of such redemption being the “Redemption
Date”), and the Company, at its option, may pay the Redemption Price either in cash or Common Shares or other securities
of the Company deemed by the Board, in the exercise of its sole discretion, to be at least equivalent in value to the Redemption
Price.

 

(b) Immediately upon the action of the
Board ordering the redemption of the Rights, and without any further action and without any notice, the right to exercise the Rights
will terminate and the only right thereafter of the holders of Rights shall be to receive the Redemption Price. Promptly after
the action of the Board ordering the redemption of the Rights, the Company shall give notice of such redemption to the Rights Agent
and the holders of the then outstanding Rights by mailing such notice to all such holders at their last addresses as they appear
upon the registry books of the Rights Agent or, prior to the Distribution Date, on the registry books of the transfer agent for
the Common Shares. Each such notice of redemption shall state the method by which payment of the Redemption Price will be made.
The notice, if mailed in the manner herein provided, shall be conclusively presumed to have been duly given, whether or
not the holder of Rights receives such notice. In any case, failure to give such notice by mail, or any defect in the notice, to
any particular holder of Rights shall not affect the sufficiency of the notice to other holders of Rights. Neither the Company
nor any of its Affiliates or Associates may redeem, acquire or purchase for value any Rights at any time in any manner except as
specifically set forth in this Section or in Section 11(b) or in connection with the purchase of Common Shares prior to
the Distribution Date.

 

 

 

 

    	 	23	 

     

    

 

SECTION 25.  Notices.
Notices or demands authorized by this Rights Agreement to be given or made by the Rights Agent or by the holder of a Right Certificate
(or, prior to the Distribution Date, of the Common Shares) to or on the Company shall be sufficiently given or made if in writing
and when sent by overnight delivery service or first-class mail, postage-prepaid, addressed (until another address is filed in
writing with the Rights Agent) as follows:

 

Oculus Innovative Sciences, Inc.

1129 N. McDowell Blvd.

Petaluma, CA 94954

 

Attention: Chief Executive Officer

 

With a copy to (which shall not constitute
Notice):

 

Amy Trombly

1314 Main St., Suite 102

Louisville, CO 80027

 

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

 

Computershare Trust Company, N.A.

250 Royall Street

Canton, MA 02021

Attention: Client Services

 

Notices or demands authorized by this Rights
Agreement to be given or made by the Company or the Rights Agent to any holder of a Right Certificate (or, prior to the Distribution
Date, of the Common Shares) shall be sufficiently given or made if in writing and when 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, prior to the Distribution
Date, on the registry books of the transfer agent for the Common Shares.

 

SECTION 26.  Supplements
and Amendments. At any time prior to the Distribution Date, and subject to the last sentence of this Section 26,
the Company may, and the Rights Agent shall if the Company so directs, but subject to the penultimate sentence in this Section
26, supplement or amend any provision of this Rights Agreement in any manner which the Company may deem necessary or desirable
(including the date on which the Distribution Date shall occur, the amount of the Purchase Price, the definition of “Acquiring
Person” or the time during which the Rights may be redeemed pursuant to Section 24) without the approval of any
holder of the Rights. From and after the Distribution Date, and subject to applicable law, the Company may, and the Rights Agent
shall if the Company so directs, amend this Rights Agreement without the approval of any holders of Right Certificates only (a) to
cure any ambiguity or to correct or supplement any provision contained herein which may be defective or inconsistent with any other
provision of this Rights Agreement or (b) to otherwise change or supplement any other provisions in this Rights Agreement
in any manner which the Company may deem necessary or desirable and which does not adversely affect the interests of the holders
of Right Certificates (other than an Acquiring Person, an Affiliate or Associate of an Acquiring Person, a Post Transferee, a Prior
Transferee or a Further Subsequent Transferee). Any supplement or amendment adopted during any period after any Person has become
an Acquiring Person but prior to the Distribution Date shall be null and void unless such supplement or amendment could have been
adopted under the prior sentence from and after the Distribution Date. All supplements and amendments shall be in writing and must
be authorized by the Board and no supplement or amendment to this Rights Agreement shall be effective unless duly executed by the
Rights Agent. Upon the delivery of a certificate from the Chairman of the Board, the Chief Executive Officer, the President or
Secretary of the Company that states that the proposed supplement or amendment is in compliance with the terms of this Section 26,
the Rights Agent shall execute such supplement or amendment; provided, that the Rights Agent may, but shall not be obligated to,
enter into any supplement or amendment that affects the Rights Agent’s own rights, duties, obligations or immunities under
this Rights Agreement. In addition, notwithstanding anything to the contrary contained in this Rights Agreement, no supplement
or amendment to this Rights Agreement shall be made which reduces the Redemption Price (except as required by Section 12(a))
or extends the Expiration Date.

 

 

 

    	 	24	 

     

    

 

SECTION 27.  Successors.
All the covenants and provisions of this Rights 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 28.  Benefits of
Rights Agreement; Determinations and Actions by the Board, etc.

 

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

 

(b) Except as explicitly otherwise provided
in this Rights Agreement, without limiting the rights of the Rights Agent under this Agreement, the Board shall have the exclusive
power and authority to administer this Rights 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 Rights Agreement, including the right and
power to (i) interpret the provisions of this Rights Agreement and (ii) make all determinations deemed necessary or advisable for
the administration of this Rights Agreement (including a determination to redeem or not redeem the Rights or to amend this Rights
Agreement and a determination of whether there is an Acquiring Person). For all purposes of this Rights Agreement, any calculation
of the number of Common Shares outstanding at any particular time, including for purposes of determining the particular percentage
of such outstanding Common Shares of which any Person is the Beneficial Owner, will be made in accordance with, as the Board deems
to be applicable, the last sentence of Rule 13d-3(d)(1)(i) of the General Rules and Regulations under the Exchange Act or the provisions
of Section 382. The Rights Agent is entitled always to assume that the Board acted in good faith and shall be fully protected and
incur no liability in reliance thereon.

 

(c) Nothing contained in this Rights Agreement
shall be deemed to be in derogation of the obligation of the Board to exercise its fiduciary duty. Without limiting the foregoing,
nothing contained herein shall be construed to suggest or imply that the Board shall not be entitled to reject any tender offer
or other acquisition proposal, or to recommend that holders of Common Shares reject any tender offer or other acquisition proposal,
or to take any other action (including the commencement, prosecution, defense or settlement of any litigation and the submission
of additional or alternative offers or other proposals) with respect to any tender offer or other acquisition proposal that the
Board believes is necessary or appropriate in the exercise of such fiduciary duty.

 

SECTION 29.  Process to
Seek Exemption. Any Person who desires to effect any acquisition of securities that would, if consummated, result in such Person
becoming an Acquiring Person (a “Requesting Person”) may, prior to such time and in accordance with this Section
29, request that the Board grant an exemption with respect to such acquisition under this Rights Agreement so that such Person
would be deemed to be an “Exempt Person” as defined in Section 1 for purposes of this Rights Agreement (an “Exemption
Request”). An Exemption Request shall be in proper form and shall be delivered by overnight delivery service or first-class
mail, postage-prepaid, to the Secretary of the Company at the principal executive office of the Company. The Exemption Request
shall be deemed made upon receipt by the Secretary of the Company. To be in proper form, an Exemption Request shall set forth (a)
the name and address of the Requesting Person, (b) the number and percentage of Common Shares then Beneficially Owned by the Requesting
Person, together with all Affiliates and Associates of the Requesting Person, and (c) a reasonably detailed description of the
transaction or transactions by which the Requesting Person would propose to become an Acquiring Person and the maximum number and
percentage of Common Shares that the Requesting Person proposes to acquire. The Board shall make a determination whether to grant
an exemption in response to an Exemption Request as promptly as practicable (and, in any event, within ten Business Days) after
receipt thereof; provided, that the failure of the Board to make a determination within such period shall be deemed to constitute
the denial by the Board of the Exemption Request. The Requesting Person shall respond promptly to reasonable and appropriate requests
for additional information from the Board and its advisors to assist the Board in making its determination. The Board shall only
grant an exemption in response to an Exemption Request if the Board determines in its sole discretion that the acquisition of Beneficial
Ownership of Common Shares by the Requesting Person, considered alone or with other transactions (including past transactions or
contemplated transactions), (i) will not jeopardize or endanger the availability to the Company of its NOLs or other Tax Benefits,
taking into account all relevant facts and circumstances, including the potential for the Company to issue a reasonable amount
of equity in the future without jeopardizing the availability of its NOLs and other Tax Benefits or (ii) is otherwise in the best
interests of the Company. Any exemption granted hereunder may be granted in whole or in part, and may be subject to limitations
or conditions (including a requirement that the Requesting Person agree that it will not acquire Beneficial Ownership of Common
Shares in excess of the maximum number and percentage of shares approved by the Board), in each case as and to the extent the Board
shall determine necessary or desirable to provide for the protection of the NOLs and other Tax Benefits or as is otherwise in the
best interests of the Company. Any Exemption Request may be submitted on a confidential basis and, except to the extent required
by applicable law, the Company shall maintain the confidentiality of such Exemption Request and the Board’s determination
with respect thereto, unless the information contained in the Exemption Request or the Board’s determination with respect
thereto otherwise becomes publicly available. The Exemption Request shall be considered and evaluated by the Board, or a duly constituted
committee of Independent Directors, and the action of a majority of such directors (or such committee) shall be deemed to be the
determination of the Board for purposes of such Exemption Request.

 

 

 

    	 	25	 

     

    

 

SECTION 30.  Tax Benefits
Review. In addition to the review and evaluation otherwise contemplated by this Rights Agreement, the Board, or a duly constituted
committee of Independent Directors, shall review the calculation for determining whether an ownership change has occurred under
Section 382 once per year (or with such greater frequency as the Board (or any such committee), in its sole discretion, shall determine
is advisable). The Board shall determine after such review whether maintenance of this Rights Agreement continues to be advisable
in order to preserve the value of the NOLs and other Tax Benefits, taking into account all the relevant facts and circumstances,
including the potential for the Company to issue a reasonable amount of equity in the future without jeopardizing the availability
of the NOLs and other Tax Benefits, the potential value of the NOLs and other Tax Benefits even after an ownership change under
Section 382 based upon the price of the Company’s Common Shares at such time or based upon changes in the Company’s
projected taxable income during any future period and potential opportunities to monetize the NOLs through one or more inter-company
sales or other transactions that increase the depreciable basis of the Company’s assets.

 

SECTION 31.  Severability.
If any term, provision, covenant or restriction of this Rights 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 Rights
Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated; provided, however, that
if such excluded provision, covenant or restriction shall affect the rights, immunities, liabilities, duties or obligations of
the Rights Agent, the Rights Agent shall be entitled to resign immediately.

 

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

 

SECTION 33.  Counterparts;
Effectiveness. This Rights Agreement may be executed in any number of counterparts and each of such counterparts shall for
all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.
A signature to this Rights Agreement transmitted electronically shall have the same authority, effect and enforceability as an
original signature. This Rights Agreement shall be effective as of the Close of Business on the date hereof.

 

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

 

 

 

    	 	26	 

     

    

 

SECTION 35.  Force Majeure.
Notwithstanding anything to the contrary contained herein, the Rights Agent shall not be liable for any delays or failures in performance
resulting from acts beyond its reasonable control and without the fault or gross negligence of the delayed or non-performing party,
including acts of God, terrorist acts, shortage of supply, breakdowns or malfunctions, interruptions or malfunction of computer
facilities, or loss of data due to power failures or mechanical difficulties with information storage or retrieval systems, labor
difficulties, war, or civil unrest; provided that the Rights Agent shall use reasonable commercial efforts to resume or
cure performance as soon as practicable.

 

[Signature Page Follows]

 

 

 

    	 	27	 

     

    

 

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

 

	 	Oculus Innovative Sciences, Inc.,
	 	 	 	 
	 	 	by:	/s/ Jim Schutz
	 	 	 	Name: Jim Schutz
	 	 	 	Title: Chief Executive Officer
	 	 	 	 
	 	Computershare Inc., as Rights Agent
	 	 	 	 
	 	 	by:	/s/ Joseph S. Campbell
	 	 	 	Name: Joseph S. Campbell
	 	 	 	Title: Vice President

 

 

 

    	 	28	 

     

    

 

Exhibit A

 

CERTIFICATE OF DESIGNATION

 

OF

 

SERIES B PREFERRED STOCK

 

OF

 

OCULUS INNOVATIVE SCIENCES, INC.

 

The undersigned do hereby certify that
the following resolution was duly adopted by the Board of Directors of Oculus Innovative Sciences, Inc., a Delaware corporation
(the “Company”), on October 18, 2016:

 

RESOLVED, that pursuant to the authority
vested in the board of directors of the Company (the “Board of Directors”) by the Company’s Restated Certificate
of Incorporation, as amended (the “Certificate of Incorporation”), the Board of Directors does hereby create,
authorize and provide for the issue of a series of Preferred Stock, par value $0.0001 per share, of the Company, to be designated
“Series B Preferred Stock,” initially consisting of 100,000 shares, and to the extent that the designations, powers,
preferences and relative and other special rights and the qualifications, limitations or restrictions of the Series B Preferred
Stock are not stated and expressed in the Certificate of Incorporation, does hereby fix and herein state and express such designations,
powers, preferences and relative and other special rights and the qualifications, limitations and restrictions thereof, as follows
(all terms used herein which are defined in the Certificate of Incorporation shall be deemed to have the meanings provided therein):

 

SECTION 1. Designation and Amount.
There shall be a series of Preferred Stock designated as “Series B 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 of Directors of the
Company (the “Board”); provided, however, that no decrease shall reduce the number of shares of Series B Preferred
Stock to less than the number of shares then issued and outstanding plus the number of shares issuable upon exercise of outstanding
rights, options or warrants or upon conversion of outstanding securities issued by the Company.

 

SECTION 2. Dividends or Distributions.
Subject to the superior rights of the holders of shares of any other series of preferred stock of the Company or other class of
capital stock of the Company ranking superior to the shares of Series B Preferred Stock with respect to dividends or distributions,
the holders of shares of Series B Preferred Stock shall be entitled to receive a dividend or distribution, when, as and if declared
by the Board, out of the assets of the Company legally available therefor.

 

SECTION 3. Voting Rights.
The holders of shares of Series B Preferred Stock, in addition to the voting rights provided by law, shall have the following voting
rights:

 

(a) Each holder of Series B Preferred Stock
shall be entitled to a number of votes on each matter on which holders of the Common Stock, par value $0.0001 per share, of the
Company (the “Common Stock”) or stockholders are entitled to vote equal to the Formula Number then in effect,
for each share of Series B Preferred Stock held of record, multiplied by the maximum number of votes per share which any holder
of Common Stock or stockholders generally then have with respect to such matter (assuming, if applicable, any holding period or
other requirement to exercise such maximum voting rights is satisfied). As used herein, the “Formula Number”
shall be 1,000; provided, however, that, if at any time after October 18, 2016, the Company shall (i) declare or pay any
dividend on the Common Stock payable in shares of Common Stock or make any distribution on the Common Stock in shares of Common
Stock, (ii) subdivide (by a stock split or otherwise) the outstanding shares of Common Stock into a larger number of shares of
Common Stock, or (iii) combine (by a reverse stock split or otherwise) the outstanding shares of Common Stock into a smaller number
of shares of Common Stock, then in each such event the Formula Number shall be adjusted to a number determined by multiplying the
Formula Number in effect immediately prior to such event by a fraction, the numerator of which is the number of shares of Common
Stock that are outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that
are outstanding immediately prior to such event (and rounding the result to the nearest whole number); and provided further that,
if at any time after October 18, 2016, the Company shall issue any shares of its capital stock in a merger, reclassification, or
change of the outstanding shares of Common Stock, then in each such event the Formula Number shall be appropriately adjusted to
reflect such merger, reclassification or change so that each share of Series B Preferred Stock continues to be the economic equivalent
of a Formula Number of shares of Common Stock prior to such merger, reclassification or change.

 

 

 

    	 	A-1	 

     

    

 

(b) Except as otherwise herein provided
or by applicable law, the holders of shares of Series B Preferred Stock and the holders of shares of Common Stock shall vote together
as one class for the election of directors of the Company and on all other matters submitted to a vote of stockholders of the Company.

 

SECTION 4. Certain Restrictions.
Whenever dividends or distributions on the Series B 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 B Preferred Stock outstanding
shall have been paid in full, the Company shall not:

 

(i) declare or pay dividends on, make any
other distributions on, or redeem or purchase or otherwise acquire for consideration any shares of stock ranking junior (either
as to dividends or upon liquidation, dissolution or winding up) to the Series B 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 B Preferred Stock, except dividends paid ratably on the Series B 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 on a parity (either as to dividends or upon liquidation, dissolution or winding up)
with the Series B Preferred Stock; provided, however, that the Company may at any time redeem, purchase or otherwise acquire shares
of any such parity stock in exchange for shares of any stock of the Company ranking junior (either as to dividends or upon dissolution,
liquidation or winding up) to the Series B Preferred Stock; or

 

(iv) purchase or otherwise acquire for
consideration any shares of Series B Preferred Stock, or any shares of stock ranking on a parity with the Series B 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.

 

SECTION 5. Liquidation Rights.
Upon the liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, no distribution shall be made
(1) to the holders of any shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up)
to the Series B Preferred Stock unless, prior thereto, the holders of shares of Series B Preferred Stock shall have received an
amount equal to the accrued and unpaid dividends and distributions thereon, whether or not declared, to the date of such payment,
plus an amount equal to the greater of (x) $1,000 per whole share or (y) an aggregate amount per share equal to the Formula Number
then in effect times the aggregate amount to be distributed per share to holders of Common Stock or (2) to the holders of any shares
of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series B Preferred
Stock, except distributions made ratably on the Series B Preferred Stock and all other such parity stock in proportion to the total
amounts to which the holders of all such shares are entitled upon such liquidation, dissolution or winding up.

 

SECTION 6. Consolidation, Merger,
etc. In case the Company shall enter into any consolidation, merger, combination or other transaction in which the shares of
Common Stock are exchanged for or changed into other stock or securities, cash or any other property, then in any such case the
then outstanding shares of Series B Preferred Stock shall at the same time be similarly exchanged or changed into an amount per
share equal to the Formula Number then in effect 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 exchanged or changed. In the event both this
Section 6 and Section 2 appear to apply to a transaction, this Section 6 will control.

 

 

 

    	 	A-2	 

     

    

 

SECTION 7. No Redemption; No
Sinking Fund. (a) The shares of Series B Preferred Stock shall not be subject to redemption by the Company or at the option
of any holder of Series B Preferred Stock; provided, however, that, subject to Section 4(a)(iv), the Company may purchase or otherwise
acquire outstanding shares of Series B Preferred Stock in the open market or by offer to any holder or holders of shares of Series
B Preferred Stock.

(b) The shares of Series B Preferred Stock
shall not be subject to or entitled to the operation of a retirement or sinking fund.

 

SECTION 8. No Purchase Fund.
The shares of Series B Preferred Stock shall not be subject to or entitled to the operation of a purchase fund.

 

SECTION 9. No Conversion; No
Exchange. The shares of Series B Preferred Stock shall not be convertible into, or exchangeable for, shares of any other class
or series.

 

SECTION 10. Ranking. The
Series B Preferred Stock shall rank junior to all other series of preferred stock of the Company unless the Board shall specifically
determine otherwise in fixing the powers, preferences and relative, participating, optional and other special rights of the shares
of such series and the qualifications, limitations and restrictions thereof.

 

SECTION 11. Fractional Shares.
The Series B Preferred Stock shall be issuable upon exercise of the Rights issued pursuant to the Rights Agreement in whole shares
or in any fraction of a share that is one one-thousandth of a share (as such fraction may be adjusted as provided in the Rights
Agreement) or any integral multiple of such fraction which shall entitle the holder, in proportion to such holder’s fractional
shares, to receive dividends, participate in distributions and to have the benefit of all other rights of holders of Series B Preferred
Stock. In lieu of any fractional shares, the Company may elect (a) to make a cash payment as provided in the Rights Agreement for
fractions of a share, other than those one one-thousandths (1/1,000ths) of a Preferred Share (as such fraction may be adjusted
as provided in the Rights Agreement), or any integral multiple thereof, represented by one or more whole Rights immediately prior
to such exercise, or (b) to issue depositary receipts evidencing fractional shares of Series B Preferred Stock pursuant to an appropriate
agreement between the Company and a depository selected by the Company; provided, however, that such agreement shall provide that
the holders of such depositary receipts shall have all the rights, privileges and preferences to which they are entitled as holders
of the Series B Preferred Stock.

 

SECTION 12. Reacquired Shares.
Any shares of Series B Preferred Stock purchased or otherwise acquired by the Company in any manner whatsoever shall be retired
and canceled promptly after the acquisition thereof. All such shares shall upon their cancelation become authorized but unissued
shares of Preferred Stock, without designation as to series until such shares are once more designated as part of a particular
series by the Board pursuant to the provisions of the Articles.

 

SECTION 13. Amendment. So
long as any shares of Series B Preferred Stock shall be outstanding, (i) none of the voting power, the designations, the relative
preferences, powers, participating, optional or other special rights and the qualifications, limitations and restrictions of the
Series B Preferred Stock as herein provided shall be amended in any manner which would alter or change the powers, preferences,
rights or privileges of the holders of Series B Preferred Stock so as to affect them adversely and (ii) no amendment, alteration
or repeal of the Articles or of the Amended and Restated By-laws of the Company shall be effected so as to affect adversely any
of such powers, preferences, rights or privileges.

 

 

 

 

 

    	 	A-3	 

     

    

 

IN WITNESS WHEREOF, the Company has caused
this Certificate of Designations to be signed by Jim Schutz its Chief Executive Officer, as of the 18th day of October,
2016.

 

	 	Oculus Innovative Sciences, Inc.
	 	 	 
	 	By:	 
	 	 	Jim Schutz
	 	 	Chief Executive Officer

 

 

 

    	 	A-4	 

     

    

 

Exhibit B

 

[Form of Right Certificate]

 

	Certificate No. [R]-	_________________Rights

 

	NOT EXERCISABLE AFTER October 18, 2026, OR EARLIER IF REDEEMED BY THE COMPANY OR OTHERWISE EXPIRED PURSUANT TO THE RIGHTS AGREEMENT. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT $0.0001 PER RIGHT, ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) AND BY ANY SUBSEQUENT HOLDER OF SUCH RIGHTS ARE NULL AND VOID AND NONTRANSFERABLE.

 

Right Certificate

 

Oculus Innovative Sciences, 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 October 18, 2016, as it may be amended from
time to time (the “Rights Agreement”), between Oculus Innovative Sciences, Inc., a Delaware corporation (the
“Company”), and Computershare Inc., as Rights Agent (the “Rights Agent”), unless the Rights
evidenced hereby shall have been previously redeemed or exchanged by the Company, to purchase from the Company at any time after
the Distribution Date (as defined in the Rights Agreement) and prior to 5:00 p.m., New York City time on the earliest of (a) October
18, 2026, (b) the effective date of the repeal of Section 382 or any successor statute if the Board determines that the Rights
Agreement is no longer necessary or desirable for the preservation of NOLs or other tax benefits, or (c) the first day of a taxable
year of the Company to which the Board determines that no NOLs or other tax benefits may be carried forward, unless earlier redeemed
or exchanged by the Company as described below (the earliest of the events described in clauses (a), (b), and (c) being referred
to as, the “Expiration Date”), at the office or offices of the Rights Agent designated for such purpose, or
its successors as Rights Agent, one one-thousandth (1/1,000th) of a fully paid, nonassessable share of Series B Preferred Stock,
par value $0.0001 per share, of the Company (the “Preferred Shares”), at a purchase price per one one-thousandth
(1/1,000th) of a share equal to $10.00 (the “Purchase Price”) payable in cash, upon presentation and surrender
of this Right Certificate with the Form of Election to Purchase duly executed.

 

The Purchase Price and the number and kind
of shares which may be purchased upon exercise of each Right evidenced by this Right Certificate, as set forth above, are the Purchase
Price and the number and kind of shares which may be so purchased as of October 18, 2026. As provided in the Rights Agreement,
the Purchase Price and the number and kind of shares which may be purchased upon the exercise of each Right evidenced by this Right
Certificate are subject to modification and adjustment upon the happening of certain events.

 

If the Rights evidenced by this Right Certificate
are at any time beneficially owned by an Acquiring Person or an Affiliate or Associate of an Acquiring Person (as such terms are
defined in the Rights Agreement), such Rights shall be null and void and nontransferable and the holder of any such Right (including
any purported transferee or subsequent holder) shall not have any right to exercise or transfer any such Right.

 

This Right Certificate is subject to all
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 reference to the Rights Agreement is hereby made for a full description of the
rights, limitations of rights, obligations, duties and immunities hereunder of the Rights Agent, the Company and the holders of
the Right Certificates. Copies of the Rights Agreement are on file at the above-mentioned office of the Rights Agent and are also
available from the Company upon written request.

 

 

 

    	 	B-1	 

     

    

 

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

 

Subject to the provisions of the Rights
Agreement, the Rights evidenced by this Right Certificate may be redeemed by the Company at its option at a redemption price (in
cash or shares of Common Stock, par value $0.0001 per share, of the Company or other securities of the Company deemed by the Board
of Directors of the Company (the “Board”) to be at least equivalent in value) of $0.0001 per Right (which amount
shall be subject to adjustment as provided in the Rights Agreement) at any time prior to the earlier of (i) the Distribution
Date and (ii) the Expiration Date.

 

With respect to one one-thousandths (1/1,000ths)
of a Preferred Share (as such fraction may be adjusted as provided in the Rights Agreement), or any integral multiple thereof,
represented by one or more whole Rights immediately prior to their exercise, the Company shall be required and, with respect to
other fractions of a Preferred Share the Company may, but shall not be required, to (i) issue fractions of Preferred Shares upon
exercise of the Rights or distribute certificates that evidence such fractional Preferred Shares or (ii) utilize a depositary arrangement
as provided by the terms of the Rights Agreement and the Preferred Shares. Except with respect to one one-thousandths (1/1,000ths)
of a Preferred Share (as such fraction may be adjusted as provided in this Rights Agreement), or any integral multiple thereof,
represented by one or more whole Rights immediately prior to their exercise, the Company, in lieu of issuing fractional shares,
may elect to make a cash payment as provided in the Rights Agreement for fractions of a share.

 

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

 

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

 

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

 

Dated as of:

 

	 	Oculus Innovative Sciences, Inc.
	 	 	 
	 	by:	 
	 	 	Name: Jim Schutz
	 	 	Title: Chief Executive Officer

	Attest:	 
	 	 
	 	 
	Name:	 
	Title:	 

 

 

 

 

    	 	B-2	 

     

    

 

Date of countersignature:

 

Countersigned:

 

Computershare Inc.,

as Rights Agent,

 

by 

	 	 

Authorized Signatory

[On Reverse Side of Right Certificate]

 

FORM OF ELECTION TO PURCHASE

 

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

to exercise the Rights represented by this
Right Certificate.)

 

To the Rights Agent:

 

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

 

Please insert social security

or other identifying number: _____________________

 

(Please print name and address): _______________________________

 

_______________________________

 

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

 

Please insert social security

or other identifying number

 

 

(Please print name and address)

 

Dated: ________

 

	 	Signature

 

Signature Medallion Guaranteed:

 

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

 

The undersigned hereby certifies that (1)
the Rights evidenced by this Right Certificate are not being exercised by or on behalf of a person who is or was an Acquiring Person
or an Affiliate or Associate thereof (as such terms are defined in the Rights Agreement) and (2) after due inquiry and to the best
knowledge of the undersigned, the undersigned did not acquire the Rights evidenced by this Right Certificate from any person who
is or was an Acquiring Person or an Affiliate or Associate thereof.

 

 

 

    	 	B-3	 

     

    

 

Dated: ________

 

	 	Signature

 

Signature Medallion Guaranteed:

 

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

 

FORM OF ASSIGNMENT

 

(To be executed by the registered holder
if such

holder desires to transfer the Right Certificate.)

 

FOR VALUE RECEIVED ____________________________________________________________
hereby sells, assigns and transfer unto ________________________________________________________________

 

 

(Please print name and address of
transferee)

 

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

 

Dated: ______________, ____

 

 

	Signature	 

 

Signature Medallion Guaranteed:

 

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

 

The undersigned hereby certifies that (1)
the Rights evidenced by this Right Certificate are not being sold, assigned or transferred by or on behalf of a Person who is or
was an Acquiring Person or an Affiliate or Associate thereof (as such terms are defined in the Rights Agreement), (2) this Right
Certificate is not being sold, assigned or transferred to or on behalf of any such Acquiring Person, Affiliate or Associate and
(3) after inquiry and to the best knowledge of the undersigned, the undersigned did not acquire the Rights evidenced by this Right
Certificate from any Person who is or was an Acquiring Person or an Affiliate or Associate thereof (as such terms are defined in
the Rights Agreement).

 

 

	Signature	 

 

NOTICE

 

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

 

 

 

    	 	B-4	 

     

    

 

Exhibit C

 

RIGHTS BENEFICIALLY OWNED BY ANY ACQUIRING
PERSONS OR THEIR AFFILIATES OR ASSOCIATES AND BY ANY SUBSEQUENT HOLDER OF SUCH RIGHTS ARE NULL AND VOID AND NONTRANSFERABLE.

 

SUMMARY OF RIGHTS TO PURCHASE

 

SERIES B PREFERRED STOCK

 

OF OCULUS INNOVATIVE SCIENCES, INC.

 

On October 18, 2016 (the “Rights
Dividend Declaration Date”), the Board of Directors (the “Board”) of Oculus Innovative Sciences, Inc.,
a Delaware corporation (the “Company”), declared a dividend of one right (collectively, the “Rights”)
for each outstanding share of Common Stock, par value $0.0001 per share, of the Company (the “Common Shares”).
The Rights will be issued to the holders of record of Common Shares outstanding at November 1, 2016 (the “Record
Date”) and with respect to Common Shares issued thereafter until the Distribution Date (as defined below). Each Right,
when it becomes exercisable as described below, will entitle the registered holder to purchase from the Company one one-thousandth
(1/1,000th) of a share of Series B Preferred Stock, par value $0.0001 per share, of the Company (the “Preferred Shares”)
at a price of $10.00 (the “Purchase Price”). The description and terms of the Rights are set forth in a Section
382 Rights Agreement dated as of October 18, 2016 as it may be amended from time to time (the “Rights Agreement”),
between the Company and Computershare Inc., as Rights Agent (the “Rights Agent”).

 

The Board adopted the Rights Agreement
in an effort to protect shareholder value by attempting to protect against a possible limitation on the Company’s ability
to use its net operating loss carryforwards (the “NOLs”) and other tax benefits to reduce potential future United
States Federal income tax obligations. The Company has experienced and continues to experience substantial operating losses, and
under the Internal Revenue Code of 1986, as amended (the “Code”), and rules promulgated thereunder, the Company
may “carry forward” these NOLs and other tax benefits in certain circumstances to offset any current and future earnings
and thus reduce the Company’s federal income tax liability, subject to certain requirements and restrictions. To the extent
that the NOLs and other tax benefits do not otherwise become limited, the Company believes that it will be able to carry forward
a significant amount of NOLs and other tax benefits, and therefore these NOLs and other tax benefits could be a substantial asset
to the Company. However, if the Company experiences an “Ownership Change,” as defined in Section 382, its ability to
use the NOLs and other tax benefits will be substantially limited, including that the timing of the usage of the NOLs and other
tax benefits could be substantially delayed, which could therefore significantly impair the value of those assets.

 

Until the earlier of 5:00 p.m. New York
City time on (a) the tenth calendar day after such date as the Company learns that a person or group (including any affiliate or
associate of such person or group), has acquired, or obtained the right to acquire, beneficial ownership of 4.99% or more of the
outstanding Common Shares (any such person or group being called an “Acquiring Person”) (subject to exceptions),
and (b) such date, if any, as may be designated by the Board following the commencement of, or first public disclosure of an intention
to commence, a tender or exchange offer for outstanding Common Shares which could result in such person or group becoming the beneficial
owner of 4.99% or more of the outstanding Common Shares (the earlier of such dates being called the “Distribution Date”),
the Rights will be evidenced by certificates for Common Shares registered in the names of the holders thereof, or, in the case
of Common Shares held in uncertificated form, by the transaction statement or other record of ownership of such Common Shares,
and not by separate Right Certificates. Generally, the Rights Agreement provides that any person or group (including any affiliate
or associate of such person or group) (a “Grandfathered Person”) which beneficially owned (as disclosed in public
filings with the Securities and Exchange Commission) 4.99% or more of the outstanding Common Shares as of the Rights Dividend Declaration
Date (the percentage of such ownership, the “Grandfathered Percentage”) will not be deemed an “Acquiring
Person” unless such Grandfathered Person exceeds its Grandfathered Percentage by 0.5% or more. If any Grandfathered Person
shall sell, transfer or otherwise dispose of any outstanding Common Shares after the Rights Dividend Declaration Date, the related
Grandfathered Percentage shall then mean, the lesser of (a) the Grandfathered Percentage as in effect immediately prior to such
sale, transfer or disposition or (b) the percentage of outstanding Common Shares of the Company that such Grandfathered Person
beneficially owns immediately following such sale, transfer or disposition; provided, however, if at any time after the
Rights Dividend Declaration Date, such Grandfathered Person is the beneficial owner of less than 4.99% of the outstanding Common
Shares, then such person or group (including any affiliate or associate of such person or group) will cease to be a Grandfathered
Person. Additionally, the Rights Agreement includes procedures whereby the Board will consider requests to exempt (a) any person
or group (including any affiliate or associate of such person or group) (an “Exempt Person”) which would otherwise
be an “Acquiring Person”, or (b) any transaction (an “Exempt Transaction”) resulting in the beneficial
ownership of Common Shares, prior to the consummation of such transaction, from the Acquiring Person trigger, in each case if the
Board determines in its sole discretion either that such person or group (including any affiliate or associate of such person or
group) or such transaction (i) will not jeopardize or endanger the availability of the NOLs or other tax benefits to the Company
or (ii) is otherwise in the best interest of the Company; provided that, (A) in the case of an Exempt Person, if the Board
later makes a contrary determination with respect to the effect of such person or group’s (including any affiliate or associate
of such person or group) beneficial ownership with respect to the availability to the Company of its NOLs or other tax benefits,
such person or group (including any affiliate or associate of such person or group) shall cease to be an Exempt Person and (B)
in the case of an Exempt Person or Exempt Transaction, the Board may require the applicable person or group (including any affiliate
or associate of such person or group) to make certain representations or undertakings, the violation or attempted violation of
which will be subject to such consequences as the Board may determine it its sole discretion, including that such person or group
(including any affiliate or associate of such person or group) shall become an “Acquiring Person”.

 

 

 

    	 	C-1	 

     

    

 

With respect to any Common Shares outstanding
as of the Record Date, until the earliest of the Distribution Date, the Redemption Date or the Expiration Date (as defined below),
(a) in the case of certificated shares, the Rights associated with the Common Shares represented by a certificate shall be evidenced
by such certificate along with a copy of this Summary of Rights, and the surrender for transfer of any such certificate shall also
constitute the transfer of the Rights associated with the Common Shares represented thereby, and (b) in the case of Common Shares
held in uncertificated form, the Rights associated with the Common Shares shall be evidenced by the balances indicated in the book-entry
account system of the transfer agent for the Common Shares, and the transfer of any Common Shares in the book-entry account system
of the transfer agent for such Common Shares shall also constitute the transfer of the Rights associated with such Common Shares.
Therefore, until the Distribution Date, the Rights may be transferred with and only with the underlying Common Shares.

 

As soon as practicable following the Distribution
Date, separate certificates evidencing the Rights (“Right Certificates”) will be mailed to holders of record
of the Common Shares as of the close of business on the Distribution Date, and such separate Right Certificates alone will thereafter
evidence the Rights.

 

The Rights are not exercisable until the
Distribution Date and will expire at 5:00 p.m., New York City time, on the earliest of (a) October 18, 2026, (b) the effective
date of the repeal of Section 382 or any successor statute if the Board determines that the Rights Agreement is no longer necessary
or desirable for the preservation of NOLs or other tax benefits, or (c) the first day of a taxable year of the Company to which
the Board determines that no NOLs or other Tax Benefits may be carried forward (the earliest of the events described in clauses
(a), (b), and (c) being referred to as, the “Expiration Date”), unless earlier redeemed or exchanged by the
Company as described below.

 

The number of Preferred Shares or other
securities issuable upon exercise of the Rights is subject to adjustment by the Board in the event of any change in the Common
Shares or Preferred Shares, whether by reason of stock dividends, stock splits, reclassifications, recapitalizations, mergers,
consolidations, combinations or exchanges of securities, split-ups, split-offs, spin-offs, liquidations, other similar changes
in capitalization, any distribution or issuance of cash, assets, evidences of indebtedness or subscription rights, options or warrants
to holders of Common Shares or Preferred Shares or otherwise. The Purchase Price and the number of Preferred Shares or other securities
issuable upon exercise of the Rights are subject to adjustment from time to time in the event of the declaration of a stock dividend
on the Common Shares payable in Common Shares or a subdivision or combination of the Common Shares prior to the Distribution Date.

 

The Preferred Shares are authorized to
be issued in fractions which are an integral multiple of one one-thousandth (1/1,000th) of a Preferred Share and, unless represented
by depositary receipts pursuant to a depositary arrangement (as provided by the terms of the Preferred Shares), shall be
so issued. The foregoing sentence notwithstanding, the Company may, in lieu of issuing fractional shares (other than fractional
shares represented by one or more whole Rights immediately prior to their exercise), make a cash payment for such shares based
on the market price of such shares on the first trading date prior to the date of exercise.

 

 

 

    	 	C-2	 

     

    

 

Subject to the right of the Board to redeem
or exchange the Rights as described below, on the tenth day after such time as the Company learns that there is an Acquiring Person,
the holder of each Right will thereafter have the right to receive, upon exercise thereof, for the Purchase Price, that number
of one one-thousandths (1/1,000ths) of a Preferred Share equal to the number of Common Shares which at the time of such transaction
would have a market value of twice the Purchase Price. Any Rights that are or were beneficially owned by an Acquiring Person will
become null and void and will not be subject to this “flip-in” provision.

 

In the event the Company is acquired by,
or otherwise engages in a merger, share exchange or other business combination with, an Acquiring Person that has common shares
publicly traded in the United States or 50% or more of the Company’s assets or assets representing 50% or more of the Company’s
earning power are sold, leased, exchanged or otherwise transferred (in one or more transactions) to an Acquiring Person that has
common shares publicly traded in the United States, proper provision must be made so that each Right will entitle its holder to
purchase, for the Purchase Price, that number of common shares of such entity which at the time of the transaction would have a
market value of twice the Purchase Price. In the event the Company is acquired in a merger or other business combination by an
Acquiring Person that does not have common shares publicly traded in the United States or 50% or more of the Company’s assets
or assets representing 50% or more of the earning power of the Company are sold, leased, exchanged or otherwise transferred (in
one or more transactions) to an Acquiring Person that does not have common shares publicly traded in the United States, proper
provision must be made so that each Right will entitle its holder to purchase, for the Purchase Price, at such holder’s option,
(a) if such entity has common shares publicly traded outside the United States, that number of common shares of such entity which
at the time of the transaction would have a market value of twice the Purchase Price, (b) that number of common shares of the surviving
corporation in the transaction with such entity which at the time of the transaction would have a book value of twice the Purchase
Price, (c) that number of common shares of such entity which at the time of the transaction would have a book value of twice the
Purchase Price or (d) if such entity has an affiliate which has common shares publicly traded in the United States, that number
of common shares of such affiliate which at the time of the transaction would have a market value of twice the Purchase Price.
This “flip-over” provision only applies to a merger or similar business combination with an Acquiring Person.

 

ANY RIGHTS THAT ARE OR WERE, AT ANY TIME
ON OR AFTER THE DATE AN ACQUIRING PERSON BECOMES SUCH, BENEFICIALLY OWNED BY SUCH ACQUIRING PERSON OR ANY AFFILIATE OR ASSOCIATE
OF SUCH ACQUIRING PERSON (OR A TRANSFEREE THEREOF) WILL BECOME NULL AND VOID AND ANY HOLDER OF ANY SUCH RIGHT (INCLUDING ANY SUBSEQUENT
HOLDER) WILL BE UNABLE TO EXERCISE ANY SUCH RIGHT.

 

The Rights are redeemable by the Board
at a redemption price of $0.0001 per Right (the “Redemption Price”) any time prior to the earlier of (a) the
Distribution Date and (b) the Expiration Date (the date of such redemption being the “Redemption Date”). Immediately
upon the action of the Board electing to redeem the Rights, and without any further action and without any notice, the right to
exercise the Rights will terminate and the only right of the holders of Rights will be to receive the Redemption Price.

 

After there is an Acquiring Person the
Board may elect to exchange each Right (other than Rights owned by an Acquiring Person) for consideration per Right consisting
of (a) one-half of the securities that would be issuable at such time upon the exercise of one Right pursuant to the terms of the
Rights Agreement or (b) cash, Preferred Shares (including fractions thereof), Common Shares (including fractions thereof) or other
equity or debt securities (or any combination of any of the foregoing) having an aggregate value equal to one-half of the value
of Preferred Shares (including fractions thereof) that would be issuable at such time upon the exercise of one Right pursuant to
the terms of the Rights Agreement. Notwithstanding the foregoing, the Board is not empowered to effect such exchange at any time
after any person (other than the Company, any subsidiary of the Company, any employee benefit plan of the Company or any such subsidiary,
or any entity holding Common Shares for or pursuant to the terms of any such plan), together with all affiliates and associates
of such person, becomes the beneficial owner of 50% or more of the Common Shares then outstanding.

 

 

 

    	 	C-3	 

     

    

 

If the Board elects to mandatorily exchange
any Rights, the Board may, at its option and without limiting any rights the Company may have under the Rights.

 

Agreement, cause the Company to enter into
one or more arrangements it deems necessary or appropriate to implement and give effect to such mandatory exchange in the manner
contemplated by the Rights Agreement, including by establishing one or more trusts or other mechanisms for the proper and orderly
distribution of the securities and/or cash to be exchanged therefor.

 

At any time prior to the date the Company
learns that a person or group (including any affiliate or associate of such person or group) has become an Acquiring Person (subject
to exceptions), the Company may, without the approval of any holder of the Rights, supplement or amend any provision of the Rights
Agreement (including the date on which the Distribution Date will occur, the amount of the Purchase Price or the definition of
“Acquiring Person”), except that no supplement or amendment may be made that reduces the Redemption Price or adversely
affects the holders of Rights (other than an Acquiring Person, an affiliate or associate of an Acquiring Person and certain transferees).

 

Until a Right is exercised, the holder
thereof, as such, will have no rights as a stockholder of the Company, including the right to vote or to receive dividends.

 

A copy of the Rights Agreement, including
the terms of the Preferred Shares, will be filed with the Securities and Exchange Commission as an Exhibit to a Registration Statement
on Form 8-A. A copy of the Rights Agreement is available free of charge from the Company upon written request. This summary description
of the Rights does not purport to be complete and is qualified in its entirety by reference to the Rights Agreement, which is incorporated
herein by reference.

 

 

 

    	 	C-4Form of Medium-Term Notes, Series K, Principal at Risk Securities Linked

 Exhibit 4.1 

[Face of Note] 

Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation
(“DTC”), to the Company or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as requested by an authorized representative
of DTC (and any payment is made to Cede & Co. or such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein. 
  

					
	 CUSIP NO. 94986RX55
	  	 	FACE AMOUNT: $                      	  
	 REGISTERED NO.      
	  			

 WELLS FARGO & COMPANY 

MEDIUM-TERM NOTE, SERIES K 

Due Nine Months or More From Date of Issue 

Principal at Risk Securities Linked to the S&P 500® Index 

WELLS FARGO & COMPANY, a corporation duly organized and existing under the laws of the State of Delaware (hereinafter
called the “Company,” which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & Co., or registered assigns, an amount equal to the Cash
Settlement Amount (as defined below), in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts, on the Stated Maturity Date. The “Stated Maturity
Date” shall be June 13, 2018. If the Determination Date (as defined below) is postponed, the Stated Maturity Date will be postponed to the third Business Day (as defined below) after the Determination Date as postponed. This Security
shall not bear any interest. 
 Any payments on this Security at Maturity will be made against presentation of this Security
at the office or agency of the Company maintained for that purpose in the City of Minneapolis, Minnesota and at any other office or agency maintained by the Company for such purpose. 

“Face Amount” shall mean, when used with respect to this Security, the amount set forth on the face of this
Security as its “Face Amount.” 

 Determination of Cash Settlement Amount and Certain Definitions 

The “Cash Settlement Amount” of this Security will equal: 

 

	 	•	 	 if the Final Underlier Level is greater than or equal to the Cap Level, the Maximum Settlement Amount;

  

	 	•	 	 if the Final Underlier Level is greater than the Initial Underlier Level but less than the Cap Level, the sum
of (i) the Face Amount plus (ii) the product of (a) the Face Amount times (b) the Upside Participation Rate times (c) the Underlier Return; 

 

	 	•	 	 if the Final Underlier Level is equal to or less than the Initial Underlier Level but greater than or equal to
the Buffer Level, the Face Amount; or 

  

	 	•	 	 if the Final Underlier Level is less than the Buffer Level, the sum of (i) the Face Amount plus
(ii) the product of (a) the Buffer Rate times (b) the sum of the Underlier Return plus the Buffer Amount times (c) the Face Amount. 

All calculations with respect to the Cash Settlement Amount will be rounded to the nearest one hundred-thousandth, with five one-millionths
rounded upward (e.g., 0.000005 would be rounded to 0.00001); and the Cash Settlement Amount will be rounded to the nearest cent, with one-half cent rounded upward. 

The “Underlier” shall mean the S&P 500® Index.

 The “Trade Date” shall mean October 14, 2016. 

The “Initial Underlier Level” is 2,132.98, the Closing Level of the Underlier on the Trade Date. 

The “Closing Level” of the Underlier on any Trading Day means the official closing level of the Underlier
reported by the Underlier Sponsor on such Trading Day, as obtained by the Calculation Agent on such Trading Day from the licensed third-party market data vendor contracted by the Calculation Agent at such time; in particular, taking into account the
decimal precision and/or rounding convention employed by such licensed third-party market data vendor on such date, subject to the provisions set forth below under “Discontinuance of The Underlier; Alteration of Method of Calculation” and
“Market Disruption Events.” 
 The “Final Underlier Level” will be the Closing Level of the
Underlier on the Determination Date. 
 The “Underlier Return” will be the quotient of (i) the Final
Underlier Level minus the Initial Underlier Level divided by (ii) the Initial Underlier Level, expressed as a percentage. 

The “Cap Level” is 2,431.5972 which is 114.00% of the Initial Underlier Level. 

The “Buffer Level” is 1,866.3575, which is equal to 87.5% of the Initial Underlier Level. 

  
 2 

 The “Maximum Settlement Amount” is 119.60% of the Face Amount of
this Security. 
 The “Buffer Amount” is 12.5%. 

The “Buffer Rate” is equal to the Initial Underlier Level divided by the Buffer Level. 

The “Upside Participation Rate” is 1.4. 

“Underlier Sponsor” shall mean S&P Dow Jones Indices LLC. 

“Business Day” shall mean a day, other than a Saturday or Sunday, that is neither a legal holiday nor a day
on which banking institutions are authorized or required by law or regulation to close in New York, New York. 
 A
“Trading Day” means a day, as determined by the Calculation Agent, on which (i) the Relevant Stock Exchanges with respect to each security underlying the Underlier are scheduled to be open for trading for their respective
regular trading sessions and (ii) each Related Futures or Options Exchange is scheduled to be open for trading for its regular trading session. 

The “Related Futures or Options Exchange” for the Underlier means an exchange or quotation system where
trading has a material effect (as determined by the Calculation Agent) on the overall market for futures or options contracts relating to the Underlier. 

The “Relevant Stock Exchange” for any security underlying the Underlier means the primary exchange or
quotation system on which such security is traded, as determined by the Calculation Agent. 
 The “Determination
Date” shall be June 8, 2018. If the originally scheduled Determination Date is not a Trading Day, the Determination Date will be postponed to the next succeeding Trading Day. The Determination Date is also subject to postponement due
to the occurrence of a Market Disruption Event (as defined below). See “–Market Disruption Events.” 

“Calculation Agent Agreement” shall mean the Calculation Agent Agreement dated as of March 18, 2015
between the Company and the Calculation Agent, as amended from time to time. 
 “Calculation Agent” shall
mean the Person that has entered into the Calculation Agent Agreement with the Company providing for, among other things, the determination of the Final Underlier Level and the Cash Settlement Amount, which term shall, unless the context otherwise
requires, include its successors under such Calculation Agent Agreement. The initial Calculation Agent shall be Wells Fargo Securities, LLC. Pursuant to the Calculation Agent Agreement, the Company may appoint a different Calculation Agent from time
to time after the initial issuance of this Security without the consent of the Holder of this Security and without notifying the Holder of this Security. 

  
 3 

 Discontinuance Of The Underlier; Alteration Of Method Of Calculation 

If the Underlier Sponsor discontinues publication of the Underlier, and the Underlier Sponsor or another entity publishes a
successor or substitute equity index that the Calculation Agent determines, in its sole discretion, to be comparable to the Underlier (a “Successor Underlier”), then, upon the Calculation Agent’s notification of that
determination to the Trustee and the Company, the Calculation Agent will substitute the Successor Underlier as calculated by the relevant Underlier Sponsor or any other entity and calculate the Final Underlier Level as described above. Upon any
selection by the Calculation Agent of a Successor Underlier, the Company will cause notice to be given to the Holder of this Security. 

In the event that the Underlier Sponsor discontinues publication of the Underlier prior to, and the discontinuance is
continuing on, the Determination Date and the Calculation Agent determines that no Successor Underlier is available at such time, the Calculation Agent will calculate a substitute Closing Level for the Underlier in accordance with the formula for
and method of calculating the Underlier last in effect prior to the discontinuance, but using only those securities that comprised the Underlier immediately prior to that discontinuance. If a Successor Underlier is selected or the Calculation Agent
calculates a level as a substitute for the Underlier, the Successor Underlier or level will be used as a substitute for the Underlier for all purposes, including the purpose of determining whether a Market Disruption Event exists. 

If on the Determination Date the Underlier Sponsor fails to calculate and announce the level of the Underlier, the
Calculation Agent will calculate a substitute Closing Level of the Underlier in accordance with the formula for and method of calculating the Underlier last in effect prior to the failure, but using only those securities that comprised the Underlier
immediately prior to that failure; provided that, if a Market Disruption Event occurs or is continuing on such day, then the provisions set forth below under “Market Disruption Events” shall apply in lieu of the foregoing.

 If at any time the Underlier Sponsor makes a material change in the formula for or the method of calculating the
Underlier, or in any other way materially modifies the Underlier (other than a modification prescribed in that formula or method to maintain the Underlier in the event of changes in constituent stock and capitalization and other routine events),
then, from and after that time, the Calculation Agent will, at the close of business in New York, New York, on each date that the Closing Level of the Underlier is to be calculated, calculate a substitute Closing Level of the Underlier in accordance
with the formula for and method of calculating the Underlier last in effect prior to the change, but using only those securities that comprised the Underlier immediately prior to that change. Accordingly, if the method of calculating the Underlier
is modified so that the level of the Underlier is a fraction or a multiple of what it would have been if it had not been modified, then the Calculation Agent will adjust the Underlier in order to arrive at a level of the Underlier as if it had not
been modified. 

  
 4 

 Market Disruption Events 

A “Market Disruption Event” means any of the following events as determined by the Calculation Agent in its
sole discretion: 
  

	 	(A)	 The occurrence or existence of a material suspension of or limitation imposed on trading by the Relevant Stock
Exchanges or otherwise relating to securities which then comprise 20% or more of the level of the Underlier or any Successor Underlier at any time during the one-hour period that ends at the Close of Trading on that day, whether by reason of
movements in price exceeding limits permitted by those Relevant Stock Exchanges or otherwise. 

  

	 	(B)	 The occurrence or existence of a material suspension of or limitation imposed on trading by any Related
Futures or Options Exchange or otherwise in futures or options contracts relating to the Underlier or any Successor Underlier on any Related Futures or Options Exchange at any time during the one-hour period that ends at the Close of Trading on that
day, whether by reason of movements in price exceeding limits permitted by the Related Futures or Options Exchange or otherwise. 

  

	 	(C)	 The occurrence or existence of any event, other than an early closure, that materially disrupts or impairs the
ability of market participants in general to effect transactions in, or obtain market values for, securities that then comprise 20% or more of the level of the Underlier or any Successor Underlier on their Relevant Stock Exchanges at any time during
the one-hour period that ends at the Close of Trading on that day. 

  

	 	(D)	 The occurrence or existence of any event, other than an early closure, that materially disrupts or impairs the
ability of market participants in general to effect transactions in, or obtain market values for, futures or options contracts relating to the Underlier or any Successor Underlier on any Related Futures or Options Exchange at any time during the
one-hour period that ends at the Close of Trading on that day. 

  

	 	(E)	 The closure on any Exchange Business Day of the Relevant Stock Exchanges on which securities that then
comprise 20% or more of the level of the Underlier or any Successor Underlier are traded or any Related Futures or Options Exchange prior to its Scheduled Closing Time unless the earlier closing time is announced by the Relevant Stock Exchange or
Related Futures or Options Exchange, as applicable, at least one hour prior to the earlier of (1) the actual closing time for the regular trading session on such Relevant Stock Exchange or Related Futures or Options Exchange, as applicable, and
(2) the submission deadline for orders to be entered into the Relevant Stock Exchange or Related Futures or Options Exchange, as applicable, system for execution at such actual closing time on that day. 

  
 5 

	 	(F)	 The Relevant Stock Exchange for any security underlying the Underlier or Successor Underlier or any Related
Futures or Options Exchange fails to open for trading during its regular trading session. 

 For purposes
of determining whether a Market Disruption Event has occurred: 
  

	 	(1)	 the relevant percentage contribution of a security to the level of the Underlier or any Successor Underlier
will be based on a comparison of (x) the portion of the level of such underlier attributable to that security and (y) the overall level of the Underlier or Successor Underlier, in each case immediately before the occurrence of the Market
Disruption Event; 

  

	 	(2)	 the “Close of Trading” on any Trading Day for the Underlier or any Successor Underlier means
the Scheduled Closing Time of the Relevant Stock Exchanges with respect to the securities underlying the Underlier or Successor Underlier on such Trading Day; provided that, if the actual closing time of the regular trading session of any
such Relevant Stock Exchange is earlier than its Scheduled Closing Time on such Trading Day, then (x) for purposes of clauses (A) and (C) of the definition of “Market Disruption Event” above, with respect to any security
underlying the Underlier or Successor Underlier for which such Relevant Stock Exchange is its Relevant Stock Exchange, the “Close of Trading” means such actual closing time and (y) for purposes of clauses (B) and (D) of the
definition of “Market Disruption Event” above, with respect to any futures or options contract relating to the Underlier or Successor Underlier, the “close of trading” means the latest actual closing time of the regular trading
session of any of the Relevant Stock Exchanges, but in no event later than the Scheduled Closing Time of the Relevant Stock Exchanges; 

  

	 	(3)	 the “Scheduled Closing Time” of any Relevant Stock Exchange or Related Futures or Options
Exchange on any Trading Day for the Underlier or any Successor Underlier means the scheduled weekday closing time of such Relevant Stock Exchange or Related Futures or Options Exchange on such Trading Day, without regard to after hours or any other
trading outside the regular trading session hours; and 

  

	 	(4)	 an “Exchange Business Day” means any Trading Day for the Underlier or any Successor Underlier
on which each Relevant Stock Exchange for the securities underlying the Underlier or any Successor Underlier and each Related Futures or Options Exchange are open for trading during their respective regular trading sessions, notwithstanding any such
Relevant Stock Exchange or Related Futures or Options Exchange closing prior to its Scheduled Closing Time. 

 If a Market
Disruption Event occurs or is continuing on the Determination Date, then the Determination Date will be postponed to the first succeeding Trading Day on which a Market Disruption Event has not occurred and is not continuing; however, if such first
succeeding Trading Day has not occurred as of the eighth Trading Day after the originally scheduled Determination Date, that eighth Trading Day shall be deemed to be the Determination Date. If 

  
 6 

 
the Determination Date has been postponed eight Trading Days after the originally scheduled Determination Date and a Market Disruption Event occurs or is continuing on such eighth Trading Day,
the Calculation Agent will determine the Closing Level of the Underlier on such eighth Trading Day in accordance with the formula for and method of calculating the Closing Level of the Underlier last in effect prior to commencement of the Market
Disruption Event, using the closing price (or, with respect to any relevant security, if a Market Disruption Event has occurred with respect to such security, its good faith estimate of the value of such security at the Scheduled Closing Time of the
Relevant Stock Exchange for such security or, if earlier, the actual closing time of the regular trading session of such Relevant Stock Exchange) on such date of each security included in the Underlier. As used herein, “closing price”
means, with respect to any security on any date, the Relevant Stock Exchange traded or quoted price of such security as of the Scheduled Closing Time of the Relevant Stock Exchange for such security or, if earlier, the actual closing time of the
regular trading session of such Relevant Stock Exchange. 
 Calculation Agent 

The Calculation Agent will determine the Cash Settlement Amount and the Final Underlier Level. In addition, the Calculation
Agent will (i) determine if adjustments are required to the Closing Level of the Underlier under the circumstances described in this Security, (ii) if publication of the Underlier is discontinued, select a Successor Underlier or, if no
Successor Underlier is available, determine the Closing Level of the Underlier under the circumstances described in this Security, and (iii) determine whether a Market Disruption Event or non-Trading Day has occurred. 

The Company covenants that, so long as this Security is Outstanding, there shall at all times be a Calculation Agent (which
shall be a broker-dealer, bank or other financial institution) with respect to this Security. 

All determinations made by the Calculation Agent with respect to this Security will be at the sole discretion of the
Calculation Agent and, in the absence of manifest error, will be conclusive for all purposes and binding on the Company and the Holder of this Security. 

Tax Considerations 

The Company agrees, and by acceptance of a beneficial ownership interest in this Security each Holder of this Security will be
deemed to have agreed (in the absence of a statutory, regulatory, administrative or judicial ruling to the contrary), for United States federal income tax purposes to characterize this Security as a prepaid derivative contract that is an “open
transaction.” 
 Redemption and Repayment 

This Security is not subject to redemption at the option of the Company or repayment at the option of the Holder hereof prior
to June 13, 2018. This Security is not entitled to any sinking fund. 

  
 7 

 Acceleration 

If an Event of Default, as defined in the Indenture, with respect to this Security shall occur and be continuing, the Cash
Settlement Amount (calculated as set forth in the next sentence) of this Security may be declared due and payable in the manner and with the effect provided in the Indenture. The amount payable to the Holder hereof upon any acceleration permitted
under the Indenture will be equal to the Cash Settlement Amount hereof calculated as provided herein as though the date of acceleration was the Determination Date. 
  

 

Reference is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at this place. 
 Unless the certificate of authentication
hereon has been executed by the Trustee referred to on the reverse hereof by manual signature or its duly authorized agent under the Indenture referred to on the reverse hereof by manual signature, this Security shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose. 
 [The remainder of this page has been left intentionally blank] 

  
 8 

 IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed
under its corporate seal. 

DATED:                         
      
  

					
	WELLS FARGO & COMPANY
		
	By:	 	 
		
		 	
		 	 Its:
	 	 

 [SEAL] 
  

					
	Attest:	 	 
		
		 	
		 	 Its:
	 	 

 TRUSTEE’S CERTIFICATE OF 

AUTHENTICATION 
 This is one of the Securities of the 

series designated therein described 
 in the within-mentioned Indenture. 
 CITIBANK, N.A., 

as Trustee 
  

			
		
	By:	 	 
		 	 Authorized Signature

 OR 
  

			
	 WELLS FARGO BANK, N.A.,

  as Authenticating Agent for the Trustee

		
	By:	 	 
		 	 Authorized Signature

  
 9 

 [Reverse of Note] 

WELLS FARGO & COMPANY 

MEDIUM-TERM NOTE, SERIES K 

Due Nine Months or More From Date of Issue 

Principal at Risk Securities Linked to the S&P 500® Index 

This Security is one of a duly authorized issue of securities of the Company (herein called the
“Securities”), issued and to be issued in one or more series under an indenture dated as of July 21, 1999, as amended or supplemented from time to time (herein called the “Indenture”), between the Company and
Citibank, N.A., as Trustee (herein called the “Trustee,” which term includes any successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Securities, and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Security is
one of the series of the Securities designated as Medium-Term Notes, Series K, of the Company, which series is limited to an aggregate principal amount or face amount, as applicable, of $25,000,000,000 or the equivalent thereof in one or more
foreign or composite currencies. The amount payable on the Securities of this series may be determined by reference to the performance of one or more equity-, commodity- or currency-based indices, exchange traded funds, securities, commodities,
currencies, statistical measures of economic or financial performance, or a basket comprised of two or more of the foregoing, or any other market measure or may bear interest at a fixed rate or a floating rate. The Securities of this series may
mature at different times, be redeemable at different times or not at all, be repayable at the option of the Holder at different times or not at all and be denominated in different currencies. 

Article Sixteen of the Indenture shall not apply to this Security. 

The Securities are issuable only in registered form without coupons and will be either
(a) book-entry securities represented by one or more Global Securities recorded in the book-entry system maintained by the Depositary or (b) certificated
securities issued to and registered in the names of, the beneficial owners or their nominees. 
 The Company agrees, to the
extent permitted by law, not to voluntarily claim the benefits of any laws concerning usurious rates of interest against a Holder of this Security. 

Modification and Waivers 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights
and obligations of the Company and the rights of the Holders of the Securities of each series to be affected under the Indenture at any time by the Company and the Trustee with the consent of the Holders of a majority in principal amount of the
Securities at the time Outstanding of all series to be affected, acting together as a class. The Indenture also contains 

  
 10 

 
provisions permitting the Holders of a majority in principal amount of the Securities of all series at the time Outstanding affected by certain provisions of the Indenture, acting together as a
class, on behalf of the Holders of all Securities of such series, to waive compliance by the Company with those provisions of the Indenture. Certain past defaults under the Indenture and their consequences may be waived under the Indenture by the
Holders of a majority in principal amount of the Securities of each series at the time Outstanding, on behalf of the Holders of all Securities of such series. Solely for the purpose of determining whether any consent, waiver, notice or other action
or Act to be taken or given by the Holders of Securities pursuant to the Indenture has been given or taken by the Holders of Outstanding Securities in the requisite aggregate principal amount, the principal amount of this Security will be deemed to
be equal to the amount set forth on the face hereof as the “Face Amount” hereof. Any such consent or waiver by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of
any Security issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Security. 

Defeasance 

Section 403 and Article Fifteen of the Indenture and the provisions of clause (ii) of Section 401(1)(B) of the
Indenture, relating to defeasance at any time of (a) the entire indebtedness on this Security and (b) certain restrictive covenants and certain Events of Default, upon compliance by the Company with certain conditions set forth therein,
shall not apply to this Security. The remaining provisions of Section 401 of the Indenture shall apply to this Security. 
 Authorized
Denominations 
 This Security is issuable only in registered form without coupons in denominations of $1,000 or any
amount in excess thereof which is an integral multiple of $1,000. 
 Registration of Transfer 

Upon due presentment for registration of transfer of this Security at the office or agency of the Company in the City of
Minneapolis, Minnesota, a new Security or Securities of this series, with the same terms as this Security, in authorized denominations for an equal aggregate Face Amount will be issued to the transferee in exchange herefor, as provided in the
Indenture and subject to the limitations provided therein and to the limitations described below, without charge except for any tax or other governmental charge imposed in connection therewith. 

This Security is exchangeable for definitive Securities in registered form only if (x) the Depositary notifies the
Company that it is unwilling or unable to continue as Depositary for this Security or if at any time the Depositary ceases to be a clearing agency registered under the Securities Exchange Act of 1934, as amended, and a successor depositary is not
appointed within 90 days after the Company receives such notice or becomes aware of such ineligibility, (y) the Company in its sole discretion determines that this Security shall be exchangeable for definitive Securities in registered form
and notifies the Trustee thereof or (z) an Event of Default with respect to the Securities represented hereby has occurred and is continuing. If this Security is exchangeable pursuant to the preceding sentence, it shall be exchangeable for
definitive Securities in registered 

  
 11 

 
form, having the same date of issuance, Stated Maturity Date and other terms and of authorized denominations aggregating a like amount. 

This Security may not be transferred except as a whole by the Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary or by the Depositary or any such nominee to a successor of the Depositary or a nominee of such successor. Except as provided above, owners of beneficial interests in this Global
Security will not be entitled to receive physical delivery of Securities in definitive form and will not be considered the Holders hereof for any purpose under the Indenture. 

Prior to due presentment of this Security for registration of transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the
contrary. 
 Obligation of the Company Absolute 

No reference herein to the Indenture and no provision of this Security or the Indenture shall alter or impair the obligation
of the Company, which is absolute and unconditional, to pay the Cash Settlement Amount at the times, place and rate, and in the coin or currency, herein prescribed, except as otherwise provided in this Security. 

No Personal Recourse 

No recourse shall be had for the payment of the Cash Settlement Amount, or for any claim based hereon, or otherwise in respect
hereof, or based on or in respect of the Indenture or any indenture supplemental thereto, against any incorporator, stockholder, officer or director, as such, past, present or future, of the Company or any successor corporation, whether by virtue of
any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issuance hereof, expressly waived and released.

 Defined Terms 

All terms used in this Security which are defined in the Indenture shall have the meanings assigned to them in the Indenture
unless otherwise defined in this Security. 
 Governing Law 

This Security shall be governed by and construed in accordance with the law of the State of New York, without regard to
principles of conflicts of laws. 

  
 12 

 ABBREVIATIONS 

The following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they
were written out in full according to applicable laws or regulations: 
  

					
	 TEN COM
	  	 --
	  	 as tenants in common

			
	 TEN ENT
	  	 --
	  	 as tenants by the entireties

			
	 JT TEN
	  	 --
	  	 as joint tenants with right

of survivorship and not
 as
tenants in common

  

							
	
UNIF GIFT MIN ACT --  
	  	 	  	 Custodian  
	  	 
		  	(Cust)	  		  	(Minor)

 Under Uniform Gifts to Minors Act 
  

 
 (State)

 Additional abbreviations may also be used though not in the above list. 

FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto 

Please Insert Social Security or 
 Other Identifying Number of
Assignee 
  
  

 

	
	
	 
	
	 
	
	 
	(PLEASE PRINT OR TYPE NAME AND ADDRESS INCLUDING POSTAL ZIP
CODE OF ASSIGNEE)

  
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 the within Security of WELLS FARGO & COMPANY and does hereby irrevocably constitute and
appoint                                      attorney to
transfer the said Security on the books of the Company, with full power of substitution in the premises. 
  

			
		
	Dated:	 	 
		 	

  

	
	
	 
	
	 

 NOTICE: The signature to this assignment must correspond with the name as written upon the face of the
within instrument in every particular, without alteration or enlargement or any change whatever. 

  
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