EX-10.1






Exhibit 10.1




THE O’GARA GROUP, INC.




2004 Stock Option Plan




(As Amended Through December 20, 2007)




ARTICLE I




OBJECTIVES




     1.1 The objectives of this Stock Option Plan (the “Plan”) are to enable The O’Gara
Group, Inc. (the “Company”) to compete successfully in retaining and attracting employees,
non-employee members of its Board of Advisors, non-employee members of its Board of Directors and
consultants of outstanding ability and to stimulate the efforts of these persons toward the
Company’s objectives.



ARTICLE II




DEFINITIONS




     2.1 For purposes of the Plan each of the following terms shall have the definition which is
attributed to it, unless another definition is clearly indicated by a particular usage and context.




     A. “Board” means the Board of Directors of the Company.




     B. “Board of Advisors” means the Board of Advisors of the Company.




     C. “Cause” means the occurrence of any one or more of the following events with
respect to an Option Holder: conviction of any felony criminal offense or criminal offense
involving moral turpitude or controlled substances; violation of any policy or procedure of
the Company applicable to the Option Holder which is deemed in good faith by the Board to be
harmful to the Company; violation of any provision of any written agreement between the
Company and the Option Holder which permits termination of such Agreement; or failure to
perform satisfactorily in the judgment of the Board a substantial portion of his or her
duties to the Company after having been advised by the Company that his or her performance
has been deemed to be unsatisfactory.




     D. “Code” means the Internal Revenue Code of 1986, as amended. Reference to any
Section of the Code includes the provisions of that Section as it may be amended or replaced
by any other section(s) of like intent and purpose and also includes any regulations or
rulings promulgated thereunder.




     E. “Company” means the Company and any subsidiary of the Company, as the term
“subsidiary” is defined in Section 424(f) of the Code.



 









 






     F. “Consultant” means any natural person who provides bona fide services to the
Company or its majority-owned subsidiaries, who is not on the regular payroll of the Company
and whose services neither are in connection with the offer or sale of securities of the
Company in a capital-raising transaction nor directly or indirectly promote or maintain a
market for the Company’s securities.




     G. “Date of Grant” means the date on which, or such later date as of which,
the Board makes an award of an Option.




     H. “Disability” means permanent and total disability as defined in Section
22(e)(3) of the Code.




     I. “Eligible Employee” means any individual (other than one who receives
retirement benefits, stipends, consulting fees, honorariums and the like) who performs
services for the Company and is included on the regular payroll of the Company.




     J. “Fair Market Value” means, as of any date other than the date of an initial
public offering, (i) if the Shares are readily tradable on an established securities market,
such value as the Board shall determine in accordance with Section 409A of the Code, or (ii)
if the Shares are not readily tradable on an established securities market, such value as
the Board shall determine by either (a) the reasonable application of a reasonable valuation
method that complies with the requirements of Treas. Reg. § 1.409A-1(b)(5)(iv)(B)(1) or (b)
by using one of the presumptive reasonable valuation methods described in Treas. Reg. §
1.409A-1(b)(5)(iv)(B)(2), provided that, in either case, once a single valuation method is
used to determine the Fair Market Value of a Share, such value may not be changed through
the retroactive use of another valuation method. Solely as of the date of an initial public
offering, “Fair Market Value” of a Share shall mean the price to the public pursuant to the
form of final prospectus used in connection with the initial public offering, as indicated
on the cover page of such prospectus or otherwise.




     K. “Incentive Stock Option” shall have the same meaning as is given to that
term by Section 422 of the Code.




     L. “Mature Shares” means Shares which have been fully paid and held, of record
or beneficially, by the holder of an Option for at least six months.




     M. “Nonemployee Member of the Board of Advisors” means any member of the Board
of Advisors who is not on the regular payroll of the Company.




     N. “Nonemployee Director” means any member of the Board of Directors who is not
on the regular payroll of the Company.




     O. “Nonqualified Stock Option” means any Option other than an Incentive Stock
Option.



 









 






     P. “Option” means the right, subject to the terms of this Plan and to such
other terms and conditions as the Board may establish, to purchase from the Company a stated
number of Shares at a specified price.




     Q. “Option Holder” means any Eligible Employee, Nonemployee Member of the Board
of Advisors, Nonemployee Director or Consultant to whom an Option has been granted under the
Plan.




     R. “Option Price” means the consideration in cash or property that, pursuant to
the terms of the Option, is the price at which a Share subject to the Option is purchasable.
The term “Option Price” does not include any amounts paid as interest under a deferred
payment plan or treated as interest. The Option Price for a Share shall not be less than
the Fair Market Value of a Share on the Date of Grant.




     S. “Share” means one share of the Common Stock, no par value, of the Company.



ARTICLE III




ADMINISTRATION




     3.1 Administration. The Plan shall be administered by the Board. Subject to and
consistent with the provisions of the Plan, the Board shall establish such rules and regulations as
it deems necessary or appropriate for the proper administration of the Plan, shall interpret the
provisions of the Plan, shall decide all questions of fact arising in the application of Plan
provisions and shall make such other determinations and take such actions in connection with the
Plan and the Options granted hereunder as it deems necessary or advisable.



     3.2 Except as specifically limited by the provisions of the Plan, the Board shall have
authority to:




     A. Determine which Eligible Employees, Nonemployee Members of the Board of Advisors,
Nonemployee Director or Consultants shall be granted Options;




     B. Determine the number of Shares which may be subject to each Option;




     C. Determine the term and the Option Price of each Option;




     D. Determine whether an Option is an Incentive Stock Option or a Nonqualified Stock
Option (except that only Nonqualified Stock Options may be granted to Nonemployee Members of
the Board of Advisors, Nonemployee Director or Consultants);




     E. Determine the time or times when Options will be granted; and




     F. Determine all other terms and conditions of each Option, including (but not limited
to) the terms of any Option agreement. The Board may, in its discretion, determine as a
condition of any Option that a stated percentage of Shares covered by such Option shall vest
in any one year or other stated period of time and may specify



 









 







the conditions under which a vested Option is exercisable. The Board may also waive or
amend the terms and conditions of, or accelerate either or both the vesting or
exercisability of, an Option under circumstances selected by the Board, except to the extent
such waiver, amendment or acceleration would cause the Option to be treated as either (i)
the grant of a new Option or an extension of the Option under Treas. Reg. §
1.409A-1(b)(5)(v) that is not exempt from the requirements of Section 409A of the Code or
(ii) as having had an additional deferral feature from the original Date of Grant that is
not permitted under Treas. Reg. § 1.409A-1(b)(5)(i)(A)(3), as long as such waivers,
amendments or accelerations are not inconsistent with the terms of the Plan, but no such
changes shall materially impair the rights of any Option Holder without his or her consent
unless required by law or integrally related to a requirement of law.



     3.3 Any action, decision, interpretation or determination by the Board with respect to the
application or administration of this Plan shall be final and binding upon all persons, and need
not be uniform with respect to its determination of recipients, amount, timing, form, terms or
provisions of Options.



     3.4 No member of the Board shall be liable for any action or determination taken or made in
good faith with respect to the Plan or any Option granted hereunder and, to the extent not
prohibited by applicable law, all members shall be indemnified by the Company for any liability and
expenses which they may incur as a result of any claim or cause of action, or threatened claim or
cause of action, arising in connection with the administration of this Plan or the grant of any
Option hereunder.



     3.5 The Board may, at its discretion, delegate any or all of the functions to be performed by
it to a committee of the Board.



ARTICLE IV




SHARES ISSUABLE




     4.1 Except as provided in Article XI, the number of Shares which may be issued under the Plan
shall not exceed 570 (after giving effect to the 100 for 1 stock split contemplated in connection
with the Investment Agreement dated as of May 17, 2004) in the aggregate. If any Option expires or
terminates for any reason without being completely exercised, the Shares with respect to which such
Option was not exercised may again be subject to other Options. Shares tendered as payment for the
Option Price pursuant to Section 7.1 shall be available for issuance under the Plan. The Board may
make such other determinations regarding the counting of Shares issued pursuant to the Plan as it
deems necessary or advisable, provided that such determinations shall be permitted by law.



ARTICLE V




GRANTING OF OPTIONS




     5.1 Subject to the terms and conditions of the Plan, the Board may, from time to time, grant
Options to Eligible Employees, Nonemployee Members of the Board of Advisors, Nonemployee Directors
or Consultants on such terms and conditions as it shall determine.



 









 







More than one Option and more than one form of Option may be granted to the same individual.



ARTICLE VI




EXERCISE OF OPTIONS




     6.1 Any person entitled to exercise an Option may do so in whole or in part, to the extent the
Option is vested, by delivering to the Company, attention: Secretary, at its principal office, a
written notice of exercise. The written notice shall specify the number of Shares for which an
Option is being exercised and shall be accompanied by full payment of the Option Price for the
Shares being purchased.



ARTICLE VII




PAYMENT OF OPTION PRICE




     7.1 Subject to such administrative requirements as the Board may impose, payment of the Option
Price may be made, at the election of the Option Holder, in cash or by the tender of Mature Shares
or by a combination of the foregoing. If payment by the tender of Mature Shares is selected, the
value of each Mature Share shall be deemed to be the Fair Market Value of a Share on the day the
Mature Shares are tendered for payment, which shall be the date on which the Mature Shares, duly
endorsed or accompanied by a stock power duly endorsed for transfer to the Company, are received by
the Company.



ARTICLE VIII




INCENTIVE STOCK OPTIONS AND NONQUALIFIED STOCK OPTIONS




     8.1 Any Option designated as an Incentive Stock Option will be subject to the general
provisions applicable to all Options granted under the Plan. In addition, an Incentive Stock
Option shall be subject to the following specific provisions:




     A. No incentive Stock Option may be exercised after the expiration of ten years from
the Date of Grant.




     B. At the time the Incentive Stock Option is granted, if the Eligible Employee owns,
directly or indirectly, stock representing more than 10% of the total combined voting power
of all classes of stock of the Company then:




     (i) The Option Price must equal at least 110% of the Fair Market Value on the
Date of Grant; and




     (ii) The term of the Option shall not be greater than five years from the Date
of Grant.




     C. The aggregate Fair Market Value (determined as of the Date of Grant) of the Shares
with respect to which Incentive Stock Options are exercisable for the first



 









 







time by any holder during any calendar year (under all plans of the Company) shall not
exceed $100,000.



     8.2 If any Option is not granted, exercised or held pursuant to the provisions of Code Section
422, it will be considered to be a Nonqualified Stock Option to the extent that any or all of the
grant is in conflict with those provisions.



ARTICLE IX




TRANSFERABILITY OF OPTIONS




     9.1 During the lifetime of an Option Holder, an Option granted under this Plan to him or her
will be non-assignable and non-transferable and may be exercised only by such individual or that
individual’s legal representative or guardian. In the event of the death of an Option Holder, an
exercisable Option shall be transferable, to the extent the Option is vested on the date of death,
pursuant to the holder’s Will or by the laws of descent and distribution and may thereafter be
exercised by the transferee(s) as provided in Article X. Shares issued upon Option exercise shall,
in all cases, be subject to the provisions of Article XV.



ARTICLE X




TERMINATION OF OPTIONS




     10.1 Unless earlier terminated pursuant to Article XIII, an Option granted to an Eligible
Employee will terminate as follows:




     A. During the period of the Eligible Employee’s continuous employment with the Company,
the Option will terminate upon the earlier of the date on which it has been fully exercised,
it expires by its terms or it is terminated by the mutual agreement of the Company and the
Eligible Employee.




     B. Upon termination of the Eligible Employee’s employment with the Company for any
reason any unexercisable Option, whether or not vested, shall immediately terminate. Except
as provided in Section 10.1(C) or Section 10.1(D), any Option which is vested (in whole or
part) and exercisable on the date of termination of employment will terminate upon the
earlier of its full exercise (to the extent vested on the date of termination of
employment), the expiration of the Option by its terms or the end of the three-month period
following the date of termination. For purposes of the Plan, a leave of absence approved by
the Company shall not be deemed to be termination of employment.




     C. If an Eligible Employee to whom an Option was granted dies or becomes subject to a
Disability while employed by the Company, an Option which is vested (in whole or part) and
exercisable on the date of death or the commencement of Disability may be exercised at any
time within one year after the date of death or the commencement of Disability, to the
extent that the Eligible Employee was entitled to exercise it at the time of death or the
commencement of Disability, by the Eligible Employee or the Eligible Employee’s legal
representative or guardian or by the



 









 







representative(s) of the Eligible Employee’s estate or the person(s) to whom the Option
may have been transferred by Will or by the laws of descent and distribution.




     D. Upon termination by the Company of the Eligible Employee’s employment for Cause, all
unexercised Options, whether vested or not, held by the Eligible Employee at the time of
termination shall immediately terminate. In addition, if an Eligible Employee terminates
his or her employment and the Board, in good faith, determines that grounds existed at that
time for the Company to terminate the Eligible Employee for Cause, all unexercised Options
held by the Eligible Employee at the time of termination, whether then exercisable or not,
shall be deemed to have been terminated at the time of termination of employment.



     10.2 Unless earlier terminated pursuant to Article XIII, an Option granted to a Nonemployee
Member of the Board of Advisors will terminate as follows:




     A. During the period of the Nonemployee Member of the Board of Advisors’ continuous
service as a member of the Board of Advisors, the Option will terminate upon the earlier of
the date on which it has been fully exercised, it expires by its terms or it is terminated
by the mutual agreement of the Company and the Nonemployee Member of the Board of Advisors.




     B. Upon termination of the Nonemployee Member of the Board of Advisors’ service as a
member of the Board of Advisors for any reason any unexercisable Option, whether or not
vested, shall immediately terminate. Except as provided in Section 10.2(C) or Section
10.2(D), any Option which is vested (in whole or part) and exercisable on the date of
termination of service as a member of the Board of Advisors will terminate upon the earlier
of its full exercise (to the extent vested on the date of termination of service), the
expiration of the Option by its terms or the end of the three-month period following the
date of termination.




     C. If a Nonemployee Member of the Board of Advisors to whom an Option was granted dies
or becomes subject to a Disability while serving on the Board of Advisors, an Option which
is vested (in whole or part) and exercisable on the date of death or the commencement of
Disability may be exercised at any time within one year after the date of death or the
commencement of Disability, to the extent that the Nonemployee Member of the Board of
Advisors was entitled to exercise it at the time of death or the commencement of Disability,
by the Nonemployee Member of the Board of Advisors or the Nonemployee Member of the Board of
Advisors’ legal representative or guardian or by the representative(s) of the Nonemployee
Member of the Board of Advisors’ estate or the person(s) to whom the Option may have been
transferred by Will or by the laws of descent and distribution.




     D. If the Board should determine that a Nonemployee Member of the Board of Advisors has
engaged in conduct that, if the Nonemployee Member of the Board of Advisors were an Eligible
Employee would be grounds for termination of employment for Cause, all unexercised Options,
whether vested or not, held by the Nonemployee Member of the Board of Advisors at the time
of such determination shall immediately terminate. In addition, if a Nonemployee Member of
the Board of Advisors terminates



 









 







his or her service as a member of the Board of Advisors, and the Board, in good faith,
determines that grounds existed at that time for the Board to have made such a
determination, all unexercised Options held by the Nonemployee Member of the Board of
Advisors at the time of termination of service, whether then exercisable or not, shall be
deemed to have been terminated at the time of termination of service.



     10.3 Unless earlier terminated pursuant to Article XIII, an Option granted to a Nonemployee
Director will terminate as follows:




     A. During the period of the Nonemployee Director’s continuous service as a member of
the Board, the Option will terminate upon the earlier of the date on which it has been fully
exercised, it expires by its terms or it is terminated by the mutual agreement of the
Company and the Nonemployee Director.




     B. Upon termination of the Nonemployee Director’s service as a member of the Board for
any reason any unexercisable Option, whether or not vested, shall immediately terminate.
Except as provided in Section 10.3(C) or Section 10.3(D), any Option which is vested (in
whole or part) and exercisable on the date of termination of service as a member of the
Board will terminate upon the earlier of its full exercise (to the extent vested on the date
of termination of service), the expiration of the Option by its terms or the end of the
three-month period following the date of termination.




     C. If a Nonemployee Director to whom an Option was granted dies or becomes subject to a
Disability while serving on the Board, an Option which is vested (in whole or part) and
exercisable on the date of death or the commencement of Disability may be exercised at any
time within one year after the date of death or the commencement of Disability, to the
extent that the Nonemployee Director was entitled to exercise it at the time of death or the
commencement of Disability, by the Nonemployee Director or the Nonemployee Director’s legal
representative or guardian or by the representative(s) of the Nonemployee Director’s estate
or the person(s) to whom the Option may have been transferred by Will or by the laws of
descent and distribution.




     D. If the Board should determine that a Nonemployee Director has engaged in conduct
that, if the Nonemployee Director were an Eligible Employee would be grounds for termination
of employment for Cause, all unexercised Options, whether vested or not, held by the
Nonemployee Director at the time of such determination shall immediately terminate. In
addition, if a Nonemployee Director terminates his or her service as a member of the Board,
and the Board, in good faith, determines that grounds existed at that time for the Board to
have made such a determination, all unexercised Options held by the Nonemployee Director at
the time of termination of service, whether then exercisable or not, shall be deemed to have
been terminated at the time of termination of service.



     10.4 Unless earlier terminated pursuant to Article XIII, an Option granted to a Consultant
will terminate as follows:



 









 






     A. During the period of the Consultant’s continuous service to the Company, the Option
will terminate upon the earlier of the date on which it has been fully exercised, it expires
by its terms or it is terminated by the mutual agreement of the Company and the Consultant.




     B. Upon termination of the services to the Company (as determined by the Board), for
any reason any unexercisable Option, whether or not vested, shall immediately terminate.
Except as provided in Section 10.4(C) or Section 10.4(D), any Option which is vested (in
whole or part) and exercisable on the date of termination of services will terminate upon
the earlier of its full exercise (to the extent vested on the date of termination of
services), the expiration of the Option by its terms or the end of the three-month period
following the date of termination of services.




     C. If a Consultant to whom an Option was granted dies or becomes subject to a
Disability while providing services to the Company, an Option which is vested (in whole or
part) and exercisable on the date of death or the commencement of Disability may be
exercised at any time within one year after the date of death or the commencement of
Disability, to the extent that the Consultant was entitled to exercise it at the time of
death or the commencement of Disability, by the Consultant or the Consultant’s legal
representative or guardian or by the representative(s) of the Consultant’s estate or the
person(s) to whom the Option may have been transferred by Will or by the laws of descent and
distribution.




     D. Upon termination by the Company of the Consultant’s services for Cause, all
unexercised Options, whether vested or not, held by the Consultant at the time of
termination shall immediately terminate. In addition, if a Consultant terminates his or her
services and the Board, in good faith, determines that grounds existed at that time for the
Company to terminate the Consultant’s services for Cause, all unexercised Options held by
the Consultant at the time of termination, whether then exercisable or not, shall be deemed
to have been terminated at the time of termination of services.



     10.5 The Board, at its discretion may extend the periods for Option exercise as set forth in
this Article X, provided that such extension complies with restrictions of Section 3.2(F) hereof.



ARTICLE XI




ADJUSTMENTS TO SHARES AND OPTION PRICE




     11.1 If the Company shall at any time after the effective date of the Plan change the number
of issued Shares without new consideration to the Company (such as by stock dividend, stock split,
reverse stock split, recapitalization, reorganization, exchange of shares, liquidation, combination
or other change in corporate structure affecting the Shares) or make a distribution to shareholders
of cash or property (such as a large nonrecurring cash dividend or in a spin-off or split-up) which
has a substantial impact on the value of outstanding Shares (collectively, an “Equity
Restructuring”), then the numbers of Shares specified in Section 4.1, the specified or fixed
numbers of Shares covered by each outstanding Option, and, if applicable, the Option Price (the
“Adjusted Items”) shall be proportionately and equitably



 









 







adjusted; provided that (i) any adjustments made in the number of Shares with respect to which
Incentive Stock Options may be or have been granted shall be made in accordance with Code Section
424, (ii) the numbers of Shares covered by each outstanding Option shall be made in accordance with
Section 409A of the Code, and (iii) fractions of a Share will not be issued but either will be
replaced by a cash payment equal to the Fair Market Value of such fraction of a Share or will be
rounded down to the nearest whole Share, as determined by the Board. The determination of whether
an Equity Restructuring has occurred, and what adjustments are to be made to Adjusted Items, shall
be made by the Board in good faith in such manner as it deems necessary or appropriate in order to
prevent enlargement or dilution of the rights and benefits (or potential benefits) intended to be
made available under the Plan.


In the event the type of Shares to be issued hereunder are affected on account of a merger,
consolidation, recapitalization, reclassification, combination, stock dividend, stock split, or
other similar event, the type of Shares issuable under this Plan in substitution of, or in exchange
for, the Shares shall be a class of stock that is common stock for purposes of Section 305 of the
Code of a corporation that is an eligible issuer of service recipient stock (within the meaning of
the Treas. Reg. § 1.409-1(b)(5)(iii)(E)). However, under no circumstances shall the Shares be
substituted or exchanged for a class of stock that (x) has any preference as to distributions other
than distributions of such stock and distributions in liquidation of the issuer or (y) is subject
to a mandatory repurchase obligation (other than a right of first refusal), or a put or call right
that is not a lapse restriction (as defined in Treas. Reg. § 1.83-3(i)) if the stock price under
such right or obligation is based on a measure other than the fair market value (disregarding lapse
restrictions as defined in §1.83-3(i)) of the equity interest in the corporation represented by the
stock.




ARTICLE XII




AMENDMENT OR TERMINATION OF PLAN




     12.1 The Board may at any time amend, suspend or terminate the Plan; provided, however, that
shareholder approval shall be required for any amendment if such approval is required pursuant to
the Code, or any rule or regulation thereunder, as such may be in effect and be interpreted from
time to time.



     12.2 No amendment to the Plan shall alter or impair any Option granted under the Plan without
the consent of the holder thereof.



ARTICLE XIII




CERTAIN EVENTS




     13.1 Subject to Section 13.4, in the event the Company shall consolidate with, merge into, or
transfer all or substantially all of its assets to another corporation or corporations (a
“successor corporation”), such successor corporation may obligate itself to continue this
Plan and to assume all obligations under the Plan. In the event that such successor corporation
does not obligate itself to continue this Plan as above provided, the Plan shall terminate
effective upon such consolidation, merger or transfer and an Option previously granted hereunder
shall terminate. If practical, the Company shall give each Option Holder twenty (20) days prior



 









 




notice of any possible transaction which might terminate this Plan and the Options previously
granted hereunder.




     13.2 Subject to Section 13.4, in the event any person (other than Thomas M. O’Gara or any of
his affiliates), by any means of purchase or acquisition, becomes the “beneficial owner” (as
defined in Exchange Act Rule 13d-3 as in effect on February 28, 2002) of more than 50% of the
outstanding Shares of the Company, or commences a tender offer pursuant to Exchange Act Regulation
14C (as in effect on February 28, 2002) which, if successful, would result in such person becoming
the beneficial owner of more than 50% of such Shares, then all Options which are outstanding at the
time of such event shall immediately become exercisable in full.



     13.3 Subject to Section 13.4, in the event of the execution of an agreement of reorganization,
merger or consolidation of the Company with one or more corporations as a result of which the
Company is not to be the surviving corporation (whether or not the Company shall be dissolved or
liquidated) or the execution of an agreement of sale or transfer of all or substantially all of the
assets of the Company, then all Options which are outstanding at the time of such event shall
immediately become exercisable in full.



     13.4 The grant of Options under the Plan shall in no way affect the right of the Company to
adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge,
consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.



     13.5 Notwithstanding the foregoing, in the event the amounts deemed payable under this Article
XIII when added to all other payments to the Option Holder by the Company, would, if made,
constitute Excess Parachute Payments within the meaning of Sections 280G and 4999 of the Code, the
amounts deemed payable by the Company under this Article shall be reduced by the amount deemed
necessary to cause the holder to receive $1,000.00 less than three times the holder’s Base Amount
(as that term is defined in Code Section 280G) from all such payments to the holder from the
Company. In the event the amount of the payments exceeds the amount subsequently determined to
have been due, the excess benefits over three times the Base Amount shall be returned immediately
to the Company by the holder.



ARTICLE XIV




EFFECTIVE DATE




     14.1 This Plan became effective on January 5, 2004. No Option shall be granted pursuant to
this Plan subsequent to January 4, 2014 or subsequent to any earlier date as of which this Plan is
terminated.



ARTICLE XV




REPURCHASE OF OPTION SHARES




     15.1 In the event an Eligible Employee exercises an Option and thereafter, while still an
employee of the Company, wishes to sell the Shares received upon exercise, he or she shall



 









 







first offer to sell such Shares to the Company. The Eligible Employee shall give notice to
the Company at least 15 days prior to the proposed sale. The notice shall include the identity of
the proposed purchaser and the details of the terms of the proposed purchase. The Company shall
have ten days after receipt of this notice to advise the Eligible Employee that the Company has
decided to purchase the shares on the same terms. If the terms of the proposed purchase involve
consideration other than cash, the Company may pay with consideration of comparable value. The
purchase will be closed within five days after notice is given by the Company. If the Company does
not purchase the Shares, the Eligible Employee may proceed with the proposed sale, but only on the
terms described in the original notice. The proposed sale must be completed within 30 days after
the end of the Company’s ten day reply period.



     15.2 In the event a Nonemployee Member of the Board of Advisors exercises an Option and
thereafter, while still serving as a member of the Board of Advisors, wishes to sell the Shares
received upon exercise, he or she shall first offer to sell such Shares to the Company. The
Nonemployee Member of the Board of Advisors shall give notice to the Company at least 15 days prior
to the proposed sale. The notice shall include the identity of the proposed purchaser and the
details of the terms of the proposed purchase. The Company shall have ten days after receipt of
this notice to advise the Nonemployee Member of the Board of Advisors that the Company has decided
to purchase the shares on the same terms. If the terms of the proposed purchase involve
consideration other than cash, the Company may pay with consideration of comparable value. The
purchase will be closed within five days after notice is given by the Company. If the Company does
not purchase the Shares, the Nonemployee Member of the Board of Advisors may proceed with the
proposed sale, but only on the terms described in the original notice. The proposed sale must be
completed within 30 days after the end of the Company’s ten day reply period.



     15.3 In the event a Nonemployee Director exercises an Option and thereafter, while still
serving as a member of the Board, wishes to sell the Shares received upon exercise, he or she shall
first offer to sell such Shares to the Company. The Nonemployee Director shall give notice to the
Company at least 15 days prior to the proposed sale. The notice shall include the identity of the
proposed purchaser and the details of the terms of the proposed purchase. The Company shall have
ten days after receipt of this notice to advise the Nonemployee Director that the Company has
decided to purchase the shares on the same terms. If the terms of the proposed purchase involve
consideration other than cash, the Company may pay with consideration of comparable value. The
purchase will be closed within five days after notice is given by the Company. If the Company does
not purchase the Shares, the Nonemployee Director may proceed with the proposed sale, but only on
the terms described in the original notice. The proposed sale must be completed within 30 days
after the end of the Company’s ten day reply period.



     15.4 In the event a Consultant exercises an Option and thereafter, while still providing
services to the Company, wishes to sell the Shares received upon exercise, he or she shall first
offer to sell such Shares to the Company. The Consultant shall give notice to the Company at least
15 days prior to the proposed sale. The notice shall include the identity of the proposed
purchaser and the details of the terms of the proposed purchase. The Company shall have ten days
after receipt of this notice to advise the Consultant that the Company has decided to purchase the
shares on the same terms. If the terms of the proposed purchase involve



 









 







consideration other than cash, the Company may pay with consideration of comparable value.
The purchase will be closed within five days after notice is given by the Company. If the Company
does not purchase the Shares, the Consultant may proceed with the proposed sale, but only on the
terms described in the original notice. The proposed sale must be completed within 30 days after
the end of the Company’s ten day reply period.



     15.5 A. The provisions of this Article XV shall not apply to any Option Holder who is also a
party to the Company’s Second Amended and Restated Shareholder’s Agreement, dated July 14, 2006, as
amended and supplemented from time to time (“Buy-Sell Agreement”), so long as the Shares
acquired as a result of Options granted under this Plan are subject to the terms of the Buy-Sell
Agreement; provided that under no circumstances shall the Shares acquired under this Plan include
or be subject to a mandatory repurchase obligation (other than a right of first refusal), or a put
or call right that is not a lapse restriction (as defined in Treas. Reg. § 1.83-3(i)) if the per
Share price under such right or obligation is based on a measure other than the Fair Market Value
(disregarding lapse restrictions as defined in § 1.83-3(i)) of a Share).




       B. The provisions of this Article XV shall terminate upon either: the successful
completion of a public offering of the Common Stock, no par value, of the Company that is
registered under the Securities Act of 1933 and which results, upon completion, in the
Common Stock being listed on a national stock exchange or a national trading or quotation
system; or the completion of a transaction which results in the Options granted under this
Plan becoming rights to purchase securities of another entity which are listed on a national
stock exchange or a national trading or quotation system.



ARTICLE XVI




MISCELLANEOUS




     16.1 Nothing contained in this Plan shall constitute the granting of an Option. Each Option
shall be represented by a written Option agreement executed by both the Option Holder and the
Company.



     16.2 Certificates for Shares purchased through exercise of Options will be issued in regular
course after exercise of the Option and payment therefor as called for by the terms of the Option.
No person holding an Option or entitled to exercise an Option granted under this Plan shall have
any rights or privileges of a shareholder of the Company with respect to any Shares issuable upon
exercise of such Option until certificates representing such Shares shall have been issued and
delivered. Notwithstanding any provision of this Plan or any Option agreement, no Option may be
transferred, and no Option shall be exercisable or Shares issued and delivered upon exercise of an
Option, unless and until the Company has complied with any and all applicable federal and state
securities laws, listing requirements of any market or national securities exchange on which the
Company’s Shares may then be traded and other requirements of law. Any certificate representing
Shares acquired upon exercise of an Option may bear such legends as the Company deems advisable to
assure compliance with all applicable laws and regulations.



 









 





     16.3 All Shares acquired upon exercise of options granted under this Plan shall be subject to
such “lock-up” arrangements as the underwriters reasonably may impose in the event of an initial
public offering by the Company.



     16.4 Nothing contained in this Plan or in any Option granted pursuant to it shall confer upon
any person any right to continue in the employ of the Company or to interfere in any way with the
right of the Company to terminate a person’s employment with the Company at any time. So long as a
holder of an Option shall continue to be an employee of the Company, the Option shall not be
affected by any change of the employee’s duties or position.



     16.5 This
Plan shall be construed and administered in accordance with and governed by the laws
of the State of Ohio.



     16.6 For federal income tax purposes, the Plan and the Options granted hereunder are intended
to be exempt from Section 409A of the Code as a result of compliance with the exemptions set forth
Treas. Reg. §§ 1.409A-1(b)(5)(i)(A) (relating to the exemption for Nonqualified Stock Options) and
1.409A-1(b)(5)(ii) (relating to the exemption for Incentive Stock Options). This Plan and all
Options granted hereunder shall be interpreted, operated and administered in a manner consistent
with this intention.



     16.7 When Shares are to be delivered upon exercise of an Option, the Company shall be entitled
to require (i) that the Option Holder remit an amount in cash, or if determined by the Board,
Mature Shares, sufficient to satisfy all federal, state, local and foreign tax withholding
requirements related thereto (“Required Withholding”), (ii) the withholding of such
Required Withholding from compensation otherwise due to the Option Holder or from any Shares to be
delivered to the Option Holder under the Plan, or (iii) any combination of the foregoing.