Document:

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                                                                     EXHIBIT 4.5

                                                                  EXECUTION COPY

                          REGISTRATION RIGHTS AGREEMENT

      This Registration Rights Agreement (this "AGREEMENT") is made and entered
into as of July 25, 2005, among Verso Technologies, Inc., a Minnesota
corporation (the "COMPANY"), and the investors signatory hereto (each such
investor is a "PURCHASER" and all such investors are, collectively, the
"PURCHASERS").

      WHEREAS, the parties have agreed to enter into this Agreement in
connection with, and as a condition to the Amendment to the 7.50% Convertible
Debentures, dated as of the date hereof, by and among the Company and the
Holders identified therein (the "AMENDMENT");

      NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this
Agreement, and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the Company and the Purchasers agree
as follows:

      1.    Definitions. In addition to the terms defined elsewhere in this
Agreement, (a) capitalized terms that are not otherwise defined herein have the
meanings given to such terms in the Amendment, and (b) the following terms have
the meanings indicated:

            "EXCHANGE ACT" means the Securities and Exchange Act of 1934, as
      amended.

            "FILING DATE" means, with respect to the initial Registration
      Statement required to be filed pursuant to Section 2, the 30th day
      following the date hereof (provided that if such date is not a day on
      which the Commission is open, then the Filing Date shall mean the first
      day following such 30th day on which the Commission is open), and, with
      respect to any additional Registration Statements that may be required
      pursuant to Section 3(c), the 30th day following the date on which the
      Company first knows, or reasonably should have known, that such additional
      Registration Statement is required under such Section.

            "HOLDER" means any holder, from time to time, of Registrable
      Securities.

            "PROSPECTUS" means the prospectus included in the Registration
      Statement (including, without limitation, a prospectus that includes any
      information previously omitted from a prospectus filed as part of an
      effective registration statement in reliance upon Rule 430A promulgated
      under the Securities Act), as amended or supplemented by any prospectus
      supplement, with respect to the terms of the offering of any portion of
      the Registrable Securities covered by the Registration Statement, and all
      other amendments and supplements to the Prospectus, including
      post-effective amendments, and all material incorporated by reference or
      deemed to be incorporated by reference in such Prospectus.

            "REGISTRABLE SECURITIES" means any Common Stock issued or issuable
      pursuant to the Transaction Documents, together with any securities issued
      or issuable upon any stock split, dividend or other distribution,
      recapitalization or similar event with respect to the foregoing.

            "REGISTRATION STATEMENT" means the initial registration statement
      required to be filed hereunder and any additional registration statements
      contemplated by Section 3(c), including (in each case) the Prospectus,
      amendments and supplements to such registration

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      statement or Prospectus, including pre- and post-effective amendments, all
      exhibits thereto, and all material incorporated by reference or deemed to
      be incorporated by reference in such registration statement.

            "RULE 415," "RULE 424" and "RULE 461" means Rule 415, Rule 424 and
      Rule 461, respectively, promulgated by the Commission pursuant to the
      Securities Act, as such Rules may be amended from time to time, or any
      similar rule or regulation hereafter adopted by the Commission having
      substantially the same effect as such Rule.

            "SPECIAL COUNSEL" means one special counsel to the Holders. Unless
      the Holders notify the Company otherwise, the Special Counsel will be
      Proskauer Rose LLP.

            "COMMISSION" means the Securities and Exchange Commission.

            "ELIGIBLE MARKET" means any of the New York Stock Exchange, the
      American Stock Exchange, the NASDAQ National Market or the NASDAQ SmallCap
      Market.

            "EFFECTIVE DATE" means the date on which the Registration Statement
      is declared effective by the Commission.

            "BUSINESS DAY" means any day other than Saturday, Sunday or other
      day on which commercial banks in The City of New York are authorized or
      required by law to remain closed

            "SECURITIES ACT" means the Securities Act of 1933, as amended.

            "TRADING DAY" means (a) any day on which the Common Stock is listed
      or quoted and traded on its primary Trading Market, (b) if the Common
      Stock is not then listed or quoted and traded on any Eligible Market, then
      a day on which trading occurs on the NASDAQ National Market (or any
      successor thereto), or (c) if trading ceases to occur on the NASDAQ
      National Market (or any successor thereto), any Business Day.

            "TRADING MARKET" means the Nasdaq SmallCap Market or any other
      Eligible Market, or any national securities exchange, market or trading or
      quotation facility on which the Common Stock is then listed or quoted.

            "TRANSACTION DOCUMENTS" means the Warrants, the Amendment, this
      Agreement, the Debentures and any other document or agreements executed in
      connection with the transactions contemplated thereunder.

            "PERSON" means any individual, corporation, trust, association,
      company, partnership, joint venture, limited liability company, joint
      stock company, governmental authority or other entity.

            "PROCEEDING" means any action, suit, inquiry, notice of violation,
      proceeding or investigation pending or, to the knowledge of the Company,
      threatened against or affecting the Company or any of its subsidiaries or
      any of their respective properties

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      before or by any court, arbitrator, governmental or administrative agency
      or regulatory authority (federal, state, county, local or foreign)
      (collectively, "PROCEEDINGS").

      2.    Shelf Registration

            (a)   As promptly as possible, and in any event on or prior to each
Filing Date, the Company shall prepare and file with the Commission a "Shelf"
Registration Statement covering the resale of all Registrable Securities for an
offering to be made on a continuous basis pursuant to Rule 415. The Registration
Statement shall be on Form S-3 (except if the Company is not then eligible to
register for resale the Registrable Securities on Form S-3, in which case such
registration shall be on another appropriate form in accordance herewith as the
Holders may consent) and shall contain (except if otherwise directed by the
Holders) the "Plan of Distribution" attached hereto as Annex A. The Company
shall use commercially reasonable efforts to cause the Registration Statement to
be declared effective under the Securities Act as promptly as possible after the
filing thereof and shall use its best efforts to keep such Registration
Statement continuously effective under the Securities Act until the earlier of:
(i) the fifth anniversary of the Effective Date and (ii) when all Registrable
Securities covered by such Registration Statement have been sold (the
"EFFECTIVENESS PERIOD"). The Company shall notify each Holder in writing
promptly (and in any event within two Business Days) after receiving
notification from the Commission that a Registration Statement has been declared
effective.

            (b)   Except as specified in Schedule 2(b) to this Agreement, the
Company may not, prior to the Effective Date of the Registration Statement,
prepare and file with the Commission a registration statement relating to an
offering for its own account or the account of others under the Securities Act
of any of its equity securities.

      3.    Registration Procedures. In connection with the Company's
registration obligations hereunder, the Company shall:

            (a)   Not less than three Trading Days prior to the filing of each
Registration Statement or any related Prospectus or any amendment or supplement
thereto (including any document that would be incorporated or deemed to be
incorporated therein by reference), the Company shall: (i) furnish to the
Holders and their Special Counsel copies of all such documents proposed to be
filed, which documents (other than those incorporated or deemed to be
incorporated by reference) will be subject to the review of such Holders and
their Special Counsel; and (ii) cause its officers and directors, counsel and
independent certified public accountants to respond to such inquiries as shall
be necessary, in the reasonable opinion of respective counsel, to conduct a
reasonable investigation within the meaning of the Securities Act. The Company
shall not file the Registration Statement or any such Prospectus or any
amendments or supplements thereto to which the Holders of a majority of the
Registrable Securities and their Special Counsel shall reasonably object.

            (b)   Prepare and file with the Commission such amendments,
including post-effective amendments, to the Registration Statement and the
Prospectus used in connection therewith as may be necessary to keep the
Registration Statement continuously effective as to the applicable Registrable
Securities for the Effectiveness Period and prepare and file with the Commission
such additional Registration Statements in order to register for resale under
the

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Securities Act all of the Registrable Securities; cause the related Prospectus
to be amended or supplemented by any required Prospectus supplement, and as so
supplemented or amended to be filed pursuant to Rule 424; respond as promptly,
as reasonably possible to any comments received from the Commission with respect
to the Registration Statement or any amendment thereto and as promptly as
reasonably possible provide the Holders true and complete copies of all
correspondence from and to the Commission relating to the Registration
Statement; and comply in all material respects with the provisions of the
Securities Act and the Exchange Act with respect to the disposition of all
Registrable Securities covered by the Registration Statement during the
applicable period in accordance with the intended methods of disposition by the
Holders thereof set forth in the Registration Statement as so amended or in such
Prospectus as so supplemented.

            (c)   If, on any date, the number of shares of Common Stock
previously registered under all existing Registration Statements is less than
125% of the Actual Minimum on such date, then the Company shall file an
additional Registration Statement covering a number of shares of Common Stock at
least equal to (i) the Actual Minimum on such date, less (ii) the number of
shares of Common Stock previously registered under all existing Registration
Statements; provided that the Company will not be required at any time to
register a number of shares of Common Stock greater than the maximum number of
shares of Common Stock that could possibly be issued pursuant to the Transaction
Documents. For the purposes hereof, "ACTUAL MINIMUM" shall mean, as of any date,
the maximum aggregate number of shares of Common Stock then issued or
potentially issuable in the future pursuant to the Transaction Documents,
including any shares of Common Stock issuable upon exercise in full of all
Warrants, without giving effect to any limits on the number of shares of Common
Stock that may be owned by a Holder at any one time.

            (d)   Notify the Holders of Registrable Securities to be sold and
their Special Counsel as promptly as reasonably possible, and (if requested by
any such Person) confirm such notice in writing no later than two Trading Days
thereafter, of any of the following events: (i) the Commission notifies the
Company whether there will be a "review" of any Registration Statement; (ii) the
Commission comments in writing on any Registration Statement (in which case the
Company shall deliver to each Holder a copy of such comments and of all written
responses thereto); (iii) any Registration Statement or any post-effective
amendment is declared effective; (iv) the Commission or any other Federal or
state governmental authority requests any amendment or supplement to a
Registration Statement or Prospectus or requests additional information related
thereto; (v) the Commission issues any stop order suspending the effectiveness
of any Registration Statement or initiates any Proceedings for that purpose;
(vi) the Company receives notice of any suspension of the qualification or
exemption from qualification of any Registrable Securities for sale in any
jurisdiction, or the initiation or threat of any Proceeding for such purpose; or
(vii) the financial statements included in any Registration Statement become
ineligible for inclusion therein or any statement made in any Registration
Statement or Prospectus or any document incorporated or deemed to be
incorporated therein by reference is untrue in any material respect or any
revision to a Registration Statement, Prospectus or other document is required
so that it will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.

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            (e)   Use its best efforts to avoid the issuance of or, if issued,
obtain the withdrawal of: (i) any order suspending the effectiveness of any
Registration Statement or (ii) any suspension of the qualification (or exemption
from qualification) of any of the Registrable Securities for sale in any
jurisdiction, at the earliest practicable moment.

            (f)   Furnish to each Holder and their Special Counsel, without
charge, at least one conformed copy of each Registration Statement and each
amendment thereto, including financial statements and schedules, all documents
incorporated or deemed to be incorporated therein by reference, and all exhibits
to the extent requested by such Person (including those previously furnished or
incorporated by reference) promptly after the filing of such documents with the
Commission.

            (g)   Promptly deliver to each Holder and their Special Counsel,
without charge, as many copies of the Prospectus or Prospectuses (including each
form of prospectus) and each amendment or supplement thereto as such Persons may
reasonably request. The Company hereby consents to the use of such Prospectus
and each amendment or supplement thereto by each of the selling Holders in
connection with the offering and sale of the Registrable Securities covered by
such Prospectus and any amendment or supplement thereto.

            (h)   (A) In the time and manner required by each Trading Market, if
at all, prepare and file with such Trading Market an additional shares listing
application covering all of the Registrable Securities; (B) take all steps
necessary to cause such Registrable Securities to be approved for listing on
each Trading Market as soon as reasonably practicable thereafter; (C) to the
extent available to the Company, provide to the Purchasers evidence of such
listing; and (D) maintain the listing of such Registrable Securities on each
such Trading Market or another Eligible Market.

            (i)   Prior to any public offering of Registrable Securities, use
its best efforts to register or qualify or cooperate with the selling Holders
and their Special Counsel in connection with the registration or qualification
(or exemption from such registration or qualification) of such Registrable
Securities for offer and sale under the securities or Blue Sky laws of such
jurisdictions within the United States as any Holder requests in writing, to
keep each such registration or qualification (or exemption therefrom) effective
during the Effectiveness Period and to do any and all other acts or things
necessary or advisable to enable the disposition in such jurisdictions of the
Registrable Securities covered by a Registration Statement.

            (j)   Cooperate with the Holders to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be delivered to a transferee pursuant to a Registration Statement, which
certificates shall be free, to the extent permitted by the Transaction
Documents, of all restrictive legends, and to enable such Registrable Securities
to be in such denominations and registered in such names as any such Holders may
request.

            (k)   Upon the occurrence of any event described in Section
3(d)(vii), as promptly as reasonably possible, prepare a supplement or
amendment, including a post-effective amendment, to the Registration Statement
or a supplement to the related Prospectus or any document incorporated or deemed
to be incorporated therein by reference, and file any other required document so
that, as thereafter delivered, neither the Registration Statement nor such

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Prospectus will contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.

            (l)   Cooperate with any due diligence investigation undertaken by
the Holders in connection with the sale of Registrable Securities, including,
without limitation, by making available any documents and information; provided
that the Company will not deliver or make available to any Holder material,
nonpublic information unless such Holder specifically requests in advance to
receive material, nonpublic information.

            (m)   If Holders of a majority of the Registrable Securities being
offered pursuant to a Registration Statement select underwriters for the
offering, the Company shall enter into and perform its obligations under an
underwriting agreement, in usual and customary form, including, without
limitation, by providing customary legal opinions, comfort letters and
indemnification and contribution obligations.

            (n)   Comply with all applicable rules and regulations of the
Commission.

      4.    Registration Expenses. All fees and expenses incident to the
performance of or compliance with this Agreement by the Company shall be borne
by the Company whether or not any Registrable Securities are sold pursuant to
the Registration Statement. The fees and expenses referred to in the foregoing
sentence shall include, without limitation: (a) all registration and filing fees
(including, without limitation, fees and expenses (i) with respect to filings
required to be made with any Trading Market, and (ii) in compliance with
applicable state securities or Blue Sky laws (including, without limitation,
fees and disbursements of counsel for the Company in connection with Blue Sky
qualifications or exemptions of the Registrable Securities and determination of
the eligibility of the Registrable Securities for investment under the laws of
such jurisdictions as requested by the Holders )); (b) printing expenses
(including, without limitation, expenses of printing certificates for
Registrable Securities and of printing prospectuses requested by the Holders);
(c) messenger, telephone and delivery expenses; (d) fees and disbursements of
counsel for the Company and Special Counsel for the Holders; and (e) fees and
expenses of all other Persons retained by the Company in connection with the
consummation of the transactions contemplated by this Agreement.

      5.    Indemnification

            (a)   Indemnification by the Company. The Company shall,
notwithstanding any termination of this Agreement, indemnify and hold harmless
each Holder, the officers, directors, partners, members, agents, brokers
(including brokers who offer and sell Registrable Securities as principal as a
result of a pledge or any failure to perform under a margin call of Common
Stock), investment advisors and employees of each of them, each Person who
controls any such Holder (within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act) and the officers, directors, partners,
members, agents and employees of each such controlling Person, to the fullest
extent permitted by applicable law, from and against any and all losses, claims,
damages, liabilities or reasonable out-of-pocket expenses (whether joint or
several) (collectively, including reasonable legal expenses or other expenses
reasonably incurred in connection with investigating or defending same,
"LOSSES"), as incurred, arising out of or

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relating to any untrue or alleged untrue statement of a material fact contained
in the Registration Statement, any Prospectus or any form of prospectus or in
any amendment or supplement thereto or in any preliminary prospectus, or arising
out of or relating to any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein (in
the case of any Prospectus or form of prospectus or supplement thereto, in light
of the circumstances under which they were made) not misleading, except to the
extent, but only to the extent, that: (i) such untrue statements or omissions
are based solely upon information regarding such Holder furnished in writing to
the Company by such Holder expressly for use therein, or to the extent that such
information relates to such Holder or such Holder's proposed method of
distribution of Registrable Securities and was reviewed and expressly approved
in writing by such Holder expressly for use in the Registration Statement, such
Prospectus or such form of Prospectus or in any amendment or supplement thereto;
or (ii) in the case of an occurrence of an event of the type specified in
Section 3(d)(v)-(vii), the use by such Holder of an outdated or defective
Prospectus after the Company has notified such Holder in writing that the
Prospectus is outdated or defective and prior to the receipt by such Holder of
the Advice contemplated in Section 6(f). The Company shall notify the Holders
promptly of the institution, threat or assertion of any Proceeding of which the
Company is aware in connection with the transactions contemplated by this
Agreement.

            (b)   Indemnification by Holders. Each Holder shall, severally and
not jointly, indemnify and hold harmless the Company, its directors, officers,
agents and employees, each Person who controls the Company (within the meaning
of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the
directors, officers, agents or employees of such controlling Persons, to the
fullest extent permitted by applicable law, from and against all Losses (as
determined by a court of competent jurisdiction in a final judgment not subject
to appeal or review) arising solely out of any untrue statement of a material
fact contained in any Registration Statement, any Prospectus, or any form of
prospectus, or in any amendment or supplement thereto, or arising solely out of
any omission of a material fact required to be stated therein or necessary to
make the statements therein not misleading to the extent, but only to the
extent, that such untrue statement or omission is contained in any information
so furnished in writing by such Holder to the Company specifically for inclusion
in such Registration Statement or such Prospectus. In no event shall the
liability of any selling Holder hereunder be greater in amount than the dollar
amount of the net proceeds received by such Holder upon the sale of the
Registrable Securities giving rise to such indemnification obligation.

            (c)   Conduct of Indemnification Proceedings. If any Proceeding
shall be brought or asserted against any Person entitled to indemnity hereunder
(an "INDEMNIFIED PARTY"), such Indemnified Party shall promptly notify the
Person from whom indemnity is sought (the "INDEMNIFYING PARTY") in writing, and
the Indemnifying Party shall assume the defense thereof, including the
employment of counsel reasonably satisfactory to the Indemnified Party and the
payment of all fees and expenses incurred in connection with defense thereof;
provided, that the failure of any Indemnified Party to give such notice shall
not relieve the Indemnifying Party of its obligations or liabilities pursuant to
this Agreement, except (and only) to the extent that it shall be finally
determined by a court of competent jurisdiction (which determination is not
subject to appeal or further review) that such failure shall have proximately
and materially adversely prejudiced the Indemnifying Party.

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      An Indemnified Party shall have the right to employ separate counsel in
any such Proceeding and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such Indemnified Party or
Parties unless: (i) the Indemnifying Party has agreed in writing to pay such
fees and expenses; or (ii) the Indemnifying Party shall have failed promptly to
assume the defense of such Proceeding and to employ counsel reasonably
satisfactory to such Indemnified Party in any such Proceeding; or (iii) the
named parties to any such Proceeding (including any impleaded parties) include
both such Indemnified Party and the Indemnifying Party, and such Indemnified
Party shall have been advised by counsel that a conflict of interest is likely
to exist if the same counsel were to represent such Indemnified Party and the
Indemnifying Party (in which case, if such Indemnified Party notifies the
Indemnifying Party in writing that it elects to employ separate counsel at the
expense of the Indemnifying Party, the Indemnifying Party shall not have the
right to assume the defense thereof and such counsel shall be at the expense of
the Indemnifying Party). The Indemnifying Party shall not be liable for any
settlement of any such Proceeding effected without its written consent, which
consent shall not be unreasonably withheld. No Indemnifying Party shall, without
the prior written consent of the Indemnified Party, effect any settlement of any
pending Proceeding in respect of which any Indemnified Party is a party, unless
such settlement includes an unconditional release of such Indemnified Party from
all liability on claims that are the subject matter of such Proceeding.

      All fees and expenses of the Indemnified Party (including reasonable fees
and expenses to the extent incurred in connection with investigating or
preparing to defend such Proceeding in a manner not inconsistent with this
Section) shall be paid to the Indemnified Party, as incurred, within ten Trading
Days of written notice thereof to the Indemnifying Party (regardless of whether
it is ultimately determined that an Indemnified Party is not entitled to
indemnification hereunder; provided, that the Indemnifying Party may require
such Indemnified Party to undertake to reimburse all such fees and expenses to
the extent it is finally judicially determined that such Indemnified Party is
not entitled to indemnification hereunder).

            (d)   Contribution. If a claim for indemnification under Section
5(a) or 5(b) is unavailable to an Indemnified Party (by reason of public policy
or otherwise), then each Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Losses, in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party and
Indemnified Party in connection with the actions, statements or omissions that
resulted in such Losses as well as any other relevant equitable considerations.
The relative fault of such Indemnifying Party and Indemnified Party shall be
determined by reference to, among other things, whether any action in question,
including any untrue or alleged untrue statement of a material fact or omission
or alleged omission of a material fact, has been taken or made by, or relates to
information supplied by, such Indemnifying Party or Indemnified Party, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such action, statement or omission. The amount paid or
payable by a party as a result of any Losses shall be deemed to include, subject
to the limitations set forth in Section 5(c), any reasonable attorneys' or other
reasonable fees or expenses incurred by such party in connection with any
Proceeding to the extent such party would have been indemnified for such fees or
expenses if the indemnification provided for in this Section was available to
such party in accordance with its terms.

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      The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 5(d), no Holder shall be required
to contribute, in the aggregate, any amount in excess of the amount by which the
proceeds actually received by such Holder from the sale of the Registrable
Securities subject to the Proceeding exceeds the amount of any damages that such
Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation.

      The indemnity and contribution agreements contained in this Section are in
addition to any liability that the Indemnifying Parties may have to the
Indemnified Parties.

      6.    Miscellaneous

            (a)   Remedies. In the event of a breach by the Company or by a
Holder of any of their obligations under this Agreement, each Holder or the
Company, as the case may be, in addition to being entitled to exercise all
rights granted by law and under this Agreement will be entitled to specific
performance of its rights under this Agreement. The Company and each Holder
agree that monetary damages would not provide adequate compensation for any
losses incurred by reason of a breach by it of any of the provisions of this
Agreement and hereby further agrees that, in the event of any action for
specific performance in respect of such breach, it shall waive the defense that
a remedy at law would be adequate.

            (b)   Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, unless the same shall be in writing and signed by the Company
and the Holders of at least two-thirds of the then outstanding Registrable
Securities. Notwithstanding the foregoing, a waiver or consent to depart from
the provisions hereof with respect to a matter that relates exclusively to the
rights of Holders and that does not directly or indirectly affect the rights of
other Holders may be given by Holders of at least a majority of the Registrable
Securities to which such waiver or consent relates; provided, however, that the
provisions of this sentence may not be amended, modified, or supplemented except
in accordance with the provisions of the immediately preceding sentence.

            (c)   No Inconsistent Agreements. Except as specified in Schedule
6(c) to this Agreement, neither the Company nor any of its subsidiaries has
entered, as of the date hereof, nor shall the Company or any of its
subsidiaries, on or after the date of this Agreement, enter into any agreement
with respect to its securities that would have the effect of impairing the
rights granted to the Holders in this Agreement or otherwise conflicts with the
provisions hereof. Except as specified in Schedule 6(c) to this Agreement,
neither the Company nor any subsidiary of the Company has previously entered
into any agreement granting any registration rights with respect to any of its
securities to any Person that have not been satisfied in full.

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            (d)   No Piggyback on Registrations. Except as specified in Schedule
6(d) to this Agreement, neither the Company nor any of its security holders
(other than the Holders in such capacity pursuant hereto) may include securities
of the Company in the Registration Statement other than the Registrable
Securities, and the Company shall not after the date hereof enter into any
agreement providing any such right to any of its security holders.

            (e)   Compliance. Each Holder covenants and agrees that it will
comply with the prospectus delivery requirements of the Securities Act as
applicable to it in connection with sales of Registrable Securities pursuant to
the Registration Statement.

            (f)   Discontinued Disposition. Each Holder agrees by its
acquisition of such Registrable Securities that, upon receipt of a notice from
the Company of the occurrence of any event of the kind described in Sections
3(d)(v), 3(d)(vi), or 3(d)(vii), such Holder will forthwith discontinue
disposition of such Registrable Securities under the Registration Statement
until such Holder's receipt of the copies of the supplemented Prospectus and/or
amended Registration Statement contemplated by Section 3(k), or until it is
advised in writing (the "ADVICE") by the Company that the use of the applicable
Prospectus may be resumed, and, in either case, has received copies of any
additional or supplemental filings that are incorporated or deemed to be
incorporated by reference in such Prospectus or Registration Statement. The
Company may provide appropriate stop orders to enforce the provisions of this
paragraph. Notwithstanding anything to the contrary on this Agreement, the
Company shall not be obligated to prepare, file and furnish any supplemented
Prospectus and/or amended or additional Registration Statement as contemplated
by Section 3(b) or Section 3(k) if such filing relates to any material nonpublic
information at any such time as the Board of Directors of the Company has
determined that, for good business reasons, the disclosure of such material
nonpublic information at that time would be materially detrimental to the
Company in the circumstances and is not otherwise required under applicable law
(including applicable securities laws), provided that the aggregate length that
the Company may delay its obligations pursuant to the aforementioned proviso
shall not exceed ten (10) consecutive Business Days or an aggregate of twenty
(20) Business Days in any 365 day period.

            (g)   Piggy-Back Registrations. If at any time during the
Effectiveness Period there is not an effective Registration Statement covering
all of the Registrable Securities and the Company shall determine to prepare and
file with the Commission a registration statement relating to an offering for
its own account or the account of others under the Securities Act of any of its
equity securities, other than on Form S-4 or Form S-8 (each as promulgated under
the Securities Act) or their then equivalents relating to equity securities to
be issued solely in connection with any acquisition of any entity or business or
equity securities issuable in connection with stock option or other employee
benefit plans, then the Company shall send to each Holder written notice of such
determination and, if within fifteen days after receipt of such notice, any such
Holder shall so request in writing, the Company shall include in such
registration statement all or any part of such Registrable Securities such
holder requests to be registered; provided, however, that the Company shall not
be required to include in such registration statement any of the Registrable
Securities if including the Registrable Securities in such registration
statement causes a conflict with, or constitutes a default (or an event which
with notice or lapse of time or both would become a default) under, or gives to
others any rights of termination, amendment, acceleration or cancellation of any
currently existing agreement, indenture

                                       10

<PAGE>

or other written instrument of the Company or other currently existing written
agreement to which the Company is a party.

            (h)   Notices. Any and all notices or other communications or
deliveries required or permitted to be provided hereunder shall be in writing
and shall be deemed given and effective on the earliest of (a) the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile telephone number specified in this Section prior to 6:30 p.m. (New
York City time) on a Trading Day, (b) the next Trading Day after the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile telephone number specified in this Agreement on a day that is not a
Trading Day or later than 6:30 p.m. (New York City time) and earlier than 11:59
p.m. (New York City time) on any Trading Day, (c) the Trading Day following the
date of mailing, if sent by U.S. nationally recognized overnight courier
service, or (d) upon actual receipt by the party to whom such notice is required
to be given. The address for such notices and communications shall be as set
forth on the signature page to this Agreement.

            (i)   Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and permitted assigns of each of
the parties and shall inure to the benefit of each Holder. The Company may not
assign its rights or obligations hereunder without the prior written consent of
each Holder. Each Holder may assign its rights and obligations hereunder in the
manner and to the extent permitted under the Warrants.

            (j)   Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original
and, all of which taken together shall constitute one and the same Agreement. In
the event that any signature is delivered by facsimile transmission, such
signature shall create a valid binding obligation of the party executing (or on
whose behalf such signature is executed) the same with the same force and effect
as if such facsimile signature were the original thereof.

            (k)   GOVERNING LAW; VENUE; WAIVER OF JURY TRAIL. ALL QUESTIONS
CONCERNING THE CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK. EACH PARTY HEREBY IRREVOCABLY SUBMITS TO THE
EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF
NEW YORK, BOROUGH OF MANHATTAN, FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR
IN CONNECTION HEREWITH OR WITH ANY TRANSACTION CONTEMPLATED HEREBY OR DISCUSSED
HEREIN (INCLUDING WITH RESPECT TO THE ENFORCEMENT OF ANY OF THE TRANSACTION
DOCUMENTS), AND HEREBY IRREVOCABLY WAIVES, AND AGREES NOT TO ASSERT IN ANY SUIT,
ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF ANY SUCH COURT, THAT SUCH SUIT, ACTION OR PROCEEDING IS
IMPROPER. EACH PARTY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND
CONSENTS TO PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY
MAILING A COPY THEREOF VIA REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY
(WITH EVIDENCE OF DELIVERY) TO SUCH PARTY AT THE ADDRESS IN

                                       11

<PAGE>

EFFECT FOR NOTICES TO IT UNDER THIS AGREEMENT AND AGREES THAT SUCH SERVICE SHALL
CONSTITUTE GOOD AND SUFFICIENT SERVICE OF PROCESS AND NOTICE THEREOF. NOTHING
CONTAINED HEREIN SHALL BE DEEMED TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS
IN ANY MANNER PERMITTED BY LAW. THE COMPANY HEREBY WAIVES ALL RIGHTS TO A TRIAL
BY JURY.

            (l)   Cumulative Remedies. The remedies provided herein are
cumulative and not exclusive of any remedies provided by law.

            (m)   Severability. If any term, provision, covenant or restriction
of this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their reasonable efforts to find and employ an alternative
means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant or restriction. It is hereby stipulated and
declared to be the intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without including any of
such that may be hereafter declared invalid, illegal, void or unenforceable.

            (n)   Headings. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.

                   [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                           SIGNATURE PAGES TO FOLLOW]

                                       12

<PAGE>

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

                                         VERSO TECHNOLOGIES, INC.

                                         By: /s/ Juliet M. Reising
                                             ------------------------------
                                         Name: Juliet M. Reising
                                         Title: EVP & CFO

                   [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                    SIGNATURE PAGES OF PURCHASERS TO FOLLOW]

                                       13

<PAGE>

                                         PURCHASER

                                         MAINFIELD ENTERPRISES INC.

                                         By: /s/ Avi Vigder
                                            ---------------------------
                                            Name: Avi Vigder
                                            Title: Authorized Signatory

                                         Address for Notice:

                                         Mainfield Enterprises, Inc.
                                         c/o Daniel Golan
                                         660 Madison Avenue, 18th Floor
                                         New York, New York
                                         Facsimile No.: (212) 651-9010
                                         Telephone No.: (212) 651-9000

                       With a copy to:   Proskauer Rose LLP
                                         1585 Broadway
                                         New York, New York 10036-8299
                                         Facsimile No.: (212) 969-2900
                                         Telephone No.: (212) 969-3000
                                         Attn: Adam J. Kansler, Esq.

                                       14

<PAGE>

                                         PURCHASER

                                         HEIMDALL INVESTMENTS, LTD.

                                         By: HBK Investments, Investment Advisor

                                         By:____________________________________
                                            Name:_______________________________
                                            Title: Authorized Signatory

                                         Address for Notice:
                                         C/O HBK Investments L.P.
                                         300 Cresent Court, Suite, 700
                                         Dallas, TX 75201
                                         Attn: Legal Department

                                         Facsimile No.: (214) 758-1207
                                         Telephone No.: (214) 758-6107

                                       15

<PAGE>

                                                                         Annex A

                              PLAN OF DISTRIBUTION

      The selling stockholders may, from time to time, sell any or all of their
shares of common stock on any stock exchange, market or trading facility on
which the shares are traded or in private transactions. These sales may be at
fixed or negotiated prices. The selling stockholders may use any one or more of
the following methods when selling shares:

-     ordinary brokerage transactions and transactions in which the
      broker-dealer solicits purchasers;

-     block trades in which the broker-dealer will attempt to sell the shares as
      agent but may position and resell a portion of the block as principal to
      facilitate the transaction;

-     purchases by a broker-dealer as principal and resale by the broker-dealer
      for its account;

-     an exchange distribution in accordance with the rules of the applicable
      exchange;

-     privately negotiated transactions;

-     short sales;

-     broker-dealers may agree with the selling stockholders to sell a specified
      number of such shares at a stipulated price per share;

-     a combination of any such methods of sale; and

-     any other method permitted pursuant to applicable law.

      The selling stockholders may also sell shares under Rule 144 under the
Securities Act, if available, rather than under this prospectus.

      The selling stockholders may also engage in short sales against the box,
puts and calls and other transactions in our securities or derivatives of our
securities and may sell or deliver shares in connection with these trades.

      Broker-dealers engaged by the selling stockholders may arrange for other
brokers-dealers to participate in sales. Broker-dealers may receive commissions
or discounts from the selling stockholders (or, if any broker-dealer acts as
agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated. The selling stockholders do not expect these commissions and
discounts to exceed what is customary in the types of transactions involved. Any
profits on the resale of shares of common stock by a broker-dealer acting as
principal might be deemed to be underwriting discounts or commissions under the
Securities Act. Discounts, concessions, commissions and similar selling
expenses, if any, attributable to the sale of shares will be borne by a selling
stockholder. The selling stockholders may agree to indemnify any agent, dealer
or broker-dealer that participates in transactions involving sales of the shares
if liabilities are imposed on that person under the Securities Act.

<PAGE>

      The selling stockholders may from time to time pledge or grant a security
interest in some or all of the shares of common stock owned by them and, if they
default in the performance of their secured obligations, the pledgees or secured
parties may offer and sell the shares of common stock from time to time under
this prospectus after we have filed an amendment to this prospectus under Rule
424(b)(3) or other applicable provision of the Securities Act of 1933 amending
the list of selling stockholders to include the pledgee, transferee or other
successors in interest as selling stockholders under this prospectus.

      The selling stockholders also may transfer the shares of common stock in
other circumstances, in which case the transferees, pledgees or other successors
in interest will be the selling beneficial owners for purposes of this
prospectus and may sell the shares of common stock from time to time under this
prospectus after we have filed an amendment to this prospectus under Rule
424(b)(3) or other applicable provision of the Securities Act of 1933 amending
the list of selling stockholders to include the pledgee, transferee or other
successors in interest as selling stockholders under this prospectus.

      The selling stockholders and any broker-dealers or agents that are
involved in selling the shares of common stock may be deemed to be
"underwriters" within the meaning of the Securities Act in connection with such
sales. In such event, any commissions received by such broker-dealers or agents
and any profit on the resale of the shares of common stock purchased by them may
be deemed to be underwriting commissions or discounts under the Securities Act.

      We are required to pay all fees and expenses incident to the registration
of the shares of common stock, including the fees and disbursements of counsel
to the selling stockholders. We have agreed to indemnify the selling
stockholders against certain losses, claims, damages and liabilities, including
liabilities under the Securities Act.

      The selling stockholders have advised us that they have not entered into
any agreements, understandings or arrangements with any underwriters or
broker-dealers regarding the sale of their shares of common stock, nor is there
an underwriter or coordinating broker acting in connection with a proposed sale
of shares of common stock by any selling stockholder. If we are notified by any
selling stockholder that any material arrangement has been entered into with a
broker-dealer for the sale of shares of common stock, if required, we will file
a supplement to this prospectus. If the selling stockholders use this prospectus
for any sale of the shares of common stock, they will be subject to the
prospectus delivery requirements of the Securities Act.

      The anti-manipulation rules of Regulation M under the Securities Exchange
Act of 1934 may apply to sales of our common stock and activities of the selling
stockholders.Exhibit 4.3

 

Exhibit 4.3

Stoneridge, Inc.

Directors’ Restricted Shares Plan

1. Purpose of Plan.

The purpose of this Directors’ Restricted Shares Plan (the “Plan”) of Stoneridge, Inc., an Ohio
corporation (the “Company”), is to advance the interests of the Company and its shareholders by
providing Eligible Directors (as defined in Section 3, below) with (a) an opportunity to
participate in the Company’s future prosperity and growth and (b) an incentive to increase the
value of the Company based on the Company’s performance, development, and financial success. These
objectives will be promoted by granting to Eligible Directors restricted Common Shares, without par
value, of the Company (the “Restricted Shares”).

2. Administration of Plan.

The Plan will be administered by the Board of Directors (the “Board”). The Board shall have the
power and authority to: (a) approve the grant of Restricted Shares to Eligible Directors (such
Eligible Directors, “Participants”); (b) approve the terms and conditions, not inconsistent with
the terms hereof, of any grant of Restricted Shares, including without limitation time and
performance restrictions, and approve the form of Restricted Shares Grant Agreement (as defined in
Section 5, below); (c) adopt, alter, and repeal such administrative rules, guidelines, and
practices governing the Plan as it shall, from time to time, deem advisable; (d) interpret the
terms and provisions of the Plan and any agreements relating thereto; and (e) take any other
actions the Board considers appropriate in connection with, and otherwise supervise the
administration of the Plan, all in a manner consistent with the other provisions of the Plan.

3. Participants in Plan.

The persons eligible to receive Restricted Shares under the Plan shall be those directors of the
Company who are not employees or officers (provided, however, such person may be the Secretary) of
the Company or any subsidiary of the Company (any such person, an “Eligible Director”).

4. Shares Subject to Plan.

The maximum aggregate number of Common Shares that may be issued under the Plan as Restricted
Shares shall be 300,000 Common Shares, without par value. The shares that may be issued under the
Plan may be authorized but unissued shares or issued shares reacquired by the Company and held as
Treasury Shares.

 

 

In the event of a reorganization, recapitalization, share split, share dividend, combination of
shares, merger, consolidation, distribution of assets, or any other change in the corporate
structure or shares of the Company, the Company will make such adjustments as it deems
appropriate in the number and kind of Common Shares reserved for issuance under the Plan. In the
event of any merger, consolidation or other reorganization in which the Company is not the
surviving or continuing corporation, all Restricted Shares that were granted hereunder and that are
outstanding on the date of such event shall immediately vest and no longer be subject to forfeiture
on the date of such event.

5. Grant, Issuance of Restricted Shares.

The Restricted Shares issued by the Company in connection with the Restricted Share grants made
under the Plan shall be authorized by the Board and shall be made in accordance with, and subject
to the terms of a written agreement (the “Restricted Shares Grant Agreement”) in the form approved
by the Board from time to time. To be effective, any such Restricted Shares Grant Agreement, shall
be signed by an officer of the Company authorized by the Board, and signed by the Participant, set
forth the terms and other conditions to which the award of Restricted Shares is subject, if any,
the period of time that the Restricted Shares are subject to forfeiture, if any, and state that
such Restricted Shares are subject to all the terms and conditions of the Plan and such other terms
and conditions, not inconsistent with the Plan, as the Board may approve. The date on which the
Board approves the granting of the Restricted Shares shall be deemed to be the date on which the
Restricted Shares are granted for all purposes, unless the Board otherwise specifies in its
approval.

The Board may, in its sole discretion, provide in the written agreement that the forfeiture period
with respect to the Restricted Shares may lapse upon a Participant’s death or disability or upon a
Change in Control or Potential Change of Control (both defined in Section 11, below) of the
Company. Any Restricted Shares issued under the Plan, so long as subject to forfeiture (a) shall
not be sold, transferred, assigned, pledged, hypothecated, anticipated, alienated, encumbered or
charged, whether voluntarily, involuntarily or by operation of law (collectively, “Transferred”)
and (b) shall be forfeited to the Company in the event a Participant to whom such Restricted Shares
are awarded voluntarily ceases to be a director during the period of time, if any, specified by the
Board. Restricted Shares awarded under the Plan will be issued in the name of the Participant to
whom awarded and held by the Company (or the Company’s agent) during such period of time that the
Restricted Shares are subject to forfeiture. At the time the award is made the Participant may be
asked to execute one or more blank stock powers and deliver the same to the Company so that any
shares which are forfeited may be cancelled.

6. Termination of Status as an Eligible Director.

If a Participant’s status as an Eligible Director terminates for any reason (including death,
disability (as defined by the Board from time to time, in its sole discretion), resignation,
refusal to stand for reelection or failure to be elected) then unless otherwise determined by the
Board, to the extent any grant of Restricted Shares held by such Participant is not vested (i.e.,
no longer subject to forfeiture) as of the date of such termination, such Restricted Shares shall
automatically be forfeited on such date.

-2-

 

7. Withholding Tax.

The Company, at its option, shall have the right to require the Participant to pay the Company the
amount of any taxes which the Company is required to withhold with respect to such Restricted
Shares or, in lieu of such payment, to retain or sell without notice a number of such Restricted
Shares sufficient to cover the amount required to be so withheld. The Company, at its option,
shall have the right to deduct from all dividends paid with respect to Restricted Shares the amount
of any taxes which the Company is required to withhold with respect to such dividend payments. The
obligations of the Company under the Plan shall be conditional on such payment or other
arrangements acceptable to the Company.

8. Securities Law Restrictions.

No right under the Plan shall be exercisable and no Restricted Shares shall be delivered under the
Plan except in compliance with all applicable federal and state securities laws and regulations.
The Company shall not be required to deliver any Restricted Shares or other securities under the
Plan prior to such registration or other qualification of such shares under any state or federal
law, rule, or regulation as the Board shall determine to be necessary or advisable, in its sole
discretion.

Unless such shares have been registered under the Securities Act of 1933, as amended (the “1933
Act”), the Restricted Shares Grant Agreement evidencing the award of Restricted Shares shall
contain a representation in form approved by the Board that such Restricted Shares are not being
acquired with a view to resale or distribution and will not be sold or otherwise transferred by the
Participant, except in compliance with the 1933 Act and the rules and regulations thereunder and
any applicable state securities laws. The Board may impose such other restrictions on the
Restricted Shares as it may deem advisable. Share certificates issued in connection with awards of
Restricted Shares under the Plan shall bear such legends and statements as the Board shall deem
advisable to assure compliance with federal and state securities laws and regulations and any other
restriction imposed by the Board on such awards.

9. Term of Plan.

This Plan shall continue until terminated by the Board. The Board shall have the unrestricted
right to amend, modify, suspend or terminate the Plan at any time; provided, however, the Board may
not modify the terms of any outstanding awards evidenced by executed Restricted Shares Grant
Agreements.

10. Shareholders Rights.

Participants to whom Restricted Shares have been issued under the Plan shall have the rights of
shareholders with respect to the Company’s Common Shares so long as no forfeiture event has
occurred, except that the Restricted Shares may not be Transferred during the forfeiture period.

11. Change in Control.

     (a) Accelerated Vesting.

-3-

 

     Notwithstanding any provision of this Plan or any Restricted Shares Grant Agreement to
the contrary, if a Change in Control or a Potential Change in Control (each as defined
below) occurs, then all Restricted Shares theretofore granted and not fully vested shall
thereupon become vested (i.e., shall no longer be subject to forfeiture)

     (b) Definition of Change in Control.

     For purposes of the Plan, a “Change in Control” means the happening of any of the
following:

     (i) When any “person,” as defined in Section 3(a)(9) of the Securities Exchange
Act of 1934, as amended (the “1934 Act”), and as used in Sections 13(d) and 14(d)
thereof, including a “group” as defined in Section 13(d) of the 1934 Act, but
excluding the Company, any subsidiary of the Company, any employee benefit plan
sponsored or maintained by the Company or any subsidiary of the Company (including
any trustee of such plan acting as trustee), any person who is a shareholder of the
Company on the effective date of this Plan (an “Existing Shareholder”), and any
affiliate of an Existing Shareholder directly or indirectly becomes the “beneficial
owner” (as defined in Rule 13d-3 under the 1934 Act) of securities of the Company
representing 50% or more of the combined voting power of the Company’s then
outstanding securities;

     (ii) When, during any period of 24 consecutive months during the existence of
the Plan, the individuals who, at the beginning of such period, constitute the Board
(the “Incumbent Directors”) cease for any reason other than death or disability to
constitute at least a majority of the Board; provided, however, that a director who
was not a director at the beginning of such 24-month period shall be deemed to have
satisfied such 24-month requirement (and be an Incumbent Director) if such director
was elected by, or on the recommendation of or with the approval of, at least
two-thirds of the directors who then qualified as Incumbent Directors, either
actually (because they were directors at the beginning of such 24-month period) or
by prior operation of this Section 11(b)(ii); or

     (iii) The occurrence of a transaction not recommended by the Board requiring
shareholder approval for the acquisition of the Company by an entity other than the
Company or a subsidiary of the Company through purchase of assets, by merger, or
otherwise.

Provided, however, further that a change in control shall not be deemed to be a Change in
Control for purposes of this Plan if the Board had approved such change prior to either (A)
the commencement of any of the events described in Section 11(b)(i), (ii), (iii), or Section
11(c)(i) of this Plan, or (B) the commencement by any person other than the Company of a
tender offer for Company Common Shares.

     (c) Definition of Potential Change in Control.

-4-

 

     For purposes of the Plan, a “Potential Change in Control” means the happening of any
one of the following:

     (i) The approval by the shareholders of the Company of an agreement by the
Company, the consummation of which would result in a Change in Control of the
Company as defined in Section 11(b), above; or

     (ii) The acquisition of beneficial ownership of the Company, directly or
indirectly, by any entity, person, or group (other than the Company, a subsidiary of
the Company, any Company employee benefit plan (including any trustee of such plan
acting as such trustee), an Existing Shareholder, or an affiliate of an Existing
Shareholder) representing 5% or more of the combined voting power of the Company’s
outstanding securities and the adoption by the Board of a resolution to the effect
that a Potential Change in Control of the Company has occurred for purposes of the
Plan.

12. Acceleration of Rights.

The Board shall have the authority, in its discretion, to accelerate the time of vesting of
Restricted Shares whenever it may determine that such action is appropriate by reason of changes in
applicable tax or other laws or other changes in circumstances occurring after the award of the
Restricted Shares.

13. Interpretation, Amendment or Termination of Plan.

The interpretation by the Board of any provision of the Plan or of any terms contained in any
Restricted Shares Grant Agreement executed in connection with a grant of Restricted Shares under
the Plan shall be final and conclusive upon all Participants under the Plan. The Board, without
further action on the part of the shareholders of the Company, may from time to time alter, amend,
or suspend the Plan or may at any time terminate the Plan; provided that no such action shall
adversely affect any Participant’s rights with respect to an outstanding issuance of Restricted
Shares then held by such Participant without such Participant’s consent. No member of the Board
will incur any liability for any action taken or admitted, or any determination made, in good faith
in connection with the Plan.

14. Government Regulations.

Notwithstanding any provision of the Plan or any Restricted Shares Grant Agreement executed
pursuant to the Plan, the Company’s obligations under the Plan and such agreement shall be subject
to all applicable laws, rules, and regulations and to such approvals as may be required by any
governmental or regulatory agencies, including without limitation any stock exchange on which the
Company’s Common Shares may then be listed.

15. Governing Law.

The Plan shall be construed and governed by the laws of the State of Ohio.

-5-

 

16. Effective Date.

The Plan shall become effective on the day it is approved by the Company’s shareholders.

17. Severability Clause.

In case any one or more of the provisions of this Plan shall be held invalid, illegal, or
unenforceable in any respect, the validity, legality, and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby, and the invalid, illegal, or
unenforceable provision shall be deemed null and void; however, to the extent permissible by law,
any provision which could be deemed null and void shall first be construed, interpreted, or revised
retroactively to permit this Plan to be construed so as to foster the intent of this Plan. This
Plan and all transactions pursuant to this Plan are intended to comply in all respects with
applicable laws and regulations.

-6-

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