Document:

exv10w1

Exhibit 10.1

VOTING AND STANDSTILL AGREEMENT

     This Voting and Standstill Agreement (the “Agreement”) is made and entered into as of March
19, 2010 (“Effective Date”), between United American Healthcare Corporation, a Michigan corporation
(“Company”) and St. George Investments, LLC, an Illinois limited liability company (“St. George”).

W I T N E S S E T H

     WHEREAS, St. George Beneficially Owns Common Shares and may acquire additional Shares
following the Effective Date;

     WHEREAS, the Company believes it is in the best interests of its shareholders for St. George
to withdraw its nominations for Directors so as to provide stability and to permit management and
the Board to create shareholder value;

     WHEREAS, the Company believes it is in the best interests of its shareholders for St. George
to stand still with respect to any insurgent activities;

     WHEREAS, the Company believes it is in the best interests of its shareholders to have a call
option to purchase all of the shares owned now or in the future by St. George, according to the
terms described herein;

     WHEREAS, the Company believes it is in the best interests of its shareholders to have the
ability, upon its request, to receive a cash investment from St. George to enable the Company to
create shareholder value;

     WHEREAS, St. George is willing to use its expertise and connections to assist the Company in
identifying merger or acquisition opportunities; and

     WHEREAS, the parties desire to make the covenants and agreements described herein.

     NOW, THEREFORE, for and in consideration of the mutual covenants contained herein and other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:

ARTICLE I.

DEFINITIONS

          SECTION 1.1 Certain Defined Terms. As used in this Agreement:

     “Action” has the meaning set forth in SECTION 13.1(e).

     “Affiliate” means, with respect to any Person, any other Person that directly, or indirectly
through one or more intermediaries, Controls, is Controlled By or is Under Common Control With,
such specified Person.

 

 

     “Agreement” has the meaning set forth in the introductory paragraph hereof.

     “Beneficially Owns” means, with respect to any Person, that such Person or any of such
Person’s Affiliates is deemed to beneficially own shares of capital stock of the Company, within
the meaning of Rule 13d-3 of the General Rules and Regulations under the Exchange Act as in effect
on the date of this Agreement; or shares of capital stock that such Person or any of such Person’s
Affiliates has any agreement, arrangement or understanding for the purpose of acquiring, holding,
voting or disposing of any securities of the Company; provided, however, that an agreement,
arrangement or understanding shall not be deemed to include actions, including any agreement,
arrangement or understanding, or statements by (i) any member of the Board of Directors, as
comprised on the date of this Agreement (the “Existing Directors”), (ii) any subsequent directors
of the Company who have been nominated by a majority of the Existing Directors (the “Successor
Directors”), or (iii) any subsequent member of the Board of Directors who is elected by a majority
of the Existing Directors and/or Successor Directors, nominating as a group.

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

     “Business Combination” means any acquisition by the Company of substantially all of the
outstanding shares or assets of a Person (including an unincorporated division or business) or the
acquisition of substantially all of the outstanding shares or assets of the Company, in each case,
whether by stock or asset purchase, merger, consolidation, share exchange or other business
combination.

     “Business Day” means a day on which federally-chartered banks are open for business in
Illinois and Michigan.

     “By-laws” means the by-laws of the Company, as amended or restated from time to time.

     “Call Closing Date” has the meaning set forth in SECTION 6.5.

     “Call Exercise Period” has the meaning set forth in SECTION 6.1.

     “Call Notice” has the meaning set forth in SECTION 6.1.

     “Call Option” has the meaning set forth in SECTION 6.1.

     “Call Price” has the meaning set forth in SECTION 6.3.

     “Call Price Per Share” has the meaning set forth in SECTION 6.4.

     “Call Shares” has the meaning set forth in SECTION 6.1.

     “Certificate of Designation” has the meaning set forth in SECTION 6.1.

     “Charter” means the Articles of Incorporation of the Company, as amended or restated from time
to time.

     “Company” has the meaning set forth in the introductory paragraph hereof.

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     “Common Shares” means the shares of common stock of the Company.

     “Control” (including the terms “Controlled By” and “Under Common Control With”) means the
possession, directly or indirectly, of the power to direct or cause the direction of management,
policies or activities of a Person, whether through the ownership of voting securities or other
interests, by contract or otherwise.

     “Conversion Shares” means, collectively, the Common Shares issuable upon conversion of the
Preferred Shares in accordance with the terms of Exhibit A.

     “Director” means any member of the Board.

     “Effective Date” has the meaning set forth in the introductory paragraph hereof.

     “Encumbrance” means any encumbrance, lien, mortgage, charge, claim, option, pledge, license,
sublicense, security interest, assignment by way of security, call, proxy or similar restriction.

     “Event of Default” has the meaning set forth in SECTION 11.1.

     “Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder, or any similar successor statute.

     “Expenses” has the meaning set forth in SECTION 12.1.

     “Fiscal Year 2010” means the fiscal year of the Company ending on June 30, 2010.

     “Group” has the meaning assigned to such term in Section 13(d)(3) of the Exchange Act.

     “Losses” has the meaning set forth in SECTION 12.1.

     “Make-Whole Shares” has the meaning set forth in SECTION 11.3.

     “Market Price” shall mean the volume weighted average of the closing prices during a 30
calendar day period immediately preceding March 16, 2010 of a share of the Company’s capital stock
on the principal United States securities exchange registered under the Exchange Act on which such
stock is listed.

     “Person” means any individual, corporation, partnership, association, limited liability
company, trust, estate, or other entity.

     “Preferred Call” means the Company’s right to require St. George to make an investment in the
Company as set forth in SECTION 8.1.

     “Preferred Call Option” means the call option for the Preferred Shares set forth in Exhibit A.

     “Preferred Call Notice” has the meaning set forth in SECTION 8.1.

     “Preferred Issuance” has the meaning set forth in SECTION 8.1.

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     “Preferred Put Option” means the put option for the Preferred Shares set forth in Exhibit A.

     “Preferred Shares” has the meaning set forth in SECTION 8.1.

     “Put Closing Date” has the meaning set forth in SECTION 5.6.

     “Put Commencement Date” means October 1, 2011 (subject to acceleration pursuant to SECTION
5.3).

     “Put Exercise Period” has the meaning set forth in SECTION 5.1.

     “Put Expiration Date” means the last day of the Put Exercise Period.

     “Put Notice” has the meaning set forth in SECTION 5.1.

     “Put Obligations” means the amounts that Company is required to pay to St. George if and when
St. George exercises the Put Option and the Preferred Put Option.

     “Put Option” has the meaning set forth in SECTION 5.1.

     “Put Price” has the meaning set forth in SECTION 5.4.

     “Put Price Per Share” has the meaning set forth in SECTION 5.5.

     “Put Shares” has the meaning set forth in SECTION 5.1.

     “Register”, “Registered” and “Registration” means a registration effected by preparing and
filing a Registration Statement or Statements in compliance with the Securities Act providing for
offering securities, and the declaration or ordering of effectiveness of such Registration
Statement by the SEC.

     “Registrable Securities” means the Shares, provided that for any particular securities, such
securities shall cease to be Registrable Securities when they have been sold pursuant to an
effective registration statement or in compliance with Rule 144 or are eligible to be sold pursuant
to Rule 144 without volume limitations under Rule 144(e).

     “Registration Period” means the period from the Effective Date to the earliest of (i) the date
which is two (2) years after the SEC Effective Date, (ii) the date on which St. George may sell all
of its Registrable Securities without registration under the Securities Act pursuant to Rule 144,
without (A) restriction on the manner of sale or the volume of securities which may be sold in any
period, and (B) the requirement for the giving of any notice to, or the making of any filing with,
the SEC, and (iii) the date on which St. George no longer beneficially owns any Registrable
Securities.

     “Registration Statement” means a registration statement of the Company under the Securities
Act, including any amendment thereto, required to be filed by the Company pursuant to this
Agreement.

     “Reporting Service” means Bloomberg LP or if that service is not then reporting the relevant
information regarding the common stock, a comparable reporting service of national reputation
selected by St. George and Company.

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     “Rule 144” means Rule 144 promulgated under the Securities Act or any other similar rule or
regulation of the SEC that may at any time permit a holder of any securities to sell securities of
the Company to the public without registration under the Securities Act.

     “SEC” means the United States Securities and Exchange Commission or any other federal agency
at the time administering the Securities Act or the Exchange Act.

     “SEC Effective Date” means the date the Registration Statement is declared effective by the
SEC.

     “Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations
thereunder, or any similar successor statute.

     “Shareholders’ Equity” means shareholders’ equity as defined by Generally Accepted Accounting
Principles and as reported on the Company’s audited financial statements prepared in accordance
with past practices.

     “Shares” means (a) the Common Shares held by St. George or its Affiliates as of the Effective
Date, or the Common Shares or Preferred Shares acquired by St. George or its Affiliates thereafter,
including upon any stock split, stock dividend, payment-in-kind dividend, recapitalization or
similar event with respect to such Common Shares or Preferred Shares; (b) any Conversion Shares
issued or issuable to St. George or its Affiliates upon the conversion of any Preferred Shares and
(c) any other security of the Company issued to St. George or its Affiliates, including those
issued as a dividend or other distribution with respect to, in exchange for, or in replacement of,
Shares.

     “St. George” has the meaning set forth in the introductory paragraph hereof.

     “St. George Party” has the meaning set forth in SECTION 12.1.

     “Triggering Event’ means the earliest of (x) the Company’s execution of a letter of intent for
a Business Combination, (y) the Company’s execution of definitive agreements for a Business
Combination and (z) the Company’s public announcement (by press release, filing of a Current Report
on Form 8-K or similar means) that it intends to consummate a Business Combination.

     “Volume Weighted Average Price” or “VWAP” means, for any security as of any date, the dollar
volume-weighted average price for such security on the principal trading market during the period
beginning at 9:30:01 am., New York City time (or such other time as the principal trading market
publicly announces is the official open of trading), and ending at 4:00:00 p.m., New York City time
(or such other time as the principal trading market publicly announces is the official close of
trading) as reported by the Reporting Service (as defined below) through its ‘Volume at Price’
functions, or, if the foregoing does not apply, the dollar volume-weighted average price of such
security in the over-the-counter market on the electronic bulletin board for such security during
the period beginning at 9:30:01 a.m., New York City time (or such other time as the principal
trading market publicly announces is the official open of trading), and ending at 4:00:00 p.m., New
York City time (or such other time as the principal trading market publicly announces is the
official close of trading), as reported by the Reporting Service, or, if no dollar volume-weighted
average price is reported for such security by the Reporting

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Service for such hours, the average of the highest closing bid price and the lowest closing
ask price of any of the market makers for such security as reported in the “pink sheets” by Pink
Sheets LLC (formerly the National Quotation Bureau, Inc.). If the Volume Weighted Average Price
cannot be calculated for a security on a particular date on any of the foregoing bases, the Volume
Weighted Average Price of such security on such date shall be the fair market value as determined
by St. George and Company.

ARTICLE II.

RECITALS 

          SECTION 2.1 Recitals. The above recitals are made a part hereof and incorporated
herein.

ARTICLE III.

VOTING AGREEMENT

          SECTION 3.1 Voting Agreement. During the period commencing on the Effective Date
and terminating as provided in SECTION 3.3, at any meeting of the shareholders of the Company,
however called, or in connection with any written consent of the shareholders of the Company, St.
George shall vote or consent to vote the Shares with respect to any matter coming before the
shareholders for a vote as recommended by a majority of the Board. This voting agreement will be
effectuated by the grant of irrevocable proxies pursuant to SECTION 3.2. Currently, Common
Shares are held by two St. George Affiliates, John M. Fife and Iliad Research and Trading, L.P.
St. George hereby covenants and represents that St. George will cause its Affiliates to issue the
proxies consistent with SECTION 3.2 for Common Shares and Conversion Shares described herein and
deliver the same to Company concurrently with the issuance of the Preferred Stock together with
evidence of assignment of Beneficial Ownership from such Affiliates to St. George.

          SECTION 3.2 Irrevocable Proxy. St. George hereby irrevocably constitutes and
appoints the Secretary of the Company as its attorney-in-fact and proxy, with full power of
substitution, to vote and otherwise act (by written consent or otherwise) with respect to the
Shares which St. George is entitled to vote at any meeting of shareholders of the Company
(whether annual or special and whether or not at an adjourned or postponed meeting) or consent to
vote in lieu of any such meeting or otherwise, on any matter coming before the shareholders for a
vote, and to duly execute and deliver any and all consents, instruments or other agreements or
documents in order to take any and all such actions in connection with or in furtherance of the
obligations of St. George set forth in SECTION 3.1. St. George intends that the proxy granted
hereby shall be coupled with an interest pursuant to this Agreement and that such proxy,
therefore, shall be irrevocable until the date specified in SECTION 3.3.

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          SECTION 3.3 Termination of Voting Agreement and Proxy. The voting agreement set
forth in SECTION 3.1 and the proxy set forth in SECTION 3.2 shall expire on the Put Expiration
Date (other than as a result of the elimination of the Put Option pursuant to SECTION 5.2),
unless terminated sooner pursuant to Article XI.

          SECTION 3.4 Other Proxies. St. George hereby revokes all other proxies and powers
of attorney with respect to the Shares that it heretofore may have appointed or granted, and no
subsequent proxy or power of attorney shall be given or written consent executed (and if given or
executed, shall not be effective) by St. George with respect thereto. All authority herein
conferred or agreed to be conferred shall survive the dissolution of St. George and any
obligation of St. George under this Agreement shall be binding upon the successors and assigns of
St. George, except as otherwise provided herein.

          SECTION 3.5 Restrictions on Transfer.

          (a) Prior to or following the SEC Effective Date, but subject to SECTION 5.2, St.
George may sell any of the Common Shares or Conversion Shares held by St. George in the
open market pursuant to a Registration or an exemption from registration under the Exchange
Act free and clear of the terms and conditions of this Agreement, and the obligations of
St. George under this Agreement shall not be binding upon any purchaser of shares in the
open market.

          (b) St. George may sell, exchange, pledge, encumber or otherwise transfer or dispose
of in one or more privately placed transactions, or agree to sell, exchange, pledge,
encumber or otherwise transfer or dispose of, any of the Shares in one or more privately
placed transactions, or any interest therein, or enter into any agreement, arrangement,
commitment, understanding or undertaking to do any of the foregoing in a private
transaction, provided that the obligations of St. George under this Agreement shall be
binding upon any transferee or assignee of the Shares.

          SECTION 3.6 Exceptions to Restrictions on Transfer. If the Company shall have
entered into a definitive agreement providing for, or, in the case of clause (ii) below, the
Board shall have recommended in favor of, (i) any direct or indirect acquisition or purchase by
any Person or Group of a majority of the issued and outstanding Common Shares, (ii) any tender
offer or exchange offer that if consummated would result in any Person or Group acquiring a
majority of the issued and outstanding Common Shares or (iii) any merger, consolidation, share
exchange or other business combination involving the Company which, if consummated, would result
in the shareholders of the Company immediately prior to the consummation of such transaction
ceasing to own at least a majority of the equity interests in the surviving entity (or any direct
or indirect parent of such surviving entity), then notwithstanding anything contained herein to
the contrary, any Shares transferred or assigned by St. George pursuant to such definitive
agreement or tender offer or exchange offer shall not be subject to the obligations of St. George
under this Agreement (including the Put Option, the Call Option and the restrictions in Article
III and Article IV).

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          SECTION 3.7 Transfers to Affiliates. Notwithstanding anything contained in this
Agreement to the contrary, St. George may transfer Shares to one or more Affiliates of St. George,
provided that any such transferee agrees in writing to be bound by the terms of this Agreement, and
St. George and such Affiliates shall not be deemed to be a Group for purposes of this Agreement.

ARTICLE IV.

STANDSTILL

          SECTION 4.1 Standstill Agreement. St. George covenants and agrees with the Company
that it shall not, during the period commencing on the Effective Date and terminating as provided
in SECTION 4.2 directly or indirectly, alone or in concert with others, unless specifically
requested in writing by the Company or by a resolution of a majority of the Directors (or take
any action that would require the Company to make an announcement regarding any of the
following):

          (a) effect, seek, offer, engage in, propose (whether publicly or otherwise) or cause
or participate in, or assist any other Person to effect, seek, engage in, offer or propose
(whether publicly or otherwise) or participate in:

     (i) any exchange offer, merger, consolidation, share exchange, business
combination, recapitalization, restructuring, liquidation, dissolution or other
extraordinary transaction involving the Company or any of its subsidiaries or any
material portion of its or their business or any purchase of all or any substantial
part of the assets of the Company or any of its subsidiaries or any material
portion of its or their business; or

     (ii) any “solicitation” of “proxies” (as such terms are used the proxy rules
of the SEC but without regard to the exclusion set forth in Section 14a-1(1)(2)(iv)
from the definition of “solicitation”) with respect to the Company or any of its
Affiliates or becoming a “participant” in any “election contest” (as such terms are
used in the proxy rules of the SEC) with respect to the Company or any of its
Affiliates;

          (b) propose any matter for submission to a vote of shareholders of the Company or call
or seek to call a meeting of the shareholders of the Company;

          (c) seek election to the Board, seek to place a representative or other nominee on the
Board or seek the removal of any Director;

          (d) grant any proxy with respect to any Shares (other than to the Secretary of the
Company);

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          (e) execute any written consent with respect to any Shares, other than at the request
of the Company or a majority of the Directors;

          (f) form, join or participate in a Group with respect to any Shares or deposit any
Shares in a voting trust or subject any Shares to any arrangement or agreement with respect
to the voting of such Shares or other agreement having similar effect;

          (g) take any other action to seek to affect the control of the management or Board of
the Company or any of its Affiliates, including publicly suggesting or announcing its
willingness to engage in or have another Person engage in a transaction that could
reasonably be expected to result in a transaction of the type described in SECTION
4.1(a)(i);

          (h) enter into any discussions, negotiations, arrangements or understandings with any
Person with respect to any of the foregoing, or advise, assist, encourage or seek to
persuade others to take any action with respect to any of the foregoing; with respect to
the Company or the Common Shares, (i) otherwise communicate with the Company’s shareholders
or others pursuant to Rule 14a-1(1)(2)(iv) under the Exchange Act, (ii) participate in, or
take any action pursuant to any “shareholder access” proposal that may be adopted by the
SEC, whether in accordance with proposed Rule 14a-11 or otherwise, or (iii) conduct any
nonbinding referendum;

          (i) make any statement or disclose to any Person, or otherwise induce, encourage,
discuss or facilitate, any intention, plan or arrangement inconsistent with the foregoing
or which would result in the Company or any of its Affiliates to be required to make any
such disclosure in any filing with a governmental entity or being required to make a public
announcement with respect thereto;

          (j) bring any action or otherwise act to contest the validity of this Article IV
(including this SECTION 4.1) or seek a release from the restrictions contained in this
Article IV; or

          (k) request the Company or any of its Affiliates, Directors, officers, employees,
representatives, advisors or agents, or any party hereto, directly or indirectly, to amend
or waive this Article IV, the Charter or the By-laws (or similar constituent documents) of
the Company or any of its Affiliates.

          SECTION 4.2 Termination of Standstill Agreement. The standstill agreement set forth
in SECTION 4.1 shall expire on the Put Expiration Date (other than as a result of the elimination
of the Put Option pursuant to SECTION 5.2), unless terminated sooner pursuant to Article XI.

          SECTION 4.3 Exceptions to Standstill Agreement. If the Company shall have entered
into a definitive agreement providing for, or, in the case of clause (ii)

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below, the Board shall have recommended in favor of, (i) any direct or indirect acquisition
or purchase by any Person or Group of a majority of the issued and outstanding Common Shares,
(ii) any tender offer or exchange offer that if consummated would result in any Person or Group
acquiring a majority of the issued and outstanding Common Shares or (iii) any merger,
consolidation, share exchange or other business combination involving the Company which, if
consummated, would result in the shareholders of the Company immediately prior to the
consummation of such transaction ceasing to own at least a majority of the equity interests in
the surviving entity (or any direct or indirect parent of such surviving entity), then
notwithstanding anything contained herein to the contrary, St. George may take actions otherwise
prohibited by SECTION 4.1 if such actions are consistent with such definitive agreement or tender
offer or exchange offer.

ARTICLE V.

PUT OPTION 

          SECTION 5.1 Put Option. During the period beginning on the Put Commencement Date
and terminating one hundred and eighty (180) days thereafter (the “Put Exercise Period”) St.
George shall have the right and option on up to three (3) occasions (the “Put Option”),
exercisable from time to time by written notice (the “Put Notice”) delivered to Company by
registered mail, overnight courier or facsimile stating that St. George intends to exercise its
rights pursuant to this SECTION 5.1, to sell to Company and to cause Company to purchase from St.
George any or all of the Common Shares and Conversion Shares then held by St. George (such number
of Shares specified in such Put Notice, the “Put Shares”), for an aggregate purchase price equal
to the Put Price. Each time that St. George exercises the Put Option, the number of Put Shares
shall be at least ten percent (10%) of the Common Shares and Conversion Shares then held by St.
George. The Put Notice shall also specify the Put Closing Date. The Put Notice shall be deemed
to have been delivered (i) five (5) Business Days after being mailed by registered mail (return
receipt requested and postage prepaid) to the recipient, (ii) one (1) Business Day after being
sent by overnight courier (receipt confirmation requested) or (iii) if sent by facsimile
transmission, on the date of such transmission, with a confirming copy deposited in the United
States mail, postage prepaid. If St. George fails to deliver a Put Notice during the Put
Exercise Period, St. George shall have forfeited the Put Option.

          SECTION 5.2 Elimination of the Put Option. After the SEC Effective Date, the Put
Option shall be eliminated if the Company creates Shareholder Value. “Shareholder Value” is
defined as the occurrence of one of the following: (i) if following the SEC Effective Date,
within any rolling 90 trading day period (in which the Registration Statement is continuously
effective) the average of the 30 highest Volume Weighted Average Prices (not required to be
consecutive) of the Common Shares is greater than $2.21 or (ii) if following the SEC Effective
Date, within any rolling 90 trading day period (in which the Registration Statement is
continuously effective) the average Volume Weighted Average Price of the Common Shares for 20
consecutive trading days is greater than $2.21. For the avoidance of doubt, all of the days in
the computation of (i) and (ii) above shall fall within a period when the Registration

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Statement is continuously effective. If the Put Option is eliminated, then St. George may
sell or otherwise transfer the Shares pursuant to SECTION 3.5 or may continue to hold the Shares
subject to the terms and conditions of this Agreement, including the voting agreement set forth
in Article III and the standstill agreement set forth in Article IV. If the Put Option is
eliminated pursuant to this SECTION 5.2, in connection with any sale, transfer or other
disposition permitted by SECTION 3.5, St. George shall in no event sell Common Shares or
Conversion Shares as a result of which its Beneficial Ownership of Common Shares would be less
than 1,882,583 Shares until March 31, 2012, at which time the restrictions contained in this
sentence shall be eliminated.

          SECTION 5.3 Acceleration of the Put Option. The Put Commencement Date shall
accelerate and the Put Option shall become immediately exercisable by St. George, in accordance
with the procedures and terms set forth in this Article V, upon the occurrence of an Event of
Default which is not cured as provided in SECTION 11.2.

          SECTION 5.4 Put Price. For purposes hereof, with respect to each exercise of the
Put Option, the term “Put Price” shall mean the Put Price Per Share multiplied by the number of
Put Shares.

          SECTION 5.5 Put Price Per Share. The “Put Price Per Share” shall be equal to the
Market Price.

          SECTION 5.6 Put Closing Date. St. George shall fix the date (a “Put Closing Date”)
for the exercise of a Put Option no earlier than ten (10) but not more than thirty (30) Business
Days after the Put Notice is deemed to be delivered as set forth in SECTION 5.1 hereof.

          SECTION 5.7 Closing Deliveries. On the Put Closing Date, St. George will physically
or electronically deliver certificates representing the Put Shares (if physical certificate
delivery, duly endorsed for transfer by St. George or accompanied by duly executed stock powers
in blank) to Company, and Company shall deliver payment of the Put Price in cash by wire transfer
of immediately available funds to an account at a bank designated by St. George.

          SECTION 5.8 Non-compliance. If the Company does not honor the Put Option and comply
with the terms of this Article V, interest shall be due and payable on the portion of the Put
Price not paid at an annual rate of eighteen percent (18%) payable monthly in cash.

ARTICLE VI.

CALL OPTION

          SECTION 6.1 Call Option. During the period beginning on the Effective Date and
terminating on September 30, 2011 (the “Call Exercise Period”) Company

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shall have the right and option (the “Call Option”), exercisable by written notice (the
“Call Notice”) delivered to St. George by registered mail, overnight courier or facsimile stating
that Company intends to exercise its rights pursuant to this SECTION 6.1, to purchase from St.
George and to cause St. George to sell to Company all, but not less than all, of the Common
Shares and Conversion Shares then held by St. George (the “Call Shares”) for an aggregate
purchase price equal to the Call Price. The Call Notice shall also specify the Call Closing Date.
Additionally, the Call Option may only be exercised in conjunction with and at the same time as
the Preferred Call Option, the Call Option must be exercised if Company exercises the Preferred
Call Option, and the Preferred Call Option must be exercised if the Company exercises the Call
Option. The Call Notice shall be deemed to have been delivered (i) five (5) Business Days after
being mailed by registered mail (return receipt requested and postage prepaid) to the recipient,
(ii) one (1) Business Day after being sent by overnight courier (receipt confirmation requested)
or (iii) if sent by facsimile transmission, on the date of such transmission, with a confirming
copy deposited in the United States mail, postage prepaid. If Company fails to deliver a Call
Notice during the Call Exercise Period, Company shall have forfeited the Call Option.

          SECTION 6.2 Elimination of the Call Option. The Call Option shall be eliminated
upon the occurrence of one of the following: (i) the Put Option is eliminated pursuant to SECTION
5.2, (ii) the Put Commencement Date is accelerated pursuant to SECTION 5.3, or (iii) a Triggering
Event.

          SECTION 6.3 Call Price. For purposes hereof, the term “Call Price” shall mean the
Call Price Per Share multiplied by the number of Call Shares.

          SECTION 6.4 Call Price Per Share. If the Call Closing Date occurs during the period
beginning on the Effective Date and ending on June 30, 2011, the “Call Price Per Share” shall be
equal to the Market Price less ten percent (10%). If the Call Closing Date occurs during the
period beginning on July 1, 2011 and ending on September 30, 2011, the Call Price Per Share shall
be equal to the Market Price.

          SECTION 6.5 Call Closing Date. Company shall fix the date (the “Call Closing Date”)
for the exercise of the Call Option no earlier than ten (10) but not more than thirty (30)
Business Days after the Call Notice is deemed to be delivered as set forth in SECTION 6.1 hereof.

          SECTION 6.6 Closing Deliveries. On the Call Closing Date, St. George will
physically or electronically deliver certificates representing the Call Shares (if physical
certificate delivery, duly endorsed for transfer by St. George or accompanied by duly executed
stock powers in blank) to Company, and Company shall deliver payment of the Call Price in cash by
wire transfer of immediately available funds to an account at a bank designated by Company. The
Call Option and the Preferred Call Option may only be paid in cash.

          SECTION 6.7 Section 16 Compliance. Company shall not exercise the Call Option at
any time that would result in St. George incurring short swing profit

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liability to permit the recapture of profits by the Company pursuant to Section 16 of the
Exchange Act involving an equity security in a transaction within a period of 6 months.

ARTICLE VII.

CONDITIONS PRECEDENT

          SECTION 7.1 Conditions to Obligations of Company and St. George. The obligations of
Company and St. George to consummate the transactions contemplated by this Agreement to occur on
each Put Closing Date or Call Closing Date shall be subject to the satisfaction or waiver of the
following conditions on or prior to the applicable Put Closing Date or Call Closing Date:

          (a) No Injunction. No preliminary or permanent injunction or other order shall have
been issued by any court of competent jurisdiction, or by a governmental or regulatory
body, which remains in effect and invalidates any or all of the provisions of this
Agreement or prohibits or enjoins the consummation of any of the transactions contemplated
by this Agreement.

          (b) No Prohibitions. A prohibition shall not exist on the repurchase under, and the
repurchase shall not otherwise violate, Section 345 of the Michigan Business Corporation
Act of 1972, as amended, or any other applicable successor statute, or the applicable
statutes of any state in which Company reincorporates.

ARTICLE VIII.

PREFERRED CALL

          SECTION 8.1 Preferred Call. At any time after May 1, 2010 and prior to the earlier
of (x) July 1, 2011 and (y) the Company’s filing of a Registration Statement for the Shares, the
Company may give written notice to St. George (the “Preferred Call Notice”) that it has elected
to require that St. George make an investment of up to $600,000 in the Company by purchasing
newly-issued shares of Series A Convertible Preferred Stock (the “Preferred Stock”) which have
the rights, preferences, privileges and restrictions set forth on the Certificate of Designation
attached hereto as Exhibit A (the “Certificate of Designation”). The number of shares of
Preferred Stock to be issued to St. George (the “Preferred Issuance”) shall be equal to 600,000
divided by the VWAP for the common stock for the thirty calendar days immediately prior to the
date of issuance of the shares; provided that if there has occurred a Triggering Event, the VWAP
shall be based on the thirty calendar days prior to the earliest of the Triggering Events. The
Company shall concurrently with the giving of notice of the exercise of the Preferred Call take
such actions as are necessary to adopt and file the Certificate of Designation which shall
authorize a sufficient number of shares of Preferred Stock for both the Preferred Issuance and
additional shares for the payment

13

 

of dividends in kind and shall reserve a sufficient number of Common Shares for issuance
upon the conversion of the Preferred Shares. The Preferred Shares shall (i) be convertible into
Common Shares at any time; (ii) receive a quarterly dividend at a rate of three percent (3%)
annually to be paid in cash or in additional Preferred Shares at the Company’s election; and
(iii) be non-voting except for matters that affect the class of Preferred Shares. Any Conversion
Shares shall be subject to all of the terms and conditions of this Agreement, including the Put
Option and Call Option.

          SECTION 8.2 Purchase of Preferred Shares. Within five Business Days following
receipt of the Preferred Call Notice together with evidence of the filing of the Certificate of
Designation, St. George shall purchase from the Company for $600,000 cash by wire transfer the
Preferred Issuance and the Company shall either issue certificates evidencing the Preferred
Issuance or book-entry transfers reflecting the Preferred Issuance.

ARTICLE IX.

REGISTRATION RIGHTS

          SECTION 9.1 Registration. The Company shall prepare and, on or prior to June 30,
2011, file with the SEC a Registration Statement on Form S-3 (or, if the Company is not eligible
to use such form at the time of filing with the SEC, Form S-1) which, on the date of filing with
the SEC, covers the resale of Common Shares equal to the number of Common Shares, Conversion
Shares and Make-Whole Shares held by St. George or which may be issued to St. George pursuant to
this Agreement. Without the written consent of St. George, the Registration Statement shall not
include securities to be sold for the account of any Person that holds Common Shares (or any
other security holder of Company), other than St. George and other than Common Shares issued in
connection with an acquisition or strategic transaction approved by a majority of the Board
provided that if Company and St. George determine in good faith that due to market conditions,
not all such Common Shares can be registered, all Shares of St. George shall be registered before
any Common Shares of any other Person shall be registered. The Company shall request the
Registration Statement to remain effective during the Registration Period.

          SECTION 9.2 Other Registrations. Prior to the SEC Effective Date, the Company shall
not file any other registration statement or any amendment thereto with the SEC under the
Securities Act, or request the acceleration of the effectiveness of any other registration
statement previously filed with the SEC, for any Person that holds Common Shares (or any other
security holder of Company), other than St. George (or subject to the provisions of SECTION 9.1,
for a Person in connection with an acquisition or strategic transaction).

          SECTION 9.3 Reports. The Company shall file all reports required to be filed by the
Company with the SEC in a timely manner so as to obtain and/or maintain eligibility for the use
of Form S-3.

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          SECTION 9.4 Expenses. All reasonable expenses (other than underwriting discounts
and commissions and other fees and expenses of investment bankers engaged by St. George and other
than brokerage commissions), incurred in connection with registrations, filings or qualifications
pursuant to this Article IX, including, without limitation, all registration, listing and
qualifications fees, printers and accounting fees and the fees and disbursements of counsel for
the Company, shall be borne by the Company.

ARTICLE X.

COVENANTS

          SECTION 10.1 Covenants of Company. Company agrees that, during the period beginning
on the Effective Date and ending on the earlier of (i) the expiration of the Put Exercise Period
or (ii) the Company’s payment in full of the Put Obligations:

          (a) Company shall not enter into any agreement that would interfere with this
Agreement (e.g. a loan agreement that restricts equity redemptions or dividends);

          (b) Company shall not permit its unrestricted cash to fall below twenty percent (20%)
of Shareholders Equity (as measured in the Company’s audited financial statements for
Fiscal Year 2010). Company shall provide St. George with a pro forma estimate of
Shareholders Equity as of June 30, 2010. For purposes of this paragraph, the proceeds of
St. George’s purchase of Preferred Shares pursuant to ARTICLE VIII shall not be included
within Shareholders’ Equity. Company shall provide a certificate to St. George within ten
(10) days after the end of each calendar month certifying that Company is in compliance
with the covenant contained in this paragraph; provided that the certificate shall be based
on the Company’s pro forma estimate of Shareholders Equity as of June 30, 2010 (which shall
be updated each month), until the audited financial statements for Fiscal Year 2010 have
been prepared.

          (c) In addition to SECTION 10.1(b) above, as restrictions are lifted from any
restricted cash on the Company’s balance sheet as reported in its quarterly report for the
quarter ending December 31, 2009, an additional amount of cash shall be reserved for the
purpose of honoring the Put Option and the Preferred Put Option, if and when the options
are exercised by St. George; provided that the cash reserved pursuant to SECTION 10.1(b)
together with the cash reserved pursuant to this SECTION 10.1(c) shall not exceed the Put
Obligations; and provided that the cash reserved pursuant to SECTION 10.1(b) together with
the cash reserved pursuant to this SECTION 10.1(c) shall be equal to, but shall not be
required to exceed, 65% of the Put Obligations as of May 31, 2010, 85% of the Put
Obligations as of June 30, 2010 and 100% of the Put Obligations as of July 31, 2010. The
certificate provided in SECTION 10.1(b) shall also certify that these percentages have been
met. If Shares are acquired after the Effective Date that are subject to either the Put
Option or Preferred Put

15

 

Option, then St. George shall notify the Company in writing (with the filing of Form
4’s with the SEC constituting sufficient notice), and the Company shall have two months to
set aside sufficient cash to satisfy the Put Obligations with respect to these Shares, and
the Company shall certify as to compliance with the forgoing in its monthly compliance
certificates referred to in SECTION 10.1(b). After achieving compliance with the cash set
aside requirements in each instance, the Company shall thereafter maintain sufficient cash
to satisfy 100% of the Put Obligations until the earlier of the expiration of the Put
Exercise Period or the Company’s payment in full of the Put Obligations. If St. George
elects in writing not to exercise the Put Option and the Preferred Put Option, or if the
Put Option and the Preferred Put Option expire in accordance with their terms, the Company
shall be permitted to use this cash for any other operating purpose.

          (d) After any Put Commencement Date, the Company shall maintain sufficient liquidity
and cash resources to be able to honor the Put Option and the Preferred Put Option in
compliance with Section 345 of the Michigan Business Corporation Act of 1972, as amended,
or any other applicable successor statute, or the applicable statutes of any state in which
Company reincorporates; and

          (e) In lieu of maintaining the covenant contained in SECTION 10.1(b), the Company may
provide a letter of credit in the amount of the Put Price that names St. George as the
account beneficiary, and in a form acceptable to St. George exercising reasonable judgment,
or otherwise establish a segregated and dedicated account containing an amount equal to the
Put Price that is specially and exclusively reserved for the benefit of St. George if and
when it elects to exercise the Put Option and the Preferred Put Option.

          SECTION 10.2 Cooperation; Further Assurances.

          (a) Subject to the terms and conditions of this Agreement, each of the Parties shall
use all reasonable efforts to take, or cause to be taken, all action and to do, or cause to
be done, all things necessary, proper or advisable under applicable laws and regulations to
consummate and make effective the transactions contemplated by this Agreement, including
providing information and using reasonable efforts to obtain all necessary or appropriate
waivers, consents and approvals, and effecting all necessary registrations and filings.

          (b) In case at any time before or after any Put Closing Date or Call Closing Date any
further action is necessary or desirable to carry out the purposes of this Agreement, the
proper officers and directors of the Parties shall execute such further documents
(including assignments, acknowledgments and consents and other instruments of transfer) and
shall take such further action as shall be necessary or desirable to carry out the purposes
of this Agreement, in each case to the extent not inconsistent with applicable law.

          (c) Subject to the terms and conditions hereof, each of the Parties shall use its
reasonable efforts to cause the fulfillment at the earliest practicable

16

 

date of all of the conditions to the obligations of the Parties to consummate the
transactions contemplated by this Agreement.

          (d) Insofar as any applicable law or regulation changes after the Effective Date in a
manner that prevents St. George from realizing the benefit of its bargain hereunder (e.g.,
change in securities laws affecting registration statement or sales), the Company shall
cooperate with St. George to deliver to St. George the benefit of its bargain as closely as
possible to the original terms contained herein.

          SECTION 10.3 Public Disclosure. With respect to any public disclosure required to
be made by any Party of the existence of this Agreement, the contents hereof or the transactions
contemplated hereby, such Party shall give the other Party at least one (1) Business Day to
review its proposed form of public disclosure.

          SECTION 10.4 Observation Rights. From the Effective Date until the earlier of (i)
the expiration of the Put Exercise Period or (ii) the Company’s payment in full of the Put
Obligations, the Company shall give a designee of St. George copies of all notices, minutes,
consents, and other material that it provides to its Directors at or about the same time as
delivered to the Directors. A designee of St. George shall have the right to attend, in a
non-voting observer status, all meetings of the Board and all meetings of any committees of the
Board. Notwithstanding anything to the contrary in this Section, the Company reserves the right
to withhold any information and to exclude a St. George observer from any meeting or portion
thereof (so long as the Company notifies such observer of such withholding or exclusion) if
access to such information or attendance at such meeting would (i) in the reasonable judgment of
the Company’s outside counsel, prevent the members of the Board from engaging in attorney-client
privileged communication with counsel to the material detriment of the Company or (ii) in the
good faith determination of a majority of the members of such Board, result in a conflict of
interest with St. George. The Company will withhold information and restrict attendance at
meetings only under the circumstances set forth in the preceding sentence and will notify St.
George in advance at least one (1) Business Day of any action taken by its Board at any meeting
at which attendance by such observer is so restricted (except to the extent that such
notification would jeopardize the privilege that the Company was seeking to preserve or would
result in the conflict that the Company was seeking to avoid). St. George and its designee shall
be subject to all of the Company’s inside trading policies.

          SECTION 10.5 Covenants of St. George. St. George covenants and agrees with the
Company that during the period beginning on the Effective Date and terminating on the Put
Commencement Date:

          (a) It shall use commercially reasonable efforts to assist the Company, upon Company’s
request, in identifying possible merger or acquisition opportunities for the Company
without charging any fees in connection with these services; provided, however, that St.
George makes no assurances that any possible merger or acquisition candidate will be
acceptable to the Company’s Board of Directors or its shareholders (and the Company shall
not use this SECTION 10.5(a) as a defense to excuse any performance on the Company’s part
of its obligations under this Agreement).

17

 

          (b) It shall withdraw, as of the Effective Date, the nominations it made for the
Company’s Board as indicated in the preliminary proxy on Schedule 14(a) and 13D-A filed on
or around January 22, 2010; and

          (c) It shall not, directly or indirectly, alone or with its Affiliates, acquire more
than thirty five percent (35%) of the issued and outstanding Common Shares, provided that
the foregoing limitation shall not include the Conversion Shares.

ARTICLE XI.

DEFAULT

          SECTION 11.1 Default. Company will be deemed in default under this Agreement upon
the occurrence of any of the following (each an “Event of Default”):

          (a) Company breaches this Agreement, and such breach is not cured by Company within
ten (10) days of receipt of notice of breach;

          (b) Company becomes insolvent, or admits in writing its inability to pay debts as they
become due, a petition under any section or chapter of the Bankruptcy Reform Act of 1978 or
any similar law or regulation is filed by or against Company (provided, however, that if
the filing of a Bankruptcy petition is involuntary, Company shall have 30 days from the
date of filing to have said petition dismissed), or Company shall make an assignment for
the benefit of creditors;

          (c) A judgment is entered by a court of competent jurisdiction against Company in
excess of two million dollars ($2,000,000) which is not stayed or discharged within sixty
(60) days, and the Company does not have sufficient cash on hand to honor the Put Option
and Preferred Put Option;

          (d) The Company becomes delinquent in its periodic reporting requirements under
Section 13 of the Exchange Act that has the effect to bar St. George from reliance on Rule
144 of the Securities Act or to preclude the use of an effective Registration Statement;

          (e) The Common Shares are delisted from a national securities exchange, NASDAQ, or
fail to be quoted on the OTC Bulletin Board; or

          (f) Following the exercise of the Preferred Call, there is an Event of Default under
the Certificate of Designations.

          SECTION 11.2 Notice of Default. Upon the occurrence of an Event of Default, St.
George shall send a notice of default to Company. The notice of default shall include the
default date. If the default is not cured within any applicable cure

18

 

period, in addition to all other rights and remedies provided at law or in equity or
elsewhere in this Agreement, the Put Commencement Date shall accelerate to the later of (x) the
default date specified in the notice pursuant to SECTION 5.3 if there is no cure period or (y)
the last date of any applicable cure period. Additionally, as of the date of an Event of Default
which is not cured within any applicable cure period, the voting agreement and proxy set forth in
SECTION 3.1 and SECTION 3.2, and the standstill agreement set forth in SECTION 4.1, shall
terminate.

          SECTION 11.3 Make-Whole Shares. If the Company does not honor the Put Option or the
Preferred Put Option in full because the Company has insufficient cash or is otherwise under a
restraint that prevents the Company’s compliance, then, St. George shall be deemed to be a
creditor of Company in the amount of the outstanding balance of the Put Obligations, together
with interest on the Put Obligations at the rate of eighteen percent (18%) per annum. With
respect to the Put Shares that have not been honored for payment, those Shares shall be deemed
redeemed by the Company as of the Put Closing Date and St. George shall have no power or
authority to control the disposition or voting of those Shares. At St. George’s option, St.
George may elect to draw down tranches of Common Shares, subject to the limitation below, for
sale in the market and will apply the net proceeds (after commissions) to the outstanding balance
of the Put Obligations, plus interest. Insofar as the net proceeds of any tranche of Common
Shares is insufficient to extinguish the Put Obligations, St. George may request from time to
time further tranches of Common Shares until Company either pays the Put Obligations in cash or
the net proceeds from the sale of Common Shares are sufficient to extinguish the Put Obligations.
Each tranche of Common Shares requested by St. George shall not exceed 9.9% of the issued and
outstanding Common Shares of Company. The Company shall electronically deliver the tranche
shares to an account designated by St. George within 3 Business Days of the Company’s receipt of
the request. All Common Shares issued to St. George following Company’s failure to honor the Put
Option or the Preferred Put Option pursuant to this SECTION 11.3 shall be referred to as
“Make-Whole Shares”. On the Put Closing Date, the Put Shares shall be deemed to be redeemed

ARTICLE XII.

INDEMNIFICATION 

          SECTION 12.1 Indemnification. Company hereby unconditionally agrees to indemnify
and hold harmless St. George and each of its Affiliates, members, managers, directors, officers,
agents, successors and assigns (each a “St. George Party”; collectively, “St. George Parties”) to
the fullest extent permitted by law, from and against any and all losses, claims, damages,
obligations, penalties, judgments, awards, costs, disbursements and liabilities (including
amounts paid in settlement) (collectively, “Losses”) and expenses, including, without limitation,
all fees and expenses of each of the St. George Parties’ counsel and each of the St. George
Parties’ reasonable out-of-pocket expenses actually and reasonably incurred by each of the St.
George Parties or on their behalf in connection with the investigation of any pending or
threatened claims or the preparation for, the defense of, or the furnishing of evidence in, any
pending or threatened litigation, claim, investigation or proceedings,

19

 

in which any of the St. George Parties is an actual or threatened party or participant
thereto (collectively, “Expenses”) based upon or arising out of any issue or controversy that is
in any way related to any claim, cause of action, allegation, action, suit, proceeding,
litigation, arbitration or investigation brought by or against any St. George Party at law or in
equity, or before or by any federal, state, municipal, foreign or other governmental department,
commission, board, agency, instrumentality or authority by any third party (other than Company)
relating to Board action or inaction while St. George or its designee has observer status to the
Board as provided in SECTION 10.4. Expenses will be reimbursed or advanced when and as incurred
or within thirty (30) days upon submission by any of the St. George Parties of statements to
Company. Company shall not be required to indemnify a St. George Party to the extent that a
court or tribunal finds that it is unlawful or against public policy to do so.

          SECTION 12.2 Indemnification Procedure. If any litigation, investigation or
proceeding is commenced as to which a St. George Party proposes to demand indemnification
pursuant to SECTION 12.1, the St. George Party will notify Company with reasonable promptness;
provided, however, that any failure by the St. George Party to notify the Company will relieve
the Company from its obligations only to the extent the Company has been prejudiced by such
failure or delay. The St. George Party will have the right to retain counsel (and local counsel,
if appropriate) of its own choice to represent it (but subject to the Company’s prior approval,
which approval shall not be unreasonably withheld). The Company will pay the reasonable fees,
expenses and disbursements of such counsel within thirty (30) days upon submission by the St.
George Party of detailed statements describing the services performed, applicable hourly rates
and amounts charged. The Company retains the right to participate in the defense of such
litigation, investigation or proceeding as to which the St. George Party seeks indemnification
through counsel of the Company’s choice (the cost of which will be paid by the Company) and the
St. George Party will reasonably cooperate with such counsel and the Company (including, keeping
the Company reasonably informed of the defense, unless cooperation conflicts with the St. George
Party’s own interests). Company will be liable for any settlement of any claim made against a
St. George Party; provided that St. George Party shall not settle a claim without the written
consent of Company, which consent will not be unreasonably withheld. Company shall not settle a
claim brought against a St. George Party without the written consent of the St. George Party,
which consent will not be unreasonably withheld unless the settlement solely involves the payment
of monetary damages by Company.

ARTICLE XIII.

REPRESENTATIONS AND WARRANTIES

          SECTION 13.1 Representations and Warranties of Company. Company represents and
warrants to St. George as of the date hereof that:

          (a) Due Incorporation. Company is a corporation duly organized, validly existing and
in good standing under the laws of Michigan.

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          (b) Authority, Execution and Binding Effect. The execution, delivery and performance
by Company of this Agreement and the transactions contemplated hereby are within its
corporate powers, and have been duly authorized by all necessary action on the part of
Company, and no other corporate act or proceeding on the part of Company is necessary to
approve the execution and delivery of this Agreement or the consummation by Company of the
transactions contemplated hereby. This Agreement has been validly executed and delivered
by Company. Assuming due authorization, execution and delivery by St. George, this
Agreement constitutes a valid and binding agreement of Company, enforceable against Company
in accordance with its terms, except as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, and other laws of general application affecting enforcement or
creditors’ rights generally or by equitable principles.

          (c) No Governmental Consent Required. The execution, delivery and performance by
Company of this Agreement require no order, license, consent, authorization or approval of,
or exemption by, or action by or in respect of, or notice to, or filing or registration
with, any governmental body, agency or official except such as have been obtained or except
where the failure to obtain any such order, license, consent, authorization, approval or
exemption or give any such notice or make any filing or registration would not, in the
aggregate, reasonably be expected to adversely affect the ability of Company to perform its
obligations hereunder.

          (d) No Conflicts. The execution, delivery and performance of this Agreement by
Company will not, with or without the giving of notice or lapse of time, or both, (i)
conflict with the Charter or By-laws or similar constitutive documents of Company or (ii)
result in any breach of any terms or provisions of, or constitute a default under, or
conflict with any material contract, agreement or instrument to which Company is a party or
by which Company is bound, except for such breaches, defaults or conflicts which,
individually or in the aggregate, would not be likely to have a material adverse effect on
the financial position, results of operations or business of Company, or (iii) violate any
material provision of law, statute, rule or regulation to which it is subject or any
material order, judgment or decree applicable to Company.

          (e) Litigation. There is no claim, cause of action, allegation, action, suit,
proceeding, litigation, arbitration or investigation (“Action”) pending or, to Company’s
knowledge, threatened (i) by or against Company or any of its Affiliates which would be
likely to prevent, materially interfere with or materially delay the consummation of the
transactions contemplated hereby or (ii) with respect to the transactions contemplated
hereby, at law or in equity, or before or by any federal, state, municipal, foreign or
other governmental department, commission, board, agency, instrumentality or authority
which, if adversely determined, would be likely to prevent, materially interfere with or
materially delay the consummation of the transactions contemplated hereby. There is no
order, decree, injunction or judgment pending or in effect against Company or any of its
Affiliates which would be likely to prevent, materially interfere with or materially delay
the consummation of the transactions contemplated hereby.

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          (f) Preferred Shares. The Preferred Shares if sold to St. George upon exercise of the
Preferred Call, when issued, sold and delivered in accordance with the terms of this
Agreement for the consideration expressed herein, will be duly and validly issued, fully
paid and non-assessable. The Common Shares issuable upon conversion of the Preferred
Shares will have been duly and validly reserved for issuance and, upon issuance, will be
duly and validly issued, fully paid and non-assessable.

          (g) Authorized Capital. The authorized capital of the Company consists, or will
consist as of the Effective Date, of 15,000,000 shares of Common Shares and 5,000,000
preferred shares.

          (h) No Other Securities. Except for issued and outstanding Common Shares and the
rights of the holders thereof, and the rights and obligations created by this Agreement,
including the issuance of the Preferred Shares if the Preferred Call is exercised, (A)
there are no subscriptions, preemptive rights, options, convertible securities, warrants,
conversion privileges or other rights (or agreements for any such rights, contingent or
otherwise) outstanding to purchase or otherwise obtain any of the Company’s capital stock,
(B) the Company has no obligation (contingent or otherwise) to issue subscriptions,
preemptive rights, options, convertible securities, warrants, conversion privileges or
other rights or to issue or distribute to holders of any shares of its capital stock any
evidences of indebtedness or assets of the Company, and (C) the Company has no obligation
(contingent or otherwise) to purchase, redeem, or otherwise acquire any shares of its
capital stock or any interest therein or to pay any dividend or make any distribution in
respect thereof.

          SECTION 13.2 Representations and Warranties of St. George. St. George represents
and warrants to Company as of the date hereof that:

          (a) Due Organization. St. George is a limited liability company, duly organized,
validly existing and in good standing, under the laws of Illinois.

          (b) Authority, Execution and Binding Effect. The execution, delivery and performance
by St. George of this Agreement and the transactions contemplated hereby are within its
corporate powers, and have been duly authorized by all necessary action on the part of St.
George, and no other corporate act or proceeding on the part of St. George is necessary to
approve the execution and delivery of this Agreement or the consummation by St. George of
the transactions contemplated hereby. This Agreement has been validly executed and
delivered by St. George. Assuming due authorization, execution and delivery by Company,
this Agreement constitutes a valid and binding agreement of St. George, enforceable against
St. George in accordance with its terms, except as limited by applicable bankruptcy,
insolvency, reorganization, moratorium, and other laws of general application affecting
enforcement or creditors’ rights generally or by equitable principles.

22

 

          (c) No Governmental Consent Required. The execution, delivery and performance by St.
George of this Agreement require no order, license, consent, authorization or approval of,
or exemption by, or action by or in respect of, or notice to, or filing or registration
with, any governmental body, agency or official except such as have been obtained or except
where the failure to obtain any such order, license, consent, authorization, approval or
exemption or give any such notice or make any filing or registration would not, in the
aggregate, reasonably be expected to adversely affect the ability of St. George to perform
its obligations hereunder.

          (d) No Conflicts. The execution, delivery and performance of this Agreement by St.
George will not, with or without the giving of notice or lapse of time, or both, (i)
conflict with the operating agreement or similar constitutive documents of St. George or
(ii) result in any breach of any terms or provisions of, or constitute a default under, or
conflict with any material contract, agreement or instrument to which St. George is a party
or by which St. George is bound, except for such breaches, defaults or conflicts which,
individually or in the aggregate, would not be likely to have a material adverse effect on
the financial position, results of operations or business of St. George or (iii) violate
any material provision of law, statute, rule or regulation to which it is subject or any
material order, judgment or decree applicable to St. George.

          (e) Stock Ownership; Title to Shares. John M. Fife and Iliad Research and Trading,
L.P. have assigned all of their Beneficial Ownership rights in and to the Shares to St.
George. St. George Beneficially Owns 1,882,583 Common Shares as of the date hereof. All
of the Shares are as of the date hereof and will be on each Put Closing Date or Call
Closing Date owned beneficially and of record by St. George, free and clear of all
Encumbrances. When Company acquires the Shares pursuant to the provisions of this
Agreement, upon payment of the Put Price or the Call Price, as applicable, it will receive
the Shares free and clear of any Encumbrances other than Encumbrances resulting from acts
or omissions of or created by Company.

          (f) Litigation. There is no Action pending or, to St. George’s knowledge, threatened
(i) by or against St. George or any of its Affiliates which would be likely to prevent,
materially interfere with or materially delay the consummation of the transactions
contemplated hereby or (ii) with respect to the transactions contemplated hereby, at law or
in equity, or before or by any federal, state, municipal, foreign or other governmental
department, commission, board, agency, instrumentality or authority which, if adversely
determined, would be likely to prevent, materially interfere with or materially delay the
consummation of the transactions contemplated hereby. There is no order, decree, injunction
or judgment pending or in effect against St. George which would be likely to prevent,
materially interfere with or materially delay the consummation of the transactions
contemplated hereby.

          (g) Information. St. George has received all the information it considers necessary
or appropriate for deciding whether to purchase the Preferred Shares. St. George further
represents that it has had an opportunity to

23

 

ask questions and receive answers from the Company regarding the Preferred Shares and
the business, properties, prospects and financial condition of the Company and to obtain
additional information (to the extent the Company possessed such information or could
acquire it without unreasonable effort or expense) necessary to verify the accuracy of any
information furnished to it or to which it had access.

          (h) Financial Experience. St. George is an “accredited investor” as that term is
defined in Rule 501 of Regulation D promulgated under the Securities Act, and experienced
in evaluating and investing in private placement transactions of securities of companies in
a similar stage of development and acknowledges that it is able to fend for itself, can
bear the economic risk of its investment, and has such knowledge and experience in
financial and business matters that it is capable of evaluating the merits and risks of the
investment in the Preferred Shares. St. George also represents that it has not been
organized for the purpose of acquiring the Preferred Shares.

ARTICLE XIV.

NOTICE

          SECTION 14.1 Notice. All notices, consents, requests, instructions, approvals and
other communications provided for herein and all legal process in regard hereto shall be in
writing and shall be deemed to have been delivered (i) five (5) Business Days after being mailed
by registered mail (return receipt requested and postage prepaid) to the recipient, (ii) one (1)
Business Day after being sent by overnight courier (receipt confirmation requested) or (iii) if
sent by facsimile transmission, on the date of such transmission, with a confirming copy
deposited in the United States mail, postage prepaid. All notices shall be addressed as follows,
or to such other address as any party hereto may from time to time designate in writing delivered
in a like manner.

If to Company:

United American Healthcare Corporation

300 River Place, Suite 4950

Detroit, Michigan 48207-4291

Attention: William Brooks, President

Facsimile: 313-393-3394

with a required copy to:

Honigman Miller Schwartz and Cohn LLP

2290 First National Building

660 Woodward Avenue

Detroit, Michigan 48226

Attention: Alex L. Parrish, Esq.

Facsimile: (313) 465-7513

24

 

If to St. George:

St. George Investments, LLC

c/o Fife Trading, Inc.

303 E. Wacker Drive, Suite 311

Chicago, IL 60601

Attention: John M. Fife, President

Facsimile: 312-819-9701

with a required copy to:

Lathrop & Gage LLC

100 North Riverside Plaza

Suite 2100

Chicago, IL 60606

Attention: Eric M. Fogel, Esq.

Facsimile: 312-920-3305

ARTICLE XV.

GENERAL PROVISIONS

          SECTION 15.1 Captions. The paragraph titles or captions contained in this Agreement
are for convenience only and shall not be deemed a part of this Agreement.

          SECTION 15.2 Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under applicable law, but if any
provision of this Agreement shall be unenforceable or invalid under applicable law, such
provision shall be ineffective only to the extent of such unenforceability or invalidity and the
remaining provisions of this Agreement shall continue to be binding and in full force and effect.

          SECTION 15.3 Entire Agreement. This Agreement constitutes the entire agreement
between the parties hereto relating to the subject matter hereof. No change, amendment or
modification of this Agreement shall be valid unless the same shall be in writing and signed by
the parties hereto.

          SECTION 15.4 Specific Performance. Each of the parties hereto acknowledges that a
breach by it of any provision contained in this Agreement will cause the other party to sustain
damage for which it would not have an adequate remedy at law for money damages, and therefore
each of the parties hereto agrees that in the event of any such breach, the aggrieved party shall
be entitled to the remedy of specific performance of such agreement and injunctive and other
equitable relief in addition to any other remedy to which it may be entitled, at law or in
equity. Each of Company and St. George irrevocably submit to the jurisdiction of the courts of

25

 

the State of Michigan and the federal courts located in the State of Michigan in respect of
the interpretation and enforcement of the provisions of this Agreement.

          SECTION 15.5 No Waiver. The failure of any party to insist, in one or more
instances, on performance by any other in strict accordance with the terms and conditions of this
Agreement shall not be deemed a waiver or relinquishment of any right granted hereunder or of the
future performance of any term or condition of this Agreement unless such waiver or
relinquishment is contained in writing signed by or on behalf of any such party. The remedies in
this Agreement are cumulative and are not exclusive of any other remedies provided by law or in
equity.

          SECTION 15.6 Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Michigan.

          SECTION 15.7 Assignment. Except as otherwise provided herein, no party hereto may
assign its or his rights or delegate its or his duties hereunder without the prior written
consent of the other parties.

          SECTION 15.8 Binding Effect. Except as otherwise provided herein, this Agreement
shall inure to the benefit of, and be binding upon, the parties hereto and their respective
heirs, personal representatives, successors and, to the extent permitted hereby, assigns.

          SECTION 15.9 Attorneys Fees. In the event any action is instituted by a party
hereto regarding the construction of any term herein or to recover damage because of the breach
of any term of this Agreement, the prevailing party in such action shall be entitled to
reasonable reimbursement from the non-prevailing party, including, but not limited to attorneys’
fees, costs and expenses incurred as a result thereof.

          SECTION 15.10 Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed to be an original and all of which taken together
shall constitute a single instrument.

          SECTION 15.11 Survival. The representations, warranties and indemnification
agreements made in this Agreement, and any liability for breach of any agreement or any
inaccuracy of or omission from any representation or warranty under this Agreement shall survive
the termination of this Agreement.

[signature page follows]

26

 

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

	 	 	 	 	 	 	 
	 	 	COMPANY:	 	 
	 
	 	 	 	 	 	 
	 	 	United American Healthcare Corporation,	 	 
	 	 	a Michigan corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ William C. Brooks
 

William C. Brooks, President and
Chief Executive Officer
	 	 
	 
	 	 	 	 	 	 
	 	 	ST. GEORGE:	 	 
	 
	 	 	 	 	 	 
	 	 	St. George Investments, LLC,	 	 
	 	 	an Illinois limited liability company	 	 
	 
	 	 	 	 	 	 
	 	 	By: Fife Trading, Inc.,	 	 
	 	 	an Illinois corporation, its Manager	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ John M. Fife
 

John M. Fife, President
	 	 

27

 

EXHIBIT A

CERTIFICATE OF DESIGNATIONS,

PREFERENCES AND RIGHTS

of

SERIES A CONVERTIBLE PREFERRED STOCK

of

UNITED AMERICAN HEALTHCARE CORPORATION

(Pursuant to Section 450.1302 of the Michigan Business Corporation Act)

     United American Healthcare Corporation (the “Company”), a corporation organized and existing
under the Michigan Business Corporation Act, as amended (the “Michigan Act”), hereby certifies
that, pursuant to authority granted by Article III of the Restated Articles of Incorporation of the
Corporation, as amended, and in accordance with the provisions of Section 450.1302 of the Michigan
Act, the Board of Directors of the Company (the “Board of Directors” or the “Board”) has adopted
the following resolutions, at a meeting duly called and held on                      ___,                     :

     RESOLVED, that there is hereby established a series of Preferred Stock (the “Preferred
Stock”), no par value per share, and the designation and certain terms, powers, preferences and
relative, participating and other rights and certain qualifications, limitations and restrictions
thereon, are hereby fixed as follows:

Capitalized terms used and not otherwise immediately defined are defined in Section 10.

     1. Designation and Amount. The series of Preferred Stock shall be designated as Series A
Convertible Preferred Stock (the “Series A Convertible Preferred Stock”) and the number of shares
so designated shall be                      plus                     shares to enable the Company to satisfy all dividends
that may accrue hereunder.

     2. Stated Value. The stated value of each issued share of Series A Convertible Preferred
Stock shall be deemed to be $1.00 (the “Stated Value”).

     3. Dividends. When, as and if declared by the Board of Directors and to the extent permitted
by the Michigan Business Corporation Act, the Company shall pay preferential dividends to the
holders of shares of Series A Convertible Preferred Stock in the form of cash or additional shares
of Series A Convertible Preferred Stock, at the Company’s election. Regardless of whether
dividends are paid, dividends on each share of Series A Convertible Preferred Stock outstanding
from time to time shall accrue on a quarterly basis at the rate of 3% per annum on the Stated Value
of the shares of Series A Convertible Preferred Stock plus the amount of any accrued and unpaid
dividends calculated from the Original Issue Date of such share through the most recently preceding
Quarterly Dividend Reference Date. The “Quarterly Dividend Reference Dates” are each March 1, June
1, September 1 and December 1 occurring after the Original Issue Date and on or prior to the
Conversion Date (as defined below). Dividends shall be paid only as and when declared by the Board
of Directors to holders of record at the close of the

A-1

 

Quarterly Dividend Reference Dates with respect to which the dividend has been declared and
cash or certificates for such dividend shall be distributed to such holders within ten (10)
calendar days after such record date as the Board of Directors may establish. Dividends shall
begin to accrue on shares of Series A Convertible Preferred Stock issued as dividends as of the day
following the record date for their issuance regardless of the actual distribution of a
certificate. All dividends that have been accrued but not declared shall continue to accrue and
accumulate as provided herein. All dividends that have been accrued and declared shall be paid as
provided herein and dividends on such shares shall begin to accrue as provided herein. Dividends
under this Section 3 shall cease to accrue on the Conversion Date. The number of shares to be paid
as a dividend pursuant to this Section 3 shall be rounded to the nearest whole share. All shares
of Series A Convertible Preferred Stock issued in payment of dividends hereunder shall be deemed
issued and outstanding on the applicable record date, and will thereupon be duly authorized,
validly issued, fully paid and nonassessable and free and clear of all liens and charges. The
Company shall at all times reserve for issuance 100,000 shares of Series A Convertible Preferred
Stock to enable it to satisfy all dividends that may accrue hereunder. Dividends paid in shares of
Series A Convertible Stock shall be delivered to the Holder within 30 days of each Quarterly
Dividend Reference Date in either physical certificate form or via electronic delivery.

     4. Voting.

     a) Voting Rights. Except as otherwise expressly provided herein or as required by
law, the holders of shares of Series A Convertible Preferred Stock shall not be entitled to
voting rights. Upon conversion of the shares of Series A Convertible Preferred Stock by
holders thereof into Common Stock, holders (to the extent of their Common Stock) shall be
entitled to voting rights pertaining to the Common Stock received upon such conversion.

     b) Limitations on Corporate Actions. Notwithstanding anything to the contrary in
Section 4.a) above, as long as any shares of Series A Convertible Preferred Stock are
outstanding, the Company shall not, without the written consent or affirmative vote of the
holders of no-less than sixty-six and two-thirds percent (66 2/3%) of the then-outstanding
Stated Value of the Series A Convertible Preferred Stock consenting or voting (as the case
may be) as a separate class from the Common Stock, either directly or by amendment, merger,
consolidation or otherwise:

     i) amend its articles of incorporation in any manner that adversely affects
the rights of the Holders;

     ii) alter or change adversely the voting or other powers, preferences, rights,
privileges, or restrictions of the Series A Convertible Preferred Stock contained
herein or alter or amend this Certificate of Designation;

     iii) increase the authorized number of shares of Preferred Stock or Series A
Convertible Preferred Stock or reinstate or issue any other

A-2

 

series of preferred stock; provided that the Company may increase the
authorized number of shares of Preferred Stock in connection with, and may
reinstate or issue, Junior Stock;

     iv) redeem, purchase or otherwise acquire directly or indirectly any Junior
Stock or any shares pari passu with the Series A Convertible Preferred Stock;

     v) directly or indirectly pay or declare any dividend or make any distribution
in respect of, any Junior Stock, or set aside any monies for the purchase or
redemption (through a sinking fund or otherwise) of any Junior Stock or any shares
pari passu with the Series A Convertible Preferred Stock;

     vi) authorize or create any class of stock ranking as to dividends, redemption
or distribution of assets upon a Liquidation (as defined in Section 5) senior to or
otherwise pari passu with the Series A Convertible Preferred Stock; or

     vii) enter into any agreement with respect to any of the foregoing.

     5. Liquidation, Dissolution, or Winding-Down. In the event of a liquidation, dissolution or
winding up of the Company, whether voluntary or involuntary (a “Liquidation”), the holders of
shares of Series A Convertible Preferred Stock then outstanding shall be entitled to receive out of
the available assets of the Company an amount on such date equal to the Stated Value of the shares
of Series A Convertible Preferred Stock, plus the amount of any accrued and unpaid dividends as of
such date, and any declared but unpaid dividends as of such date (collectively, the “Liquidation
Preference”). Such payment shall be made before any payment shall be made or any assets
distributed to the holders of any class or series of the Common Stock or any other class or series
of the Company’s capital stock ranking junior as to liquidation rights to the Series A Convertible
Preferred Stock. If upon any Liquidation the assets available for payment of the Liquidation
Preference are insufficient to permit the payment to the holders of the shares of Series A
Convertible Preferred Stock of the full preferential amounts described in this paragraph, then all
the remaining available assets shall be distributed pro rata among the holders of the then
outstanding shares of Series A Convertible Preferred Stock.

     6. Conversion. The holders of Series A Convertible Preferred Stock shall have the conversion
rights as follows.

     a) Right to Convert. Each share of Series A Convertible Preferred Stock shall be
convertible, at the option of the holder thereof, at any time after the Original Issue
Date, and without the payment of additional consideration by the holder thereof, into such
number of fully-paid and nonassessable shares of Common Stock as is determined by dividing
the Stated Value per share by the

A-3

 

Conversion Price in effect at the time of conversion. The “Conversion Price” per
share shall be equal to the Stated Value per share, subject to adjustment as provided in
Section 7. Shares of Series A Convertible Preferred Stock converted into Common Stock or
redeemed in accordance with the terms hereof shall be canceled and shall not be reissued.

     b) Holders shall effect conversions by providing the Company with the form of
conversion notice attached hereto as Annex A (a “Notice of Conversion”). Each Notice of
Conversion shall specify the number of shares of Series A Convertible Preferred Stock to be
converted, the number of shares of Series A Convertible Preferred Stock owned prior to the
conversion at issue, the number of shares of Series A Convertible Preferred Stock owned
subsequent to the conversion at issue and the date on which such conversion is to be
effected, which date may not be prior to the date the applicable Holder delivers such
Notice of Conversion to the Company (such date, the “Conversion Date”). The Notice of
Conversion shall be deemed to have been delivered (i) five (5) Business Days after being
mailed by registered mail (return receipt requested and postage prepaid) to the recipient,
(ii) one (1) Business Day after being sent by overnight courier (receipt confirmation
requested) or (iii) if sent by facsimile transmission, on the date of such transmission,
with a confirming copy deposited in the United States mail, postage prepaid. If no
Conversion Date is specified in a Notice of Conversion, the Conversion Date shall be the
date that such Notice of Conversion to the Company is deemed delivered hereunder. To
effect conversions of shares of Series A Convertible Preferred Stock, a Holder shall not be
required to surrender the certificate(s) representing such shares of Series A Convertible
Preferred Stock to the Company unless all of the shares of Series A Convertible Preferred
Stock represented thereby are so converted, in which case such Holder shall deliver the
certificate representing such shares of Series A Convertible Preferred Stock promptly
following the Conversion Date at issue.

Notwithstanding anything to the contrary contained herein, (i) if any conversion would
result in the issuance by the Company of more the 20% of the issued and outstanding shares
of Common Stock (prior to taking into account the conversion), and, (ii) if at the time of
conversion, any exchange where the Common Stock is listed or quoted requires shareholder
approval prior to the issuance of more than 20% of the issued and outstanding shares, then,
prior to the issuance of any Common Stock that would exceed the 20% threshold, a
shareholders meeting shall be convened to vote upon whether the Company may issue the
shares above the 20% threshold.

     c) Fractional Shares. No fractional shares of Common Stock shall be issued upon
conversion of the Series A Convertible Preferred Stock. Any fractional shares to which the
holder would otherwise be entitled shall be rounded to the nearest whole share. Whether or
not fractional shares would be issuable upon such conversion shall be determined on the
basis of the total number of shares of Series A Convertible Preferred Stock the holder is
at the time converting into Common Stock and the aggregate number of shares of Common Stock
issuable upon such conversion.

A-4

 

     d) Mechanics of Conversion.

     i) Delivery of Certificate Upon Conversion. Not later than five (5) Trading
Days after each Conversion Date (the “Share Delivery Date”), the Company shall
deliver, or cause to be delivered, to the converting Holder a certificate or
certificates representing the number of shares of Common Stock being acquired upon
the conversion of shares of Series A Convertible Preferred Stock. If in the case
of any Notice of Conversion such certificate or certificates are not delivered to
or as directed by the applicable Holder by the fifth (5th) Trading Day after the
Conversion Date, the applicable Holder shall be entitled to elect by written notice
to the Company at any time on or before its receipt of such certificate or
certificates, to rescind such Conversion Notice by written notice to the Company,
in which event the Company shall promptly return to such Holder any original Series
A Convertible Preferred Stock certificate delivered to the Company and such Holder
shall promptly return any Common Stock certificates representing the shares of
Series A Convertible Preferred Stock tendered for conversion to the Company.

     ii) Obligation Absolute; Damages. The Company’s obligation to issue and
deliver the Conversion Shares upon conversion of Series A Convertible Preferred
Stock in accordance with the terms hereof are absolute and unconditional,
irrespective of any action or inaction by a Holder to enforce the same, any waiver
or consent with respect to any provision hereof, the recovery of any judgment
against any Person or any action to enforce the same, or any setoff, counterclaim,
recoupment, limitation or termination, or any breach or alleged breach by such
Holder or any other Person of any obligation to the Company; provided, however,
that such delivery shall not operate as a waiver by the Company of any such action
that the Company may have against such Holder. If the Company fails to deliver to
a Holder such certificate or certificates pursuant to this Section on the fifth
(5th) Trading Day after the Share Delivery Date applicable to such conversion, it
shall be deemed to be an Event of Default, as defined below.

     e) Reservation of Shares Issuable Upon Conversion. The Company covenants that it will
at all times reserve and keep available out of its authorized and unissued shares of Common
Stock for the sole purpose of issuance upon conversion of the Series A Convertible
Preferred Stock, free from preemptive rights or any other actual contingent purchase rights
of Persons other than the Holders of the Series A Convertible Preferred Stock, not less
than such aggregate number of shares of the Common Stock as shall (subject to the terms and
conditions in the Securities Purchase Agreement) be issuable upon the conversion of all
outstanding shares of Series A Convertible Preferred Stock. The Company covenants that all
shares of Common Stock that shall be so issuable shall, upon issue, be duly authorized,
validly issued, fully paid and nonassessable.

     7. Certain Adjustments.

A-5

 

     a) Stock Dividends and Stock Splits. If the Company, at any time while this Series A
Convertible Preferred Stock is outstanding: (A) pays a stock dividend or otherwise makes a
distribution or distributions payable in shares of Common Stock on shares of Common Stock
or any other Common Stock Equivalents (which, for avoidance of doubt, shall not include any
shares of Common Stock issued by the Company upon conversion of, or payment of a dividend
on, this Series A Convertible Preferred Stock); (B) subdivides outstanding shares of Common
Stock into a larger number of shares; (C) combines (including by way of a reverse stock
split) outstanding shares of Common Stock into a smaller number of shares; or (D) issues,
in the event of a reclassification of shares of the Common Stock, any shares of capital
stock of the Company, then the Conversion Price shall be multiplied by a fraction of which
the numerator shall be the number of shares of Common Stock outstanding immediately before
such event and of which the denominator shall be the number of shares of Common Stock
outstanding immediately after such event. Any adjustment made pursuant to this Section 7.a)
shall become effective immediately after the record date for the determination of
shareholders entitled to receive such dividend or distribution and shall become effective
immediately after the effective date in the case of a subdivision, combination or
re-classification.

     b) Fundamental Transaction. If, at any time while the Series A Convertible Preferred
Stock is outstanding, (i) the Company effects any merger or consolidation of the Company
with or into another Person, (ii) the Company effects any sale of all or substantially all
of its assets in one transaction or a series of related transactions, (iii) any tender
offer or exchange offer (whether by the Company or another Person) is completed pursuant to
which holders of Common Stock are permitted to tender or exchange their shares for other
securities, cash or property, or (iv) the Company effects any reclassification of the
Common Stock or any compulsory share exchange pursuant to which the Common Stock is
effectively converted into or exchanged for other securities, cash or property (in any such
case, a “Fundamental Transaction”), then, upon any subsequent conversion of this Series A
Convertible Preferred Stock, the Holders shall have the right to receive, for each
Conversion Share that would have been issuable upon such conversion immediately prior to
the occurrence of such Fundamental Transaction, the same kind and amount of securities,
cash or property as it would have been entitled to receive upon the occurrence of such
Fundamental Transaction if it had been, immediately prior to such Fundamental Transaction,
the holder of one share of Common Stock (the “Alternate Consideration”). For purposes of
any such conversion, the determination of the Conversion Price shall be appropriately
adjusted to apply to such Alternate Consideration based on the amount of Alternate
Consideration issuable in respect of one share of Common Stock in such Fundamental
Transaction, and the Company shall apportion the Conversion Price among the Alternate
Consideration in a reasonable manner reflecting the relative value of any different
components of the Alternate Consideration. If holders of Common Stock are given any choice
as to the securities, cash or property to be received in a Fundamental Transaction, then
the Holders shall be given the same choice as to the Alternate Consideration the Holders
receive upon any conversion of this Series A Convertible Preferred Stock following such
Fundamental Transaction.

A-6

 

     c) Calculations. All calculations under this Section 7 shall be made to the nearest
cent or the nearest whole share, as the case may be. For purposes of this Section 7, the
number of shares of Common Stock deemed to be issued and outstanding as of a given date
shall be the sum of the number of shares of Common Stock issued and outstanding.

     d) Notice to the Holders.

     i) Adjustment to Conversion Price. Whenever the Conversion Price is adjusted
pursuant to any provision of this Section 7, the Company shall promptly mail to
each Holder a notice setting forth the Conversion Price after such adjustment and
setting forth a brief statement of the facts requiring such adjustment.

     ii) Notice to Allow Conversion by Holder. If (A) the Company shall declare a
dividend (or any other distribution in whatever form) on the Common Stock, (B) the
Company shall declare a special nonrecurring cash dividend on or a redemption of
the Common Stock, (C) the Company shall authorize the granting to all holders of
the Common Stock of rights or warrants to subscribe for or purchase any shares of
capital stock of any class or of any rights, (D) the approval of any shareholders
of the Company shall be required in connection with any reclassification of the
Common Stock, any consolidation or merger to which the Company is a party, any sale
or transfer of all or substantially all of the assets of the Company, or any
compulsory share exchange whereby the Common Stock is converted into other
securities, cash or property or (E) the Company shall authorize the voluntary or
involuntary dissolution, liquidation or winding up of the affairs of the Company,
then, in each case, the Company shall cause to be filed at each office or agency
maintained for the purpose of conversion of this Series A Convertible Preferred
Stock, and shall cause to be delivered to each Holder at its last address as it
shall appear upon the stock books of the Company, at least ten (10) calendar days
prior to the applicable record or effective date hereinafter specified, a notice
stating (x) the date on which a record is to be taken for the purpose of such
dividend, distribution, redemption, rights or warrants, or if a record is not to be
taken, the date as of which the holders of the Common Stock of record to be
entitled to such dividend, distributions, redemption, rights or warrants are to be
determined or (y) the date on which such reclassification, consolidation, merger,
sale, transfer or share exchange is expected to become effective or close, and the
date as of which it is expected that holders of the Common Stock of record shall be
entitled to exchange their shares of the Common Stock for securities, cash or other
property deliverable upon such reclassification, consolidation, merger, sale,
transfer or share exchange, provided that the failure to deliver such notice or any
defect therein or in the delivery thereof shall not affect the validity of the
corporate action required to be specified in such notice. The Holder is entitled to
convert the Series A Convertible Preferred Stock (or any part hereof) during the
ten (10) day period commencing on the date of such notice through the effective
date of the event triggering such notice.

A-7

 

     8. Preferred Put Option.

     a) Option. During the period beginning on the Put Commencement Date and terminating
one hundred and eighty (180) days thereafter (the “Put Exercise Period”) a holder shall
have the right and option on up to three (3) occasions (the “Preferred Put Option”),
exercisable from time to time by written notice (the “Put Notice”) delivered to Company by
registered mail, overnight courier or facsimile stating that the Holder intends to exercise
its rights, to sell to Company and to cause Company to purchase from the Holder any or all
shares of Series A Convertible Preferred Stock then held by the Holder, on an as-converted
basis, for an aggregate purchase price equal to the Put Price. The number of as-converted
shares (the “Put Shares”) shall be equal to the Stated Value per share divided by
Conversion Price per share, multiplied by the number of shares of Series A Convertible
Preferred Stock being put to the Company. The Put Notice shall also specify the Put
Closing Date. The Put Notice shall be deemed to have been delivered (i) five (5) Business
Days after being mailed by registered mail (return receipt requested and postage prepaid)
to the recipient, (ii) one (1) Business Day after being sent by overnight courier (receipt
confirmation requested) or (iii) if sent by facsimile transmission, on the date of such
transmission, with a confirming copy deposited in the United States mail, postage prepaid.
If a Holder fails to deliver a Put Notice during the Put Exercise Period, the Holder shall
have forfeited the Preferred Put Option. Each time that a Holder exercises the Preferred
Put Option, the number of Put Shares shall be at least ten percent (10%) of the shares of
Series A Convertible Preferred Stock then held by the Holder.

     b) Elimination of the Preferred Put Option. After the SEC Effective Date, the
Preferred Put Option shall be eliminated if the Company creates Shareholder Value.
“Shareholder Value” is defined as the occurrence of one or both of the following: (i) if
following the SEC Effective Date, within any rolling 90 trading day period (in which the
Registration Statement is continuously effective) the average of the 30 highest Volume
Weighted Average Prices (not required to be consecutive) of the Common Stock is greater
than $2.21, or (ii) if following the SEC Effective Date, within any rolling 90 trading day
period (in which the Registration Statement is continuously effective) the average Volume
Weighted Average Price of the Common Stock for 20 consecutive trading days is greater than
$2.21. For the avoidance of doubt, all of the days in the computation of (i) and (ii)
above shall fall within a period when the Registration Statement is continuously effective.

     c) Acceleration of the Preferred Put Option. Upon the occurrence of an Event of
Default, the Holder shall send a notice of default to Company. The notice of default shall
include the default date. If the default is not cured within any applicable cure period,
the Put Commencement Date shall accelerate to the later of (x) the default date specified
in the notice if there is no cure period or (y) the last date of any applicable cure
period.

A-8

 

     d) Put Price. For purposes hereof, with respect to each exercise of the Preferred Put
Option, the term “Put Price” shall mean the Put Price Per Share multiplied by the number of
Put Shares.

     e) Put Price Per Share. The “Put Price Per Share” shall be equal to the Market Price.

     f) Put Closing Date. The Holder shall fix the date (a “Put Closing Date”) for the
exercise of a Preferred Put Option no earlier than ten (10) but not more than thirty (30)
Business Days after the Put Notice is deemed to be delivered.

     g) Closing Deliveries. On the Put Closing Date, the Holder will deliver the
certificates representing the Put Shares or deliver electronically (if physical delivery,
duly endorsed for transfer by the Holder or accompanied by duly executed stock powers in
blank) to Company, and Company shall deliver payment of the Put Price in cash by wire
transfer of immediately available funds to an account at a bank designated by the Holder.

     h) Non-compliance. If the Company does not honor the Preferred Put Option and comply
with the terms of this Section 8, interest shall be due and payable on the portion of the
Put Price not paid at an annual rate of eighteen percent (18%) payable monthly in cash.

     9. Preferred Call Option.

     a) Option. During the period beginning on the Effective Date and terminating on
September 30, 2011 (the “Call Exercise Period”) Company shall have the right and option
(the “Preferred Call Option”), exercisable by written notice (the “Call Notice”) delivered
to a Holder by registered mail, overnight courier or facsimile stating that Company intends
to exercise its rights to purchase from the Holder and to cause the Holder to sell to
Company all, but not less than all, of the shares of Series A Convertible Preferred Stock
then held by the Holder on an as-converted basis, for an aggregate purchase price equal to
the Call Price. The number of as-converted shares (the “Call Shares”) shall be equal to
the Stated Value per share divided by the Conversion Price per share, multiplied by the
number of shares Series A Convertible Preferred Stock being called by the Company (which
shall not be less than all of the Series A Convertible Preferred Stock). The Call Notice
shall also specify the Call Closing Date. The Call Notice shall be deemed to have been
delivered (i) five (5) Business Days after being mailed by registered mail (return receipt
requested and postage prepaid) to the recipient, (ii) one (1) Business Day after being sent
by overnight courier (receipt confirmation requested) or (iii) if sent by facsimile
transmission, on the date of such transmission, with a confirming copy deposited in the
United States mail, postage prepaid. If Company fails to deliver a Call Notice during the
Call Exercise Period, Company shall have forfeited the Preferred Call Option.

A-9

 

     b) Elimination of the Preferred Call Option. The Preferred Call Option shall be
eliminated upon the earliest to occur of: (i) the Preferred Put Option is eliminated
pursuant to Section 8.b), (ii) the Put Commencement Date is accelerated pursuant to Section
8.c), (iii) October 1, 2011, (iv) the Company’s execution of a letter of intent for a
Business Combination, (v) the Company’s execution of definitive documents for a Business
Combination and (vi) the Company’s public announcement (by press release, filing of a
Current Report on Form 8-K or other similar means) that it intends to consummate a Business
Combination.

     c) Call Price. For purposes hereof, the term “Call Price” shall mean the Call Price
Per Share multiplied by the number of Call Shares.

     d) Call Price Per Share. If the Call Closing Date occurs during the period beginning
on the Effective Date and ending on June 30, 2011, the Call Price Per Share shall be equal
to the Market Price less ten percent (10%). If the Call Closing Date occurs during the
period beginning on July 1, 2011 and ending on September 30, 2011, the Call Price Per Share
shall be equal to the Market Price.

     e) Call Closing Date. Company shall fix the date (the “Call Closing Date”) for the
exercise of the Preferred Call Option no earlier than ten (10) but not more than thirty
(30) Business Days after the Call Notice is deemed to be delivered.

     f) Closing Deliveries. On the Call Closing Date, the Holder will deliver the
certificates representing the Call Shares or deliver electronically (if physical delivery,
duly endorsed for transfer by the Holder or accompanied by duly executed stock powers in
blank) to Company, and Company shall deliver payment of the Call Price in cash by wire
transfer of immediately available funds to an account at a bank designated by Company.

     g) Section 16 Compliance. Company shall not exercise the Preferred Call Option at any
time that would result in the Holder incurring short swing profit liability to permit the
recapture of profits by the Company pursuant to Section 16 of the Exchange Act involving an
equity security in a transaction within a period of 6 months.

     10. Definitions. As used herein, the following terms shall have the following meanings:

     “Affiliate” means, with respect to any Person, any other Person that directly, or indirectly
through one or more intermediaries, Controls, is Controlled By or is Under Common Control With,
such specified Person.

     “Bankruptcy Event” means any of the following events: (a) the Company or any Significant
Subsidiary (as such term is defined in Rule 1-02(w) of Regulation S-X) thereof

A-10

 

commences a case or other proceeding under any bankruptcy, reorganization, arrangement,
adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or similar law of any
jurisdiction relating to the Company or any Significant Subsidiary thereof; (b) there is commenced
against the Company or any Significant Subsidiary thereof any such case or proceeding that is not
dismissed within sixty (60) days after commencement; (c) the Company or any Significant Subsidiary
thereof is adjudicated.

     “Business Combination” means any acquisition by the Company of substantially all of the
outstanding shares or assets of a Person (including an unincorporated division or business) or the
acquisition of substantially all of the outstanding shares or assets of the Company, in each case,
whether by stock or asset purchase, merger, consolidation, share exchange or other business
combination.

     “Business Day” means a day on which federally-chartered banks are open for business in
Illinois and Michigan.

     “Common Stock” means the shares of common stock of the Company.

     “Common Stock Equivalents” means any securities of the Company or the Subsidiaries which would
entitle the holder thereof to acquire at any time Common Stock, including, without limitation, any
debt, preferred stock, rights, options, warrants or other instrument that is at any time
convertible into or exchangeable for, or otherwise entitles the holder thereof to receive, Common
Stock.

     “Control” (including the terms “Controlled By” and “Under Common Control With”) means the
possession, directly or indirectly, of the power to direct or cause the direction of management,
policies or activities of a Person, whether through the ownership of voting securities or other
interests, by contract or otherwise.

     “Conversion Shares” means, collectively, the shares of Common Stock issuable upon conversion
of the shares of Series A Convertible Preferred Stock in accordance with the terms hereof.

     “Effective Date” means the date of filing of this Certificate of Designations.

     “Event of Default” means the occurrence of any of the following (each an “Event of Default”):

     (a) From the Put Commencement Date until the earlier of (i) the expiration of the Put
Exercise Period or (ii) the Company’s payment in full of the Put Obligations, if the
Company violates one or more of the following covenants, and such violation is not cured by
Company within ten (10) days of receipt of notice of the violation:

     (i) Company shall not enter into any agreement that would interfere with this
Certificate of Designation (e.g. a loan agreement that restricts equity redemptions
or dividends);

     (ii) Company shall not permit its unrestricted cash to fall below twenty
percent (20%) of Shareholders Equity (as measured in the Company’s audited
financial statements for Fiscal Year 2010). Company

A-11

 

shall provide the Holder with a pro forma estimate of Shareholders Equity as
June 30, 2010. For purposes of this paragraph, the proceeds of a Holder’s purchase
of Series A Convertible Preferred Stock shall not be included within Shareholders’
Equity. After the Put Commencement Date, Company shall provide a certificate to
the Holder within ten (10) days after the end of each calendar month certifying
that Company is in compliance with the covenant contained in this paragraph;
provided that the certificate shall be based on the Company’s pro forma estimate of
Shareholders Equity as of June 30, 2010 (which shall be updated each month), until
the audited financial statements for Fiscal Year 2010 have been prepared

     (iii) In addition to (a)(ii) above, as restrictions are lifted from any
restricted cash on the Company’s balance sheet as reported in its quarterly report
for the quarter ending December 31, 2009, an additional amount of cash shall be
reserved for the purpose of honoring the Put Obligations, if and when the option is
exercised by the Holder; provided that the cash reserved pursuant to subsection
(a)(ii) together with the cash reserved pursuant to this subsection (a)(iii) shall
not exceed the Put Obligations. If Shares are acquired after the Effective Date
that are subject to either the Put Option or Preferred Put Option, then Holder
shall notify the Company in writing (with the filing of Form 4’s with the SEC
constituting sufficient notice), and the Company shall have two months to set aside
sufficient cash to satisfy the Put Obligations with respect to these Shares, and
the Company shall certify as to compliance with the foregoing in its monthly
compliance certificates referred to in (ii) above. After achieving compliance with
the cash set aside requirements in each instance, the Company shall thereafter
maintain sufficient cash to satisfy 100% of the Put Obligations until the earlier
of the expiration of the Put Exercise Period or the Company’s payment in full of
the Put Obligations. If the Holder elects in writing not to exercise the Preferred
Put Option, or if the Preferred Put Option expires in accordance with its terms,
the Company shall be permitted to use this cash for any other operating purpose.

     (iv) After any Put Commencement Date, the Company shall maintain sufficient
liquidity and cash resources to be able to honor the Preferred Put Option in
compliance with Section 345 of the Michigan Business Corporation Act of 1972, as
amended, or any other applicable successor statute; and

     (v) In lieu of maintaining the covenant contained in (ii) above, the Company
may provide a letter of credit in the amount of the Put Price, that names the
Holder as the account beneficiary, and in a form acceptable to the Holder
exercising reasonable judgment, or otherwise establish a segregated and dedicated
account containing an amount equal to the Put Price that is specially and
exclusively reserved for the benefit of the Holder if and when it elects to
exercise the Preferred Put Option.

     (b) Company fails to deliver to a Holder a certificate or certificates pursuant to a
conversion request pursuant to Section 6(d)(ii) of this certificate within five (5) Trading
Days after the Share Delivery Date, or the Company

A-12

 

otherwise breaches this Certificate of Designation which breach is not cured by
Company within ten (10) days of receipt of notice of breach;

     (c) Company becomes insolvent or generally fails to pay, or admits in writing its
inability to pay debts as they become due, a petition under any section or chapter of the
Bankruptcy Reform Act of 1978 or any similar law or regulation is filed by or against
Company (provided, however, that if the filing of a Bankruptcy petition is involuntary,
Company shall have 30 days from the date of filing to have said petition dismissed), or
Company shall make an assignment for the benefit of creditors;

     (d) A judgment is entered by a court of competent jurisdiction against Company in
excess of two million dollars ($2,000,000) which is not stayed or discharged within sixty
(60) days, and the Company does not have sufficient cash on hand to honor the Preferred Put
Option;

     (e) The Company becomes delinquent in its periodic reporting requirements under
Section 13 of the Exchange Act that has the effect to bar any prospective selling
shareholder from reliance on Rule 144 of the Securities Act or to preclude the use of an
effective Registration Statement; or

     (f) The Common Shares are delisted from a national securities exchange, NASDAQ, or
fail to be quoted on the OTC Bulletin Board.

     “Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder, or any similar successor statute.

     “Fiscal Year 2010” means the fiscal year of the Company ending on June 30, 2010.

     “Holder” means a holder of Series A Convertible Preferred Stock.

     “Junior Stock” means the Common Stock and all other securities of the Company, including
Common Stock Equivalents of the Company other than those securities which are explicitly senior or
pari passu to the Series A Convertible Preferred Stock in dividend rights or liquidation
preference.

     “Market Price” means the volume weighted average of the closing prices during a 30 calendar
day period immediately preceding the Effective Date of a share of the Company’s capital stock on
the principal United States securities exchange registered under the Exchange Act on which such
stock is listed.

     “Original Issue Date” means the date the Company initially issues the shares of Series A
Convertible Preferred Stock, regardless of the number of times transfer of such share is made on
the stock records maintained by or for the Company and regardless of the number of certificates
which may be issued to evidence such shares.

     “Person” means any individual, corporation, partnership, association, limited liability
company, trust, estate, or other entity.

A-13

 

     “Put Commencement Date” means October 1, 2011 (subject to acceleration pursuant to Section
8.c)).

     “Put Obligations” means Company’s obligations under the Preferred Put Option plus the put
option held by the Holder on Common Stock.

     “Registration Statement” means any registration statement of the Company under the Securities
Act, including any amendment thereto, required to be filed by the Company with respect to the
Conversion Shares.

     “Rule 144” means Rule 144 promulgated under the Securities Act or any other similar rule or
regulation of the SEC that may at any time permit a holder of any securities to sell securities of
the Company to the public without registration under the Securities Act.

     “SEC” means the United States Securities and Exchange Commission or any other federal agency
at the time administering the Securities Act or the Exchange Act.

     “SEC Effective Date” means the date a Registration Statement is declared effective by the SEC.

     “Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations
thereunder, or any similar successor statute.

     “Shareholders’ Equity” means shareholders equity as defined by Generally Accepted Accounting
Principles and as reported on the Company’s audited financial statements prepared in accordance
with past practices.

     “Subsidiary” means any corporation, association, partnership, limited liability company or
other business entity of which more than fifty percent (50%) of the total voting power is, at the
time, owned or controlled, directly or indirectly, by the Company or one or more of the other
Subsidiaries of the Company or a combination thereof.

     “Trading Day” means a day on which the Common Stock is traded on a Trading Market.

     “Trading Market” means the following exchanges on which the Common Stock is listed for trading
on the date in question: the New York Stock Exchange, the Nasdaq Capital Market or the Nasdaq
Global Market, the NYSE Amex, the OTCBB, or Pink Sheets.

     “Volume Weighted Average Price” or “VWAP” means, for any security as of any date, the dollar
volume-weighted average price for such security on the principal trading market during the period
beginning at 9:30:01 am., New York City time (or such other time as the principal trading market
publicly announces is the official open of trading), and ending at 4:00:00 p.m., New York City time
(or such other time as the principal trading market publicly announces is the official close of
trading) as reported by the Reporting Service (as defined below) through its ‘Volume at Price’
functions, or, if the foregoing does not apply, the dollar volume-weighted average price of such
security in the over-the-counter market on the electronic bulletin board for such security during
the period beginning at 9:30:01 a.m., New York City time (or such other time as the principal
trading

A-14

 

market publicly announces is the official open of trading), and ending at 4:00:00 p.m., New
York City time (or such other time as the principal trading market publicly announces is the
official close of trading), as reported by the Reporting Service, or, if no dollar volume-weighted
average price is reported for such security by the Reporting Service for such hours, the average of
the highest closing bid price and the lowest closing ask price of any of the market makers for such
security as reported in the “pink sheets” by Pink Sheets LLC (formerly the National Quotation
Bureau, Inc.). If the Volume Weighted Average Price cannot be calculated for a security on a
particular date on any of the foregoing bases, the Volume Weighted Average Price of such security
on such date shall be the fair market value as determined by the Company and the Holder. For
purposes of this section, “Reporting Service” means Bloomberg LP or if that service is not then
reporting the relevant information regarding the common stock, a comparable reporting service of
national reputation selected by the Holder and the Company.

     IN WITNESS WHEREOF, this Certificate of Designations has been executed by a duly authorized
officer of the Company on this ___th day of                     , ___.

	 	 	 	 	 
	 	United American Healthcare Corporation,

a Michigan corporation

 	 
	 	By:  	 	 
	 	 	William C. Brooks, President and 	 
	 	 	Chief Executive Officer 	 
	 

A-15

 

ANNEX A

NOTICE OF CONVERSION

(TO BE EXECUTED BY THE REGISTERED HOLDER IN ORDER TO CONVERT 
SHARES

OF SERIES A PREFERRED STOCK)

The undersigned hereby elects to convert the number of shares of Series A Convertible Preferred
Stock indicated below into shares of common stock, $.001 par value per share (the “Common
Stock”), of United American Healthcare Corporation, a Michigan corporation (the
"Company”), according to the conditions hereof, as of the date written below. If shares of
Common Stock are to be issued in the name of a Person other than the undersigned, the undersigned
will pay all transfer taxes payable with respect thereto and is delivering herewith such
certificates and opinions as may be required by the Company in accordance with the Certificate of
Designation. No fee will be charged to the Holders for any conversion, except for any such
transfer taxes.

Conversion calculations:

Date to Effect Conversion:

 

Number of shares of Series A Convertible Preferred Stock owned prior to Conversion:

 

Number of shares of Series A Convertible Preferred Stock to be Converted:

 

Stated Value of shares of Series A Convertible Preferred Stock to be Converted:

 

Applicable Conversion Price:

 

Number of shares of Preferred Stock subsequent to Conversion:

 

	 	 	 	 	 
	 	[HOLDER]

 	 
	 	 	 
	 	Name:  	 	 
	 	Title:  	 	 

A-16Exhibit 10.1

Exhibit 10.1

FIFTH AMENDMENT TO EXECUTIVE EMPLOYMENT AGREEMENT

This Fifth Amendment to Executive Employment Agreement (this “Amendment”) is entered into by
and between American Reprographics Company, a Delaware corporation (“ARC”) as the employer, and
Kumarakulasingam Suriyakumar, an individual residing in the State of California (“Executive”), as
the employee, on March 18, 2010.

WHEREAS, ARC and Executive entered into an Executive Employment Agreement dated January 7,
2005, as amended (“Agreement”), under which Executive is employed as Chief Executive Officer and
President of ARC. The parties now wish to enter into this Amendment to amend the Agreement.

Now, therefore, the parties agree as follows:

1. All capitalized terms in this Amendment not otherwise defined herein shall have the
meanings ascribed to them in the Agreement.

2. A new Section 3(a)(ii) is added to Section 3(a) of the Agreement (Base Salary) as follows:

“(ii) The amount of Base Salary payable to Executive pursuant to Section 3(a) shall
be reduced by ten percent (10%) (the “2010 Base Salary Reduction”) effective as of
January 1, 2010 through and including December 31, 2010 (the “Effective Period”).
Notwithstanding anything to the contrary contained in this Section 3(a)(ii), if
Executive’s employment with ARC is terminated other than for Cause during the
Effective Period, any Base Salary severance benefits payable to Executive under
Sections 12(a), (c) or (d) of the Agreement shall be calculated based on the amount
of Base Salary set forth in Section 3(a), without taking into account the 2010 Base
Salary Reduction.”

3. Except as specifically set forth in this Amendment, the Agreement remains in full force and
effect without modification.

IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the date first
hereinabove set forth.

	 	 	 	 	 
	 	AMERICAN REPROGRAPHICS COMPANY,

a Delaware corporation

 	 
	 	By:  	/s/ JONATHAN R. MATHER
 	 
	 	 	Name:  	Jonathan R. Mather 	 
	 	 	Title:  	Chief Financial Officer 	 
	 
	 	EXECUTIVE

 	 
	 	/s/ KUMARAKULASINGAM SURIYAKUMAR
 	 
	 	Kumarakulasingam Suriyakumar

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