Document:

EMPLOYEE AGREEMENT

EMPLOYEE AGREEMENT

THIS EMPLOYEE AGREEMENT made as of August 1, 2008, by and between Lightwave Logic, Inc., a Nevada corporation (the “Company”), whose principal place of business is at 2601 Annand Dr., #16, Wilmington, Delaware 19808; and James S. Marcelli (“Employee”), who resides at 4327 Cheyenne Drive, Larkspur, Colorado 80118.  

WHEREAS, the Company wishes to procure the services of Employee under the terms and conditions set forth and Employee wishes to be employed on these terms and conditions.

WHEREAS, the parties to this Employee Agreement wish to enter into a written expression of their relationship as Employer and Employee.

THEREFORE, in consideration of the agreements contained in this Employee Agreement, the parties, intending to be legally bound, agree as follows:

ARTICLE 1

Employment

1.1.

Employment. The Company agrees to employ Employee, and Employee accepts employment with the Company, on and subject to the terms and conditions set forth in this Employee Agreement. 

1.2.

Term.

Subject to the provisions for termination as provided in Article 9 of this Employee Agreement, the term of this agreement shall begin on August 1, 2008 and shall terminate 12 months thereafter. This Employee Agreement may be renewed for successive 12 month terms upon the written agreement of the parties hereto that shall be delivered by each party to the other not less than 60 days prior to the expiration of the existing term.

ARTICLE 2

Duties 

2.1.

Position and Duties. The Company agrees to employ Employee to act as its Chief Executive Officer. Employee shall be responsible for performing the duties as described on Appendix A attached hereto and made a part hereof. Employee agrees that he will serve the Company faithfully and to the best of his ability during the term of employment, under the direction of the board of directors of the Company. The Company and Employee may jointly from time to time to change the nature of Employee’s duties and job title.

2.2.

Time Devoted to Work.  Employee agrees that he will devote all of the necessary business time, attention, and energies, as well as Employee’s best talents and abilities to the business of the Company in accordance with the Company’s instructions and directions.  Employee may engage in other business activities unrelated to the Company during the term of this Employee Agreement so long as such other business activities do not interfere with the terms and conditions of this Employee Agreement.

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ARTICLE 3

Place of Employment

3.1.

Place of Employment.   Employee shall perform his duties under this Employee Agreement at 4327 Cheyenne Drive, Larkspur, Colorado 80118.

ARTICLE 4

Compensation of Employee

4.1. 

Base Compensation.  For all services rendered by Employee under this Employee Agreement, the Company agrees to pay Employee the rate of $14,500 per month, which shall be payable to Employee not less frequently than monthly, or as is consistent with the Company’s practice for its other employees.  

4.2.

Other Compensation.  Employee shall receive other compensation as more fully described on Appendix B, attached hereto and made a part hereof. 

4.3.

 Reimbursement for Business Expenses.  Subject to the approval of the Company, the Company shall promptly pay or reimburse Employee for all reasonable business expenses incurred by Employee in performing Employee’s duties and obligations under this Employee Agreement, but only if Employee properly accounts for expenses in accordance with the Company’s policies.

ARTICLE 5

Vacations and Other Paid Absences

5.1. 

Vacation Days.  Employee shall be entitled to the same paid vacation days each calendar year during the term of this Employee Agreement as authorized by the Company for its other employees.

5.2. 

Holidays.   Employee shall be entitled to the same paid holidays as authorized by the Company for its other employees.

5.3.

Sick Days and Personal Absence Days.  Employee shall be entitled to the same number of paid sick days and personal absence days as authorized by the Company for its other employees.

ARTICLE 6

Key Man Life Insurance

During the term of this Employee Agreement, the Company shall maintain in effect a key man life insurance policy on the life of Employee in the face amount of $1,000,000 or such higher amount as the Company shall in its sole discretion decide to maintain during the term of this Employee Agreement.  Any proceeds payable under the policy shall be paid to the Company.

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ARTICLE 7

Fringe Benefits

Employee shall be entitled to participate in and receive benefits from all of the Company’s employee benefit plans that are now, or in the future may be, maintained by the Company for its employees, including, without limitation, the Company’s health insurance plan. Notwithstanding Article 1.2 of this Employee Agreement, for health insurance plan purposes only, the Employee shall receive Company health insurance benefits (or credit compensation therefore) as if Employee’s employment commenced on July 1, 2008. No amounts paid to Employee from an employee benefit plan shall count as compensation due Employee as base salary or additional compensation.  Nothing in this Employee Agreement shall prohibit the Company from modifying or terminating any of its employee benefit plans in a manner that does not discriminate between Employee and other Company employees.

ARTICLE 8

Maintenance of Liability Insurance

So long as Employee shall serve as an executive officer of the Company pursuant to this Employee Agreement, the Company shall obtain and maintain in full force and effect a policy of director’s and officer’s liability insurance in reasonable amounts from an established and reputable insurer. In all policies of such insurance, Employee shall be named as an insured in such manner as to provide Employee the same rights and benefits as are accorded to the most favorably insured of the Company’s officers or directors. 

ARTICLE 9

Termination of Employment

9.1.

Termination of Employment. Employee’s employment hereunder shall automatically terminate upon (i) his death (ii) the expiration of the term of this Employee Agreement; or (iii) Employee voluntarily leaving the employ of the Company. In the event that Employee’s employment terminates upon his death and the key man life insurance is in effect pursuant to section 6 herein, then the Company will continue to pay the compensation described in section 4.1 to Employee’s estate through the remainder of term of this Employee Agreement, or 90 days, whichever is longer.  

9.2.

Termination For Employee’s Failure to Meet Performance Standard.  Employee’s employment with the Company shall terminate, at the Company’s discretion, upon 15 days prior written notice to Employee if the Company terminates his employment hereunder for "cause". For purposes hereof, "cause" shall include (i) Employee’s willful malfeasance, misfeasance, nonfeasance or gross negligence, (ii) any willful misrepresentation or concealment of a material fact made by Employee in connection with this Employee Agreement; (iii) the willful breach of any covenant made by Employee hereunder; or (iv) the failure of Employee to meet the performance standards more fully described in Appendix A attached hereto and made a part hereof.

Notwithstanding the above, if the Employee is terminated by the Company without cause, the Company shall be obligated to pay to Employee the compensation set forth in Section 4 

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hereof for the remainder of the term of this Employee Agreement.

ARTICLE 10

Confidential Information

10.1.

 Disclosures While Employed by the Company.  Employee acknowledges that, in performing the duties required by this Employee Agreement, Employee will be making use of, acquiring and adding to the confidential and proprietary information of the Company and/or those persons or entities directly or indirectly controlling or controlled by, or under direct or indirect common control with, the Company (each an “Affiliate” and collectively, the “Affiliates”), which (i) is of a special nature and value, (ii) is not public information or is not generally known or available to the Company’s and/or the Affiliates’ competitors, (iii) is known only by the Company and/or the Affiliates and those of their respective employees, independent contractors, consultants, suppliers, customers or agents to whom such data and information must be confided in order to apply it to the uses intended, and (iv) relates to matters such as, but not limited to, the Company’s and the Affiliates’ respective methods of operation, internal structure, financial affairs, programs, software, equipment and techniques, existing and contemplated facilities, products and services, know-how, inventions, systems, devices (whether or not patentable), methods, ideas, procedures, manuals, confidential studies and reports, lists of suppliers and customers and prospective suppliers and customers, financial information and practices, plans, pricing, selling techniques, sales and marketing programs and methods, names, addresses and telephone numbers of the Company’s and/or the Affiliates’ suppliers and customers, credit and financial data of the Company’s and/or the Affiliates’ suppliers and customers, particular business requirements of the Company’s and/or the Affiliates’ suppliers and customers, special methods and processes involved in designing, producing and selling the Company’s and/or the Affiliates’ products and services, any other information related to the Company’s and/or the Affiliates’ suppliers and customers that could be used as a competitive advantage by the Company’s and/or the Affiliates’ competitors if revealed or disclosed to such competitors or to persons or entities revealing or disclosing same to such competitors, and all “trade secrets” (as that term is defined in O.C.G.A.  s. 10-1-761, as amended) of the Company and/or the Affiliates, all of which, together with any and all extracts, summaries and photo, electronic or other copies or reproductions, in whole or in part thereof, stored in whatever medium (including electronic or magnetic), shall be deemed the Company’s and/or the Affiliates’ exclusive property, as applicable, and shall be deemed to be “Confidential Information.”  Employee acknowledges that the Confidential Information has been and will continue to be of central importance to the business of the Company and the Affiliates, and that disclosure of it to, or its use by, others could cause substantial loss to the Company and the Affiliates.  In consideration of Employee’s employment hereunder, Employee agrees that, at all times during the term of this Employee Agreement, and (i) with respect to all Confidential Information constituting “trade secrets,” for so long thereafter as such Confidential Information continues to constitute “trade secrets” (or for the period beginning on the last day of the term of this Employee Agreement and ending five (5) years thereafter, whichever is longer); and (ii) with respect to all Confidential Information not constituting “trade secrets,” for the period beginning on the last day of the term of this Employee Agreement and ending five (5) years thereafter, Employee shall not, directly or indirectly, use, divulge or disclose to any person or entity, other than those persons or entities employed or engaged by the Company who or which are authorized to receive such information, any of such Confidential Information, and Employee shall hold all of the Confidential Information confidential and inviolate and will not use such 

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Confidential Information against the best interests of the Company or any of the Affiliates.

10.2.

Disclosures After Employment Terminates; Return of Records.  Employee acknowledges and agrees that all supplier, customer, employee and contractor files, contracts, agreements, financial books, records, instruments and documents, supplier and customer lists, memoranda, data, reports, sales documentation and literature, software, rolodexes, telephone and address books, letters, research, listings, and any other instruments, records or documents relating or pertaining to (i) the customers or suppliers of the Company and/or any of the Affiliates serviced by or serving the Company, any of the Affiliates or Employee, (ii) the duties performed hereunder by Employee, or (iii) the business of the Company and/or any of the Affiliates (collectively, the “Records”) shall at all times be and remain the exclusive property of the Company and/or the Affiliates, as applicable.  Upon termination of Employee’s employment hereunder for any reason whatsoever, Employee shall promptly return to the Company all Records (whether furnished by the Company or any of the Affiliates or prepared by Employee), and Employee shall neither make nor retain, nor allow any third party to make or retain, any photo, electronic or other copy or other reproduction of any of such Records after such termination.  

10.3

Assignment of Inventions and Works Made for Hire.   Employee hereby irrevocably assigns and transfers, and agrees to assign and transfer, to the Company all of Employee’s right, title and interest in and to any and all Inventions and Works Made for Hire (each as hereinafter defined) made, generated or conceived by Employee at any time during the term of this Employee Agreement, whether alone or with the assistance of others, whether or not made, generated or conceived during normal business hours, and whether or not his employment with the Company is hereafter terminated for any reason whatsoever.  For purposes of this Employee Agreement, “Inventions” shall mean any and all discoveries, improvements, innovations, ideas, formulae, devices, systems, software programs, processes, products and any other creations similar thereto which pertain or relate to the Company’s electro-optical polymer technology.  For purposes of this Employee Agreement, “Works Made for Hire” shall mean any and all “work made for hire”, as that term is defined in Section 101 of the United States Copyright Law, Title 17 of the United States Code, as amended.  Upon the Company’s request, Employee will promptly execute and sign any and all applications, assignments, and other documents, and will promptly render all assistance, which may be reasonably necessary for the Company to obtain patent, copyright or any other form of intellectual property protection. 

ARTICLE 11

Protective Covenants

Employee acknowledges that his specialized skills, abilities and contacts are important to the success of the Company, and agrees that he shall faithfully and strictly adhere to the following covenants:

11.1.

Non-competition. Employee acknowledges that by reason of the character and nature of the Company’s business activities and operations, and further by reason of the scope of the territory in which Employee will perform the services under this Employee Agreement, in order to protect the Company’s legitimate business interests it is necessary for Employee to agree not to engage in certain specified activities in such territory at any time during the term of this Employment Agreement and for a period of time thereafter.  Therefore, at all times during the term of this Employee Agreement, and for a period of five (5) years thereafter, Employee will 

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not, directly or indirectly, within the Territory (as defined below), (a) for himself, in his capacity as a Competing Business, (b) as a consultant, manager, supervisor, employee or owner of a Competing Business (as defined below), or (c) as an independent contractor for a Competing Business, engage in any business in which Employee provides services which are the same as or substantially similar to the services Employee is providing hereunder. “Competing Business” shall mean any person, business or entity who or which sells, markets or distributes products and/or sells, furnishes or provides services substantially the same as those sold, marketed, distributed, furnished or supplied or expected to be sold, marketed, distributed, furnished or supplied by the Company during the term of this Employee Agreement. “Territory” shall mean the (i) the United States of America; (ii) any market area that the Company conducts its business; or (iii) any contemplated market area that the Company intends to conduct its business within the following five (5) years of the date of Employee’s termination. “Contemplated Market Area” shall mean any market area which the Company has evaluated, is evaluating, or expects to evaluate and the Company has a reasonable expectation that the Company will conduct business in such area. Employee agrees that he and the Company may amend the definition of “Territory” from and after the date hereof to reflect any significant contraction or expansion of the geographical area in which he performs the services hereunder.  

11.2

Non-solicitation of Customers. Employee agrees that all customers whose relationships are managed by Employee, or with whom Employee has contact during the term of this Employee Agreement, are the Company’s customers, and that all fees and revenues produced from such relationships or contacts are the exclusive property of the Company.  Employee hereby waives and releases all claims and rights of ownership to such customer relationships, fees and revenues.  Furthermore, at all times during the term of this Employee Agreement and for a period of five (5) years thereafter, Employee will not directly or indirectly, on his own behalf or on behalf of any person, firm, partnership, association, corporation, business organization, entity or enterprise, solicit, call upon or attempt to solicit or call upon, any customer or prospective customer of the Company, or any representative of any customer or prospective customer of the Company, with a view to the sale or provision of any product or service competitive or potentially competitive with any product or service sold or provided, or under development, by the Company at any time during the shorter in duration of the term of this Employee Agreement and the last five (5) years thereof; provided that the restrictions set forth in this sentence shall apply only to customers or prospective customers of the Company, or representatives of customers or prospective customers of the Company, with which Employee had contact at any time during the shorter in duration of the term of this Employee Agreement and the last five (5) years thereof.

11.3

Non-solicitation of Employees and Independent Contractors.  At all times during the term of this Employee Agreement and for a period of five (5) years thereafter, Employee will not directly or indirectly solicit or encourage any employee or independent contractor of the Company to leave such employment or engagement with the Company, or directly or indirectly employ or engage in any capacity any former employee or independent contractor of the Company, unless such former employee or independent contractor of the Company shall have ceased to be so employed or engaged by the Company for a period of at least two (2) years immediately prior to such action by Employee.

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ARTICLE 12

Construction

Employee acknowledges and agrees that the covenants and agreements contained in Sections 10 and 11 of this Employee Agreement are the essence of this Employee Agreement, and that each of such covenants and agreements is reasonable and necessary to protect and preserve the interests and business of the Company.  Employee further acknowledges and agrees that: (i) each of such covenants and agreements is separate, distinct and severable, not only from the other of such covenants and agreements, but also from the remaining provisions of this Employee Agreement, (ii) the unenforceability of any such covenants or agreements shall not affect the validity or enforceability of any other such covenants or agreements or any other provision or provisions of this Employee Agreement, and (iii) in the event any court of competent jurisdiction or arbitrator, as applicable, determines, rules or holds that any such covenant or agreement hereof is overly broad or against the public policy of the state, then said court or arbitrator, as the case may be, is specifically authorized to reform and narrow said covenant or agreement to the extent necessary to make said reformed and narrowed covenant or agreement valid and enforceable to the maximum enforceable restriction permitted by law.

  

ARTICLE 13

Remedies

It is specifically understood and agreed that (i) any breach of any of the provisions of Section 10 or 11 of this Employee Agreement is likely to result in irreparable injury to the Company, (ii) the remedy at law alone will be an inadequate remedy for such breach, and (iii) in addition to any other remedy it may have for such breach, the Company shall be entitled to enforce the specific performance of this Employee Agreement by Employee and to seek both temporary and permanent injunctive relief (to the extent permitted by law) without the necessity of proving actual damages.  Notwithstanding any other provision of this Employee Agreement to the contrary, any and all obligations of the Company to pay any compensation to Employee for any reason shall cease and terminate upon the breach by Employee of any of the obligations of Employee under Sections 10 or 11 of this Employee Agreement.

ARTICLE 14

Existing Restrictive Covenants and Indemnification

Employee represents and warrants that (i) Employee is not a party to or subject to any outstanding contract, agreement or order whereby Employee is prohibited from entering into this Employee Agreement, or any outstanding restrictive covenant or noncompetition agreement which would interfere with or prevent Employee’s employment hereunder as contemplated by this Employee Agreement; (ii) Employee has performed any and all duties or obligations that he may have under any contract or agreement with a former Employer or other party, including, without limitation, the return of all confidential materials; and (iii) Employee is currently not in possession of any confidential materials or property belonging to any such former Employer or other party.  Employee acknowledges and agrees that he shall advise the Company in the event that his duties with the Company should be changed or enlarged in such a manner as to conflict with any such prior contract, agreement, order or restrictive covenant.  Without limitation on any 

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other rights or remedies available to the Company with respect to Employee’s breach of his obligations hereunder, Employee shall defend, indemnify and hold the Company, the Affiliates, and each of their respective shareholders, officers, directors, employees, counsel, agents, affiliates and assigns (collectively, the “Company Indemnities”) harmless from and against any and all direct or indirect demands, claims, payments, obligations, recoveries, deficiencies, fines, penalties, assessments, actions, causes of action, suits, losses, diminution in the value of assets of the Company, compensatory, punitive, exemplary or consequential damages (including, without limitation, lost income and profits and interruptions of business), liabilities, costs, expenses, and interest on any amount payable to a third party as a result of the foregoing, whether accrued, absolute, contingent, known, unknown or otherwise asserted against, imposed upon or incurred by Company Indemnities, or any of them, by reason of or resulting from, arising out of, based upon or otherwise in respect of (1) any conflict between Employee’s employment hereunder and any prior employment, duty, contract, express or implied agreement, order or restrictive covenant, or (2) any misrepresentation by Employee hereunder as to any facts which are the subject matter of any conflict or violation of any prior contract, agreement, order or restrictive covenant on the part of Employee.

ARTICLE 15

Notice to Future Employers

If Employee’s employment hereunder terminates for any reason, (i) Employee shall, during the five (5) year period after the effective date of such termination, inform any subsequent employers, business partners or colleagues of the existence and provisions of Sections 11.1 and 11.2 of this Employee Agreement and, if requested, provide a copy of such Sections of this Employee Agreement to any such employer, business partner or colleague; and the Company may, at any time, notify any future employer, business partner or colleague of Employee of the existence and provisions of Sections 11.1 and 11.2 of this Employee Agreement. 

ARTICLE 16

Notices

Any notice given under this Employee Agreement to either party shall be made in writing.  Notices shall be deemed given when delivered by hand, document delivery service, or when mailed by registered or certified mail, return receipt requested, postage prepaid, and addressed to the party at the address set forth below.

Employee address: 

Mr. James S. Marcelli

4327 Cheyenne Drive

Larkspur, Colorado 80118

with a copy to:

________________

________________

Company address: 

Mr. Fred Goetz

Lightwave Logic, Inc.

2601 Annand Dr., #16

Wilmington, Delaware 19808

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with a copy to:

David M. Bovi, Esq.

319 Clematis Street, Suite 700

West Palm Beach, Florida 33401

Each party may designate a different address for receiving notices by giving written notice of the different address to the other party. The written notice of the different address will be deemed given when it is received by the other party.

ARTICLE 17

Binding Agreement

17.1.

Company’s Successors.  The rights and obligations of the Company under this Employee Agreement shall inure to the benefit of and shall be binding upon the successors and assigns of the Company.

17.2.

Employee’s Successors.  This Employee Agreement shall inure to the benefit and be enforceable by Employee’s personal representatives, legatees, and heirs. If Employee dies while amounts are still owed, such amounts shall be paid to Employee’s legatees or, if no such person or persons have been designated, to Employee’s estate.

ARTICLE 18

Waivers

The waiver by either party of a breach of any provision of this Employee Agreement shall not operate or be construed as a waiver of any subsequent breach.

ARTICLE 19

Entire Agreement

19.1.

No Other Agreements.  This instrument contains the entire agreement of the parties pertaining to the employment of Employee by the Company.  The parties have not made any agreements or representations, oral or otherwise, express or implied, pertaining to the employment of Employee by the Company other than those specifically included in this Employee Agreement.

19.2. 

Prior Agreements. This Employee Agreement supersedes any prior employee agreements pertaining to or connected with or arising in any manner out of the employment of Employee by the Company. All such agreements are terminated and are of no force or effect whatsoever.

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ARTICLE 20

Amendment of Agreement

No change or modification of this Employee Agreement shall be valid unless it is in writing and signed by the party against whom the change or modification is sought to be enforced. No change or modification by the Company shall be effective unless it is approved by the Company’s Board of Directors and signed by an officer specifically authorized to sign such documents.

ARTICLE 21

Severability of Provisions

If any provision of this Employee Agreement is invalidated or held unenforceable, the invalidity or unenforceability of that provision or provisions shall not affect the validity or enforceability of any other provision of this Employee Agreement.

ARTICLE 22

Assignment of Agreement

Otherthan as otherwise provided for in this Employee Agreement, so long as Employee is an Employee pursuant to this Employee Agreement, the Company shall not assign this Employee Agreement without Employee’s prior written consent, which consent shall not be unreasonably withheld. Employee may not assign this Employee Agreement.

ARTICLE 23

Governing Law and Venue

 This Agreement shall be deemed to have been entered into by all parties within the State of Delaware and all questions regarding the validity and interpretation of this Employee Agreement shall be governed by and construed and enforced in all respects in accordance with the laws of the State of Delaware as applied to contracts made and to be performed entirely within Delaware without regard to choice of law provisions.  The sole and proper venue shall be New Castle County, Delaware.

ARTICLE 24

Arbitration of Disputes

If a dispute arises out of or relates to this Employee Agreement, or the breach thereof, and if the dispute cannot be settled through negotiation, the parties agree first to try in good faith to settle the dispute by mediation administered by the American Arbitration Association under its Employment Mediation Rules before resorting to arbitration, litigation or some other dispute resolution procedure.

[See Signature Page Attached]

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IN WITNESS, the parties have executed this Employee Agreement in duplicate on the date and year first above written.

Employee,

_______________

______________________

Witness

 

James S. Marcelli

Lightwave Logic, Inc.,

_______________

By: ____________________

Witness 

      Fred Goetz, Jr.,

       

      President

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Appendix A

Duties of Employee

Employee, as the Company’s Chief Executive Officer, subject to the control of the Board of Directors, shall be responsible for:

A.

The overall general management of the Company and supervision of Company policies, setting the Company’s strategies, formulating and overseeing the Company’s business plan, raising capital, expanding the Company’s management team and the general promotion of the Company. 

B.

Such other powers and duties as may be prescribed by the Board of Directors which is reasonably agreed upon by Employee. 

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Appendix B

Other Compensation

I.

Car Allowance:

Company Car or $600 per month.

II.

Housing Allowance:

For temporary housing in Delaware.

To be agreed upon as appropriate.

II.

Restricted Stock Award: 

200,000 shares of restricted common stock due upon execution of the Employee Agreement. The stock grant shall be made pursuant to the Company’s 2007 Employee Stock Plan and subject to the terms of the Plan’s standard stock grant agreement.

III.

Option Grant:

Options: 

1,050,000 (non-qualified)   

Grant Date:

08/01/2008

Expiration Date:

07/31/2013   

Vesting Schedule:

The options vest quarterly over three years in equal installments of 87,500 shares per quarter beginning November 1, 2008. The options grant shall be made pursuant to the Company’s 2007 Employee Stock Plan and subject to the terms of the Plan’s standard non-statutory stock option agreement.

13EX-4.11

Exhibit 4.11

CERTIFICATE OF DESIGNATIONS, PREFERENCES

AND RIGHTS OF THE

SERIES A CONVERTIBLE PREFERRED STOCK

OF

L-1 IDENTITY SOLUTIONS, INC.

 

Pursuant to Section 151 of the

Delaware General Corporation Law

 

     L-1 Identity Solutions, Inc. (the “Company”), a corporation organized and existing under the
laws of the State of Delaware, hereby certifies that pursuant to the provisions of Section 151 of
the Delaware General Corporation Law, its Board of Directors adopted the following resolutions,
which resolutions remain in full force and effect as of the date hereof:

     WHEREAS, the Board of Directors of the Company is authorized, within the limitations and
restrictions stated in Article Fourth of the Company’s Amended and Restated Certificate of
Incorporation, to fix by resolution the designation of preferred stock and the powers, preferences
and relative participating, optional or other special rights and qualifications, limitations or
restrictions thereof; and

     WHEREAS, it is the desire of the Board of Directors of the Company, pursuant to its authority
as aforesaid, to authorize and fix the terms of the preferred stock to be designated the Series A
Convertible Preferred Stock of the Company and the number of shares constituting such preferred
stock;

     NOW, THEREFORE, BE IT RESOLVED, that the Company be, and hereby is, authorized to issue a new
series of its preferred stock, par value $0.001 per share, on the following terms and with the
following designations, power, preferences and rights:

     1. CERTAIN DEFINITIONS. Unless the context otherwise requires, when used herein the
following terms shall have the meaning indicated.

     “Affiliate” shall mean with respect to any Person, any other Person directly, or indirectly
through one or more intermediaries, controlling, controlled by or under common control with such
Person. For purposes of this definition, the term “control” (and correlative terms “controlling,”
“controlled by” and “under common control with”) means possession of the power, whether by
contract, equity ownership or otherwise, to direct the policies or management of a Person.

     “Board” shall mean the Board of Directors of the Company.

     “Business Combination” shall mean (i) any reorganization, consolidation, merger, share
exchange or similar business combination transaction involving the Company with any Person or (ii)
the sale, assignment, conveyance, transfer, lease or other disposition by the Company of all or
substantially all of its assets.

 

 

     “Business Day” shall mean a day except a Saturday, a Sunday or other day on banks in the City
of New York are authorized or required by applicable law to be closed.

     “Common Stock” shall mean shares of common stock, par value $0.001, of the Company.

     “Common Stock Event” shall mean at any time after the date of the original issuance of shares
of Series A Preferred Stock, (i) the issue by the Company of additional shares of Common Stock as a
dividend or other distribution on outstanding Common Stock, (ii) a subdivision of the outstanding
shares of Common Stock into a greater number of shares of Common Stock, or (iii) a combination of
the outstanding shares of Common Stock into a smaller number of shares of Common Stock.

     “Conversion Date” has the meaning set forth in Section 7 hereof.

     “Conversion Price” has the meaning set forth in Section 7 hereof.

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

     “Fair Market Value” shall mean an amount equal to the per share closing price of the Common
Stock on the NYSE (or if the Common Stock is not then traded on the NYSE, on a similar
national securities exchange or national quotation system) for the relevant determination date
or, if the relevant determination date is not a Trading Day, on the Trading Day immediately prior
to the relevant determination date (as reported on the website of the NYSE, or, if not reported
thereby, any other authoritative source).

     “Initial Conversion Price” shall be $13.19.

     “Initial Purchaser” shall be Robert V. LaPenta.

     “Liquidation Preference” has the meaning set forth in Section 5 hereof.

     “Mandatory Conversion Date” shall be June 30, 2028.

     “NYSE” shall mean the New York Stock Exchange.

     “Parity Securities” has the meaning set forth in Section 3 hereof.

     “Person” means an individual, entity or group (within the meaning of Section 13(d)(3) or
14(d)(2) of the Exchange Act).

     “Rights or Options” shall mean Convertible Securities, warrants, options or other rights to
purchase or acquire shares of Common Stock or Convertible Securities.

     “Senior Securities” has the meaning set forth in Section 3 hereof.

     “Series A Preferred Stock” has the meaning set forth in Section 2 hereof.

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     “Series B Preferred Stock” shall mean the 8% Series B Senior Preferred Stock, par value
$0.001, of the Company, the terms of which are set forth in Section 8 hereto.

     “Subsidiary” of a Person means (i) a corporation, a majority of whose stock with voting power,
under ordinary circumstances, to elect directors is at the time of determination, directly or
indirectly, owned by such Person or by one or more Subsidiaries of such Person, or (ii) any other
entity (other than a corporation) in which such Person or one or more Subsidiaries of such Person,
directly or indirectly, at the date of determination thereof has at least a majority ownership
interest.

     “Trading Day” is a day on which the NYSE, or if the Company’s shares of Common Stock cease to
be quoted on the NYSE, the principal national securities exchange on which the Company’s securities
are listed, is open for trading, and only includes those days that have a scheduled closing time of
4:00 p.m. (New York City time) or the then standard closing time for regular trading on the
relevant exchange or trading system.

     2. NUMBER OF SHARES AND DESIGNATION. 25,000 shares of preferred stock of the Company
shall constitute a series of preferred stock, par value $0.001 per share, of the Company designated
as Series A Convertible Preferred Stock (the “Series A Preferred Stock”). Each share of
Series A Preferred Stock shall rank equally in all respects and shall be subject to the following
provisions of this Certificate.

     3. RANK. The Series A Preferred Stock shall, with respect to payment of dividends and
rights (including as to the distribution of assets) upon liquidation, dissolution or winding up of
the affairs of the Company (i) except to the extent otherwise provided herein rank on a parity with
the Common Stock (the “Parity Securities”), and (ii) rank junior to each other class or
series of equity securities of the Company, whether currently issued or issued in the future
without violation of this Certificate, that by its terms ranks senior to the Series A Preferred
Stock as to payment of dividends or rights upon liquidation, dissolution or winding up of the
affairs of the Company (all of such equity securities are collectively referred to herein as the
“Senior Securities”). The respective definitions of Parity Securities and Senior Securities
shall also include any rights or options exercisable or exchangeable for or convertible into any of
the Parity Securities or Senior Securities, as the case may be.

     4. DIVIDENDS.

     a) Holders of shares of Series A Preferred Stock shall be entitled to participate equally and
ratably with the holders of shares of Common Stock in all dividends and distributions paid (whether
in the form of cash, securities, evidences of indebtedness, assets or otherwise, of the Company,
any of its Subsidiaries or any other Person (or rights, options or warrants to subscribe for or
acquire any of the foregoing)) on the shares of Common Stock as if immediately prior to each record
date for the payment of dividends to the holders of shares of Common Stock, the shares of Series A
Preferred Stock then outstanding were converted into shares of Common Stock (in the manner
described in Section 7 below). Dividends or distributions payable pursuant to the preceding
sentence shall be payable on the same date that such dividends or distributions are payable to
holders of shares of Common Stock. Each such dividend or distribution shall be payable to the
holders of record of shares of Series A Preferred Stock as they appear on the stock records of the
Company at the close of business on the applicable record date, which
shall be not more than 60 days nor less than 10 days preceding
the related dividend or distribution payment date, as
shall be fixed by the Board.

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     b) If there shall be any dividend or distribution, in which holders of Series A Preferred
Stock shall be entitled to participate pursuant to this Certificate, which is in the form of Common
Stock or rights, options or warrants to subscribe for or acquire Common Stock, then such dividend
or distribution shall instead be made to such holder in the form of Series A Preferred Stock (with
the number of shares of Series A Preferred Stock issuable in such dividend or distribution being
equal to the number of shares of Series A Preferred Stock that would be convertible under Section 7
into the number of shares of Common Stock that such holder would have received in such dividend or
distribution, and, in the case of any such dividend or distribution that is in the form of rights,
options or warrants to subscribe for or acquire Common Stock, a number of rights, options or
warrants to subscribe for or acquire shares of Series A Preferred Stock (with (i) such number of
shares of Series A Preferred Stock being equal to the number of shares of Series A Preferred Stock
that would be convertible under Section 7 into the number of shares of Common Stock that such
rights, options or warrants would have covered had such rights, options or warrants been to
subscribe for or acquire Common Stock and (ii) such other terms of the rights, options or warrants
(including exercise price and other terms) being such that such rights, option or warrants have
equivalent economic and other terms as the rights, options or warrants to subscribe for or acquire
Common Stock).

     5. LIQUIDATION PREFERENCE. In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Company, the holders of shares of Series A Preferred Stock then
outstanding shall, with respect to each share of Series A Preferred Stock, be entitled to be paid
in redemption of such share out of the assets of the Company available for distribution to its
stockholders a liquidation preference equal to $1,000 per share of Series A Preferred Stock, before
any distribution is made to holders of shares of Common Stock (the “Liquidation
Preference”). Neither a consolidation, merger, share exchange or similar transaction involving
the Company and any other entity, nor a sale or transfer of all or any part of the Company’s assets
for cash, securities or other property, shall be considered a liquidation, dissolution or winding
up of the Company within the meaning of this Section 5.

     6. VOTING RIGHTS. Other than any voting rights provided by the Delaware General
Corporation Law, the holders of shares of Series A Preferred Stock shall have no voting rights.

     7. OPTIONAL CONVERSION.

          (a) Conversion upon Transfer.

               (i) Any share of Series A Preferred Stock owned by the Initial Purchaser or any Affiliate of
an Initial Purchaser shall not be convertible into any share of Common Stock so long as such share
of Series A Preferred Stock is owned by such Initial Purchaser or such Affiliate of an Initial
Purchaser, provided, however, a share of Series A Preferred Stock shall, at the option of the
Initial Purchaser, be convertible (the date of such conversion, the “Conversion Date”) into
fully paid and non-assessable shares of Common Stock at the conversion price equal to the “Initial
Conversion Price” per share of Common Stock (as defined below), subject to adjustment as described
in Section 7(c) hereof (as adjusted, the “Conversion Price”), if such conversion is then
permissible in accordance with the rules and regulations of the NYSE. The number of shares of Common Stock into which one share of the
Series A Preferred Stock shall be convertible (calculated as to each conversion to the nearest 1/10,000th of a share) shall be determined by
dividing (A) the Liquidation Preference by (B) the Conversion Price in effect at the time of
conversion.

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               (ii) Notwithstanding the foregoing, at any time when a share of Series A Preferred Stock is
not or ceases to be owned by the Initial Purchaser or an Affiliate of the Initial Purchaser, such
share of Series A Preferred Stock, without any further action or deed on the part of the Company or
any other Person, shall automatically convert into fully paid and non-assessable shares of Common
Stock at the Conversion Price.

          (b) Mechanics of Conversion.

               (i) On the Conversion Date: (A) the Person in whose name or names any certificate or
certificates for shares of Common Stock shall be issuable upon conversion shall be deemed to have
become the holder of record of the shares of Common Stock represented thereby at such time, and (B)
the shares of Series A Preferred Stock so converted shall no longer be deemed to be outstanding,
and all rights of a holder with respect to such shares shall immediately terminate except the right
to receive the Common Stock and other amounts payable pursuant to this Section 7. All shares of
Common Stock delivered upon conversion of the Series A Preferred Stock will, upon delivery, be duly
and validly authorized and issued, fully paid and nonassessable, free from all preemptive rights
and free from all taxes, liens, security interests and charges (other than liens or charges created
by or imposed upon the holder or taxes in respect of any transfer occurring contemporaneously
therewith).

               (ii) Holders of shares of Series A Preferred Stock at the close of business on the record date
for any payment of a dividend in which shares of Series A Preferred Stock are to participate
pursuant to Section 3 hereof shall be entitled to receive the dividend payable on such shares on
the corresponding dividend payment date notwithstanding the conversion thereof following such
dividend payment record date and prior to such dividend payment date, and a holder of shares of
Series A Preferred Stock on a dividend payment record date whose shares of Series A Preferred Stock
have been converted pursuant to Section 7(a) into shares of Common Stock on such dividend payment
date will receive the dividend payable by the Company on such shares of Series A Preferred Stock if
and when paid, and the converting holder need not include payment of the amount of such dividend
upon conversion of shares of Series A Preferred Stock pursuant to Section 7(a).

               (iii) From the date of this Certificate, the Company will at all times reserve and keep
available, free from preemptive rights, out of its authorized but unissued Common Stock, solely for
the purpose of effecting conversions of the Series A Preferred Stock, the aggregate number of
shares of Common Stock issuable upon conversion of the Series A Preferred Stock (as if all shares
of Series A Preferred Stock are so convertible). The Company will procure, at its sole expense,
the listing of all shares of Common Stock issuable upon conversion of Series A Preferred Stock,
subject to issuance or notice of issuance, on the principal domestic stock exchange on which the
Common Stock is then listed or traded. The Company will take all action as may be necessary to
ensure that all shares of Common Stock issuable upon conversion of Series A Preferred Stock will be
issued without violation of any applicable law or regulation or of any requirement of any
securities exchange on which the shares of Common Stock are listed or traded.

5

 

               (iv) Issuances of certificates for shares of Common Stock upon conversion of the Series A
Preferred Stock shall be made without charge to the holder of shares of Series A Preferred Stock or
any of its transferees for any issue or transfer tax (other than taxes in respect of any transfer
of Series A Preferred Stock occurring contemporaneously therewith) or other incidental expense in
respect of the issuance of such certificates, all of which taxes and expenses shall be paid by the
Company; provided, however, that the Company shall not be required to pay any tax which may be
payable in respect of any transfer involved in the issuance or delivery of shares of Common Stock
in a name other than that of the transferee of the Series A Preferred Stock that is to receive
Common Stock pursuant to Section 7(a), and no such issuance or delivery need be made unless and
until the Person requesting such issuance or delivery has paid to the Company the amount of any
such tax or has established, to the reasonable satisfaction of the Company, that such tax has been,
or will timely be, paid.

               (v) In connection with the conversion of any shares of Series A Preferred Stock, no fractions
of shares of Common Stock shall be issued, but in lieu thereof the Company shall pay cash in
respect of such fractional interest in an amount equal to such fractional interest multiplied by
the Fair Market Value per share of Common Stock on the applicable Conversion Date.

               (vi) The Company shall procure that each share of Common Stock issued as a result of
conversion of Series A Preferred Stock shall be accompanied by any rights associated generally with
each other share of Common Stock outstanding as of the applicable Conversion Date.

          (c) Adjustments to Conversion Price. From and after the date of this Certificate, the
Conversion Price shall be adjusted from time to time as follows:

               (i) Common Stock Event. Upon the occurrence of a Common Stock Event, the Conversion
Price in effect at the time of the record date for such dividend or distribution or the effective
date of such subdivision, combination or reclassification shall be adjusted to the number obtained
by multiplying the Conversion Price theretofore in effect by a fraction, the numerator of which
shall be the number of shares of Common Stock outstanding immediately prior to such action, and the
denominator of which shall be the number of shares of Common Stock outstanding immediately
following such action; provided, however, that the Conversion Price of shares of Series A Preferred
Stock held by a holder thereof need not be adjusted in respect of a dividend or distribution
covered by this paragraph to the extent such holder shall participate in such dividend or
distribution equally and ratably on an as-converted basis for such Series A Preferred Stock
pursuant to Section 3 hereof.

               (ii) Adjustment for Reclassification, Exchange and Substitution. If at any time or
from time to time after the Original Issue Date, the Common Stock issuable upon the conversion of
the Series A Preferred Stock is changed into the same or a different number of shares of any class
or classes of stock, whether by recapitalization, reclassification or otherwise (other than by a
Common Stock Event or a Business Combination covered by Sections 7(c)(i) or 7(c)(iii) hereof), then
in any such event each holder of Series A Preferred Stock shall have the right thereafter to
receive the kind and amount of stock and other securities and property receivable upon such
recapitalization, reclassification or other change by holders of the number of shares of Common
Stock into which such shares of Series A Preferred Stock could have been converted

6

 

immediately prior to such recapitalization, reclassification or change, all subject to further
adjustment as provided herein or with respect to such other securities or property by the terms
thereof.

               (iii) Business Combinations. In case of any Business Combination or reclassification
of Common Stock (other than a reclassification of Common Stock covered by Section 7(c)(ii) hereof),
lawful provision shall be made as part of the terms of such Business Combination or
reclassification whereby the holder of each share of Series A Preferred Stock then outstanding
shall have the right to convert only into the kind and amount of securities, cash and other
property receivable upon the Business Combination or reclassification by a holder of the number of
shares of Common Stock of the Company into which a share of Series A Preferred Stock would have
been convertible at the conversion rate described under this Section 7 immediately prior to the
Business Combination or reclassification.

               (iv) Successive Adjustments. Successive adjustments in the Conversion Price shall be
made, without duplication, whenever any event specified in Sections 7(c)(i), (ii) or (iii) hereof
shall occur.

               (v) Rounding of Calculations; Minimum Adjustments. All calculations under this Section
7(c) shall be made to the nearest one-tenth (1/10th) of a cent. No adjustment in the Conversion
Price is required if the amount of such adjustment would be less than $0.01; provided, however,
that any adjustments which by reason of this Section 7(c)(v) are not required to be made will be
carried forward and given effect in any subsequent adjustment.

               (vi) Adjustment for Unspecified Actions. If the Company takes any action affecting
the Common Stock, other than action described in this Section 7(c), which in the opinion of the
Board would materially adversely affect the conversion rights of the holders of shares of Series A
Preferred Stock, the Conversion Price may be adjusted, to the extent permitted by law, in such
manner, if any, and at such time, as the Board may determine in good faith to be equitable in the
circumstances.

               (vii) Statement Regarding Adjustments. Whenever the Conversion Price shall be
adjusted as provided in this Section 7(c), the Company shall forthwith file, at the principal
office of the Company, a statement showing in reasonable detail the facts requiring such adjustment
and the Conversion Price that shall be in effect after such adjustment and the Company shall also
cause a copy of such statement to be sent by mail, first class postage prepaid, to each holder of
shares of Series A Preferred Stock at the address appearing in the Company’s records.

               (viii) Notices. In the event that the Company shall give notice or make a public
announcement to the holders of Common Stock of any action of the type described in this Section
7(c) or in Section 3 or 4 hereof, the Company shall, at the time of such notice or announcement,
and in the case of any action which would require the fixing of a record date, at least 10 days
prior to such record date, give notice to the holders of shares of Series A Preferred Stock, in the
manner set forth in Section 7(c)(vii), which notice shall specify the record date, if any, with
respect to any such action and the approximate date on which such action is to take place. Such
notice shall also set forth the facts with respect thereto as shall be reasonably necessary to
indicate the effect on the Conversion Price and the number, kind or class of shares or other
securities or property which shall be deliverable upon conversion of the Series A Preferred Stock.
All notices to

7

 

the Company permitted hereunder shall be personally delivered or sent by first class mail,
postage prepaid, addressed to its principal office located at 177 Broad Street, Stamford,
Connecticut 06901, or to such other address at which its principal office is located and as to
which notice thereof is similarly given to the holders of the Series A Preferred Stock at their
addresses appearing on the books of the Company.

     8. Mandatory Conversion.

     a) On the Mandatory Conversion Date, each share of Series A Preferred Stock that is
outstanding as of such date, shall automatically convert into fully paid and non-assessable shares
of Series B Preferred Stock with a liquidation preference equal to the $1,000 per share of Series B
Preferred Stock, subject to adjustment as described in Section 7(c) hereof . All shares of Series
A Preferred Stock being converted at one time by a holder shall be aggregated (even if they are
represented by more than one certificate) in determining whether a holder would receive a
fractional share of Series B Preferred Stock.

     b) On the Mandatory Conversion Date, any party entitled to receive shares of Series B
Preferred Stock issuable upon such conversion shall be treated for all purposes as the record
holder of such shares of Series B Preferred Stock on such date, whether or not such holder has
surrendered the certificate or certificates for such holder’s shares of Series A Preferred Stock.
A holder surrendering his or her certificate or certificates shall notify the Company of the name
or names of such holder’s nominees in which such holder wishes the book entry evidence of ownership
for shares of Series B Preferred Stock to be issued. The Company shall, as soon as practicable
thereafter (and, in any event, within twenty (20) days of such surrender), cause to be issued book
entry evidence of ownership of the number of shares of Series B Preferred Stock to which such
holder shall be entitled as aforesaid, together with cash in lieu of any fraction of a share as
provided herein.

     c) The Company shall file a Certificate of Designations, Preferences and Rights of the 8%
Series B Senior Preferred Stock of L-1 Identity Solutions, Inc., and shall reserve a sufficient
number of shares of Series B Preferred Stock for issuance prior to the Mandatory Conversion Date.

     d) The text of the Certificate of Designations, Preferences and Rights of the 8% Series B
Senior Preferred Stock of L-1 Identity Solutions, Inc. shall read as follows:

	     1.	 	“CERTAIN DEFINITIONS. Unless the context otherwise requires, when used
herein the following terms shall have the meaning indicated.

     “Board” shall mean the Board of Directors of the Company.

     “Common Stock” shall mean shares of common stock, par value $0.001, of the Company.

     “Dividend Payment Date” has the meaning set forth in Section 4 hereof.

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

     “Junior Securities” has the meaning set forth in Section 3 hereof.

8

 

     “Liquidation Preference” has the meaning set forth in Section 5 hereof.

     “Original Issue Date” shall mean the date of the original issuance of shares of Series B
Preferred Stock.

     “Parity Securities” has the meaning set forth in Section 3 hereof.

     “Person” means an individual, entity or group (within the meaning of Section 13(d)(3) or
14(d)(2) of the Exchange Act).

     “Preferred Stock” has the meaning set forth in Section 2 hereof.

     “Series B Dividend” has the meaning set forth in Section 4 hereof.

     “Series B Preferred Stock” has the meaning set forth in Section 2 hereof.

     “Stated Value” shall mean with respect to each share of Series B Preferred Stock, $1,000, plus
any accrued dividends with respect to any such share of Series B Preferred Stock.

     “Subsidiary” of a Person means (i) a corporation, a majority of whose stock with voting power,
under ordinary circumstances, to elect directors is at the time of determination, directly or
indirectly, owned by such Person or by one or more Subsidiaries of such Person, or (ii) any other
entity (other than a corporation) in which such Person or one or more Subsidiaries of such Person,
directly or indirectly, at the date of determination thereof has at least a majority ownership
interest.

     2. NUMBER OF SHARES AND DESIGNATION. 25,000 shares of preferred stock of the Company
shall constitute a series of preferred stock, par value $0.001 per share (the “Preferred
Stock”), of the Company designated as 8% Series B Senior Preferred Stock (the “Series B
Preferred Stock”). Each share of Series B Preferred Stock shall rank equally in all respects
and shall be subject to the following provisions of this Certificate.

     3. RANK. The Series B Preferred Stock shall, with respect to payment of dividends and
rights (including as to the distribution of assets) upon liquidation, dissolution or winding up of
the affairs of the Company rank (i) senior to all classes of Common Stock and to each other class
of capital stock of the Company or series of Preferred Stock of the Company existing or hereafter
created, the terms of which do not expressly provide that it ranks senior to, or on a parity with,
the Series B Preferred Stock as to dividend distributions and distributions upon liquidation,
winding-up and dissolution of the Company (collectively referred to, together with all classes of
Common Stock of the Company, as “Junior Securities”); and (ii) on a parity with any class
of capital stock of the Company or series of Preferred Stock of the Company hereafter created the
terms of which expressly provide that such class or series will rank on a parity with the Series B
Preferred Stock as to dividend distributions and distributions upon liquidation, winding-up and
dissolution (collectively referred to as “Parity Securities”).

     4. DIVIDENDS.

               (i) The holders of the shares of Series B Preferred Stock shall be entitled to receive
cumulative dividends on each outstanding share of Series B Preferred Stock (the “Series B
Dividend”), payable at a rate per annum of 8% of the Stated Value on the Original Issue Date of

9

 

each such share of Series B Preferred Stock. The Series B Dividend shall not be paid in cash,
and will accrue and cumulate and be added to the Stated Value on each Dividend Payment Date,
whether or not declared by the Board. The Series B Dividend shall be payable from and including
the Original Issue Date and shall accrue annually, in arrears, on the six-month anniversary of the
Original Issue Date (each such date, a “Dividend Payment Date”). Accrued but unpaid Series
B Dividends shall not bear interest, or any sum of money in lieu of interest.

               (ii) The amount of Series B Dividends payable for any period less than a full Dividend Period
shall be determined on the basis of twelve 30-day months and a 360-day year. Series B Dividends
shall be paid to the holders of record of shares of Series B Preferred Stock as each appears in the
stock register of the Company on the close of business on the Original Issue Date.

     5. LIQUIDATION PREFERENCE. In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Company, the holders of shares of Series B Preferred Stock then
outstanding shall, with respect to each share of Series B Preferred Stock, be entitled to be paid
in redemption of such share out of the assets of the Company available for distribution to its
stockholders a liquidation preference equal to the Stated Value per share of Series B Preferred
Stock, before any distribution is made to holders of shares of Common Stock (the “Liquidation
Preference”). For purposes hereof, a consolidation, merger, share exchange or similar
transaction involving the Company and any other entity, or a sale or transfer of all or any part of
the Company’s assets for cash, securities or other property, shall be considered a liquidation,
dissolution or winding up of the Company within the meaning of this Section 5.

     6. VOTING RIGHTS. Other than any voting rights provided by law, the holders of shares
of Series B Preferred Stock shall have no voting rights.

     7. CERTAIN OTHER PROVISIONS.

	 	a.	 	No share or shares of Series B Preferred Stock acquired by the
Company shall be reissued, and all such shares shall be cancelled, retired and
eliminated from the shares of Series B Preferred Stock which the Company shall
be authorized to issue.
	 
	 	b.	 	If any Series B Preferred Stock certificate shall be mutilated,
lost, stolen or destroyed, the Company will issue, in exchange and in
substitution for and upon cancellation of the mutilated certificate, or in lieu
of and substitution for the certificate lost, stolen or destroyed, a new Series
B Preferred Stock certificate of like tenor and representing an equivalent
amount of Series B Preferred Stock, upon receipt of evidence of such loss, theft
or destruction of such certificate and, if requested by the Company, an
indemnity on customary terms for such situations reasonably satisfactory to the
Company.
	 
	 	c.	 	The Company shall not, by amendment of its Amended and Restated
Certificate of Incorporation or through reorganization, consolidation, merger,
dissolution, sale of assets, or otherwise, avoid or seek to avoid the observance
or performance of any of the terms of this Certificate, but will at all times in
good faith assist in the carrying out of all such terms and in the taking of all
such action as may be

10

 

	 	 	 	necessary or appropriate in order to protect the rights of the holders of Series
B Preferred Stock against dilution or other impairment.
	 	d.	 	The headings of the various subdivisions hereof are for
convenience of reference only and shall not affect the interpretation of any of
the provisions hereof.”

     9. CERTAIN OTHER PROVISIONS.

          (a) No share or shares of Series A Preferred Stock acquired by the Company shall be reissued,
and all such shares shall be cancelled, retired and eliminated from the shares of Series A
Preferred Stock which the Company shall be authorized to issue.

          (b) If any Series A Preferred Stock certificate shall be mutilated, lost, stolen or destroyed,
the Company will issue, in exchange and in substitution for and upon cancellation of the mutilated
certificate, or in lieu of and substitution for the certificate lost, stolen or destroyed, a new
Series A Preferred Stock certificate of like tenor and representing an equivalent amount of Series
A Preferred Stock, upon receipt of evidence of such loss, theft or destruction of such certificate
and, if requested by the Company, an indemnity on customary terms for such situations reasonably
satisfactory to the Company.

          (c) The Company shall not, by amendment of its Certificate of Incorporation or through
reorganization, consolidation, merger, dissolution, sale of assets, or otherwise, avoid or seek to
avoid the observance or performance of any of the terms of this Certificate, but will at all times
in good faith assist in the carrying out of all such terms and in the taking of all such action as
may be necessary or appropriate in order to protect the rights of the holders of Series A Preferred
Stock against dilution or other impairment. At all times, the Company will take all such action as
may be necessary or appropriate in order that the Company may validly and legally issue shares of
Common Stock as herein contemplated upon conversion of shares of Series A Preferred Stock.

          (d) The headings of the various subdivisions hereof are for convenience of reference only and
shall not affect the interpretation of any of the provisions hereof.

          (e) This Certificate shall become effective immediately upon it being filed with the Secretary
of State of the State of Delaware on August 4th, 2008.

[Remainder of Page Intentionally Left Blank]

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     IN WITNESS WHEREOF, the undersigned has duly executed this Certificate on this 30th
day of July, 2008.

	 	 	 	 	 
	 	L-1 IDENTITY SOLUTIONS, INC.

 	 
	 	By:  	/s/
 VINCENT D'ANGELO	 
	 	 	Name:  	Vincent D’Angelo	 
	 	 	Title:  	Senior Vice President, Finance and Chief
Accounting Officer

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