UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No.     )*

American Defense Systems, Inc.

(Name of Issuer)

Common Stock, par value $0.001

(Title of Class of Securities)

025351107

(CUSIP Number)

Armor Technologies LLC

202 Champions Point Way

Cary, North Carolina 27513

Attn: Dale S. Scales

(919) 389-8321

(Name, Address and Telephone Number of Person Authorized to

Receive Notices and Communications)

December 29, 2011

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and if filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box.  ¨

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule including all exhibits. See § 240.13d-7 for other parties to whom copies are to be sent.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

This statement is being filed jointly by: (i) Armor Technologies LLC, a North Carolina limited liability company (“Armor”), (ii) Dale S. Scales, (iii) Frank A. Bednarz, (iv) Harold Wrobel, (v) John Jodlowski, (vi) JOWCO LLC, a Colorado limited liability company (“JOWCO”), (vii) Mark Wayner, (viii) Emi Wayner and (ix) Joe Van Hecke (collectively, the “Reporting Persons”). The Reporting Persons are making this joint filing because they comprise a “group,” within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), formed for the purposes described in Item 4 of this Schedule 13D and thus are eligible to make a joint filing under Rule 13d-1(k) under the Exchange Act.

This statement relates to the common stock, par value $0.001 per share (the “Shares”), of American Defense Systems, Inc., a Delaware corporation (the “Issuer”). The address of the principal executive offices of the Issuer is 420 McKinney Pkwy., Lillington, North Carolina 27546.

(a) – (c) The principal business of Armor is consulting in the areas of corporate finance strategy and operations management. The principal business address, and the address of the principal office, of Armor is 202 Champions Point Way, Cary, North Carolina 27513. Mr. Scales is the sole member and manager of Armor.

The present principal occupation or employment of Mr. Scales is serving as a consultant specializing in private equity and venture capital investments, risk analysis, corporate finance strategies and operational management restructures. The principal business address of Mr. Scales is c/o Armor Technologies LLC, 202 Champions Point Way, Cary, North Carolina 27513.

The present principal occupation or employment of Mr. Jodlowski is serving as a self-employed options trader. Mr. Jodlowski is the sole member and manager of JOWCO. The principal business address of Mr. Jodlowski, and the principal business address and address of the principal office of JOWCO, is 135 W. Colorado #2C, Telluride, Colorado 81435. Mr. Jodlowski is the sole trustee of the John Jodlowski Revocable Trust (the “Jodlowski Trust”).

The present principal occupation or employment of Mr. Bednarz is serving as the Managing Director of Chicago Trading Company, a derivatives trading company. The principal business address of Mr. Bednarz is c/o Chicago Trading Company, 440 South LaSalle, Suite 400, Chicago, Illinois 60605.

The present principal occupation or employment of Mr. Wrobel is conducting business as an entrepreneur. The principal business address of Mr. Wrobel is 14954 Corona Del Mar, Pacific Palisades, California 90272.

The present principal occupation or employment of Mr. Wayner is serving as the Chief Executive Officer and a director of Taiga Trading LLC, an investment consulting company. The principal business address of Mr. Wayner is c/o Taiga Trading LLC, 1600 Rosecrans, 4^th Floor, Manhattan Beach, California 90266. Mr. Wayner is a co-trustee of the Mark and Emi Wayner 2007 Family Trust (the “Wayner Trust”).

The present principal occupation or employment of Ms. Wayner is conducting business as the owner of Zenka Nail Salon. The principal business address of Ms. Wayner is c/o Zenka Nail Salon, 451 Manhattan Beach Blvd., Metlox Plaza, Manhattan Beach, California 90266. Ms. Wayner is a co-trustee of the Wayner Trust.

The present principal occupation or employment of Mr. Van Hecke is serving as the Managing Director of Grace Hall Capital, LLC, the manager of an investment fund. The principal business address of Mr. Van Hecke is c/o Grace Hall Capital, LLC, 6322 St. Stephen Lane, Charlotte, North Carolina 28210.

(d) – (e) None of the Reporting Persons nor any manager or executive officer of the Reporting Persons, has, during the last five years, (a) been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors), or (b) been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting, or mandating activities subject to, federal or state securities laws or a finding of any violation with respect to such laws.

(f) Each of Messrs. Scales, Jodlowski, Bednarz, Wrobel, Wayner and Van Hecke are citizens of the United States of America. Ms. Wayner is a citizen of Japan.

The aggregate purchase price of the 1,833,134 Shares held directly by, and acquired with the personal funds of, Mr. Scales is $45,744.

The aggregate purchase price of the (i) 4,655,710 Shares held directly by Mr. Jodlowski, (ii) 1,166,343 Shares held by the Jodlowski Trust, of which Mr. Jodlowski is the sole trustee, and (iii) 829,046 Shares held by JOWCO, of which Mr. Jodlowski is the sole member and manager, acquired with the personal funds of Mr. Jodlowski, is approximately $2,540,400.

The aggregate purchase price of the 5,100,138 Shares held directly by, and acquired with the personal funds of, Mr. Bednarz is $169,013.

The aggregate purchase price of the 1,951,037 Shares held directly by, and acquired with the personal funds of, Mr. Wrobel is $1,000,000.

The aggregate purchase price of the 650,000 Shares held by the Wayner Trust, of which Mr. and Ms. Wayner are co-trustees, and acquired with the personal funds of Mr. and Ms. Wayner, is $613,210.

The aggregate purchase price of the 414,143 Shares held directly by, and acquired with the personal funds of, Mr. Van Hecke is $410,000.

Certain of the Reporting Persons originally purchased the Shares based on their belief that the Shares, when purchased, were undervalued and represented an attractive investment opportunity. Depending upon overall market conditions, other investment opportunities available to the Reporting Persons, and the availability of Shares at prices that would make the purchase or sale of Shares desirable, the Reporting Persons may endeavor to increase or decrease their respective positions in the Issuer through, among other things, the purchase or sale of Shares on the open market or in private transactions or otherwise, on such terms and at such times as the Reporting Persons may deem advisable.

On January 6, 2012, the Reporting Persons entered into a Joint Filing and Solicitation Agreement (the “Joint Filing and Solicitation Agreement”) in which, among other things, (a) the parties agreed to the joint filing and solicitation on behalf of each of them of statements on Schedule 13D with respect to the securities of the Issuer to the extent required under applicable securities laws and (b) the parties agreed to form a “group,” within the meaning of Section 13(d)(3) of the Exchange Act, for the purpose of calling a special meeting of the stockholders of the Issuer (together with any adjournments, postponements, rescheduling or continuations thereof, the “Special Meeting”) to remove the current Board of Directors of the Issuer (the “Board”), to appoint new representatives to the Board, to amend the Issuer’s certificate of incorporation and bylaws, including the “anti-takeover provisions” thereof to enable the foregoing, to solicit proxies, written requests or written consents to effect the foregoing, and for the purpose of taking all other actions necessary to achieve the foregoing (collectively, the “Purposes”). The foregoing description of the Joint Filing and Solicitation Agreement is qualified in its entirety by reference to the Joint Filing and Solicitation Agreement, which is filed as Exhibit 99.1 hereto and is incorporated herein by reference.

(a) The aggregate percentage of Shares reported owned by each person named herein is based upon 54,987,192 Shares outstanding as of December 1, 2011, as reported in the Issuer’s Proxy Statement on Schedule 14A filed with the Securities and Exchange Commission on December 9, 2011.

By virtue of the Voting Agreement discussed in further detail in Item 6 of this Schedule 13D, Armor may be deemed to be the beneficial owner of an aggregate of 16,599,551 Shares, which represents approximately 30.2% of the outstanding Shares of the Issuer.

As the sole member and manager of Armor, Mr. Scales may be deemed to be the beneficial owner of an aggregate of 16,599,551 Shares, which represents approximately 30.2% of the outstanding Shares of the Issuer.

As of the date hereof, Mr. Jodlowski may be deemed to be the beneficial owner of 6,651,099 Shares, which includes (i) 4,655,710 Shares held directly by him, (ii) 1,166,343 Shares held directly by the Jodlowski Trust, of which Mr. Jodlowski is the sole trustee, and (iii) 829,046 Shares held directly by JOWCO, of which Mr. Jodlowski is the sole member and manager. Such Shares represent approximately 12.1% of the outstanding Shares of the Issuer. Mr. Jodlowski may be deemed to be a member of a “group,” within the meaning of Section 13(d)(3) of the Exchange Act, comprised of the Reporting Persons. Shares listed as beneficially owned by Mr. Jodlowski exclude Shares held by certain other Reporting Persons, as to which Mr. Jodlowski disclaims beneficial ownership.

As of the date hereof, JOWCO beneficially owns 829,046 Shares held directly by JOWCO, which represents approximately 1.5% of the outstanding Shares of the Issuer. JOWCO may be deemed to be a member of a “group,” within the meaning of Section 13(d)(3) of the Exchange Act, comprised of the Reporting Persons. Shares listed as beneficially owned by JOWCO exclude Shares held by any other Reporting Persons, as to which JOWCO disclaims beneficial ownership.

As of the date hereof, Mr. Bednarz beneficially owns 5,100,138 Shares held directly by him, which represents approximately 9.3% of the outstanding Shares of the Issuer. Mr. Bednarz may be deemed to be a member of a “group,” within the meaning of Section 13(d)(3) of the Exchange Act, comprised of the Reporting Persons. Shares listed as beneficially owned by Mr. Bednarz exclude Shares held by any other Reporting Persons, as to which Mr. Bednarz disclaims beneficial ownership.

As of the date hereof, Mr. Wrobel beneficially owns 1,951,037 Shares held directly by him, which represents approximately 3.5% of the outstanding Shares of the Issuer. Mr. Wrobel may be deemed to be a member of a “group,” within the meaning of Section 13(d)(3) of the Exchange Act, comprised of the Reporting Persons. Shares listed as beneficially owned by Mr. Wrobel exclude Shares held by any other Reporting Persons, as to which Mr. Wrobel disclaims beneficial ownership.

As of the date hereof, Mr. Wayner may be deemed to be the beneficial owner of 650,000 Shares held directly by the Wayner Trust, of which Mr. Wayner is a co-trustee. Such Shares represent 1.2% of the outstanding Shares of the Issuer. Mr. Wayner may be deemed to be a member of a “group,” within the meaning of Section 13(d)(3) of the Exchange Act, comprised of the Reporting Persons. Shares listed as beneficially owned by Mr. Wayner exclude Shares held by certain other Reporting Persons, as to which Mr. Wayner disclaims beneficial ownership.

As of the date hereof, Ms. Wayner may be deemed to be the beneficial owner of 650,000 Shares held directly by the Wayner Trust, of which Ms. Wayner is a co-trustee. Such Shares represent 1.2% of the outstanding Shares of the Issuer. Ms. Wayner may be deemed to be a member of a “group,” within the meaning of Section 13(d)(3) of the Exchange Act, comprised of the Reporting Persons. Shares listed as beneficially owned by Ms. Wayner exclude Shares held by certain other Reporting Persons, as to which Ms. Wayner disclaims beneficial ownership.

As of the date hereof, Mr. Van Hecke beneficially owns 414,143 Shares held directly by him, which represents less than 1% of the outstanding Shares of the Issuer. Mr. Van Hecke may be deemed to be a member of a “group,” within the meaning of Section 13(d)(3) of the Exchange Act, comprised of the Reporting Persons. Shares listed as beneficially owned by Mr. Van Hecke exclude Shares held by any other Reporting Persons, as to which Mr. Van Hecke disclaims beneficial ownership.

(b) By virtue of the Voting Agreement discussed in further detail in Item 6 of this Schedule 13D, Armor may be deemed to have shared power to vote or to direct the vote of an aggregate of 16,599,551 Shares. Mr. Scales is the sole member and manager of Armor.

As the sole member and manager of Armor, Mr. Scales may be deemed to have shared power to vote or to direct the vote of an aggregate of 16,599,551 Shares. Mr. Scales has sole power to dispose or to direct the disposition of 1,833,134 Shares held directly by him.

By virtue of the Voting Agreement discussed in further detail in Item 6 of this Schedule 13D, Mr. Jodlowski may be deemed to have shared power to vote or to direct the vote of an aggregate of 6,651,099 Shares, which includes (i) 4,655,710 Shares held directly by him, (ii) 1,166,343 Shares held directly by the Jodlowski Trust, of which Mr. Jodlowski is the sole trustee, and (iii) 829,046 Shares held directly by JOWCO, of which Mr. Jodlowski is the sole member and manager.

Mr. Jodlowski may be deemed to have sole power to dispose or to direct the disposition of 5,822,053 Shares, which includes (i) 4,655,710 Shares held directly by him, and (ii) 1,166,343 Shares held directly by the Jodlowski Trust, of which Mr. Jodlowski is the sole trustee. Mr. Jodlowski may be deemed to have shared power to dispose or to direct the disposition of 829,046 Shares held directly by JOWCO, of which Mr. Jodlowski is the sole member and manager.

JOWCO may be deemed to have shared power to vote or to direct the vote, and shared power to dispose or to direct the disposition, of 829,046 Shares held directly by JOWCO. Mr. Jodlowski is the sole member and manager of JOWCO.

By virtue of the Voting Agreement discussed in further detail in Item 6 of this Schedule 13D, Mr. Bednarz may be deemed to have shared power to vote or to direct the vote of 5,100,138 Shares held directly by him. Mr. Bednarz has sole power to dispose or to direct the disposition of 5,100,138 Shares held directly by him.

By virtue of the Voting Agreement discussed in further detail in Item 6 of this Schedule 13D, Mr. Wrobel may be deemed to have shared power to vote or to direct the vote of 1,951,037 Shares held directly by him. Mr. Wrobel has sole power to dispose or to direct the disposition of 1,951,037 Shares held directly by him.

By virtue of the Voting Agreement discussed in further detail in Item 6 of this Schedule 13D, each of Mr. and Ms. Wayner may be deemed to have shared power to vote or to direct the vote of 650,000 Shares held directly by the Wayner Trust, of which Mr. and Ms. Wayner are co-trustees. Each of Mr. and Ms. Wayner may be deemed to have shared power to dispose or to direct the disposition of 650,000 Shares held directly by the Wayner Trust, of which Mr. and Ms. Wayner are co-trustees.

By virtue of the Voting Agreement discussed in further detail in Item 6 of this Schedule 13D, Mr. Van Hecke may be deemed to have shared power to vote or to direct the vote of 414,143 Shares held directly by him. Mr. Van Hecke has sole power to dispose or to direct the disposition of 414,143 Shares held directly by him.

(c) On December 29, 2011, West Coast Opportunity Fund, LLC, a Delaware limited liability company (the “Fund”) sold (i) 4,569,510 Shares to Mr. Bednarz for a purchase price of $105,000 in a private sale transaction, (ii) 4,569,510 Shares to Mr. Jodlowski for a purchase price of $105,000 in a private sale transaction, and (iii) 1,833,134 Shares to Mr. Scales for a purchase price of $45,744 in a private sale transaction, as discussed in further detail in Item 6 of this Schedule 13D.

Certain of the Reporting Persons engaged in transactions on the open market in the ordinary course of business during the past 60 days with respect to the Issuer’s Shares, as set forth on Schedule A, which is attached hereto and is incorporated herein by reference.

(d) No persons other than the Reporting Persons are known to have the right to receive, or the power to direct the receipt of dividends from, or proceeds from the sale of, the Shares reflected in this Schedule 13D.

(e) Not applicable.

See Item 4 of this Schedule 13D for a discussion of the Joint Filing and Solicitation Agreement.

On January 6, 2012, Armor and certain of the Reporting Persons entered into a Voting Agreement (the “Voting Agreement”), pursuant to which, among other things, such Reporting Persons agreed that, at the Special Meeting, or at any and all other meetings of stockholders of the Issuer, or at any adjournment, postponement, rescheduling or continuation thereof, or in any other circumstances upon which a vote, consent (including unanimous written consents), agreement or other approval is sought, they shall vote the Shares of the Issuer owned or controlled by them (whether now owned or hereafter acquired) and shall otherwise consent or agree in such manner as may be directed by Armor in its sole and absolute discretion, in pursuit of the Purposes, as discussed in Item 4 of this Schedule 13D. The foregoing description of the Voting Agreement is qualified in its entirety by reference to the Voting Agreement, which is filed as Exhibit 99.2 hereto and is incorporated herein by reference.

On December 29, 2011, Mr. Scales and the Fund entered into a Purchase and Option Agreement pursuant to which Mr. Scales granted options to the Fund to purchase 1,803,836 Shares of the Issuer at an exercise price of $0.075 per Share, vesting on the six-month anniversary of December 29, 2011 and expiring December 31, 2012. The foregoing description is qualified in its entirety by reference to such agreement, which is filed as Exhibit 99.3 hereto and is incorporated herein by reference.

On December 29, 2011, Mr. Jodlowski and the Fund entered into a Purchase and Option Agreement pursuant to which Mr. Jodlowski granted options to the Fund to purchase 1,598,082 Shares of the Issuer at an exercise price of $0.075 per Share, vesting on the six-month anniversary of December 29, 2011 and expiring December 31, 2012. The foregoing description is qualified in its entirety by reference to such agreement, which is filed as Exhibit 99.4 hereto and is incorporated herein by reference.

On December 29, 2011, Mr. Bednarz and the Fund entered into a Purchase and Option Agreement pursuant to which Mr. Bednarz granted options to the Fund to purchase 1,598,082 Shares of the Issuer at an exercise price of $0.075 per Share, vesting on the six-month anniversary of December 29, 2011 and expiring December 31, 2012. The foregoing description is qualified in its entirety by reference to such agreement, which is filed as Exhibit 99.5 hereto and is incorporated herein by reference.

Except as set forth herein, there are no contracts, arrangements, understandings or relationships among the Reporting Persons, or between the Reporting Persons and any other person, with respect to the securities of the Issuer.

SIGNATURES

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

SCHEDULE A

The Reporting Persons engaged in the following transactions on the open market in the ordinary course of business during the past 60 days with respect to the Issuer’s Shares:

FRANK A. BEDNARZ

JOHN JODLOWSKI

MARK WAYNER

Exhibit 99.1

JOINT FILING AND SOLICITATION AGREEMENT

WHEREAS, certain of the undersigned are stockholders, direct or beneficial, of American Defense Systems, Inc., a Delaware corporation (the “Company”);

WHEREAS, Armor Technologies LLC, a North Carolina limited liability company (“Armor”), John Jodlowski, Frank A. Bednarz, Harold Wrobel, Joe Van Hecke, Mark Wayner, Emi Wayner, Dale S. Scales and JOWCO LLC, a Colorado limited liability company, wish to form a group for the purpose of calling a special meeting of the stockholders of the Company (together with any adjournments, postponements, reschedulings or continuations thereof, the “Special Meeting”) to remove the current Board of Directors of the Company (the “Board”), to appoint new representatives to the Board, to amend the Company’s certificate of incorporation and bylaws, including the “anti-takeover provisions” thereof, so as to enable the foregoing, to solicit proxies, written requests or written consents to effect the foregoing, and for the purpose of taking all other actions necessary to achieve the foregoing (collectively, the “Purposes”).

NOW THEREFORE, IT IS AGREED, this 6^th day of January, 2012, by the undersigned and each other person and entity executing this joint filing and solicitation agreement (this “Agreement”):

1. In accordance with Rule 13d-1(k)(1)(iii) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), each of the undersigned (collectively, the “Group”) agrees to the joint filing on behalf of each of them of statements on Schedule 13D, and any amendments thereto, with respect to the securities of the Company. Each member of the Group shall be responsible for the accuracy and completeness of his/its own disclosure therein, and is not responsible for the accuracy and completeness of the information concerning the other members, unless such member knows or has reason to know that such information is inaccurate.

2. So long as this Agreement is in effect, each of the undersigned shall provide written notice to Troutman Sanders LLP (“Troutman Sanders”) of (i) any of their purchases or sales of securities of the Company, or (ii) any securities of the Company over which they acquire or dispose of beneficial ownership. Notice shall be given no later than 24 hours after each such transaction.

3. Each of the undersigned agrees to form the Group for the purpose of (i) soliciting proxies, written requests or written consents to achieve the Purposes, (ii) taking such other actions as the parties deem advisable, and (iii) taking all other action necessary or advisable to achieve the foregoing.

4. Each of the undersigned agrees that all expenses incurred in connection with the Group’s activities set forth in Section 3 must be pre-approved in writing by Armor. Armor agrees to pay directly all such pre-approved expenses.

5. Each of the undersigned agrees that any filing with the Securities and Exchange Commission, press release or stockholder communication proposed to be made or issued by the Group or any member of the Group in connection with the Group’s activities set forth in Section 3 shall be first approved by Armor or its representatives, which approval shall not be unreasonably withheld.

6. The relationship of the parties hereto shall be limited to carrying on the business of the Group in accordance with the terms of this Agreement. Such relationship shall be construed and deemed to be for the sole and limited purpose of carrying on such business as described herein. Nothing herein shall be construed to authorize any party to act as an agent for any other party, or to create a joint venture or partnership, or to constitute an indemnification. Nothing herein shall restrict any party’s right to purchase or sell securities of the Company, as he/it deems appropriate, in his/its sole discretion, provided that all such purchases and sales are made in compliance with all applicable securities laws.

7. This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute but one and the same instrument, which may be sufficiently evidenced by one counterpart.

8. In the event of any dispute arising out of the provisions of this Agreement or their investment in the Company, the parties hereto consent and submit to the exclusive jurisdiction of the Federal and State Courts in the State of New York.

9. For the avoidance of doubt, this Agreement is not, and shall not be construed as, a proxy, voting agreement or similar arrangement with respect to the securities of the Company.

10. Any party hereto may terminate his/its obligations under this Agreement on 24 hours’ prior written notice to all other parties, with a copy by fax to Henry J. Heyming at Troutman Sanders, Fax No. (804) 698-6012; provided that no party hereto who is also a party to that certain Voting Agreement filed as an exhibit to a Schedule 13D together with this Agreement (the “Voting Agreement”) may terminate this Agreement pursuant to this Section 9 so long as such Voting Agreement is still in full force and effect.

11. Each party acknowledges that Troutman Sanders shall act as counsel for both the Group and Armor and its affiliates relating to the Purposes.

12. Each of the undersigned parties hereby agrees that this Agreement shall be filed as an exhibit to a Schedule 13D pursuant to Rule 13d-1(k)(1)(iii) under the Exchange Act.

[Signature page follows]

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

Exhibit 99.2

VOTING AGREEMENT

WHEREAS, certain of the undersigned own or control voting securities of American Defense Systems, Inc., a Delaware corporation (the “Company”);

WHEREAS, Armor Technologies LLC, a North Carolina limited liability company (“Armor”), and JOWCO, LLC, a Colorado limited liability company, together with the undersigned, have formed a group (the “Group”) for the purpose of calling a special meeting of the stockholders of the Company (together with any adjournments, postponements, reschedulings or continuations thereof, the “Special Meeting”) to remove the current Board of Directors of the Company (the “Board”), to appoint new representatives to the Board, to amend the Company’s certificate of incorporation and bylaws, including the “anti-takeover provisions” thereof, so as to enable the foregoing, to solicit proxies, written requests or written consents to effect the foregoing, and for the purpose of taking all other actions necessary to achieve the foregoing (collectively, the “Purposes”).

NOW THEREFORE, IT IS AGREED, this 6^th day of January, 2012, by the undersigned and each other person and entity executing this voting agreement (this “Agreement”):

1. Each of the undersigned hereby covenants and agrees that, during the term of this Agreement, at the Special Meeting, or at any and all other meetings of stockholders of the Company, or at any adjournment, postponement, rescheduling or continuation thereof, or in any other circumstances upon which a vote, consent (including unanimous written consents), agreement or other approval is sought, he/it shall vote (or cause to be voted) all of the voting securities of the Company owned or controlled by him/it (whether now owned or hereafter acquired) and shall otherwise consent or agree in such manner as may be directed by Armor in its sole and absolute discretion, in pursuit of the Purposes. Each of the undersigned, as a holder of voting securities of the Company, shall be present in person or by proxy at all meetings of stockholders of the Company, including, without limitation, the Special Meeting, so that all voting securities held by him/it are counted for purposes of determining the presence of a quorum at such meeting.

2. Each of the parties hereto represents that he/it has full power to enter into this Agreement and has not, prior to the date of this Agreement, executed or delivered any proxy or entered into any other voting agreement or similar arrangement with respect to the securities of the Company, other than one that has expired or terminated prior to the date hereof.

3. So long as this Agreement is in effect, each of the undersigned shall provide written notice to Troutman Sanders LLP (“Troutman Sanders”) of (i) any of their purchases or sales of securities of the Company, or (ii) any securities of the Company over which they acquire or dispose of beneficial ownership. Notice shall be given no later than 24 hours after each such transaction.

4. The relationship of the parties hereto shall be limited to carrying on the business of the Group in accordance with the terms of this Agreement. Such relationship shall be construed and deemed to be for the sole and limited purpose of carrying on such business as

described herein. Nothing herein shall be construed to authorize any party to act as an agent for any other party, or to create a joint venture or partnership, or to constitute an indemnification. Nothing herein shall restrict any party’s right to purchase or sell securities of the Company, as he/it deems appropriate, in his/its sole discretion, provided that all such purchases and sales are made in compliance with all applicable securities laws.

5. This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute but one and the same instrument, which may be sufficiently evidenced by one counterpart.

6. In the event of any dispute arising out of the provisions of this Agreement or their investment in the Company, the parties hereto consent and submit to the exclusive jurisdiction of the Federal and State Courts in the State of New York.

7. This Agreement shall not be terminable for a period of 90 days from the date hereof, except in a writing signed by all parties hereto. Thereafter, any party hereto may terminate his/its obligations under this Agreement on 24 hours’ prior written notice to all other parties, with a copy by fax to Henry J. Heyming at Troutman Sanders, Fax No. (804) 698-6012.

8. Each party acknowledges that Troutman Sanders shall act as counsel for both the Group and Armor and its affiliates relating to the Purposes.

9. Each of the undersigned parties hereby agrees that this Agreement shall be filed as an exhibit to a Schedule 13D pursuant to Rule 13d-1(k)(1)(iii) under the Exchange Act.

[Signature page follows]

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

EXHIBIT 99.3

PURCHASE AND OPTION AGREEMENT

THIS PURCHASE AND OPTION AGREEMENT (this “Agreement”) is made and entered into as of December 29, 2011, by and between Dale Scales, an individual residing in North Carolina (“Purchaser”), and West Coast Opportunity Fund LLC, a Delaware limited liability company (“Seller”).

W I T N E S S E T H:

WHEREAS, Seller is the owner of 12,994,823 shares of the common stock, $0.001 par value per share (the “Common Stock”), of American Defense Systems, Inc., a Delaware corporation (the “Company”);

WHEREAS, Purchaser desires to purchase from Seller, and Seller desires to sell to Purchaser, 1,833,134 shares of the Company’s Common Stock (the “Shares”) in accordance with the terms and conditions hereof; and

WHEREAS, Purchaser desires to grant to Seller, and Seller desires to accept from Purchaser, the option to purchase up to 1,803,836 shares of the Company’s Common Stock (the “Option Shares”) from Purchaser in accordance with the terms and conditions hereof.

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

1. Purchase and Sale of Shares. Subject to the terms and conditions of this Agreement, Seller hereby sells, conveys, transfers, assigns and delivers to Purchaser, and Purchaser hereby purchases from Seller, the Shares.

2. Purchase Price; Payment; Delivery of Shares. The total purchase price for the Shares shall be an amount equal to $45,744. Simultaneous with the execution and delivery of this Agreement, (a) Purchaser shall (i) pay to Seller $744.00 by check or wire transfer of immediately available funds to an account designated by Seller, and (ii) issue to Seller a promissory note in the form attached hereto as Exhibit A in the amount of $45,000; and (b) Seller shall deliver to the Purchaser, at or promptly following the Closing, one or more original stock certificates evidencing the Shares being sold hereunder, together with such stock powers, assignment instruments, and irrevocable instructions to the Company’s transfer agent as may be necessary to vest good title to the Shares in Purchaser’s name, subject to existing restrictions on transfer under applicable federal securities laws.

3. Representations and Warranties of Seller. Seller represents and warrants to Purchaser as follows:

(a) Seller is duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation or incorporation. Seller has full power, authority and legal capacity to execute and deliver this Agreement and to perform Seller’s obligations hereunder. The execution, delivery and performance by Seller of this Agreement have been duly approved by the managers, board of directors or comparable governing body of Seller. West Coast Asset Management Inc. (the “Managing Member”) is the managing member of Seller and has authority to bind Seller hereunder. This Agreement constitutes the valid and legally binding obligation of Seller, enforceable against Seller in accordance with its terms.

(b) Seller is the sole record owner of the Shares.

(c) Seller has good and valid title to the Shares, free and clear of all liens, encumbrances and restrictions on transfer. Neither the Seller, the Company nor the Shares is subject to any stockholders’ or similar agreement that would in any way restrict or limit the transfer of the Shares by Seller to Purchaser. No provision in Seller’s certificate of formation or limited liability company agreement restricts or limits in any way the transferability of the Shares pursuant to this Agreement.

(d) The execution, delivery and performance of this Agreement (including without limitation the transactions contemplated under Section 5) will not, directly or indirectly, with or without notice or lapse of time: (i) violate any law or regulation to which Seller or the Shares is subject; (ii) violate the formation documents, limited liability company agreement or any other organizational document of Seller; (iii) violate, conflict with, result in a breach of, constitute a default under, result in the acceleration of or give any person the right to accelerate the maturity or performance of, or to cancel, terminate, modify or exercise any remedy under, any contract or agreement to which Seller is a party or by which Seller or the Shares is bound; or (iv) result in the imposition of any lien or encumbrance on the Shares. Except for filings that may be required under the Securities Exchange Act of 1934 and any administrative requirements of the Company’s transfer agent in order to effect the transfer to Purchaser of record title to the Shares, Seller need not notify, make any filing with, or obtain any consent of, the Company or any other third party in order to execute, deliver and perform this Agreement.

(e) Seller has no liability for any fee, commission or payment to any broker, finder or agent with respect to the transactions described in this Agreement.

4. Representations and Warranties of Purchaser. Purchaser represents and warrants to Seller as follows:

(a) Purchaser is acquiring the Shares hereunder for his own account for investment and not with a view toward, or in connection with, any distribution or resale thereof.

(b) Purchaser has sufficient knowledge and experience in financial, tax and business matters to evaluate the merits and risks associated with the purchase of the Shares and to make an informed investment decision with respect thereto.

(d) Purchaser is an “accredited investor” within the meaning of Rule 501 of Regulation D under the Securities Act of 1933, as amended (the “Securities Act”).

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(e) Purchaser (i) has not received from Seller any “material nonpublic information” (as such term is defined for purposes of Section 10b(5) of the Securities Exchange Act of 1934, as amended) with respect to the Company, (ii) is not in possession of any material nonpublic information with respect to the Company that was received from any other source, and (iii) and is not making its decision to purchase the Shares on the basis of or by reference in any way to any material nonpublic information whatsoever with respect to the Company.

5. Option.

(a) Purchaser herby grants to Seller the option to purchase the Option Shares (the “Option”) at a purchase price of $0.075 per share (the “Option Purchase Price”), vesting on the six-month anniversary of the date hereof and expiring December 31, 2012 (the “Option Period”).

(b) The Option may be exercised by the delivery of written notice or email (each an “Option Notice”) by the Seller to the Purchaser during the Option Period, specifying a purchase date that is within the Option Period (each an “Option Purchase Date”) and the number of Option Shares for which the Option is then being exercised. The Option may be exercised in whole or in part; provided that minimum proceeds to Purchaser of $25,000 shall be required in connection with each such exercise. If the Option is not exercised for all Option Shares before the expiration of the Option Period, it shall terminate as to the maximum number of Option Shares for which the Option is then exercisable as of the expiration of the Option Period and shall thereafter be void.

(c) On an Option Purchase Date, (a) Seller shall pay to Purchaser the applicable Option Purchase Price for the number of Option Shares being purchased by wire transfer of immediately available funds to an account designated by Purchaser; and (b) Purchaser shall deliver to Seller DTC shares, representing such Option Shares, together with such additional documents, stock powers and assignment instruments as may be necessary to vest good title to such Option Shares in Seller’s name. As of each Option Purchase Date, Seller shall be deemed to have made the representations and warranties to Purchaser set forth in Section 4 above as if Seller were “Purchaser” therein, mutatis mutandis, and Purchaser shall be deemed to have made the representations and warranties to Seller contained in Section 3 above as if Purchaser were “Seller” therein, mutatis mutandis, each as if the term “Shares” included the Option Shares being purchased on such date.

(d) Notwithstanding the foregoing provisions of this Section 5, the exercise of the Option is contingent upon (A) Seller qualifying as an “accredited investor” within the meaning of Rule 501 of Regulation D under the Securities Act at the time of such exercise, and (B) the consummation of such exercise and the transfer of Shares not, directly or indirectly, violating any law or regulation to which Purchaser or the Shares is subject (including without limitation the Securities Act).

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6. Indemnification.

(a) Subject to the other terms and conditions of this Section 6, Seller will indemnify and hold harmless Purchaser, and its and his representatives, from and against any and all claims, damages, losses, law suits, arbitration or administrative proceedings, liabilities, penalties, fees, costs and expenses, including, without limitation, reasonable attorneys’ fees and expenses (collectively, “Losses”), directly or indirectly, relating to or arising from: (i) any breach, or any allegation of any third party that, if true, would be a breach, of any representation or warranty made by Seller, in this Agreement; or (ii) any breach of any covenant or agreement of Seller, as the case may be, in this Agreement.

(b) Subject to the other terms and conditions of this Section 6, Purchaser will indemnify, defend, and hold harmless Seller and their representatives, from and against any and all Losses, directly or indirectly, relating to or arising from: (i) any breach of any representation or warranty made by Purchaser in this Agreement; or (ii) any breach of any covenant or agreement of Purchaser in this Agreement.

(c) All representations, warranties, covenants and agreements of Purchaser and Seller in this Agreement or any other certificate or document delivered pursuant to this Agreement will survive the execution and delivery of this Agreement and the closing of the transactions described herein.

(d) Notwithstanding the foregoing or any other provision hereof to the contrary, in no event shall any party be liable to the other party hereunder for any indirect, special, incidental or consequential damages (including lost profits or loss of goodwill), whether based on contract, tort (including negligence), or any other legal theory, arising out of or related to this Agreement.

7. Expenses. Each party shall be responsible for its own fees and expenses, including attorneys’ and accountants’ fees and expenses, incurred in connection with the negotiation and preparation of this Agreement and the consummation of the transactions described herein.

8. Miscellaneous.

(a) Further Assurances. Each of the parties hereto agrees to execute and deliver such other documents or agreements and to take such other action as may be reasonably necessary or desirable for the implementation of this Agreement and the consummation of the transactions contemplated hereby.

(b) Entire Agreement; Amendments and Waivers. This Agreement, together with the other agreements referenced herein, represent the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and thereof and all prior or contemporaneous written or oral agreements with respect to such subject matter are merged herein. This Agreement may be amended, supplemented or changed, and any provision hereof may be waived, only by written instrument making specific reference to this Agreement signed by the party against whom enforcement of any such amendment, supplement, modification or waiver is sought. The waiver by any party hereto of a breach of any provision of this Agreement shall not operate or be construed as a further or continuing waiver of such breach or as a waiver of any other or subsequent breach. No failure on the part of any party to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof.

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(c) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to conflict of laws principles. In the event of any dispute arising out of the provisions of this Agreement or their investment in the Company, the parties hereto consent and submit to the exclusive jurisdiction of the Federal and State Courts in the State of Delaware.

(d) Attorneys’ Fees. If any action is commenced to construe this Agreement or to enforce the rights or duties of the parties hereunder, then the party prevailing in that action shall be entitled to recover its costs and attorneys’ fees in that action, as well as all costs and attorneys’ fees incurred in enforcing any judgment entered therein.

(e) Binding Effect; Assignment. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and permitted assigns. The Seller may transfer or assign this Agreement or any of its/his rights or obligations hereunder without the prior written consent of Purchaser. Purchaser may not transfer or assign this Agreement and any of its rights or obligations hereunder without the consent of Seller. Any transfer or assignment of this Agreement in violation of this Section 8(e) shall be void.

(f) Severability. Should any provision of this Agreement or part thereof be held under any circumstances in any jurisdiction to be invalid or unenforceable, such invalidity or unenforceability will not affect the validity or enforceability of any other provision of this Agreement or other part of such provision.

(g) Third Party Beneficiaries. Nothing herein, expressed or implied, is intended to or shall be construed to confer upon or give to any person or entity other than Purchaser, Seller, and their successors or permitted assigns any rights or remedies under or by reason of this Agreement.

(h) Notices. Notices hereunder shall be in writing, and shall be deemed effectively given upon personal delivery, or upon confirmed delivery by facsimile or electronic mail, or on the next day following mailing by a reputable overnight courier, or on the third (or, for international deliveries, tenth) day following mailing by registered or certified mail, return receipt requested, postage prepaid, addressed to the address specified on the signature page hereto. A party may change its/his address for notices by written notice delivered in the manner set forth above.

(i) Counterparts; Facsimile Signature. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute one and the same instrument. A copy of this Agreement that is executed by a party and transmitted by that party to the other party by facsimile or as an attachment (e.g., in “.tif” or “.pdf” format) to an email shall be binding upon the signatory to the same extent as a copy hereof containing that party’s original signature.

[The next page is the signature page]

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[Signature Page to Purchase and Option Agreement]

IN WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto as of the day and year first above written.

PURCHASER:

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EXHIBIT A

To

Purchase and Option Agreement

Form of Promissory Note

PROMISSORY NOTE

FOR VALUE RECEIVED, Dale Scales, an individual (“Maker”), promises to pay to the order of WEST COAST OPPORTUNITY FUND, LLC, a Delaware limited liability company (“Holder”), at Santa Barbara, California, or at such other place as Holder may designate from time to time in writing, the principal sum of Forty Five Thousand Dollars ($45,000.00), without interest thereon (except as set forth in Section 3.3, below). The principal of this Promissory Note (the “Note”) shall be payable at the time and in the manner described in Section 1, below.

1. PAYMENT OF PRINCIPAL. Subject to prepayment pursuant to Section 2, below, and to acceleration pursuant to Section 3, below, Maker shall pay the entire unpaid principal of this Note on February 28, 2012.

2. PREPAYMENT. Maker may prepay all or any part of the principal then outstanding at any time, without penalty or premium.

3. DEFAULT

3.1 EVENTS OF DEFAULT. At the election of Holder, the entire principal balance of this Note shall become immediately due and payable upon the occurrence of one or more of the following events of default:

(a) FAILURE TO PAY. Maker defaults in the payment of any amount due under this Note;

(b) INSOLVENCY. Maker makes an assignment for the benefit of any one or more of its creditors;

(c) RECEIVER. A receiver is appointed with respect to Maker’s business operations or any substantial portion of Maker’s assets, and such receiver is not dismissed within thirty (30) days following the effective date of its appointment; or

(d) BANKRUPTCY. There is commenced with respect to Maker a bankruptcy proceeding under the Bankruptcy Code, as amended from time to time, and such proceeding is not dismissed within thirty (30).

3.2 HOLDER’S ELECTION. Holder’s failure to exercise the election described in Section 3.1, above, with respect to any event of default shall not constitute a waiver of the right to exercise such election upon the occurrence of any subsequent default.

3.3 DEFAULT INTEREST. If Maker defaults in payment of any portion of the principal of this Note, then the delinquent portion of such principal amount shall bear interest from the due date for such payment until the date paid in full at a rate of ten percent (10.0%) per annum, non-compounded (or, if less, the maximum rate permitted by applicable law).

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4. LATE PAYMENT CHARGE. Maker acknowledges and agrees that late payment to Holder will cause Holder to incur costs not contemplated by the loan evidenced by this Note, and that the exact amount of such costs are difficult and impracticable to assess. Therefore, Maker agrees that if all or any part of the amount due under this Note is not paid when due, then Maker shall pay Holder, on or before the fifteenth (15th) day after the due date for such payment, a late payment charge equal to three percent (3.0%) of any such amount not paid within ten (10) days of the due date thereof, and that such amount shall be deemed to be the damages for the loss suffered by such delinquency in payment. By accepting this Note, and without prejudicing any other rights or remedies of Holder hereunder, Holder agrees to accept such amount as liquidated damages on account of any such delinquent payment.

5. GENERAL PROVISIONS. All sums due hereunder shall be paid in lawful money of the United States of America. Interest shall be computed on the basis of a 360-day year. All payments made hereunder shall be credited first against unpaid late charges; the balance of each such payment next shall be credited against accrued and previously unpaid interest; and the balance of each such payment shall be credited against principal, and interest thereafter shall not accrue on the amount so credited to principal. In this Note, the singular shall include the plural, and each gender shall include the other. Maker, for itself and its legal representatives, successors, and assigns, expressly waives demand, notice of nonpayment, presentment for demand, presentment for the purpose of accelerating maturity, dishonor, notice of dishonor, protest, notice of protest, notice of maturity, and diligence in collection. This Note shall be construed in accordance with the laws of the State of Delaware. Maker hereby consents to the jurisdiction of the courts of the State of Delaware with respect to any matter relating to the enforcement of any rights created by or evidenced in this Note. The section and subsection headings in this Note are included for purposes of convenience and reference only and shall not affect in any way the meaning or interpretation of this Note. Maker agrees to pay all of Holder’s court costs and attorneys’ fees if counsel is engaged to assist in the collection of amounts due under this Note after a default hereunder or if any action is commenced to construe or enforce the terms of this Note.

IN WITNESS WHEREOF, the undersigned Maker has executed this Note on the date set forth below.

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EXHIBIT 99.4

PURCHASE AND OPTION AGREEMENT

THIS PURCHASE AND OPTION AGREEMENT (this “Agreement”) is made and entered into as of December 29, 2011, by and between John Jodlowski, an individual residing in Colorado (“Purchaser”), and West Coast Opportunity Fund LLC, a Delaware limited liability company (“Seller”).

W I T N E S S E T H:

WHEREAS, Seller is the owner of 12,994,823 shares of the common stock, $0.001 par value per share (the “Common Stock”), of American Defense Systems, Inc., a Delaware corporation (the “Company”);

WHEREAS, Purchaser desires to purchase from Seller, and Seller desires to sell to Purchaser, 4,569,510 shares of the Company’s Common Stock (the “Shares”) in accordance with the terms and conditions hereof; and

WHEREAS, Purchaser desires to grant to Seller, and Seller desires to accept from Purchaser, the option to purchase up to 1,598,082 shares of the Company’s Common Stock (the “Option Shares”) from Purchaser in accordance with the terms and conditions hereof.

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

1. Purchase and Sale of Shares. Subject to the terms and conditions of this Agreement, Seller hereby sells, conveys, transfers, assigns and delivers to Purchaser, and Purchaser hereby purchases from Seller, the Shares.

2. Purchase Price; Payment; Delivery of Shares. The total purchase price for the Shares shall be an amount equal to $105,000. Simultaneous with the execution and delivery of this Agreement, (a) Purchaser shall (i) pay to Seller $65,000 by check or wire transfer of immediately available funds to an account designated by Seller, and (ii) issue to Seller a promissory note in the form attached hereto as Exhibit A in the amount of $40,000; and (b) Seller shall deliver to the Purchaser, at or promptly following the Closing, one or more original stock certificates evidencing the Shares being sold hereunder, together with such stock powers, assignment instruments, and irrevocable instructions to the Company’s transfer agent as may be necessary to vest good title to the Shares in Purchaser’s name, subject to existing restrictions on transfer under applicable federal securities laws.

3. Representations and Warranties of Seller. Seller represents and warrants to Purchaser as follows:

(a) Seller is duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation or incorporation. Seller has full power, authority and legal capacity to execute and deliver this Agreement and to perform Seller’s obligations hereunder. The execution, delivery and performance by Seller of this Agreement have been duly approved by the managers, board of directors or comparable governing body of Seller. West Coast Asset Management Inc. (the “Managing Member”) is the managing member of Seller and has authority to bind Seller hereunder. This Agreement constitutes the valid and legally binding obligation of Seller, enforceable against Seller in accordance with its terms.

(b) Seller is the sole record owner of the Shares.

(c) Seller has good and valid title to the Shares, free and clear of all liens, encumbrances and restrictions on transfer. Neither the Seller, the Company nor the Shares is subject to any stockholders’ or similar agreement that would in any way restrict or limit the transfer of the Shares by Seller to Purchaser. No provision in Seller’s certificate of formation or limited liability company agreement restricts or limits in any way the transferability of the Shares pursuant to this Agreement.

(d) The execution, delivery and performance of this Agreement (including without limitation the transactions contemplated under Section 5) will not, directly or indirectly, with or without notice or lapse of time: (i) violate any law or regulation to which Seller or the Shares is subject; (ii) violate the formation documents, limited liability company agreement or any other organizational document of Seller; (iii) violate, conflict with, result in a breach of, constitute a default under, result in the acceleration of or give any person the right to accelerate the maturity or performance of, or to cancel, terminate, modify or exercise any remedy under, any contract or agreement to which Seller is a party or by which Seller or the Shares is bound; or (iv) result in the imposition of any lien or encumbrance on the Shares. Except for filings that may be required under the Securities Exchange Act of 1934 and any administrative requirements of the Company’s transfer agent in order to effect the transfer to Purchaser of record title to the Shares, Seller need not notify, make any filing with, or obtain any consent of, the Company or any other third party in order to execute, deliver and perform this Agreement.

(e) Seller has no liability for any fee, commission or payment to any broker, finder or agent with respect to the transactions described in this Agreement.

4. Representations and Warranties of Purchaser. Purchaser represents and warrants to Seller as follows:

(a) Purchaser is acquiring the Shares hereunder for his own account for investment and not with a view toward, or in connection with, any distribution or resale thereof.

(b) Purchaser has sufficient knowledge and experience in financial, tax and business matters to evaluate the merits and risks associated with the purchase of the Shares and to make an informed investment decision with respect thereto.

(d) Purchaser is an “accredited investor” within the meaning of Rule 501 of Regulation D under the Securities Act of 1933, as amended (the “Securities Act”).

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(e) Purchaser (i) has not received from Seller any “material nonpublic information” (as such term is defined for purposes of Section 10b(5) of the Securities Exchange Act of 1934, as amended) with respect to the Company, (ii) is not in possession of any material nonpublic information with respect to the Company that was received from any other source, and (iii) and is not making its decision to purchase the Shares on the basis of or by reference in any way to any material nonpublic information whatsoever with respect to the Company.

5. Option.

(a) Purchaser herby grants to Seller the option to purchase the Option Shares (the “Option”) at a purchase price of $0.075 per share (the “Option Purchase Price”), vesting on the six-month anniversary of the date hereof and expiring December 31, 2012 (the “Option Period”).

(b) The Option may be exercised by the delivery of written notice or email (each an “Option Notice”) by the Seller to the Purchaser during the Option Period, specifying a purchase date that is within the Option Period (each an “Option Purchase Date”) and the number of Option Shares for which the Option is then being exercised. The Option may be exercised in whole or in part; provided that minimum proceeds to Purchaser of $25,000 shall be required in connection with each such exercise. If the Option is not exercised for all Option Shares before the expiration of the Option Period, it shall terminate as to the maximum number of Option Shares for which the Option is then exercisable as of the expiration of the Option Period and shall thereafter be void.

(c) On an Option Purchase Date, (a) Seller shall pay to Purchaser the applicable Option Purchase Price for the number of Option Shares being purchased by wire transfer of immediately available funds to an account designated by Purchaser; and (b) Purchaser shall deliver to Seller DTC shares, representing such Option Shares, together with such additional documents, stock powers and assignment instruments as may be necessary to vest good title to such Option Shares in Seller’s name. As of each Option Purchase Date, Seller shall be deemed to have made the representations and warranties to Purchaser set forth in Section 4 above as if Seller were “Purchaser” therein, mutatis mutandis, and Purchaser shall be deemed to have made the representations and warranties to Seller contained in Section 3 above as if Purchaser were “Seller” therein, mutatis mutandis, each as if the term “Shares” included the Option Shares being purchased on such date.

(d) Notwithstanding the foregoing provisions of this Section 5, the exercise of the Option is contingent upon (A) Seller qualifying as an “accredited investor” within the meaning of Rule 501 of Regulation D under the Securities Act at the time of such exercise, and (B) the consummation of such exercise and the transfer of Shares not, directly or indirectly, violating any law or regulation to which Purchaser or the Shares is subject (including without limitation the Securities Act).

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6. Indemnification.

(a) Subject to the other terms and conditions of this Section 6, Seller will indemnify and hold harmless Purchaser, and its and his representatives, from and against any and all claims, damages, losses, law suits, arbitration or administrative proceedings, liabilities, penalties, fees, costs and expenses, including, without limitation, reasonable attorneys’ fees and expenses (collectively, “Losses”), directly or indirectly, relating to or arising from: (i) any breach, or any allegation of any third party that, if true, would be a breach, of any representation or warranty made by Seller, in this Agreement; or (ii) any breach of any covenant or agreement of Seller, as the case may be, in this Agreement.

(b) Subject to the other terms and conditions of this Section 6, Purchaser will indemnify, defend, and hold harmless Seller and their representatives, from and against any and all Losses, directly or indirectly, relating to or arising from: (i) any breach of any representation or warranty made by Purchaser in this Agreement; or (ii) any breach of any covenant or agreement of Purchaser in this Agreement.

(c) All representations, warranties, covenants and agreements of Purchaser and Seller in this Agreement or any other certificate or document delivered pursuant to this Agreement will survive the execution and delivery of this Agreement and the closing of the transactions described herein.

(d) Notwithstanding the foregoing or any other provision hereof to the contrary, in no event shall any party be liable to the other party hereunder for any indirect, special, incidental or consequential damages (including lost profits or loss of goodwill), whether based on contract, tort (including negligence), or any other legal theory, arising out of or related to this Agreement.

7. Expenses. Each party shall be responsible for its own fees and expenses, including attorneys’ and accountants’ fees and expenses, incurred in connection with the negotiation and preparation of this Agreement and the consummation of the transactions described herein.

8. Miscellaneous.

(a) Further Assurances. Each of the parties hereto agrees to execute and deliver such other documents or agreements and to take such other action as may be reasonably necessary or desirable for the implementation of this Agreement and the consummation of the transactions contemplated hereby.

(b) Entire Agreement; Amendments and Waivers. This Agreement, together with the other agreements referenced herein, represent the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and thereof and all prior or contemporaneous written or oral agreements with respect to such subject matter are merged herein. This Agreement may be amended, supplemented or changed, and any provision hereof may be waived, only by written instrument making specific reference to this Agreement signed by the party against whom enforcement of any such amendment, supplement, modification or waiver is sought. The waiver by any party hereto of a breach of any provision of this Agreement shall not operate or be construed as a further or continuing waiver of such breach or as a waiver of any other or subsequent breach. No failure on the part of any party to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof.

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(c) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to conflict of laws principles. In the event of any dispute arising out of the provisions of this Agreement or their investment in the Company, the parties hereto consent and submit to the exclusive jurisdiction of the Federal and State Courts in the State of Delaware.

(d) Attorneys’ Fees. If any action is commenced to construe this Agreement or to enforce the rights or duties of the parties hereunder, then the party prevailing in that action shall be entitled to recover its costs and attorneys’ fees in that action, as well as all costs and attorneys’ fees incurred in enforcing any judgment entered therein.

(e) Binding Effect; Assignment. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and permitted assigns. The Seller may transfer or assign this Agreement or any of its/his rights or obligations hereunder without the prior written consent of Purchaser. Purchaser may not transfer or assign this Agreement and any of its rights or obligations hereunder without the consent of Seller. Any transfer or assignment of this Agreement in violation of this Section 8(e) shall be void.

(f) Severability. Should any provision of this Agreement or part thereof be held under any circumstances in any jurisdiction to be invalid or unenforceable, such invalidity or unenforceability will not affect the validity or enforceability of any other provision of this Agreement or other part of such provision.

(g) Third Party Beneficiaries. Nothing herein, expressed or implied, is intended to or shall be construed to confer upon or give to any person or entity other than Purchaser, Seller, and their successors or permitted assigns any rights or remedies under or by reason of this Agreement.

(h) Notices. Notices hereunder shall be in writing, and shall be deemed effectively given upon personal delivery, or upon confirmed delivery by facsimile or electronic mail, or on the next day following mailing by a reputable overnight courier, or on the third (or, for international deliveries, tenth) day following mailing by registered or certified mail, return receipt requested, postage prepaid, addressed to the address specified on the signature page hereto. A party may change its/his address for notices by written notice delivered in the manner set forth above.

(i) Counterparts; Facsimile Signature. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute one and the same instrument. A copy of this Agreement that is executed by a party and transmitted by that party to the other party by facsimile or as an attachment (e.g., in “.tif” or “.pdf” format) to an email shall be binding upon the signatory to the same extent as a copy hereof containing that party’s original signature.

[The next page is the signature page]

5

[Signature Page to Purchase and Option Agreement]

IN WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto as of the day and year first above written.

6

EXHIBIT A

To

Purchase and Option Agreement

Form of Promissory Note

PROMISSORY NOTE

Santa Barbara, California

FOR VALUE RECEIVED, JOHN JODLOWSKI, an individual (“Maker”), promises to pay to the order of WEST COAST OPPORTUNITY FUND, LLC, a Delaware limited liability company (“Holder”), at Santa Barbara, California, or at such other place as Holder may designate from time to time in writing, the principal sum of Forty Thousand Dollars ($40,000.00), without interest thereon (except as set forth in Section 3.3, below). The principal of this Promissory Note (the “Note”) shall be payable at the time and in the manner described in Section 1, below.

1. PAYMENT OF PRINCIPAL. Subject to prepayment pursuant to Section 2, below, and to acceleration pursuant to Section 3, below, Maker shall pay the entire unpaid principal of this Note on February 28, 2012.

2. PREPAYMENT. Maker may prepay all or any part of the principal then outstanding at any time, without penalty or premium.

3. DEFAULT

3.1 EVENTS OF DEFAULT. At the election of Holder, the entire principal balance of this Note shall become immediately due and payable upon the occurrence of one or more of the following events of default:

(a) FAILURE TO PAY. Maker defaults in the payment of any amount due under this Note;

(b) INSOLVENCY. Maker makes an assignment for the benefit of any one or more of its creditors;

(c) RECEIVER. A receiver is appointed with respect to Maker’s business operations or any substantial portion of Maker’s assets, and such receiver is not dismissed within thirty (30) days following the effective date of its appointment; or

(d) BANKRUPTCY. There is commenced with respect to Maker a bankruptcy proceeding under the Bankruptcy Code, as amended from time to time, and such proceeding is not dismissed within thirty (30).

3.2 HOLDER’S ELECTION. Holder’s failure to exercise the election described in Section 3.1, above, with respect to any event of default shall not constitute a waiver of the right to exercise such election upon the occurrence of any subsequent default.

3.3 DEFAULT INTEREST. If Maker defaults in payment of any portion of the principal of this Note, then the delinquent portion of such principal amount shall bear interest from the due date for such payment until the date paid in full at a rate of ten percent (10.0%) per annum, non-compounded (or, if less, the maximum rate permitted by applicable law).

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4. LATE PAYMENT CHARGE. Maker acknowledges and agrees that late payment to Holder will cause Holder to incur costs not contemplated by the loan evidenced by this Note, and that the exact amount of such costs are difficult and impracticable to assess. Therefore, Maker agrees that if all or any part of the amount due under this Note is not paid when due, then Maker shall pay Holder, on or before the fifteenth (15th) day after the due date for such payment, a late payment charge equal to three percent (3.0%) of any such amount not paid within ten (10) days of the due date thereof, and that such amount shall be deemed to be the damages for the loss suffered by such delinquency in payment. By accepting this Note, and without prejudicing any other rights or remedies of Holder hereunder, Holder agrees to accept such amount as liquidated damages on account of any such delinquent payment.

5. GENERAL PROVISIONS. All sums due hereunder shall be paid in lawful money of the United States of America. Interest shall be computed on the basis of a 360-day year. All payments made hereunder shall be credited first against unpaid late charges; the balance of each such payment next shall be credited against accrued and previously unpaid interest; and the balance of each such payment shall be credited against principal, and interest thereafter shall not accrue on the amount so credited to principal. In this Note, the singular shall include the plural, and each gender shall include the other. Maker, for itself and its legal representatives, successors, and assigns, expressly waives demand, notice of nonpayment, presentment for demand, presentment for the purpose of accelerating maturity, dishonor, notice of dishonor, protest, notice of protest, notice of maturity, and diligence in collection. This Note shall be construed in accordance with the laws of the State of Delaware. Maker hereby consents to the jurisdiction of the courts of the State of Delaware with respect to any matter relating to the enforcement of any rights created by or evidenced in this Note. The section and subsection headings in this Note are included for purposes of convenience and reference only and shall not affect in any way the meaning or interpretation of this Note. Maker agrees to pay all of Holder’s court costs and attorneys’ fees if counsel is engaged to assist in the collection of amounts due under this Note after a default hereunder or if any action is commenced to construe or enforce the terms of this Note.

IN WITNESS WHEREOF, the undersigned Maker has executed this Note on the date set forth below.

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EXHIBIT 99.5

PURCHASE AND OPTION AGREEMENT

THIS PURCHASE AND OPTION AGREEMENT (this “Agreement”) is made and entered into as of December 29, 2011, by and between Frank Bednarz, an individual residing in Illinois (“Purchaser”), and West Coast Opportunity Fund LLC, a Delaware limited liability company (“Seller”).

W I T N E S S E T H:

WHEREAS, Seller is the owner of 12,994,823 shares of the common stock, $0.001 par value per share (the “Common Stock”), of American Defense Systems, Inc., a Delaware corporation (the “Company”);

WHEREAS, Purchaser desires to purchase from Seller, and Seller desires to sell to Purchaser, 4,569,510 shares of the Company’s Common Stock (the “Shares”) in accordance with the terms and conditions hereof; and

WHEREAS, Purchaser desires to grant to Seller, and Seller desires to accept from Purchaser, the option to purchase up to 1,598,082 shares of the Company’s Common Stock (the “Option Shares”) from Purchaser in accordance with the terms and conditions hereof.

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

1. Purchase and Sale of Shares. Subject to the terms and conditions of this Agreement, Seller hereby sells, conveys, transfers, assigns and delivers to Purchaser, and Purchaser hereby purchases from Seller, the Shares.

2. Purchase Price; Payment; Delivery of Shares. The total purchase price for the Shares shall be an amount equal to $105,000. Simultaneous with the execution and delivery of this Agreement, (a) Purchaser shall (i) pay to Seller $65,000 by check or wire transfer of immediately available funds to an account designated by Seller, and (ii) issue to Seller a promissory note in the form attached hereto as Exhibit A in the amount of $40,000; and (b) Seller shall deliver to the Purchaser, at or promptly following the Closing, one or more original stock certificates evidencing the Shares being sold hereunder, together with such stock powers, assignment instruments, and irrevocable instructions to the Company’s transfer agent as may be necessary to vest good title to the Shares in Purchaser’s name, subject to existing restrictions on transfer under applicable federal securities laws.

3. Representations and Warranties of Seller. Seller represents and warrants to Purchaser as follows:

(a) Seller is duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation or incorporation. Seller has full power, authority and legal capacity to execute and deliver this Agreement and to perform Seller’s obligations hereunder. The execution, delivery and performance by Seller of this Agreement have been duly approved by the managers, board of directors or comparable governing body of Seller. West Coast Asset Management Inc. (the “Managing Member”) is the managing member of Seller and has authority to bind Seller hereunder. This Agreement constitutes the valid and legally binding obligation of Seller, enforceable against Seller in accordance with its terms.

(b) Seller is the sole record owner of the Shares.

(c) Seller has good and valid title to the Shares, free and clear of all liens, encumbrances and restrictions on transfer. Neither the Seller, the Company nor the Shares is subject to any stockholders’ or similar agreement that would in any way restrict or limit the transfer of the Shares by Seller to Purchaser. No provision in Seller’s certificate of formation or limited liability company agreement restricts or limits in any way the transferability of the Shares pursuant to this Agreement.

(d) The execution, delivery and performance of this Agreement (including without limitation the transactions contemplated under Section 5) will not, directly or indirectly, with or without notice or lapse of time: (i) violate any law or regulation to which Seller or the Shares is subject; (ii) violate the formation documents, limited liability company agreement or any other organizational document of Seller; (iii) violate, conflict with, result in a breach of, constitute a default under, result in the acceleration of or give any person the right to accelerate the maturity or performance of, or to cancel, terminate, modify or exercise any remedy under, any contract or agreement to which Seller is a party or by which Seller or the Shares is bound; or (iv) result in the imposition of any lien or encumbrance on the Shares. Except for filings that may be required under the Securities Exchange Act of 1934 and any administrative requirements of the Company’s transfer agent in order to effect the transfer to Purchaser of record title to the Shares, Seller need not notify, make any filing with, or obtain any consent of, the Company or any other third party in order to execute, deliver and perform this Agreement.

(e) Seller has no liability for any fee, commission or payment to any broker, finder or agent with respect to the transactions described in this Agreement.

4. Representations and Warranties of Purchaser. Purchaser represents and warrants to Seller as follows:

(a) Purchaser is acquiring the Shares hereunder for his own account for investment and not with a view toward, or in connection with, any distribution or resale thereof.

(b) Purchaser has sufficient knowledge and experience in financial, tax and business matters to evaluate the merits and risks associated with the purchase of the Shares and to make an informed investment decision with respect thereto.

(d) Purchaser is an “accredited investor” within the meaning of Rule 501 of Regulation D under the Securities Act of 1933, as amended (the “Securities Act”).

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(e) Purchaser (i) has not received from Seller any “material nonpublic information” (as such term is defined for purposes of Section 10b(5) of the Securities Exchange Act of 1934, as amended) with respect to the Company, (ii) is not in possession of any material nonpublic information with respect to the Company that was received from any other source, and (iii) and is not making its decision to purchase the Shares on the basis of or by reference in any way to any material nonpublic information whatsoever with respect to the Company.

5. Option.

(a) Purchaser herby grants to Seller the option to purchase the Option Shares (the “Option”) at a purchase price of $0.075 per share (the “Option Purchase Price”), vesting on the six-month anniversary of the date hereof and expiring December 31, 2012 (the “Option Period”).

(b) The Option may be exercised by the delivery of written notice or email (each an “Option Notice”) by the Seller to the Purchaser during the Option Period, specifying a purchase date that is within the Option Period (each an “Option Purchase Date”) and the number of Option Shares for which the Option is then being exercised. The Option may be exercised in whole or in part; provided that minimum proceeds to Purchaser of $25,000 shall be required in connection with each such exercise. If the Option is not exercised for all Option Shares before the expiration of the Option Period, it shall terminate as to the maximum number of Option Shares for which the Option is then exercisable as of the expiration of the Option Period and shall thereafter be void.

(c) On an Option Purchase Date, (a) Seller shall pay to Purchaser the applicable Option Purchase Price for the number of Option Shares being purchased by wire transfer of immediately available funds to an account designated by Purchaser; and (b) Purchaser shall deliver to Seller DTC shares, representing such Option Shares, together with such additional documents, stock powers and assignment instruments as may be necessary to vest good title to such Option Shares in Seller’s name. As of each Option Purchase Date, Seller shall be deemed to have made the representations and warranties to Purchaser set forth in Section 4 above as if Seller were “Purchaser” therein, mutatis mutandis, and Purchaser shall be deemed to have made the representations and warranties to Seller contained in Section 3 above as if Purchaser were “Seller” therein, mutatis mutandis, each as if the term “Shares” included the Option Shares being purchased on such date.

(d) Notwithstanding the foregoing provisions of this Section 5, the exercise of the Option is contingent upon (A) Seller qualifying as an “accredited investor” within the meaning of Rule 501 of Regulation D under the Securities Act at the time of such exercise, and (B) the consummation of such exercise and the transfer of Shares not, directly or indirectly, violating any law or regulation to which Purchaser or the Shares is subject (including without limitation the Securities Act).

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6. Indemnification.

(a) Subject to the other terms and conditions of this Section 6, Seller will indemnify and hold harmless Purchaser, and its and his representatives, from and against any and all claims, damages, losses, law suits, arbitration or administrative proceedings, liabilities, penalties, fees, costs and expenses, including, without limitation, reasonable attorneys’ fees and expenses (collectively, “Losses”), directly or indirectly, relating to or arising from: (i) any breach, or any allegation of any third party that, if true, would be a breach, of any representation or warranty made by Seller, in this Agreement; or (ii) any breach of any covenant or agreement of Seller, as the case may be, in this Agreement.

(b) Subject to the other terms and conditions of this Section 6, Purchaser will indemnify, defend, and hold harmless Seller and their representatives, from and against any and all Losses, directly or indirectly, relating to or arising from: (i) any breach of any representation or warranty made by Purchaser in this Agreement; or (ii) any breach of any covenant or agreement of Purchaser in this Agreement.

(c) All representations, warranties, covenants and agreements of Purchaser and Seller in this Agreement or any other certificate or document delivered pursuant to this Agreement will survive the execution and delivery of this Agreement and the closing of the transactions described herein.

(d) Notwithstanding the foregoing or any other provision hereof to the contrary, in no event shall any party be liable to the other party hereunder for any indirect, special, incidental or consequential damages (including lost profits or loss of goodwill), whether based on contract, tort (including negligence), or any other legal theory, arising out of or related to this Agreement.

7. Expenses. Each party shall be responsible for its own fees and expenses, including attorneys’ and accountants’ fees and expenses, incurred in connection with the negotiation and preparation of this Agreement and the consummation of the transactions described herein.

8. Miscellaneous.

(a) Further Assurances. Each of the parties hereto agrees to execute and deliver such other documents or agreements and to take such other action as may be reasonably necessary or desirable for the implementation of this Agreement and the consummation of the transactions contemplated hereby.

(b) Entire Agreement; Amendments and Waivers. This Agreement, together with the other agreements referenced herein, represent the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and thereof and all prior or contemporaneous written or oral agreements with respect to such subject matter are merged herein. This Agreement may be amended, supplemented or changed, and any provision hereof may be waived, only by written instrument making specific reference to this Agreement signed by the party against whom enforcement of any such amendment, supplement, modification or waiver is sought. The waiver by any party hereto of a breach of any provision of this Agreement shall not operate or be construed as a further or continuing waiver of such breach or as a waiver of any other or subsequent breach. No failure on the part of any party to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof.

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(c) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to conflict of laws principles. In the event of any dispute arising out of the provisions of this Agreement or their investment in the Company, the parties hereto consent and submit to the exclusive jurisdiction of the Federal and State Courts in the State of Delaware.

(d) Attorneys’ Fees. If any action is commenced to construe this Agreement or to enforce the rights or duties of the parties hereunder, then the party prevailing in that action shall be entitled to recover its costs and attorneys’ fees in that action, as well as all costs and attorneys’ fees incurred in enforcing any judgment entered therein.

(e) Binding Effect; Assignment. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and permitted assigns. The Seller may transfer or assign this Agreement or any of its/his rights or obligations hereunder without the prior written consent of Purchaser. Purchaser may not transfer or assign this Agreement and any of its rights or obligations hereunder without the consent of Seller. Any transfer or assignment of this Agreement in violation of this Section 8(e) shall be void.

(f) Severability. Should any provision of this Agreement or part thereof be held under any circumstances in any jurisdiction to be invalid or unenforceable, such invalidity or unenforceability will not affect the validity or enforceability of any other provision of this Agreement or other part of such provision.

(g) Third Party Beneficiaries. Nothing herein, expressed or implied, is intended to or shall be construed to confer upon or give to any person or entity other than Purchaser, Seller, and their successors or permitted assigns any rights or remedies under or by reason of this Agreement.

(h) Notices. Notices hereunder shall be in writing, and shall be deemed effectively given upon personal delivery, or upon confirmed delivery by facsimile or electronic mail, or on the next day following mailing by a reputable overnight courier, or on the third (or, for international deliveries, tenth) day following mailing by registered or certified mail, return receipt requested, postage prepaid, addressed to the address specified on the signature page hereto. A party may change its/his address for notices by written notice delivered in the manner set forth above.

(i) Counterparts; Facsimile Signature. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute one and the same instrument. A copy of this Agreement that is executed by a party and transmitted by that party to the other party by facsimile or as an attachment (e.g., in “.tif” or “.pdf” format) to an email shall be binding upon the signatory to the same extent as a copy hereof containing that party’s original signature.

[The next page is the signature page]

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[Signature Page to Purchase and Option Agreement]

IN WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto as of the day and year first above written.

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EXHIBIT A

To

Purchase and Option Agreement

Form of Promissory Note

PROMISSORY NOTE

FOR VALUE RECEIVED, FRANK BEDNARZ, an individual (“Maker”), promises to pay to the order of WEST COAST OPPORTUNITY FUND, LLC, a Delaware limited liability company (“Holder”), at Santa Barbara, California, or at such other place as Holder may designate from time to time in writing, the principal sum of Forty Thousand Dollars ($40,000.00), without interest thereon (except as set forth in Section 3.3, below). The principal of this Promissory Note (the “Note”) shall be payable at the time and in the manner described in Section 1, below.

1. PAYMENT OF PRINCIPAL. Subject to prepayment pursuant to Section 2, below, and to acceleration pursuant to Section 3, below, Maker shall pay the entire unpaid principal of this Note on February 28, 2012.

2. PREPAYMENT. Maker may prepay all or any part of the principal then outstanding at any time, without penalty or premium.

3. DEFAULT

3.1 EVENTS OF DEFAULT. At the election of Holder, the entire principal balance of this Note shall become immediately due and payable upon the occurrence of one or more of the following events of default:

(a) FAILURE TO PAY. Maker defaults in the payment of any amount due under this Note;

(b) INSOLVENCY. Maker makes an assignment for the benefit of any one or more of its creditors;

(c) RECEIVER. A receiver is appointed with respect to Maker’s business operations or any substantial portion of Maker’s assets, and such receiver is not dismissed within thirty (30) days following the effective date of its appointment; or

(d) BANKRUPTCY. There is commenced with respect to Maker a bankruptcy proceeding under the Bankruptcy Code, as amended from time to time, and such proceeding is not dismissed within thirty (30).

3.2 HOLDER’S ELECTION. Holder’s failure to exercise the election described in Section 3.1, above, with respect to any event of default shall not constitute a waiver of the right to exercise such election upon the occurrence of any subsequent default.

3.3 DEFAULT INTEREST. If Maker defaults in payment of any portion of the principal of this Note, then the delinquent portion of such principal amount shall bear interest from the due date for such payment until the date paid in full at a rate of ten percent (10.0%) per annum, non-compounded (or, if less, the maximum rate permitted by applicable law).

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4. LATE PAYMENT CHARGE. Maker acknowledges and agrees that late payment to Holder will cause Holder to incur costs not contemplated by the loan evidenced by this Note, and that the exact amount of such costs are difficult and impracticable to assess. Therefore, Maker agrees that if all or any part of the amount due under this Note is not paid when due, then Maker shall pay Holder, on or before the fifteenth (15th) day after the due date for such payment, a late payment charge equal to three percent (3.0%) of any such amount not paid within ten (10) days of the due date thereof, and that such amount shall be deemed to be the damages for the loss suffered by such delinquency in payment. By accepting this Note, and without prejudicing any other rights or remedies of Holder hereunder, Holder agrees to accept such amount as liquidated damages on account of any such delinquent payment.

5. GENERAL PROVISIONS. All sums due hereunder shall be paid in lawful money of the United States of America. Interest shall be computed on the basis of a 360-day year. All payments made hereunder shall be credited first against unpaid late charges; the balance of each such payment next shall be credited against accrued and previously unpaid interest; and the balance of each such payment shall be credited against principal, and interest thereafter shall not accrue on the amount so credited to principal. In this Note, the singular shall include the plural, and each gender shall include the other. Maker, for itself and its legal representatives, successors, and assigns, expressly waives demand, notice of nonpayment, presentment for demand, presentment for the purpose of accelerating maturity, dishonor, notice of dishonor, protest, notice of protest, notice of maturity, and diligence in collection. This Note shall be construed in accordance with the laws of the State of Delaware. Maker hereby consents to the jurisdiction of the courts of the State of Delaware with respect to any matter relating to the enforcement of any rights created by or evidenced in this Note. The section and subsection headings in this Note are included for purposes of convenience and reference only and shall not affect in any way the meaning or interpretation of this Note. Maker agrees to pay all of Holder’s court costs and attorneys’ fees if counsel is engaged to assist in the collection of amounts due under this Note after a default hereunder or if any action is commenced to construe or enforce the terms of this Note.

IN WITNESS WHEREOF, the undersigned Maker has executed this Note on the date set forth below.

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