Exhibit 10.2

 

REGISTRATION RIGHTS AGREEMENT

 

This Registration Rights Agreement (this “Agreement”) is made and entered into
as of [●], by and between Digital Power Corporation (the “Company”), a
California corporation, with offices at 49430 Lakeview Boulevard, Fremont, CA
94538, and [●],with an address at [●] (the “Purchaser”).

 

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

 

1.

Definitions. As used in this Agreement, the following terms shall have the
respective meanings set forth in this Section 1.

 

“Advice” shall have the meaning set forth in Section 6(c).

 

“Affiliate” means any Person that, directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common control with a
Person, as such terms are used in and construed under Rule 144.

 

“Business Day” means any day except Saturday, Sunday and any day that shall be a
federal legal holiday or a day on which banking institutions in the State of New
York are authorized or required by law or other governmental action to close.

 

“Commission” means the Securities and Exchange Commission.

 

“Common Stock” means the Company’s common stock, no par value.

 

“Effective Date” means the date that the Registration Statement filed pursuant
to Section 2(a) is first declared effective by the Commission.

 

“Effectiveness Date” means: (a) with respect to the initial Registration
Statement required to be filed to cover the resale by the Holder of the
Registrable Securities, the earlier of: (i) the 90th day (120th day if the
Registration Statement is subject to Commission review) following the date
hereof or (ii) the fifth trading day following the date on which the Company is
notified by the Commission that the initial Registration Statement will not be
reviewed or is no longer subject to further review and comments, and (b) with
respect to any additional Registration Statements that may be required pursuant
to Sections 2(a) and (b) hereof, the earlier of: (i) the 90th day (120th day if
the Registration Statement is subject to Commission review) following the date
on which the Company first knows, or reasonably should have known, that such
additional Registration Statement is required under such Sections or (ii) the
fifth trading day following the date on which the Company is notified by the
Commission that such additional Registration Statement will not be reviewed or
is no longer subject to further review and comments. “Effectiveness Date” shall
also have the meaning specified in Section 2(b).

 

“Effectiveness Period” shall have the meaning set forth in Section 2(a).

 

“Exchange Act” means the Securities Exchange Act of 1934.

 

“Filing Date” means: (a) with respect to the initial Registration Statement
required to be filed to cover the resale by the Holder of the Registrable
Securities, the 30th day following the date hereof, and (b) with respect to any
additional Registration Statements that may be required pursuant to Sections
2(a) and (b) hereof, the 30th day following the date on which the Company first
knows, or reasonably should have known, that such additional Registration
Statement is required under such Sections.

 

 
 

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“Holder” or “Holders” means the holder or holders, as the case may be, from time
to time of Registrable Securities.

 

“Indemnified Party” shall have the meaning set forth in Section 5(c).

 

“Indemnifying Party” shall have the meaning set forth in Section 5(c).

 

“Losses” shall have the meaning set forth in Section 5(a).

 

“Person” means an individual or corporation, partnership, trust, incorporated or
unincorporated association, joint venture, limited liability company, joint
stock company, government (or an agency or subdivision thereof) or other entity
of any kind.

 

“Proceeding” means an action, claim, suit, investigation or proceeding
(including, without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced or threatened.

 

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

 

“Registrable Securities” means the shares of Common Stock for which the Series C
Preferred Stock may be converted and the Warrants may be exercised, together
with any securities issued or issuable upon any stock split, dividend or other
distribution, recapitalization or similar event, or any Series C Preferred Stock
conversion rate or Warrant exercise price adjustment with respect thereto.

 

“Registration Statement” means each of the following: (i) an initial
registration statement which is required to register the resale of the
Registrable Securities, and (ii) each additional registration statement, if any,
contemplated by Sections 2(a) and (b), and including, in each case, the
Prospectus, amendments and supplements to each such registration statement or
Prospectus, including pre-and post-effective amendments, all exhibits thereto,
and all material incorporated by reference or deemed to be incorporated by
reference in such registration statement.

 

“Rule 144” means Rule 144 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the Commission having substantially the
same effect as such Rule.

 

“Rule 415” means Rule 415 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the Commission having substantially the
same effect as such Rule.

 

“Rule 424” means Rule 424 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the Commission having substantially the
same effect as such Rule.

 

 
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“Securities Act” means the Securities Act of 1933.

 

“Selling Stockholders” shall have meaning defined in Section 3(b)(iii)

 

“Series C Preferred Stock” means the shares of Series C Preferred Stock of the
Company, which is part of the Unit.

 

“Transfer Agent” means the transfer agent for the Common Stock.

 

“Transaction Documents” means this Agreement, the Series C Preferred Stock, the
Warrants, and any other documents or agreements executed in connection with the
transactions contemplated hereunder and in the Series C Preferred Stock and
Warrants.

 

“Units” means the Units purchased by the Purchaser each Unit consisting of
20,000 shares of Series C Preferred Stock and Warrants to purchase 80,000 shares
of Common stock.

 

“Warrants” means Warrants to purchase shares of Common Stock at $1.00 per share.

 

2.

Registration.

 

(a)     Initial Registration Statements. On or prior to each Filing Date, the
Company shall prepare and file with the Commission a Registration Statement
covering the resale of all Registrable Securities not already covered by an
existing and effective Registration Statement for an offering to be made on a
continuous basis pursuant to Rule 415. The Registration Statement shall be on
Form S-3, or another appropriate form for such purpose, and shall contain such
other documentation as may be required by the Commission. The Company shall
cause the Registration Statement to be declared effective under the Securities
Act as soon as possible but, in any event, no later than the Effectiveness Date,
and shall use its best efforts to keep the Registration Statement continuously
effective under the Securities Act until the date that is two years after the
date that the Registration Statement is declared effective by the Commission or
such earlier date when all Registrable Securities covered by the Registration
Statement have been sold or may be sold pursuant to Rule 144(b)(1) as determined
by the counsel to the Company pursuant to a written opinion letter to such
effect, addressed and acceptable to the Transfer Agent and the affected Holder
(the “Effectiveness Period”). It is agreed and understood that the Company
shall, from time to time, be obligated to file an additional Registration
Statement to cover any Registrable Securities that are not registered for resale
pursuant to a pre-existing Registration Statement.

 

(b)     Additional Registration Statements. If for any reason the Commission
does not permit all of the Registrable Securities to be included in the
Registration Statement filed pursuant to Section 2(a), then the Company shall
prepare and file as soon as possible after the date on which the Commission
shall indicate as being the first date or time that such filing may be made, but
in any event by the 30th day following such date, an additional Registration
Statement covering the resale of all Registrable Securities not already covered
by an existing and effective Registration Statement for an offering to be made
on a continuous basis pursuant to Rule 415, on Form S-3 or another appropriate
form for such purpose. Each such Registration Statement shall contain such other
documentation as may be required by the Commission. The Company shall cause each
such Registration Statement to be declared effective under the Securities Act as
soon as possible (the “Effectiveness Date”) and shall use its best efforts to
keep such Registration Statement continuously effective under the Securities Act
during the entire Effectiveness Period.

 

 
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(c)     Issuance of Legal Opinion. Within three business days after the
Effectiveness Date of a Registration Statement, the Company shall cause its
counsel to issue a blanket opinion in the form attached hereto as Exhibit A, to
the Transfer Agent stating that the Shares, as defined therein, are subject to
an effective registration statement and can be reissued free of restrictive
legend upon notice of a sale by the Purchaser and confirmation by the Purchaser
that it has complied with the prospectus delivery requirements, provided that
the Company has not advised the Transfer Agent in writing that the opinion has
been withdrawn. Copies of the blanket opinion required by this Section 2(c)
shall be delivered to the Purchaser within the time period set forth above.

 

3.

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

 

(a)     Not less than four trading days prior to the filing of a Registration
Statement or any related Prospectus or any amendment or supplement thereto,
furnish to the Holder copies of all such documents proposed to be filed, which
documents (other than those incorporated by reference) will be subject to review
by such Holder. The Company shall not file a Registration Statement or any such
Prospectus or any amendments or supplements thereto to which the Holders of a
majority of the Registrable Securities shall, in writing, reasonably object in
good faith.

 

(b)     (i) Prepare and file with the Commission such amendments, including
post-effective amendments, to each Registration Statement and the Prospectus
used in connection therewith as may be necessary to keep such Registration
Statement continuously effective as to the applicable Registrable Securities for
its Effectiveness Period and prepare and file with the Commission such
additional Registration Statements in order to register for resale under the
Securities Act all of the Registrable Securities; (ii) cause the related
Prospectus to be amended or supplemented by any required Prospectus supplement,
and as so supplemented or amended to be filed pursuant to Rule 424; (iii)
respond as promptly as reasonably possible, and in any event within ten trading
days, to any comments received from the Commission with respect to each
Registration Statement or any amendment thereto and, as promptly as reasonably
possible, provide the Holders true and complete copies of all correspondence
from and to the Commission relating to such Registration Statement that pertains
to the Holder as selling stockholder (the “Selling Stockholder”) but not any
comments that would result in the disclosure to the Holder of material and
non-public information concerning the Company; and (iv) comply in all material
respects with the provisions of the Securities Act and the Exchange Act with
respect to the Registration Statements and the disposition of all Registrable
Securities covered by each Registration Statement.

 

(c)     Notify the Holder as promptly as reasonably possible (and, in the case
of (i)(A) below, not less than four trading days prior to such filing) and (if
requested by any such Holder) confirm such notice in writing no later than one
trading day following the day (i)(A) when a Prospectus or any Prospectus
supplement or post-effective amendment to a Registration Statement is proposed
to be filed; (B) when the Commission notifies the Company whether there will be
a “review” of such Registration Statement and whenever the Commission comments
in writing on such Registration Statement (the Company shall provide true and
complete copies thereof and all written responses thereto to each of the Holders
that pertain to such Holder as a Selling Stockholder or to the Plan of
Distribution, but not information which the Company believes would constitute
material and non-public information); and (C) with respect to each Registration
Statement or any post-effective amendment, when the same has become effective;
(ii) of any request by the Commission or any other federal or state governmental
authority for amendments or supplements to a Registration Statement or
Prospectus or for additional information that pertains to the Holder as Selling
Stockholder or the Plan of Distribution; (iii) of the issuance by the Commission
of any stop order suspending the effectiveness of a Registration Statement
covering any or all of the Registrable Securities or the initiation of any
Proceedings for that purpose; (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction, or the initiation or threatening of any Proceeding for such
purpose; and (v) of the occurrence of any event or passage of time that makes
the financial statements included in a Registration Statement ineligible for
inclusion therein or any statement made in such Registration Statement or
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires any revisions to such
Registration Statement, Prospectus or other documents so that, in the case of
such Registration Statement or the Prospectus, as the case may be, it will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading.

 

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

 

(e)     Furnish to each Holder, without charge, at least one conformed copy of
each Registration Statement and each amendment thereto and all exhibits to the
extent requested by such Holder (including those previously furnished or
incorporated by reference) promptly after the filing of such documents with the
Commission; provided, however, that the Company shall have no obligation to
provide any document pursuant to this clause that is available on the EDGAR
system.

 

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

 

(g)     Prior to any public offering of Registrable Securities, use its best
efforts to register or qualify or cooperate with the selling Holder in
connection with the registration or qualification (or exemption from such
registration or qualification) of such Registrable Securities for offer and sale
under the securities or Blue Sky laws of those jurisdictions within the United
States set forth on Schedule 3(g) hereto to keep each such registration or
qualification (or exemption therefrom) effective during the Effectiveness Period
and to do any and all other acts or things necessary or advisable to enable the
disposition in such jurisdictions of the Registrable Securities covered by the
Registration Statements; provided, however, that the Company shall not be
required to qualify generally to do business in any jurisdiction where it is not
then so qualified or subject the Company to any material tax in any such
jurisdiction where it is not then so subject or to take such actions in states
that require merit review.

 

(h)     Cooperate with the Holder to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be delivered to
a transferee pursuant to the Registration Statements, which certificates shall
be free, to the extent permitted by the Transaction Documents and applicable
securities laws, of all restrictive legends, and to enable such Registrable
Securities to be in such denominations and registered in such names as any such
Holders may request. The Company shall cause the Transfer Agent to transmit the
Registrable Securities to the Holder by crediting the account of the Holder’s
prime broker with the Depository Trust Company through its Deposit Withdrawal
Agent Commission system if the Company is then a participant in such system.

 

(i)     Upon the occurrence of any event contemplated by Section 3(c)(v), as
promptly as reasonably possible, prepare a supplement or amendment, including a
post-effective amendment, to the affected Registration Statements or a
supplement to the related Prospectus or any document incorporated or deemed to
be incorporated therein by reference, and file any other required document so
that, as thereafter delivered, no Registration Statement nor any Prospectus will
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading.

 

 
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The Company may require each selling Holder to furnish to the Company a
certified statement as to the number of shares of Common Stock beneficially
owned by such Holder and any Affiliate thereof.

 

4.             Registration Expenses. All fees and expenses incident to the
Company’s performance of its obligation under this Agreement (excluding any
underwriting discounts and selling commissions and all legal fees and expenses
of legal counsel for any Holder) shall be borne by the Company whether or not
any Registrable Securities are sold pursuant to a Registration Statement. The
fees and expenses referred to in the foregoing sentence shall include, without
limitation, (i) all registration and filing fees (including, without limitation,
fees and expenses (A) with respect to filings required to be made with the
trading market on which the Common Stock is then listed for trading, and (B) in
compliance with applicable state securities or Blue Sky laws), (ii) printing
expenses (including, without limitation, expenses of printing certificates for
Registrable Securities and of printing prospectuses if the printing of
prospectuses is reasonably requested by the Holders of a majority of the
Registrable Securities included in the Registration Statement), (iii) messenger,
telephone and delivery expenses, (iv) fees and disbursements of counsel for the
Company, (v) Securities Act liability insurance, if the Company so desires such
insurance, and (vi) fees and expenses of all other Persons retained by the
Company in connection with the consummation of the transactions contemplated by
this Agreement. In addition, the Company shall be responsible for all of its
internal expenses incurred in connection with the consummation of the
transactions contemplated by this Agreement (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expense of any annual audit and the fees and expenses
incurred in connection with the listing of the Registrable Securities on any
securities exchange as required hereunder.

 

5.             Indemnification.

 

(a)     Indemnification by the Company. The Company shall, notwithstanding any
termination of this Agreement, indemnify and hold harmless each Holder, the
officers, directors, agents, attorneys, investment advisors, partners, members,
shareholders and employees of each of them, each Person who controls any such
Holder (within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act) and the officers, directors, agents, attorneys and employees
of each such controlling Person, to the fullest extent permitted by applicable
law, from and against any and all losses, claims, damages, liabilities, costs
(including, without limitation, reasonable costs of preparation and reasonable
attorneys’ fees) and expenses (collectively, “Losses”), as incurred, arising out
of or relating to any untrue or alleged untrue statement of a material fact
contained in any Registration Statement, any Prospectus or any form of
prospectus or in any amendment or supplement thereto) or in any preliminary
prospectus, or arising out of or relating to any omission or alleged omission of
a material fact required to be stated therein or necessary to make the
statements therein (in the case of any Prospectus or form of prospectus or
supplement thereto, in light of the circumstances under which they were made)
not misleading, except to the extent, but only to the extent, that (1) such
untrue statements or omissions are based solely upon information regarding such
Holder furnished in writing to the Company by such Holder expressly for use
therein, or to the extent that such information relates to such Holder or such
Holder’s proposed method of distribution of Registrable Securities and was
reviewed and expressly approved in writing by such Holder expressly for use in
the Registration Statement, such Prospectus or such form of Prospectus or in any
amendment or supplement thereto or (2) in the case of an occurrence of an event
of the type specified in Section 3(c)(ii)-(v), the use by such Holder of an
outdated or defective Prospectus after the Company has notified such Holder in
writing that the Prospectus is outdated or defective and prior to the receipt by
such Holder of an Advice, as defined in Section 6(c) below, or an amended or
supplemented Prospectus, but only if and to the extent that following the
receipt of the Advice or the amended or supplemented Prospectus the misstatement
or omission giving rise to such Loss would have been corrected. The Company
shall notify the Holders promptly of the institution, threat or assertion of any
Proceeding of which the Company is aware in connection with the transactions
contemplated by this Agreement.

 

 
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(b)     Indemnification by Holder. Each Holder shall, notwithstanding any
termination of this Agreement, severally and not jointly, indemnify and hold
harmless the Company, its directors, officers, agents, attorneys and employees,
each Person who controls the Company (within the meaning of Section 15 of the
Securities Act and Section 20 of the Exchange Act), and the directors, officers,
agents, attorneys or employees of such controlling Persons, to the fullest
extent permitted by applicable law, from and against all Losses, as incurred,
arising solely out of or based solely upon: (x) such Holder’s failure to comply
with the prospectus delivery requirements of the Securities Act or (y) any
untrue statement of a material fact contained in any Registration Statement, any
Prospectus, or any form of prospectus, or in any amendment or supplement
thereto, or arising solely out of or based solely upon any omission of a
material fact required to be stated therein or necessary to make the statements
therein not misleading to the extent, but only to the extent that, (1) such
untrue statements or omissions are based solely upon information regarding such
Holder furnished in writing to the Company by such Holder expressly for use
therein, or to the extent that such information relates to such Holder or such
Holder’s proposed method of distribution of Registrable Securities and was
reviewed and expressly approved in writing by such Holder expressly for use in
the Registration Statement, such Prospectus or such form of Prospectus or in any
amendment or supplement thereto or (2) in the case of an occurrence of an event
of the type specified in Section 3(c)(ii)-(v), the use by such Holder of an
outdated or defective Prospectus after the Company has notified such Holder in
writing that the Prospectus is outdated or defective and prior to the receipt by
such Holder of an Advice or an amended or supplemented Prospectus, but only if
and to the extent that following the receipt of the Advice or the amended or
supplemented Prospectus the misstatement or omission giving rise to such Loss
would have been corrected. In no event shall the liability of any selling Holder
hereunder be greater in amount than the dollar amount of the net proceeds
received by such Holder upon the sale of the Registrable Securities giving rise
to such indemnification obligation.

 

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

 

An Indemnified Party shall have the right to employ separate counsel in any such
Proceeding and to participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Party or Parties
unless: (1) the Indemnifying Party has agreed in writing to pay such fees and
expenses; (2) the Indemnifying Party shall have failed promptly to assume the
defense of such Proceeding and to employ counsel reasonably satisfactory to such
Indemnified Party in any such Proceeding; or (3) the named parties to any such
Proceeding (including any impleaded parties) include both such Indemnified Party
and the Indemnifying Party, and such Indemnified Party shall have been advised
by counsel that a conflict of interest is likely to exist if the same counsel
were to represent such Indemnified Party and the Indemnifying Party (in which
case, if such Indemnified Party notifies the Indemnifying Party in writing that
it elects to employ separate counsel at the expense of the Indemnifying Party,
the Indemnifying Party shall not have the right to assume the defense thereof
and such counsel shall be at the expense of the Indemnifying Party); provided,
however, that the Indemnifying Party shall not be liable for the fees and
expenses of more than one separate firm of attorneys at any time for all
Indemnified Parties. The Indemnifying Party shall not be liable for any
settlement of any such Proceeding effected without its written consent, which
consent shall not be unreasonably withheld. No Indemnifying Party shall, without
the prior written consent of the Indemnified Party, effect any settlement of any
pending Proceeding in respect of which any Indemnified Party is a party, unless
such settlement includes an unconditional release of such Indemnified Party from
all liability on claims that are the subject matter of such Proceeding.

 

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

 

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

 

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

 

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

 

6.             Miscellaneous

 

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

 

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

 

(c)     Discontinued Disposition. Each Holder agrees by its acquisition of such
Registrable Securities that, upon receipt of a notice from the Company of the
occurrence of any event of the kind described in Section 3(c), such Holder will
forthwith discontinue disposition of such Registrable Securities under the
Registration Statement until such Holder’s receipt of the copies of the
supplemented Prospectus and/or amended Registration Statement or until it is
advised in writing (the “Advice”) by the Company that the use of the applicable
Prospectus may be resumed, and, in either case, has received copies of any
additional or supplemental filings that are incorporated or deemed to be
incorporated by reference in such Prospectus or Registration Statement. The
Company may provide appropriate stop orders to enforce the provisions of this
paragraph.

 

(d)     Amendments and Waivers. No provision of this Agreement may be waived or
amended except in a written instrument signed by the Company and the Holder or
Holders (as applicable) of no less than a majority of the then outstanding
Registrable Securities. No waiver of any default with respect to any provision,
condition or requirement of this Agreement shall be deemed to be a continuing
waiver in the future or a waiver of any subsequent default or a waiver of any
other provision, condition or requirement hereof, nor shall any delay or
omission of either party to exercise any right hereunder in any manner impair
the exercise of any such right.

 

(e)     Notices. All offers, acceptances, notices, requests, demands and other
communications under this Agreement shall be in writing and, except as otherwise
provided herein, shall be deemed to have been given only: (i) when delivered in
person; (ii) one day after deposit with a nationally recognized overnight
courier service; or, (iii) five days after having been mailed by certified or
registered mail prepaid, to the parties at their respective addresses first set
forth above, or at such other address as may be given in writing in future by
either party to the other. Notice may also be given via electronic or facsimile
transmission to a party who provides such party’s fax number or email address to
the other party and shall be deemed to have been given if receipt thereof is
confirmed by the recipient. If Notice is to be given to any other Person who is
then the registered Holder, to the address of such Holder as it appears in the
stock transfer books of the Company or such other address as may be designated
in writing hereafter, in the same manner, by such Person.

 

(f)     Successors and Assigns. This Agreement shall inure to the benefit of and
be binding upon the successors and permitted assigns of each of the parties and
shall inure to the benefit of each Holder. The Company may not assign its rights
or obligations hereunder without the prior written consent of each Holder.
Holders may assign their respective rights hereunder in the manner and to the
Persons as permitted under the Transaction Documents.

 

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

 

 
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(h)     Governing Law; Venue. All questions concerning the construction,
validity, enforcement and interpretation of this Agreement shall be governed by
and construed and enforced in accordance with the internal laws of the State of
New York, without regard to the principles of conflicts of law thereof. Each
party agrees that all Proceedings concerning the interpretations, enforcement
and defense of the transactions contemplated by this Agreement (whether brought
against a party hereto or its respective Affiliates, employees or agents) may be
commenced in the state and federal courts sitting in the County and State of New
York,. Each party hereto hereby irrevocably waives personal service of process
and consents to process being served in any such Proceeding by mailing a copy
thereof via registered or certified mail or overnight delivery (with evidence of
delivery) to such party at the address in effect for notices to it under this
Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Each party hereto hereby irrevocably
waives, to the fullest extent permitted by applicable law, any and all right to
trial by jury in any Proceeding arising out of or relating to this Agreement or
the transactions contemplated hereby. If any party shall commence a Proceeding
to enforce any provisions of this Agreement, then the prevailing party in such
Proceeding shall be reimbursed by the other party for its attorney’s fees and
other costs and expenses incurred with the investigation, preparation and
prosecution of such Proceeding.

 

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

 

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

 

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

 

(l)     Independent Nature of Holder’s Obligations and Rights. The obligations
of each Holder hereunder are several and not joint with the obligations of any
other Holder hereunder, and no Holder shall be responsible in any way for the
performance of the obligations of any other Holder hereunder. Each Holder shall
be entitled to protect and enforce its rights, including without limitation the
rights arising out of this Agreement, and it shall not be necessary for any
other Holder to be joined as an additional party in any proceeding for such
purpose.

 

(m)     Gender. The use herein of the masculine pronouns or similar terms shall
be deemed to include the feminine and neuter genders as well and vice versa and
the use of the singular pronouns shall be deemed to include the plural as well
and vice versa.

 

(signature page to follow)

 

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

 

DIGITAL POWER CORPORATION

 

 

By:

 

  Name: Amos Kohn   Title: President and Chief Executive Officer         [●]    
            By:     Name: [●]   Title: [●]  

 

 
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EXHIBIT A

 

[●]

 

Computershare

250 Royall Street,

Canton, MA 02021

 

Digital Power Corporation

Registration Statement on Form S-3

 

 

Ladies and Gentlemen:

 

As counsel to Digital Power Corporation, a California corporation (the
“Company”), we have been requested to render our opinion to you in connection
with the resale by the individuals or entities listed on Schedule A attached
hereto (the “Selling Stockholders”), of an aggregate of [amount] shares (the
“Shares”) of the Company’s Common Stock.

 

A Registration Statement on Form S-3 under the Securities Act of 1933 (the
“Act”), with respect to the resale of the Shares was declared effective by the
Securities and Exchange Commission on [●]. Enclosed is the Prospectus dated [●].
We understand that the Shares are to be offered and sold in the manner described
in the Prospectus.

 

Based upon the foregoing, upon request by the Selling Stockholders at any time
while the registration statement remains effective, it is our opinion that the
Shares have been registered for resale under the Act and new certificates
evidencing the Shares upon their transfer or re-registration by the Selling
Stockholders may be issued without restrictive legend. We will advise you if the
registration statement is not available or effective at any point in the future.

 

 

Very truly yours,

          [●]

 

 

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SCHEDULE 3(g)

 

BLUE SKY JURISDICTIONS

 

N/A