Document:

Co-Sale Agreement

 Exhibit 10.9 
 Execution Copy 
  
  
 DPAC Technologies Corp. 

 Co-Sale Agreement 
  
  
 Dated as of January 31,
2008 

 Co-Sale Agreement 
 This CO-SALE AGREEMENT dated as of January 31, 2008 (the “Agreement”) by and among DPAC Technologies Corp., a California corporation (the “Company”), Development
Capital Ventures, LP, a Delaware limited partnership (“DCP”), William Roberts, an individual, and Steven D. Runkel, an individual (together with any future holder of Shares, individually, a
“Shareholder” and collectively, the “Shareholders”), and Canal Mezzanine Partners, L.P., a Delaware limited partnership (the “Holder”), is provided for and entered into pursuant to the Senior
Subordinated Note and Warrant Purchase Agreement dated as of the date hereof (as amended, restated, supplemented or otherwise modified from time to time, the “Purchase Agreement”), by and between the Company, Quatech, Inc., an Ohio
corporation and wholly owned subsidiary of the Company, and the Holder. The Company, the Shareholders and the Holder are referred to collectively as the “Parties” and individually as a “Party”. 
 This Agreement is one of the “Related Documents” referred to in the Purchase Agreement. 
 In consideration of their mutual promises set forth in this Agreement and the Purchase Agreement, the Parties hereby agree as follows: 

Section 1. Definitions. All capitalized terms not otherwise defined in this Agreement shall have the definitions set forth in the Glossary
of Defined Terms attached to the Purchase Agreement, which definitions are, to the extent applicable, incorporated in this Agreement by reference. 
 Section 2. Sales by Shareholders. 
 2.1 Notice of Purchase Offers. If (i) any Shareholder (a
“Selling Shareholder”) receives or solicits, and proposes to accept one or more Purchase Offers for an amount of Shares in excess of fifty percent (50%) of such Selling Shareholder’s Fully Diluted Shares or (ii) any
Shareholders (the “Selling Shareholders”) receive or solicit, and propose to accept one or more Purchase Offers which collectively result in the Transfer of greater than fifty percent (50%) of the Fully Diluted Shares of such
Selling Shareholders, then such Selling Shareholder(s) shall provide notice to the Holder of the terms and conditions of such Purchase Offer (the “Notice of Purchase Offer”) at least twenty (20) Business Days prior to the
proposed date of consummation of such Purchase Offer. 
 2.2 Right to Participate. The Holder shall have the right, exercisable
upon written notice to the Selling Shareholder(s) within ten (10) Business Days after receipt of the Notice of Purchase Offer, to participate in such Purchase Offer on the same (or, in the case of Convertible Securities, equivalent) terms and
conditions as set forth in the Notice of Purchase Offer. If the Holder exercises its right of participation granted by this Agreement, the number of securities that such Selling Shareholder(s) may sell pursuant to such Purchase Offer shall be
reduced in the manner provided below. The right of participation of the Holder shall be subject to the following terms and conditions: 
 (a)
The Holder may sell that number of its Shares (and equivalent Convertible Securities) in the Purchase Offer as shall be equal to the product obtained by multiplying (i) the aggregate number of Shares (and equivalent Convertible Securities)
subject to the Purchase Offer by (ii) a fraction (A) the numerator of which is the number of Shares (and equivalent Convertible Securities) at the time owned by the Holder, and (B) the denominator of which is the sum of (x) the
number of Shares (and equivalent Convertible Securities) at the time owned by the Selling Shareholder(s), and (y) the number of Shares (and equivalent Convertible Securities) then owned by the Holder. For purposes of making such computation,
the number of Shares owned by the Holder shall be deemed to include the number of Warrant Shares into which the Warrant is then exercisable. 

 (b) If the Holder elects to participate in the Purchase Offer, it shall deliver to the Selling
Shareholder(s) for Transfer to the purchaser one or more certificates, properly endorsed for Transfer, free and clear of all adverse claims, that represent the number of Shares (and equivalent Convertible Securities) the Holder elects to sell
pursuant to this Agreement. Such certificates shall be delivered to the Selling Shareholder(s) no later than two (2) Business Days prior to the date set for consummation of the Purchase Offer. 
 2.3 Consummation of Purchase Offer. The certificate or certificates delivered to the Selling Shareholder(s) pursuant to Section 2.2
shall be Transferred by the Selling Shareholder(s) to the purchaser in consummation of the Purchase Offer pursuant to the terms and conditions specified in the Notice of Purchase Offer delivered to the Holder. The Selling Shareholder(s) shall
promptly thereafter remit to the Holder that portion of the sale proceeds that equals (i) the purchase price per share or share equivalent, multiplied by (ii) the number of share or share equivalents sold by the Holder in connection with
such Purchase Offer. 
 2.4 Ongoing Rights. The exercise or non-exercise by the Holder of its right to participate in one or
more Purchase Offers hereunder shall not adversely affect the Holder’s right to participate in subsequent Purchase Offers pursuant to this Agreement. 
 2.5 Permitted Exceptions. The participation rights of the Holder hereunder shall not apply to (i) any bona fide gift by a Shareholder, or (ii) Transfer of securities to the spouse or
descendants of a Shareholder or any trust established for the benefit of the Shareholder or his spouse or descendants; provided that the Shareholder shall give prior written notice to the Holder of such gift or other Transfer and the donee or
transferee shall become a party to and be bound by, and comply with, all provisions of this Agreement. 
 Section 3. Prohibited
Transfers. If a Shareholder engages in a Prohibited Transfer, the Holder, in addition to such other remedies as may be available at law or in equity, shall have the right to sell to the Shareholder engaging in such Prohibited Transfer that
number of Shares or Convertible Securities owned by the Holder which shall be equal to the number of shares the Holder would have been entitled to Transfer to the purchaser in the Prohibited Transfer. Such sale shall be made on the following terms
and conditions: 
 (a) The price per share at which such Shares or Convertible Securities shall be 

  

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sold to the Shareholder shall be equal or equivalent to the price per share paid by the purchase offeror to the Shareholder in the Prohibited Transfer. The
Shareholder shall also reimburse the Holder for any and all reasonable fees and expenses, including legal fees and expenses, incurred pursuant to the exercise or the attempted exercise of the Holder’s rights under this Section. 
 (b) Within twenty (20) Business Days after the earlier of the date on which the Holder (i) receives notice from a Shareholder of a Prohibited
Transfer, or (ii) otherwise becomes aware of a Prohibited Transfer, the Holder shall, if it determines in its sole discretion to exercise its sale rights pursuant to this Section, deliver to the Shareholder engaging in the Prohibited Transfer
the certificate or certificates representing the securities to be sold hereunder free and clear of all adverse claims and properly endorsed for Transfer. 
 (c) The Shareholder engaging in the Prohibited Transfer shall, upon receipt of the certificate or certificates for the Shares or Convertible Securities to be sold by the Holder hereunder, pay the aggregate purchase
price therefor plus the amount of reimbursable fees and expenses, as specified above, by wire transfer of immediately available funds or certified or cashier’s check made payable to the order of the Holder. 
 (d) Notwithstanding the foregoing, any attempt to Transfer securities of the Company in violation of the terms of this Agreement shall be void and the
Company agrees it will not affect such a Transfer nor will it treat any proposed transferee as the holder of such securities without the written consent of the Holder. 
 Section 4. Legend. Each certificate representing Shares or Convertible Securities of the Company now or hereafter owned by the Shareholders shall be endorsed by the Company with the following legend:

 THE SALE OR TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO THE TERMS AND CONDITIONS OF A CERTAIN CO-SALE
AGREEMENT BY AND BETWEEN THE HOLDER AND OTHER PARTIES. COPIES OF SUCH AGREEMENT MAY BE OBTAINED UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY. 
 The legend required by this Agreement shall be removed from any certificate upon the earlier of the termination of this Agreement or the date upon which the provisions of this Agreement are no longer applicable to the
securities represented by such certificate. 
 Section 5. Termination. The rights of the Holder and the obligations of the
Shareholders and the Company under this Agreement shall terminate upon the earliest to occur of the following events: 
 (a) a Qualified
Public Offering; or 
 (b) the Holder ceases to own any Holder’s Shares. 
 Section 6. Other Obligations of the Company. The Company agrees to use reasonable best efforts to enforce the terms of this Agreement, to
inform the Holder of any breach hereof and to assist the Holder in the exercise of its rights hereunder. 
  

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 Section 7. Increase in Authorized Shares of Common Stock. The Company hereby agrees, as soon
as practical following the date hereof, to take appropriate shareholder action to increase the number of authorized shares of common stock of the Company to provide a sufficient amount of shares of common stock of the Company reserved for issuance
upon conversion of (i) the Warrant issued to the Purchaser pursuant to the Purchase Agreement and (ii) the Series A Preferred Stock (the “Preferred Stock”) issued to DCP pursuant to that certain Subscription Agreement
dated December 17, 2007 between the Company and DCP (the “Subscription Agreement”). DCP hereby agrees to vote all of its Shares in favor of such an increase in the number of authorized shares of common stock of the Company. The
Company and DCP each agrees to execute and deliver such further documents and instruments and to do such further acts and things as may be necessary or desirable to carry out the intent and purposes of this Agreement. 
 Section 8. Miscellaneous. The provisions of Section 12 of the Purchase Agreement are applicable to this Agreement and are
incorporated by reference in this Agreement. 
 [signatures appear on following page] 
  

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 IN WITNESS WHEREOF, the Parties have caused this Co-Sale Agreement to be executed and delivered
effective as of the date first written above. 
  

													
	Company:	 		  	Holder:	 	
			
	 DPAC TECHNOLOGIES CORP.
a California corporation
	 		  	 CANAL MEZZANINE PARTNERS, L.P.,
a Delaware limited partnership

					
	By:	 	 /s/ Steven D. Runkel
	 		  	By:	 	 Canal Mezzanine Management, LLC,

		 	Steven D. Runkel, Chief Executive Officer and President	 		  		 	     an Ohio limited liability company

		 		 		  	Title:	 	General Partner
						
		 		 		  		 	By:	 	 Canal Holdings, LLC,
an Ohio limited liability company

	Shareholders:	 		  		 	Title:	 	Managing Member
						
	 /s/ Steven D. Runkel
	 		  		 		 	By:	 	 /s/ Shawn M. Wynne

	Steven D. Runkel	 		  		 		 	Title:	 	  

						
	 /s/ William Roberts
	 		  		 		 		 	
	William Roberts	 		  		 		 		 	
		 		 		  		 		 		 	
	DEVELOPMENT CAPITAL VENTURES, L.P.	 		  		 		 		 	
							
	By:	 	DCC Operating, Inc., General Partner	 		  		 		 		 	
							
	By:	 	 /s/ Donald L. Murfin
	 		  		 		 		 	
		 	Donald L. Murfin, Executive Vice President	 		  		 		 		 	

 Signature Page to Co-Sale AgreementRegistration Rights Agreement

 Exhibit 10.10 
 REGISTRATION RIGHTS AGREEMENT 
 This REGISTRATION RIGHTS AGREEMENT (“Agreement”) is made
and entered into as of January 31, 2008 by and between DPAC TECHNOLOGIES CORP., a California corporation (the “Company”), and Canal Mezzanine Partners, L.P. (“Investor”). 
 R E C I T A L S 
 WHEREAS, the Company, the Company’s wholly owned subsidiary, QUATECH, INC., an Ohio corporation (“Quatech”), and Investor have entered
into that certain Senior Subordinated Note and Warrant Purchase Agreement (together with all promissory notes and related agreements executed in connection therewith, including without limitation the warrant to purchase shares of the Company’s
common stock executed in connection therewith (the “Warrant”), and any amendments thereto, the “Note Agreement”), dated as of the same date herewith, pursuant to which Investor will loan to Quatech certain funds under the terms
and conditions of such Note Agreement; and 
 WHEREAS, as a condition and as an inducement to the willingness of Investor to make such loans
as are contemplated by the Note Agreement, the Company is required to enter into this Agreement with respect to shares of Company common stock, no par value per share (“DPAC Common Stock”) issuable pursuant to exercise of the Warrant, as
well as other shares of DPAC Common Stock that may be issued to Investor pursuant to Section 3 of the Warrant (“Preemptive Stock”); and 
 WHEREAS, the Company is party to that Shareholder and Registration Rights Agreement dated May 11, 2005 (the “Existing Rights Agreement”), and it is the intention of the parties hereto that the rights
contained in this Agreement be coordinated to reflect the Company’s obligations under such prior registration rights agreement, and the rights of the Shareholders (as defined therein) party thereto. 
 A G R E E M E N T 
 NOW, THEREFORE, in consideration of the foregoing, for good and valuable considerations, receipt and sufficiency of which are hereby acknowledged, the
parties to this Agreement hereby agree as follows: 
 1. Definitions. As used herein: 
  

	 	1.1	The term “Advice” is defined in Section 2.9. 

  

	 	1.2	The term “Blocking Right” is defined in Section 2.1. 

  

	 	1.3	The term “Commission” means the Securities and Exchange Commission. 

  

	 	1.4	The term “Exchange Act” means the Securities Exchange Act of 1934, as amended. 

  

	 	1.5	The term “Existing Holder” means any of the following persons owning or having the right to acquire Registrable Shares or any permitted assignee of rights under this
Agreement: Development Capital Ventures, LP; William Roberts, an individual; and Steve Runkel, an individual. 

  

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	 	1.6	The term “Institutional Shareholder” shall mean Development Capital Ventures, L.P. 

  

	 	1.7	The term “Public Offering” means and includes the closing of an underwritten public offering pursuant to an effective registration statement under the Securities Act,
covering the offer and sale of securities to the general public for the account of the Company. 

  

	 	1.8	The terms “register,” “registered” and “registration” refer to a registration effected by preparing and filing a registration statement in compliance
with the Securities Act (as defined below) and the applicable rules and regulations thereunder, and the declaration or ordering of the effectiveness of such registration statement. 

  

	 	1.9	For the purposes hereof, the term “Registrable Shares” means and includes the shares of the DPAC Common Stock issuable upon exercise of the Warrant, and the Preemptive
Stock (and where the context so includes, shall also mean Registrable Shares together with the “Registrable Shares”, as defined in the Existing Rights Agreement). 

  

	 	1.10	The term “Securities Act” means the Securities Act of 1933, as amended. 

  

	 	1.11	The descriptive headings herein are inserted for convenience of reference only and are not intended to be part of or to affect the meaning or interpretation of this Agreement.

 2. Registration Rights. 
 2.1 Demand Registration. 
 Subject to Sections 2.6, 2.7 and 2.8, if at any time the Company shall receive a written
request from the Institutional Investor that the Company file with the Commission a registration statement under the Securities Act covering the registration for offer and sale of outstanding Registrable Shares (as defined in the Existing Rights
Agreement) held by such Institutional Investor, then the Company shall promptly notify in writing the Investor of such request. Within 20 days after such notice has been given by the Company, Investor and any Existing Holder may give written
notice to the Company of its election to include its Registrable Shares in the registration. As soon as practicable after the expiration of such 20-day period, the Company shall use its reasonable best efforts to cause the registration of all
Registrable Shares of Investor with respect to which registration has been so requested. If the Institutional Investor intends to distribute its Registrable Shares covered by their request by means of an underwriting, the right of Investor to
include its Registrable Shares in such registration shall be conditioned upon Investor’s participation in such underwriting and the inclusion of Investor’s Registrable Shares in the underwriting to the extent provided herein. Investor
shall enter into an underwriting agreement in customary form with the underwriters selected for such underwriting. Notwithstanding the foregoing, if the underwriter advises the Institutional Shareholder in writing that marketing factors require a
limitation of the number of shares to be underwritten, then the Company shall so advise Investor, and the number of shares of Registrable Shares that may be included in the underwriting shall be allocated among Investor and the Existing Holders,
including the Institutional Shareholder, in proportion (as nearly as practicable) to the amount of Registrable Shares of the Company owned by each such person. 
  

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 Notwithstanding the provisions set forth above in this Section 2.1, the Company shall not be obligated to effect any
registration pursuant to this Section within 180 days after a Public Offering. In addition, the Company may postpone for up to 90 days the filing or effectiveness of a registration statement pursuant to a request under this Section if the Board of
Directors (with the concurrence of the managing underwriters, if any) determines in good faith that such registration would be reasonably expected to have a material adverse effect on any proposal or plan by the Company to engage in any acquisition
or sale of assets, merger, consolidation, tender offer, financing or similar transaction (a “Blocking Right”). The Company may not assert a Blocking Right more than once in any twelve month period. In the event of any postponement
described in this subsection the Investor shall, upon written notice to the Company, be entitled to withdraw such request and, if such request is withdrawn, such request shall not count as a request for registration pursuant to this Section.

 2.2 Piggyback Registration. 
 Subject to Sections 2.6 and 2.7, if at any time after the date hereof the Company proposes to register any of its securities under the Securities Act, either for its own account or for the account of others, in connection with the
public offering of such securities solely for cash, on a registration form that would also permit the registration of Registrable Shares, the Company shall promptly give Investor written notice of such proposal. Upon the written request of Investor
given within 20 days after any such notice is given, subject to Sections 2.6 and 2.7, the Company shall use its commercially reasonable best efforts to cause to be included in such registration all Registrable Shares with respect to which
registration has been so requested. 
 2.3 Registration Obligations of the Company. 
 Whenever required under this Agreement to use commercially reasonable best efforts to effect the registration of any Registrable Shares, the Company
shall, as expeditiously as reasonably possible: 
 (a) prepare and file with the Commission a registration statement covering
such Registrable Shares and use reasonable efforts to cause such registration statement to be declared effective by the Commission as expeditiously as possible and to keep such registration effective until the date when all Registrable Shares
covered by the registration statement have been sold; provided, that before filing a registration statement or prospectus or any amendments or supplements thereto, the Company will furnish to Investor and the underwriters, if any, copies of all such
documents proposed to be filed (excluding exhibits, unless any such person shall specifically request exhibits in writing), which documents will be subject to the review of Investor and the underwriters, and the Company will not file such
registration statement or any amendment thereto or any prospectus or any supplement thereto with the Commission if (A) a majority of the group constituting the Existing Holders and Investor (the “Rights Group”) reasonably object to
such filing (unless such registration is pursuant to Section 3 and is in connection with a Public Offering) or (B) information in such registration statement or prospectus concerning Investor has changed or is otherwise inaccurate and
Investor or the underwriters, if any, shall reasonably and promptly object; 
  

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 (b) prepare and file with the Commission such amendments and post-effective amendments to
such registration statement as may be necessary to keep such registration statement effective during the period referred to in subsection (a) above, and cause the prospectus to be supplemented by any required prospectus supplement, and as so
supplemented to be filed with the Commission pursuant to Rule 424 under the Securities Act; 
 (c) furnish to Investor
and to each underwriter, if any, such reasonable numbers of copies of such registration statement, each amendment thereto, the prospectus included in such registration statement (including each preliminary prospectus), each supplement thereto and
such other documents as they may reasonably request in order to facilitate the disposition of Registrable Shares owned by them; 
 (d) use its best efforts to register and qualify the Registrable Shares under such other securities laws of such United States jurisdictions as shall be reasonably requested by a majority of the Rights Group or any underwriters or, in the
alternative, to obtain exemptions from the registration requirements of such securities laws, and do any and all other acts and things which may be reasonably necessary or advisable to enable Investor and underwriters to consummate the disposition
of the Registrable Shares owned by Investor and underwriters in such jurisdictions; provided, that the Company shall not be required in connection therewith or as a condition thereto to qualify to transact business, subject itself to taxation or to
file a general consent to service of process in any such jurisdiction; 
 (e) promptly after becoming aware thereof, notify
Investor, at any time when a prospectus relating thereto is required to be delivered under the Securities Act, of the happening of any event as a result of which the prospectus included in such registration statement contains an untrue statement of
a material fact or omits any fact necessary to make the statements therein not misleading and, at the request of Investor, the Company will promptly prepare a supplement or amendment to such prospectus so that, as thereafter delivered to the
purchasers of such Registrable Shares, such prospectus will not contain an untrue statement of a material fact or omit to state any fact necessary to make the statements therein not misleading; 
 (f) cause all such Registrable Shares to be listed on each securities exchange on which similar securities issued by the Company are then
listed and, if not so listed, to be listed on the NASD automated quotation system and, without limiting the generality of the foregoing, to arrange for at least two market makers to register as such with respect to such Registrable Shares with the
NASD; 
 (g) provide a transfer agent and registrar for all such Registrable Shares not later than the effective date of such
registration statement; 
 (h) enter into such customary agreements (including underwriting agreements in customary form for a
primary offering) and take all such other actions as a majority of the Rights Group or the underwriters, if any, reasonably request in order to expedite or facilitate the disposition of such Registrable Shares; 
  

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 (i) subject to compliance with such confidentiality requirements as the Company may
reasonably impose, and subject to the requirements of federal and state securities laws, the rules of the NASD and the rules of any securities exchange on which the Company’s securities are traded, make available for inspection by Investor, any
underwriter participating in any disposition pursuant to such registration statement and any attorney, accountant or other agent retained by Investor or underwriter, provided, however, that the Investor shall employ only one counsel, all pertinent
financial and other records and pertinent corporate documents of the Company, and cause the officers, directors, employees and independent accountants of the Company to supply all information reasonably requested by Investor and any underwriter,
attorney, accountant or agent in connection with such registration statement; 
 (j) promptly notify Investor and the
underwriters, if any, of the following events and (if requested by any such person) confirm such notification in writing: (i) the filing of the prospectus or any prospectus supplement and the registration statement and any amendment or
post-effective amendment thereto and, with respect to the registration statement or any post-effective amendment thereto, the declaration of the effectiveness of such documents; (ii) any requests by the Commission for amendments or supplements
to the registration statement or the prospectus or for additional information; (iii) the issuance or written threat of issuance by the Commission of any stop order suspending the effectiveness of the registration statement or the initiation of
any proceedings for that purpose; and (iv) the receipt by the Company of any notification with respect to the suspension of the qualification of the Registrable Shares for sale in any jurisdiction or the initiation or threat of initiation of
any proceeding for such purpose; 
 (k) make reasonable efforts to prevent the entry of any order suspending the effectiveness
of the registration statement and obtain at the earliest possible moment the withdrawal of any such order, if entered; 
 (l)
if reasonably requested by any underwriter or Investor in connection with any underwritten offering, promptly incorporate in a prospectus supplement or post-effective amendment such information as such underwriter or a majority of the Rights Group
agree should be included therein relating to the sale of the Registrable Shares, including without limitation information with respect to the number of Registrable Shares being sold to such underwriter, the purchase price being paid therefore by
such underwriter and any other terms of the underwritten (or best efforts underwritten) offering of the Registrable Shares to be sold in such offering, and make all required filings of such prospectus supplement or post-effective amendment promptly
after being notified of the matters to be incorporated in such prospectus supplement or post-effective amendment; 
 (m) upon
the filing of any document which is to be incorporated by reference into the registration statement or the prospectus (after the initial filing of the registration statement with the Commission), (i) promptly provide copies of such document to
counsel for the requesting Investor and counsel for the underwriters, if any, and (ii) make representatives of the Company available for discussion of such document; 
  

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 (n) cooperate with Investor and the underwriters, if any, to facilitate the timely
preparation and delivery of certificates representing Registrable Shares to be sold and not bearing any restrictive legends, and enable such Registrable Shares to be in such lots and registered in such names as the underwriters may request at least
two business days prior to any delivery of Registrable Shares to the underwriters; 
 (o) if necessary, provide a CUSIP number
for all Registrable Shares not later than the effective date of the registration statement; and 
 (p) prior to the
effectiveness of the registration statement and any post-effective amendment thereto and at each closing of an underwritten offering, do the following insofar as the requesting Investor are concerned or affected: (i) make such representations
and warranties to Investor and the underwriters, if any, with respect to the Registrable Shares and the registration statement as are customarily made by issuers to holders and underwriters in primary underwritten offerings; (ii) obtain
opinions of counsel to the Company and updates thereof (which counsel and opinions shall be reasonably satisfactory to the underwriters, if any, and to a majority of the Rights Group) addressed to each of Investor and the Existing Holders and the
underwriters, if any, covering the matters customarily covered in opinions requested in underwritten offerings and such other matters as may be reasonably requested by the Rights Group and underwriters or their counsel; (iii) obtain “cold
comfort” letters and updates thereof from the Company’s independent certified public accountants addressed to the Existing Holders and Investor or underwriters, if any, such letters to be in customary form and covering matters of the type
customarily covered in cold comfort letters by accountants and underwriters in connection with primary underwritten offerings; and (iv) deliver such documents and certificates as may be reasonably requested by a majority of the Rights Group or
by the underwriters, if any, to evidence compliance with clause (i) above and with any customary conditions contained in the underwriting agreement or other agreement entered into by the Company. 
 2.4 Suspension of Disposition of Registrable Shares. 
 Investor agrees that, upon receipt of any notice from the Company of the happening of any event of the kind described in Section 2.3(e), Investor will forthwith discontinue disposition of Registrable Shares until
such Investor’s receipt of copies of a supplemented or amended prospectus contemplated by Section 2.3(e), or until it is advised in writing (an “Advice”) by the Company that the use of the prospectus may be resumed and has
received copies of any additional or supplemental filings which are incorporated by reference in the prospectus and, if so directed by the Company, Investor will deliver to the Company (at the expense of the Company) all copies, other than permanent
file copies then in Investor’s possession, of the prospectus covering such Registrable Shares current at the time of receipt of such notice. If the Company shall give any such notice, the time periods specified in Section 2.3(a) shall be
extended by the number of days during the period from and including the date of the giving of such notice pursuant to Section 2.3(e) to and including the date when Investor shall have received the copies of the supplemented or amended
prospectus contemplated by Section 2.3(e) or the Advice. 
  

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 2.5 Expenses of Registration. 
 Whether or not any registration statement prepared and filed pursuant to this Agreement is declared effective by the Commission, the Company shall pay or
incur all expenses incurred in connection with a registration pursuant to the terms hereof (excluding underwriting fees, discounts and commissions attributable to the sale of Registrable Shares), including without limitation all registration,
qualification, application, filing, listing, transfer agent and registrar fees, printing, messenger, telephone and delivery fees and expenses, accounting fees and disbursements (including the expenses of any audit, review and/or “cold
comfort” letters), fees and disbursements of counsel for the Company, and in each demand registration, to a maximum of $15,000, the fees and costs of one counsel representing the Institutional Investor. 
 2.6 Conditions Precedent to Participation in Registration. 
 Investor shall not participate in any registration hereunder unless: 
 (a) Investor timely furnishes to the
Company and/or the underwriters managing such registration, if any, all such information regarding Investor, the Registrable Shares held by it and its intended method of disposing of such Registrable Shares as the Company or such underwriters may
reasonably request; 
 (b) Investor agrees to notify the Company and/or any underwriters managing such registration of the occurrence of any
event which causes the prospectus prepared in connection with any such registration to contain an untrue statement of a material fact or omit to state a fact necessary to make the statements therein not misleading promptly after Investor obtains
knowledge of such occurrence; and 
 (c) in the case of an underwritten registration, Investor agrees to (i) sell Investor ‘s
Registrable Shares on the basis of any underwriting arrangements approved by the persons(s) entitled hereunder to approve such arrangements and (ii) complete, execute and deliver all questionnaires, powers of attorney, indemnities, lock-up
agreement, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements and consistent with this Agreement. 
 2.7 Selection of Underwriters; Priorities. 
 (a) The Institutional Investor shall have the right to
select the investment banker(s) and manager(s) to administer any offering to which Section 2.1 is applicable, subject to the written consent of a majority in interest of the Registrable Shares held by the Rights Group, which consent may be
withheld in their sole and absolute discretion; a majority of the Rights Group shall have the right to select the investment banker(s) and manager(s) to administer an offering to be effected pursuant to Section 2.2 on Form S-1 or S-3 if no such
securities are being sold for the account of the Company. 
 (b) In the case of a registration under Section 2.1 which is an underwritten
offering, if the managing underwriters advise the Company in writing that in their opinion the number of Registrable Shares and other securities requested to be included exceeds the number of Registrable Shares and other securities which can be sold
at the desired price in such offering, the Company will include in such registration, to the extent of the amount which the Company is advised can be sold 

  

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at such price: (i) first, the Registrable Shares requested to be included, pro rata among the Rights Group on the basis of the number of Registrable
Shares requested to be registered by each such person; (ii) second, securities held by persons having piggyback registration rights and securities proposed to be sold by the Company, pro rata based on the estimated gross proceeds from the sale
thereof; and (iii) third, all other securities requested to be included in such registration. 
 (c) In the case of a registration under
Section 2.2 which is an underwritten offering, if the managing underwriters advise the Company in writing that in their opinion the number of securities requested to be included in such registration exceeds the number which can be sold at the
desired price in such offering, the Company will include in such registration, to the extent of the amount which the Company is advised can be sold at such price: 
 (i) if such registration is commenced upon the demand of persons having demand registration rights, the Company will include in such registration, (A) first, securities held by the persons having such demand
registration rights, (B) second, securities proposed to be sold by the Company, Registrable Shares, and securities proposed to be sold by other persons having piggyback registration rights pro rata based on the estimated gross proceeds from the
sale thereof and (C) third, all other securities requested to be included in such registration; and 
 (ii) if such registration is
commenced by the Company on its own account and not in response to persons having demand registration rights, (A) first, the securities which the Company proposes to sell, (B) second, Registrable Shares and securities proposed to be sold
by other persons having piggyback registration rights, pro rata based on the estimated gross proceeds from the sale thereof, (C) third, all other securities requested to be included in such registration. 
 2.8 Termination of the Company’s Obligations. 
 Except as set forth below, the Company shall have no further obligations under Section 2.1 after the Company has effected (a) two (2) registrations on Form S-1 or Form S-2 (or any successor forms)
pursuant to a demand made pursuant to Section 2.1, or (b) all Registrable Shares covered thereby have been sold either pursuant thereto or pursuant to Rule 144, or (c) when all of Investor’s Registrable Shares may be sold within
one day’s then normal trading volume under Rule 144(k), or (d) the close of business on December 31, 2010, whichever is earliest. The Company’s obligation to effect registrations pursuant to Section 2.2 and registrations
under Section 2.1 to be done on Form S-3 so long as the Company is eligible to use such Form (or any successor form) shall continue for so long as any Registrable Shares remain unregistered. 
 2.9 Indemnification. 
 2.9.1
Indemnification of Investor. Pursuant to the Company’s registration of the Registrable Shares under the Securities Act, the Company will indemnify and hold harmless Investor and each underwriter of the Registrable Shares so registered
and each person, if any, who controls Investor or any such underwriter within the meaning of 

  

 8 

 
Section 15 of the Securities Act from and against any and all losses, claims, damages, expenses or liabilities (or any action in respect thereof), joint
or several, to which they or any of them become subject under the Securities Act or under any other statute or at common law or otherwise, and, except as hereinafter provided, will reimburse Investor, each such underwriter and each such controlling
person, if any, for any legal or other expenses reasonably incurred by them or any of them, as such expenses are incurred, in connection with investigating or defending any actions whether or not resulting in any liability, insofar as such losses,
claims, damages, expenses, liabilities or actions (i) arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the registration statement, in any preliminary or amended preliminary
prospectus or in the prospectus (or the registration statement or prospectus as from time to time amended or supplemented by the Company); (ii) arise out of or are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary in order to make the statements therein not misleading; or (iii) any violation by the Company of the Securities Act, the Exchange Act, a state securities law or any rule or regulation under the
Securities Act, the Exchange Act or any state securities law; provided, however, that the indemnity contained in this Section 2.9 will not apply where such untrue statement or omission was made in such registration statement, preliminary or
amended, preliminary prospectus or prospectus in reliance upon and in conformity with information furnished in writing to the Company in connection therewith by Investor, any such underwriter or any such controlling person expressly for use therein.
Promptly after receipt by Investor, any underwriter or any controlling person of notice of the commencement of any action in respect of which indemnity may be sought against the Company, Investor, or such underwriter or such controlling person, as
the case may be, will notify the Company in writing of the commencement thereof, and, subject to the provisions hereinafter stated, the Company shall assume the defense of such action (including the employment of counsel, who shall be counsel
reasonably satisfactory to Investor, such underwriter or such controlling person, as the case may be), and the payment of expenses insofar as such action shall relate to any alleged liability in respect of which indemnity may be sought against the
Company. Investor, any such underwriter or any such controlling person shall have the right to employ separate counsel in any such action and to participate in the defense thereof in the event the representation of Investor, underwriter or
controlling person by counsel retained by or on the behalf of the Company would be inappropriate due to conflicts of interest between any such person and any other party represented by such counsel in such proceeding or action, in which case the
Company shall pay, as incurred, the fees and expenses of such separate counsel. The Company shall not be liable to indemnify any person under this Section 2.9 for any settlement of any such action effected without the Company’s consent
(which consent shall not be unreasonably withheld). The Company shall not, except with the approval of each party being indemnified under this Section 2.9 (which approval will not be unreasonably withheld), consent to entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof the giving by the claimant or plaintiff to the parties being so indemnified of a release from all liability in respect to such claim or litigation. 
 2.9.2 Indemnification of the Company. In the event that the Company registers any of the Registrable Shares under the Securities Act, Investor
will indemnify and hold harmless the Company, each of its directors, each of its officers who have signed the registration statement, each underwriter of the Registrable Shares so registered and each person, if any, who controls the Company within
the meaning of Section 15 of the Securities Act from and against any and all losses, claims, damages, expenses or liabilities 

  

 9 

 
(or any action in respect thereof), joint or several, to which they or any of them may become subject under the Securities Act or under any other statute or
at common law or otherwise, and, except as hereinafter provided, will reimburse the Company and each such director, officer, underwriter or controlling person for any legal or other expenses reasonably incurred by them or any of them, as such
expenses are incurred, in connection with investigating or defending any actions whether or not resulting in any liability, insofar as such losses, claims, damages, expenses, liabilities or actions arise out of or are based upon any untrue statement
or alleged untrue statement of a material fact contained in the registration statement, in any preliminary or amended preliminary prospectus or in the prospectus (or the registration statement or prospectus as from time to time amended or
supplemented) or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to make the statements therein not misleading, but only insofar as any such
statement or omission was made in reliance upon and in conformity with information furnished in writing to the Company in connection therewith by Investor, expressly for use therein; provided, however, that Investor’s obligations hereunder
shall be limited to an amount equal to the proceeds to Investor of the Registrable Shares sold in such registration. Promptly after receipt of notice of the commencement of any action in respect of which indemnity may be sought against Investor, the
Company will notify Investor in writing of the commencement thereof, and Investor shall, subject to the provisions hereinafter stated, assume the defense of such action (including the employment of counsel, who shall be counsel satisfactory to the
Company) and the payment of expenses insofar as such action shall relate to the alleged liability in respect of which indemnity may be sought against Investor. The Company and each such director, officer, underwriter or controlling person shall have
the right to employ separate counsel in any such action and to participate in the defense thereof in the event the representation of the Company, any of its officers or directors or any underwriter or controlling person by counsel retained by or on
the behalf of Investor would be inappropriate due to conflicts of interest between any such person and any other party represented by such counsel in such proceeding or action, in which case Investor shall pay, as incurred, the fees and expenses of
such separate counsel. Notwithstanding the two preceding sentences, if the action is one in which the Company may be obligated to indemnify Investor pursuant to Section 2.9, the Company shall have the right to assume the defense of such action,
subject to the right of such holders to participate therein as permitted by Section 2.9. Investor shall not be liable to indemnify any person for any settlement of any such action effected without Investor’s consent (which consent shall
not be unreasonably withheld). Investor shall not, except with the approval of the Company (which approval shall not be unreasonably withheld), consent to entry of any judgment or enter into any settlement that does not include as an unconditional
term thereof the giving by the claimant or plaintiff to the party being so indemnified of a release from all liability in respect to such claim or litigation. 
 2.10 Contribution. 
 If the indemnification provided for in Section 2.9. is held by a court of
competent jurisdiction to be unavailable to an indemnified party with respect to any loss, liability, claim, damage or expense referred to therein, then the indemnifying party, in lieu of indemnifying such indemnified party hereunder, shall
contribute to the amount paid or payable by such indemnified party as a result of such loss, liability, claim, damage or expense in such proportion as is appropriate to reflect the relative fault of the indemnifying party on the one hand and of the
indemnified party on the other in connection with the statements or omissions that resulted in such loss, liability, claim, 

  

 10 

 
damage or expense as well as any other relevant equitable considerations. The relative fault of the indemnifying party and of the indemnified party shall be
determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the indemnifying party or by the indemnified party and the
parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. 
 2.11
Exchange Act Registration. 
 With a view to making available to Investor the benefits of Rule 144 promulgated under the Securities Act
and any other rule or regulation of the SEC that may at any time permit Investor to sell securities of the Company to the public without registration or pursuant to a registration on Form S-3, the Company agrees to: 
  

	 	2.11.1.	Use its best efforts to make and keep public information available, as those terms are understood and defined in SEC Rule 144, at all times after the Effective Time;

  

	 	2.11.2.	Take such reasonable actions, including the registration of its common stock under Section 12 of the Exchange Act, as are necessary to enable Investor to use Rule 144 for the
sale of their Registrable Shares; 

  

	 	2.11.3.	File on a timely basis with the SEC all information that the SEC may require under either of Section 13 or Section 15(d) of the Exchange Act and, so long as it is required
to file such information, take all action that may be required as a condition to the availability of Form S-3 or Rule 144 under the Securities Act (or any successor exemptive rule hereinafter in effect) with respect to DPAC Common Stock; and

  

	 	2.11.4.	Furnish to Investor forthwith upon request (a) a written statement by the Company as to its compliance with the reporting requirements of Rule 144, (b) a copy of the most
recent annual or quarterly report of the Company as filed with the SEC, and (c) any other reports and documents that Investor may reasonably request in availing itself of any rule or regulation of the SEC allowing Investor to sell any such
Registrable Shares without registration. 

 2.12. Market Stand-Off Agreement. 
 Provided that all of the members of the Rights Group are treated equally and all officers and directors of the Company are also so bound, Investor shall
not, to the extent requested by any managing underwriter of the Company, sell or otherwise transfer or dispose of (other than to donees who agree to be similarly bound) any Registrable Shares during a period (the “Stand-Off Period”) equal
to one hundred twenty (120) days following the effective date of a registration statement of any secondary offering of the Company under the Securities Act (or in each case such shorter period as the Company or managing underwriter may
authorize) and except in each case, for securities sold as part of the offering covered by such registration statement in accordance with the provisions of this Agreement. In order to enforce the foregoing covenant, the Company may impose stock
transfer restrictions with respect to the Registrable Shares of Investor until the end of the Stand-Off Period. Notwithstanding the foregoing, the obligations described in this 

  

 11 

 
Section 2.9. shall not apply to a registration relating solely to employee benefit plans on Form S-1 or Form S-8 or similar forms which may be
promulgated in the future, or a registration relating solely to an SEC Rule 145 transaction on Form S-4 or similar forms which may be promulgated in the future. 
 3. [Reserved]. 
 4. Nasdaq Listing. 
 From and after the date hereof for so long as Investor continues to hold Registrable Shares, the Company will use commercially reasonable best efforts to maintain the continued listing of the DPAC Common Stock on the Over the Counter
Bulletin Board. 
 5. Covenant Not to Enter Into Other Registration Rights Agreements. 
 Until the termination of the Company’s obligations under Section 2.8 hereof, the Company will not agree to, and will not, grant registration
rights of any type, whether demand, piggyback or other, to any other person without the express written consent of Investor. 
 6. Miscellaneous. 

 

	 	6.1.	Entire Agreement. This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all other prior
agreements and understandings, both written and oral, among the parties, or any of them, with respect to the subject matter hereof. 

  

	 	6.2.	Parties in Interest. This Agreement shall be binding upon and inure solely to the benefit of each party hereto and their respective successors, assigns, heirs, executors,
administrators and other legal representatives. Nothing in this Agreement, express or implied, is intended to confer upon any other person any rights or remedies of any nature whatsoever under or by reason of this Agreement.

  

	 	6.3.	Assignment. This Agreement shall not be assigned without the prior written consent of the other party hereto. 

  

	 	6.4.	Modifications. This Agreement shall not be amended, altered or modified in any manner whatsoever, except by a written instrument executed by the parties hereto.

  

	 	6.5.	Severability. If any provision of this Agreement or the application of such provision to any person or circumstances shall be held invalid or unenforceable by a court of
competent jurisdiction, such provision or application shall be unenforceable only to the extent of such invalidity or unenforceability, and the remainder of the provision held invalid or unenforceable and the application of such provision to persons
or circumstances, other than the party as to which it is held invalid, and the remainder of this Agreement, shall not be affected. 

  

 12 

	 	6.6.	Governing Law. This Agreement shall be governed in all respects, including validity, interpretation and effect, by the laws of the State of Ohio without regard to the
conflicts of law principles thereof. 

  

	 	6.7.	Attorneys’ Fees. The prevailing party or parties in any litigation, arbitration, mediation, bankruptcy, insolvency or other proceeding (“Proceeding”) relating
to the enforcement or interpretation of this Agreement may recover from the unsuccessful party or parties all fees and disbursements of counsel (including expert witness and other consultants’ fees and costs) relating to or arising out of
(a) the Proceeding (whether or not the Proceeding proceeds to judgment) and (b) any post-judgment or post-award proceeding including, without limitation, one to enforce or collect any judgment or award resulting from the Proceeding. All
such judgments and awards shall contain a specific provision for the recovery of all such subsequently incurred costs, expenses, fees and disbursements of counsel. 

  

	 	6.8.	Validity. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, each
of which shall remain in full force and effect. 

  

	 	6.9.	Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one and the same
agreement. 

  

	 	6.10.	Notices. Any notices or other communications required or permitted hereunder shall be in writing and shall be deemed duly given upon (a) transmitter’s confirmation
of a receipt of a facsimile transmission, (b) confirmed delivery by a standard overnight carrier, or (c) the expiration of five (5) business days after the day when mailed by certified or registered mail, postage prepaid, addressed at
the following addresses (or at such other address as the parties hereto shall specify by like notice): 

  

			
	If to the Company to:	 	With a copy to:
		
	DPAC TECHNOLOGIES CORP.	 	Buchanan Ingersoll & Rooney PC
	5675 Hudson Industrial Parkway	 	301 Grant Street 20th Floor
	Hudson, Ohio 44236	 	One Oxford Centre
	Attention: Steve Runkel, CEO	 	Pittsburgh PA 15219
	Phone: (800) 553-1170	 	Attention: Richard Rose, Esq.
	Facsimile: (        )
        -            	 	Phone: (412) 562-8425
		 	Facsimile: (412) 562-1041

 If to Investor, to the address noted on the signature page hereto and to any counsel identified in
like written notice from Investor to the Company. Each of the parties hereto shall be entitled to specify another address by giving notice as aforesaid to each of the other parties hereto. 
  

 13 

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

			
	DPAC TECHNOLOGIES CORP.
		
	By:	 	 /s/ Steven D. Runkel

		 	Steven D. Runkel,
		 	Chief Executive Officer and President

  

					
	 INVESTOR
	 	 ADDRESS FOR NOTICES

	Canal Mezzanine Partners, L.P.	 	
	By:	 	/s/ Shawn M. Wynne, its General Partner	 	

					
			
	Signature:	 	 /s/ Shawn M. Wynne
	 	
	Name:	 	Shawn M. Wynne	 	
	Title:	 	General Partner	 	

  

 14

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