Document:

ex10-3.htm

Exhibit 10.3

 

REGISTRATION RIGHTS AGREEMENT

 

REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of August 10, 2017, by and between DIGITAL POWER CORPOATION, a California corporation (the “Company”), and [●] (together with it permitted assigns, the “Buyer”). Capitalized terms used herein and not otherwise defined herein shall have the respective meanings set forth in the Securities Purchase Agreement by and between the parties hereto, dated as of the date hereof (as amended, restated, supplemented or otherwise modified from time to time, the “Purchase Agreement”).

 

WHEREAS:

 

The Company has agreed, upon the terms and subject to the conditions of the Purchase Agreement, to sell to the Buyer that certain senior convertible promissory note in the principal amount of $ [●] (the “Note”) and a warrant to purchase [●] shares of Common Stock (the “Warrant”), and to induce the Buyer to enter into the Purchase Agreement, the Company has agreed to provide certain registration rights under the Securities Act of 1933, as amended, and the rules and regulations thereunder, or any similar successor statute (collectively, the “Securities Act”), and applicable state securities laws.

 

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

 

	
 
	
1.
	
DEFINITIONS.

 

As used in this Agreement, the following terms shall have the following meanings:

 

a.     “Investor” means the Buyer, any transferee or assignee thereof to whom a Buyer assigns its rights under this Agreement in accordance with Section 9 and who agrees to become bound by the provisions of this Agreement, and any transferee or assignee thereof to whom a transferee or assignee assigns its rights under this Agreement in accordance with Section 9 and who agrees to become bound by the provisions of this Agreement.

 

b.     “Person” means any individual or entity including but not limited to any corporation, a limited liability company, an association, a partnership, an organization, a business, an individual, a governmental or political subdivision thereof or a governmental agency.

 

c.     “Register,” “registered,” and “registration” refer to a registration effected by preparing and filing one or more registration statements of the Company in compliance with the Securities Act and/or pursuant to Rule 415 under the Securities Act or any successor rule providing for offering securities on a continuous basis (“Rule 415”), and the declaration or ordering of effectiveness of such registration statement(s) by the United States Securities and Exchange Commission (the “SEC”).

 

d.     “Registrable Securities” means all of the shares of Common Stock into which the Note is convertible into (the “Conversion Shares”) and the Warrant is exercisable into (the “Warrant Shares”) (the Conversion Shares and Warrant Shares shall collectively be referred to herein as the “Total Shares”) which have been, or which may, from time to time be issued, including without limitation all of the shares of common stock which have been issued or will be issued to the Investor under the Purchase Agreement (without regard to any limitation or restriction on purchases), and any and all shares of capital stock issued or issuable with respect to the Total Shares, shares of common stock issued to the Investor as a result of any stock split, stock dividend, recapitalization, exchange or similar event or otherwise, without regard to any limitation on purchases under the Purchase Agreement.

 

e.     “Registration Statement” means one or more registration statements of the Company covering only the sale of the Registrable Securities.

 

 

 

 

  

	
 
	
2.
	
REGISTRATION.

 

a.     Mandatory Registration. The Company shall, no later than September 8, 2017 (the “Filing Date”), file with the SEC an initial Registration Statement covering the maximum number of Registrable Securities (beginning first with the Conversion Shares) as shall be permitted to be included thereon in accordance with applicable SEC rules, regulations and interpretations so as to permit the resale of such Registrable Securities by the Investor, including but not limited to under Rule 415 under the Securities Act at then prevailing market prices (and not fixed prices), as mutually determined by both the Company and the Investor in consultation with their respective legal counsel, subject to the aggregate number of authorized shares of the Company’s Common Stock then available for issuance in its Articles of Incorporation. The initial Registration Statement shall register the Registrable Securities as well as certain other registrable securities owned by third parties that the Company has previously committeed to register on a pari passu basis (the “Aggregate Registrable Securities”). The Investor and its counsel shall have a reasonable opportunity to review and comment upon such Registration Statement and any amendment or supplement to such Registration Statement and any related prospectus prior to its filing with the SEC. The Investor shall furnish all information reasonably requested by the Company for inclusion therein. The Company shall have the Registration Statement and any amendment declared effective by the SEC at the earliest possible date (in any event within one hundred and twenty (120) calendar days from the Filing Date). The Company shall keep the Registration Statement effective, including but not limited to pursuant to Rule 415 promulgated under the Securities Act and available for the resale by the Investor of all of the Registrable Securities covered thereby at all times until the earlier of (i) the date as of which the Investor may sell all of the Registrable Securities without restriction pursuant to Rule 144 promulgated under the Securities and (ii) the date on which the Investor shall have sold all the Registrable Securities covered thereby (the “Registration Period”). The Registration Statement (including any amendments or supplements thereto and prospectuses contained therein) shall not contain any 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 in which they were made, not misleading. 

 

If: (i) a Registration Statement is not filed on or prior to its Filing Date or (ii) the Company fails to file with the SEC a request for acceleration in accordance with Rule 461 promulgated under the Securities Act, within five Business Days of the date that the Company is notified (orally or in writing, whichever is earlier) by the Commission that a Registration Statement will not be “reviewed,” or not subject to further review, or (iii) prior to the date that the SEC declares the Registration Statement effective (the “Effectiveness Date”), the Company fails to file a pre-effective amendment and otherwise respond in writing to comments made by the Commission in respect of such Registration Statement within 30 calendar days after the receipt of comments by or notice from the Commission that such amendment is required in order for a Registration Statement to be declared effective, or (iv) after the Effectiveness Date, a Registration Statement ceases for any reason to remain continuously effective as to all Registrable Securities for which it is required to be effective, or the Holders are not permitted to utilize the Prospectus therein to resell such Registrable Securities for 30 consecutive calendar days but no more than an aggregate of 60 calendar days during any 12-month period (which need not be consecutive Business Days) (any such failure or breach being referred to as an “Event”, and for purposes of clause (i) the date on which such Event occurs, or for purposes of clause (ii) the date on which such five Business Day period is exceeded, or for purposes of clause (iii) the date which such 30 calendar day period is exceeded, or for purposes of clause (iv) the date on which such 30 or 60 calendar day period, as applicable, is exceeded being referred to as “Event Date”), then in addition to any other rights the Holders may have hereunder or under applicable law, on each such Event Date and on each monthly anniversary of each such Event Date (if the applicable Event shall not have been cured by such date) until the applicable Event is cured, the Company shall pay to each Holder an amount in cash, as partial liquidated damages and not as a penalty, equal to $15,000.00. If the Company fails to pay any partial liquidated damages pursuant to this Section in full within fifteen (15) days after the date payable, the Company will pay interest thereon at a rate of 12% per annum (or such lesser maximum amount that is permitted to be paid by applicable law) to the Holder, accruing daily from the date such partial liquidated damages are due until such amounts, plus all such interest thereon, are paid in full. The partial liquidated damages pursuant to the terms hereof shall apply on a daily pro-rata basis for any portion of a month prior to the cure of an Event. 

 

b.     Rule 424 Prospectus. The Company shall, as required by applicable securities regulations, from time to time file with the SEC, pursuant to Rule 424 promulgated under the Securities Act, the prospectus and prospectus supplements, if any, to be used in connection with sales of the Registrable Securities under the Registration Statement. The Investor and its counsel shall have a reasonable opportunity to review and comment upon such prospectus prior to its filing with the SEC, and the Company shall give due consideration to all such comments received within one (1) Business Day from the date the Investor receives the final pre-filing version of such prospectus. 

 

 

 

 

 

 

c.     Sufficient Number of Shares Registered. In the event the number of shares available under the Registration Statement is insufficient to cover all of the Aggregate Registrable Securities, the Company shall amend the Registration Statement or file a new Registration Statement (a “New Registration Statement”), so as to cover all of such Aggregate Registrable Securities (subject to the limitations set forth in Section 2(a)) as soon as practicable, but in any event not later than thirty (30) days after the necessity therefor arises, subject to any limits that may be imposed by the SEC pursuant to Rule 415 under the Securities Act. The Company shall use its commercially reasonable best efforts to cause such amendment and/or New Registration Statement to become effective as soon as practicable following the filing thereof. In the event that any of the Total Shares are not included in the Registration Statement, or have not been included in any New Registration Statement and the Company files any other registration statement under the Securities Act (other than on Form S-4, Form S-8, or with respect to other employee related plans or rights offerings) (“Other Registration Statement”) then the Company shall include in such Other Registration Statement the Registrable Securities on a pari passu basis with the Aggregate Registrable Securities other than the Registrable Securities. Of the Registrable Securities, the Company shall include, first all of the Conversion Shares and second all of such Total Shares that have not been previously registered.   

 

d. Offering. If the staff of the SEC (the “Staff”) or the SEC seeks to characterize any offering pursuant to a Registration Statement filed pursuant to this Agreement as constituting an offering of securities that does not permit such Registration Statement to become effective and be used for resales by the Investor under Rule 415 at then-prevailing market prices (and not fixed prices), or if after the filing of the initial Registration Statement with the SEC pursuant to Section 2(a), the Company is otherwise required by the Staff or the SEC to reduce the number of Registrable Securities included in such initial Registration Statement, then the Company shall reduce the number of Registrable Securities to be included in such initial Registration Statement until such time as the Staff and the SEC shall so permit such Registration Statement to become effective and be used as aforesaid. In the event of any reduction in Registrable Securities pursuant to this paragraph, the Company shall file one or more New Registration Statements in accordance with Section 2(c) until such time as all Registrable Securities have been included in Registration Statements that have been declared effective and the prospectus contained therein is available for use by the Investor. Notwithstanding any provision herein or in the Purchase Agreement to the contrary, the Company’s obligations to register Registrable Securities (and any related conditions to the Investor’s obligations) shall be qualified as necessary to comport with any requirement of the SEC or the Staff as addressed in this Section 2(d) as well sa the Company’s obligations with respect to the Aggregate Registrable Securities other than the Registrable Securities.

 

	
 
	
3.
	
RELATED OBLIGATIONS.

 

With respect to the Registration Statement and whenever any Registrable Securities are to be registered pursuant to Section 2 including on any New Registration Statement, the Company shall use its reasonable best efforts to effect the registration of the Registrable Securities in accordance with the intended method of disposition thereof and, pursuant thereto, the Company shall have the following obligations:

 

a.     The Company shall prepare and file with the SEC such amendments (including post-effective amendments) and supplements to any registration statement and the prospectus used in connection with such registration statement, which prospectus is to be filed pursuant to Rule 424 promulgated under the Securities Act, as may be necessary to keep the Registration Statement or any New Registration Statement effective at all times during the Registration Period, and, during such period, comply with the provisions of the Securities Act with respect to the disposition of all Registrable Securities of the Company covered by the Registration Statement or any New Registration Statement until such time as all of such Registrable Securities shall have been disposed of in accordance with the intended methods of disposition by the seller or sellers thereof as set forth in such registration statement.

 

 

 

 

 

 

b.     Upon request of the Investor, the Company shall furnish to the Investor, (i) promptly after the same is prepared and filed with the SEC, at least one copy of such registration statement and any amendment(s) thereto, including financial statements and schedules, all documents incorporated therein by reference and all exhibits, (ii) upon the effectiveness of any registration statement, a copy of the prospectus included in such registration statement and all amendments and supplements thereto (or such other number of copies as the Investor may reasonably request) and (iii) such other documents, including copies of any preliminary or final prospectus, as the Investor may reasonably request from time to time in order to facilitate the disposition of the Registrable Securities owned by the Investor. For the avoidance of doubt, any filing available to the Investor via the SEC’s live EDGAR system shall be deemed “furnished to the Investor” hereunder.

 

c.     The Company shall use commercially reasonable best efforts to (i) register and qualify the Registrable Securities covered by a registration statement under such other securities or “blue sky” laws of such jurisdictions in the United States as the Investor reasonably requests, (ii) prepare and file in those jurisdictions, such amendments (including post-effective amendments) and supplements to such registrations and qualifications as may be necessary to maintain the effectiveness thereof during the Registration Period, (iii) take such other actions as may be necessary to maintain such registrations and qualifications in effect at all times during the Registration Period, and (iv) take all other actions reasonably necessary or advisable to qualify the Registrable Securities for sale in such jurisdictions; provided, however, that the Company shall not be required in connection therewith or as a condition thereto to (x) qualify to do business in any jurisdiction where it would not otherwise be required to qualify but for this Section 3(c), (y) subject itself to general taxation in any such jurisdiction, or (z) file a general consent to service of process in any such jurisdiction. The Company shall promptly notify the Investor who holds Registrable Securities of the receipt by the Company of any notification with respect to the suspension of the registration or qualification of any of the Registrable Securities for sale under the securities or “blue sky” laws of any jurisdiction in the United States or its receipt of actual notice of the initiation or threatening of any proceeding for such purpose.

 

d.     As promptly as practicable after becoming aware of such event or facts, the Company shall notify the Investor in writing of the happening of any event or existence of such facts as a result of which the prospectus included in any registration statement, as then in effect, includes an untrue statement of a material fact or omits 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, and promptly prepare a supplement or amendment to such registration statement to correct such untrue statement or omission, and deliver a copy of such supplement or amendment to the Investor (or such other number of copies as the Investor may reasonably request). The Company shall also promptly notify the Investor in writing (i) when a prospectus or any prospectus supplement or post-effective amendment has been filed, and when a registration statement or any post-effective amendment has become effective (notification of such effectiveness shall be delivered to the Investor by email or facsimile on the same day of such effectiveness and by overnight mail), (ii) of any request by the SEC for amendments or supplements to any registration statement or related prospectus or related information, and (iii) of the Company's reasonable determination that a post-effective amendment to a registration statement would be appropriate.

 

e.     The Company shall use its reasonable best efforts to prevent the issuance of any stop order or other suspension of effectiveness of any registration statement, or the suspension of the qualification of any Registrable Securities for sale in any jurisdiction and, if such an order or suspension is issued, to obtain the withdrawal of such order or suspension at the earliest possible moment and to notify the Investor of the issuance of such order and the resolution thereof or its receipt of actual notice of the initiation or threat of any proceeding for such purpose.

 

f.     The Company shall (i) cause all the Registrable Securities to be listed on each securities exchange on which securities of the same class or series issued by the Company are then listed, if any, if the listing of such Registrable Securities is then permitted under the rules of such exchange, or (ii) secure designation and quotation of all the Registrable Securities on the Trading Market. The Company shall pay all fees and expenses in connection with satisfying its obligation under this Section.

 

g.     The Company shall cooperate with the Investor to facilitate the timely preparation and delivery of certificates (not bearing any restrictive legend) representing the Registrable Securities to be offered pursuant to any registration statement and enable such certificates to be in such denominations or amounts as the Investor may reasonably request and registered in such names as the Investor may request.

 

 

 

 

 

 

h.     The Company shall at all times provide a transfer agent and registrar with respect to its Common Stock.

 

i.     If reasonably requested by the Investor, the Company shall (i) immediately incorporate in a prospectus supplement or post-effective amendment such information as the Investor believes should be included therein relating to the sale and distribution of Registrable Securities, including, without limitation, information with respect to the number of Registrable Securities being sold, the purchase price being paid therefor and any other terms of the offering of the Registrable Securities; (ii) make all required filings of such prospectus supplement or post-effective amendment as soon as practicable upon notification of the matters to be incorporated in such prospectus supplement or post-effective amendment; and (iii) supplement or make amendments to any registration statement.

 

j.     The Company shall use its reasonable best efforts to cause the Registrable Securities covered by any registration statement to be registered with or approved by such other governmental agencies or authorities as may be necessary to consummate the disposition of such Registrable Securities.

 

k.     Within one (1) Business Day after any registration statement which includes the Registrable Securities is ordered effective by the SEC, the Company shall deliver, and shall cause legal counsel for the Company to deliver, to the transfer agent for such Registrable Securities (with copies to the Investor) confirmation that such registration statement has been declared effective by the SEC in the form attached hereto as Exhibit A. 

 

l.     The Company shall take all other reasonable actions necessary to expedite and facilitate disposition by the Investor of Registrable Securities pursuant to any registration statement.

 

	
 
	
4.
	
OBLIGATIONS OF THE INVESTOR.

 

a.     The Company shall notify the Investor in writing of the information the Company reasonably requires from the Investor in connection with any registration statement hereunder. The Investor shall furnish to the Company such information regarding itself, the Registrable Securities held by it and the intended method of disposition of the Registrable Securities held by it as shall be reasonably required to effect the registration of such Registrable Securities and shall execute such documents in connection with such registration as the Company may reasonably request.

 

b.     The Investor agrees to cooperate with the Company as reasonably requested by the Company in connection with the preparation and filing of any registration statement hereunder.

 

c.     The Investor agrees that, upon receipt of any notice from the Company of the happening of any event or existence of facts of the kind described in Section 3(e) or the first sentence of 3(d), the Investor will immediately discontinue disposition of Registrable Securities pursuant to any registration statement(s) covering such Registrable Securities until the Investor's receipt of the copies of the supplemented or amended prospectus contemplated by Section 3(e) or the first sentence of 3(d). Notwithstanding anything to the contrary, the Company shall cause its transfer agent to promptly deliver shares of Common Stock without any restrictive legend in accordance with the terms of the Purchase Agreement in connection with any sale of Registrable Securities with respect to which an Investor has entered into a contract for sale prior to the Investor's receipt of a notice from the Company of the happening of any event of the kind described in Section 3(e) or the first sentence of Section 3(d) and for which the Investor has not yet settled.

 

	
 
	
5.
	
EXPENSES OF REGISTRATION.

 

All reasonable expenses, other than sales or brokerage commissions, incurred in connection with registrations, filings or qualifications pursuant to Sections 2 and 3, including, without limitation, all registration, listing and qualifications fees, printers and accounting fees, and fees and disbursements of counsel for the Company, shall be paid by the Company.

 

 

 

 

 

 

	
 
	
6.
	
INDEMNIFICATION.

 

a.     To the fullest extent permitted by law, the Company will, and hereby does, indemnify, hold harmless and defend the Investor, each Person, if any, who controls the Investor, the members, the directors, officers, partners, employees, agents, representatives of the Investor and each Person, if any, who controls the Investor within the meaning of the Securities Act or the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (each, an “Indemnified Person”), against any losses, claims, damages, liabilities, judgments, fines, penalties, charges, costs, attorneys' fees, amounts paid in settlement or expenses, joint or several, (collectively, “Claims”) incurred in investigating, preparing or defending any action, claim, suit, inquiry, proceeding, investigation or appeal taken from the foregoing by or before any court or governmental, administrative or other regulatory agency, body or the SEC, whether pending or threatened, whether or not an indemnified party is or may be a party thereto (“Indemnified Damages”), to which any of them may become subject insofar as such Claims (or actions or proceedings, whether commenced or threatened, in respect thereof) arise out of or are based upon: (i) any untrue statement or alleged untrue statement of a material fact in the Registration Statement, any New Registration Statement or any post-effective amendment thereto or in any filing made in connection with the qualification of the offering under the securities or other “blue sky” laws of any jurisdiction in which Registrable Securities are offered (“Blue Sky Filing”), or the omission or alleged omission to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) any untrue statement or alleged untrue statement of a material fact contained in the final prospectus (as amended or supplemented, if the Company files any amendment thereof or supplement thereto with the SEC) or the omission or alleged omission to state therein any material fact necessary to make the statements made therein, in light of the circumstances under which the statements therein were made, not misleading, (iii) any violation or alleged violation by the Company of the Securities Act, the Exchange Act, any other law, including, without limitation, any state securities law, or any rule or regulation thereunder relating to the offer or sale of the Registrable Securities pursuant to the Registration Statement or any New Registration Statement or (iv) any material violation by the Company of this Agreement (the matters in the foregoing clauses (i) through (iv) being, collectively, “Violations”). The Company shall reimburse each Indemnified Person promptly as such expenses are incurred and are due and payable, for any reasonable legal fees or other reasonable expenses incurred by them in connection with investigating or defending any such Claim. Notwithstanding anything to the contrary contained herein, the indemnification agreement contained in this Section 6(a): (i) shall not apply to a Claim by an Indemnified Person arising out of or based upon a Violation which occurs in reliance upon and in conformity with information about the Investor furnished in writing to the Company by such Indemnified Person expressly for use in connection with the preparation of the Registration Statement, any New Registration Statement or any such amendment thereof or supplement thereto, if such prospectus was timely made available by the Company pursuant to Section 3(c); (ii) with respect to any superseded prospectus, shall not inure to the benefit of any such person from whom the person asserting any such Claim purchased the Registrable Securities that are the subject thereof (or to the benefit of any person controlling such person) if the untrue statement or omission of material fact contained in the superseded prospectus was corrected in the revised prospectus, as then amended or supplemented, if such revised prospectus was timely made available by the Company pursuant to Section 3(c), and the Indemnified Person was promptly advised in writing not to use the incorrect prospectus prior to the use giving rise to a violation and such Indemnified Person, notwithstanding such advice, used it; (iii) shall not be available to the extent such Claim is based on a failure of the Investor to deliver or to cause to be delivered the prospectus made available by the Company, if such prospectus was timely made available by the Company pursuant to Section 3(c); and (iv) shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written consent of the Company, which consent shall not be unreasonably withheld. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of the Indemnified Person and shall survive the transfer of the Registrable Securities by the Investor pursuant to Section 9.

 

 

 

 

 

 

b.     Promptly after receipt by an Indemnified Person or Indemnified Party under this Section 6 of notice of the commencement of any action or proceeding (including any governmental action or proceeding) involving a Claim, such Indemnified Person or Indemnified Party shall, if a Claim in respect thereof is to be made against any indemnifying party under this Section 6, deliver to the indemnifying party a written notice of the commencement thereof, and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume control of the defense thereof with counsel mutually satisfactory to the indemnifying party and the Indemnified Person or the Indemnified Party, as the case may be; provided, however, that an Indemnified Person or Indemnified Party shall have the right to retain its own counsel with the fees and expenses to be paid by the indemnifying party, if, in the reasonable opinion of counsel retained by the indemnifying party, the representation by such counsel of the Indemnified Person or Indemnified Party and the indemnifying party would be inappropriate due to actual or potential differing interests between such Indemnified Person or Indemnified Party and any other party represented by such counsel in such proceeding. The Indemnified Party or Indemnified Person shall cooperate fully with the indemnifying party in connection with any negotiation or defense of any such action or claim by the indemnifying party and shall furnish to the indemnifying party all information reasonably available to the Indemnified Party or Indemnified Person which relates to such action or claim. The indemnifying party shall keep the Indemnified Party or Indemnified Person fully apprised at all times as to the status of the defense or any settlement negotiations with respect thereto. No indemnifying party shall be liable for any settlement of any action, claim or proceeding effectuated without its written consent, provided, however, that the indemnifying party shall not unreasonably withhold, delay or condition its consent. No indemnifying party shall, without the consent of the Indemnified Party or Indemnified Person, consent to entry of any judgment or enter into any settlement or other compromise which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party or Indemnified Person of a release from all liability in respect to such claim or litigation. Following indemnification as provided for hereunder, the indemnifying party shall be subrogated to all rights of the Indemnified Party or Indemnified Person with respect to all third parties, firms or corporations relating to the matter for which indemnification has been made. The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action shall not relieve such indemnifying party of any liability to the Indemnified Person or Indemnified Party under this Section 6, except to the extent that the indemnifying party is prejudiced in its ability to defend such action.

 

c.     The indemnification required by this Section 6 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received or Indemnified Damages are incurred.

 

d.     The indemnity agreements contained herein shall be in addition to (i) any cause of action or similar right of the Indemnified Party or Indemnified Person against the indemnifying party or others, and (ii) any liabilities the indemnifying party may be subject to pursuant to the law.

 

	
 
	
7.
	
CONTRIBUTION.

 

To the extent any indemnification by an indemnifying party is prohibited or limited by law, the indemnifying party agrees to make the maximum contribution with respect to any amounts for which it would otherwise be liable under Section 6 to the fullest extent permitted by law; provided, however, that: (i) no seller of Registrable Securities guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any seller of Registrable Securities who was not guilty of fraudulent misrepresentation; and (ii) contribution by any seller of Registrable Securities shall be limited in amount to the net amount of proceeds received by such seller from the sale of such Registrable Securities.

 

	
 
	
8.
	
REPORTS AND DISCLOSURE UNDER THE SECURITIES ACTS.

 

With a view to making available to the Investor the benefits of Rule 144 promulgated under the Securities Act or any other similar rule or regulation of the SEC that may at any time permit the Investor to sell securities of the Company to the public without registration (“Rule 144”), the Company agrees, at the Company’s sole expense, to:

 

a.     make and keep public information available, as those terms are understood and defined in Rule 144;

 

b.     file with the SEC in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act so long as the Company remains subject to such requirements and the filing of such reports and other documents is required for the applicable provisions of Rule 144;

 

 

 

 

 

 

c.     furnish to the Investor so long as the Investor owns Registrable Securities, promptly upon request, (i) a written statement by the Company that it has complied with the reporting and or disclosure provisions of Rule 144, the Securities Act and the Exchange Act, (ii) a copy of the most recent annual or quarterly report of the Company and such other reports and documents so filed by the Company, and (iii) such other information as may be reasonably requested to permit the Investor to sell such securities pursuant to Rule 144 without registration; and

 

d.     take such additional action as is requested by the Investor to enable the Investor to sell the Registrable Securities pursuant to Rule 144, including, without limitation, delivering all such legal opinions, consents, certificates, resolutions and instructions to the Company’s Transfer Agent as may be requested from time to time by the Investor and otherwise fully cooperate with Investor and Investor’s broker to effect such sale of securities pursuant to Rule 144.

 

The Company agrees that damages may be an inadequate remedy for any breach of the terms and provisions of this Section 8 and that Investor shall, whether or not it is pursuing any remedies at law, be entitled to equitable relief in the form of a preliminary or permanent injunctions, without having to post any bond or other security, upon any breach or threatened breach of any such terms or provisions.

 

	 	
9.
	
ASSIGNMENT OF REGISTRATION RIGHTS.

 

The Company shall not assign this Agreement or any rights or obligations hereunder without the prior written consent of the Investor. 

 

	
 
	
10.
	
AMENDMENT OF REGISTRATION RIGHTS.

 

No provision of this Agreement may be amended or waived by the parties from and after the date that is one Business Day immediately preceding the initial filing of the Registration Statement with the SEC. Subject to the immediately preceding sentence, no provision of this Agreement may be (i) amended other than by a written instrument signed by both parties hereto or (ii) waived other than in a written instrument signed by the party against whom enforcement of such waiver is sought. Failure of any party to exercise any right or remedy under this Agreement or otherwise, or delay by a party in exercising such right or remedy, shall not operate as a waiver thereof.

 

	
 
	
11.
	
MISCELLANEOUS.

 

a.     A Person is deemed to be a holder of Registrable Securities whenever such Person owns or is deemed to own of record such Registrable Securities. If the Company receives conflicting instructions, notices or elections from two or more Persons with respect to the same Registrable Securities, the Company shall act upon the basis of instructions, notice or election received from the registered owner of such Registrable Securities.

 

b.     Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile or email (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); or (iii) one (1) Business Day after deposit with a nationally recognized overnight delivery service, in each case properly addressed to the party to receive the same. The addresses for such communications shall be:

 

If to the Company, to:

 

DIGITAL POWER CORPORATION

48430 Lakeview Blvd.

Fremont, CA 94538

Attention: Amos Kohn

e-mail: AKohn@digipwr.com

 

 

 

 

 

 

With a copy by e-mail only (which copy shall not constitute notice) to:

 

SICHENZIA ROSS FERENCE KESNER LLP

61 Broadway, 32nd Floor

New York, NY 10006

Attention: Marc J. Ross, Esq.

Email: mross@srfkllp.com

 

 If to the Investor:

 

[●]

 

With a copy by e-mail only to (which copy shall not constitute notice):

 

[●]

 

or at such other address and/or facsimile number and/or to the attention of such other person as the recipient party has specified by written notice given to each other party three (3) Business Days prior to the effectiveness of such change. Written confirmation of receipt (A) given by the recipient of such notice, consent, waiver or other communication, (B) mechanically or electronically generated by the sender's facsimile machine or email account containing the time, date, recipient facsimile number or email address, as applicable, and an image of the first page of such transmission or (C) provided by a nationally recognized overnight delivery service, shall be rebuttable evidence of personal service, receipt by facsimile or receipt from a nationally recognized overnight delivery service in accordance with clause (i), (ii) or (iii) above, respectively.

 

c.     The corporate laws of the State of New York shall govern all issues concerning this Agreement. All other questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting the New York, New York, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address for such notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. If any provision of this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the remainder of this Agreement in that jurisdiction or the validity or enforceability of any provision of this Agreement in any other jurisdiction. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY. 

 

d.     This Agreement and the Purchase Agreement constitute the entire agreement among the parties hereto with respect to the subject matter hereof and thereof. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein and therein. This Agreement and the Purchase Agreement supersede all prior agreements and understandings among the parties hereto with respect to the subject matter hereof and thereof.

 

e.     Subject to the requirements of Section 9, this Agreement shall inure to the benefit of and be binding upon the successors and permitted assigns of each of the parties hereto.

 

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

 

g.     This Agreement may be executed in identical counterparts, each of which shall be deemed an original but all of which shall constitute one and the same agreement. This Agreement, once executed by a party, may be delivered to the other party hereto by facsimile transmission or by e-mail in a “.pdf” format data file of a copy of this Agreement bearing the signature of the party so delivering this Agreement.

 

 

 

 

 

 

h.     Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

 

i.     The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent and no rules of strict construction will be applied against any party.

 

j.     This Agreement is intended for the benefit of the parties hereto and their respective successors and permitted assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person.

 

 

 

* * * * * *

 

 

 

 

 

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

 

THE COMPANY:

 

DIGITAL POWER CORPORATION

 

 

 

	
By:
	  	
 

	
 
	
Name: AMOS KOHN
	
 

	
 
	
Title: CHIEF EXECUTIVE OFFICER
	
 

 

 

INVESTOR:

 

[●]

By: [●]

 

 

 

	
By:
	  	
 

	
 
	
[●]EXHIBIT 10.1

 

 

 Exhibit 10.1
 

 

 THIS SETTLEMENT AGREEMENT (“Agreement”) dated 9th day of August, 2017 is made
 本和解協議(“本協議”)於2017年8月9日
 

 BETWEEN:
 由以下雙方簽署:
 

 (1)
 MEDSIUN PRECISION MEDICINE LTD., a company incorporated in the Republic of Marshall Islands with limited liability, whose registered office is situate at Trust Company Complex, Ajeltake Road, Majuro, Marshall Islands, MH9690 (“MPM”); and
 MEDISUN PRECISION MEDICINE LTD.,一家於馬紹爾群島共和國成立的有限公司,其註冊辦事處位於Trust Company Complex, Ajeltake Road, Majuro, Marshall Islands, MH9690 (“MPM”); 及
 

 (2)
 ZHENGDA GENE LIFE SCIENCE SHARES LIMITED, a company incorporated in the Hong Kong Special Administrative Region of the People’s Republic of China (“PRC”) with limited liability having its registered office at Unit 04, 7/F., Bright Way Tower, No. 33 Mong Kok Road, Kowloon, Hong Kong (“Zhengda”).  
 正大基因生命科學股份有限公司,一家於中華人民共和國(“中國”)香港特別行政區成立的有限公司,其註冊辦事處位於Unit 04, 7/F., Bright Way Tower, No. 33 Mong Kok Road, Kowloon, Hong Kong (“正大”)。
 

 WHEREAS:
 鑒於:
 

 (A)
 On 7 July 2017, Zhengda and MPM entered into a patent assignment agreement (“Patent Assignment Agreement”), in which, among others, it was agreed that Zhengda would sell, assign and transfer the Patent Rights (as defined in the Patent Assignment Agreement) to MPM. 
 於2017年7月7日,正大與MPM簽署了專利轉讓協議(“專利轉讓協議”),當中包括同意了正大會出售及轉讓專利權益(定義見專利轉讓協議)予MPM。
 

 (B)
 On or about 7 July 2017, in accordance with the Patent Assignment Agreement, 15,000,000 new shares of common stock of MPM (“Consideration Shares”) were issued to Zhengda. 
 於2017年7月7日左右,根據專利轉讓協議,MPM發行了15,000,000新普通股股份(“代價股份”)予正大。
 

 (C)
 As at the date of this Agreement, despite the entering into of the Patent Assignment Agreement, no application has been made to the State Intellectual Property Office of the PRC to complete the assignment and transfer of the Patent Rights.
 

 1
 

 

 

 
 

 

 於本協議日期,縱使已簽署專利轉讓協議,雙方仍未向中國國家知識產權局遞交出轉讓專利權益的申請。
 

 (D)
 By way of mutual consent and in good faith, the parties hereby wish to terminate the Patent Assignment Agreement in accordance with the terms of this Agreement.
 基於雙方的同意及友好協商,本協議雙方於此希望根據本協議的條款終止專利轉讓協議。
 

 NOW THIS AGREEMENT WITNESSETH as follows:
 現雙方同意如下:
 

 1.
 In consideration of mutual consent and release and agreements contained in this Agreement, the parties hereto, on the basis of without admission of any liabilities, unconditionally and irrevocably agree to the following settlement terms and confirm:
 鑒於雙方的同意及本協議的解除及同意條款,雙方於此無條件地及不可撤回地在沒有承認責任的情況下同意達成以下和解條款及確認:
 

 (i)
 the Patent Assignment Agreement is terminated as at the date of this Agreement, and MPM hereby assigns and transfers the Patent Rights back to Zhengda;
 專利轉讓協議於本協議當日終止,MPM於此將專利權益轉讓回正大; 
 

 (ii)
 the original share certificate issued by MPM to Zhengda in relation to the Consideration Shares (“Share Certificate”) shall be returned to MPM by Zhengda forthwith; 
 正大須立即歸還MPM MPM就代價股份發給正大的股票證書原件(“股票證書”); 
 

 (iii)
 upon receipt the original Share Certificate, MPM shall arrange for the cancellation of the issue and allotment of the Consideration Shares; 
 於收到股票證書原件後,MPM須安排將代價股份的發行及配發取消;
 

 (iv)
 subject to the compliance of Clause 1(ii) by Zhengda, MPM shall immediately release Zhengda of its existing breaches and liabilities (if any) in relation to or in connection with the Patent Assignment Agreement, and MPM shall not have any claims or take any actions against Zhengda thereof; and 
 受限於正大符合第1(ii)條的規定,MPM同意立即解除正大與專利轉讓協議有關之現有的違反和責任(如有),而MPM亦不能就此對正大作出任何索償或採取任何行動; 及
 

 (v)
 Zhengda shall immediately release MPM of its existing breaches and liabilities (if any) in relation to or in connection with the Patent Assignment Agreement, and Zhengda shall not have any claims or take any actions against MPM. 
 正大同意立即解除MPM與專利轉讓協議有關之現有的違反和責任(如
 

 2
 

 

 

 
 

 

 有),而正大亦不能就此對MPM作出任何索償或採取任何行動。
 

 2.
 This Agreement embodies all the terms and conditions between the parties hereto as to the subject matter hereof and supersedes and cancels, in all respects, all previous letters of intent, correspondences, undertakings, letters of confirmation, agreements and arrangements (if any) between the parties hereto with respect to the subject matter hereof, whether written or oral.
 本協議包含各方對本協議事項的條款及條件,並取代及取消各方就本協議事項曾作出不論是書面還是口頭的意向書、通訊、承諾、確認函、協議及安排(如有)。
 

 3.
 The illegality, invalidity or unenforceability of any provision of this Agreement under the law of any jurisdiction shall not affect its legality, validity or enforceability under the law of any other jurisdiction nor the legality, validity or enforceability of any other provision.
 任何司法管轄區的法律認定本協議的任何條款屬非法、無效或不可執行將不會影響任何其他司法管轄區認定該條款的合法性、有效性或可執行性,亦不會影響其他條款的合法性,有效性或可執行性。
 

 4.
 Any amendments to this Agreement shall be binding only if recorded in a document signed by all parties to this Agreement.
 任何本協議的修改需要在本協議各方簽署的文書上記錄方能有效。
 

 5.
 Each party to this Agreement shall bear his/her/its own legal and professional fees, costs and expenses incurred in connection with the preparation, negotiation, execution and performance of this Agreement and all incidental or related documents.
 本協議各方應各自承擔其就準備、草擬及執行本協議及與履行本協議附帶或相關的文件之法律及專業費用、成本及支出。
 

 6.
 This Agreement may be signed in any number of counterparts and by the parties hereto on separate counterparts, each of which when duly executed and sent by facsimile to the other party shall be an original, but all the counterparts (including counterparts sent by way of facsimile) shall together constitute one and the same document.
 本協議可以任何數量方式由各協議方分開簽署,並於簽署後以傳真方式送交另一方後被視為原件,而全部分開簽署的文件 (包括通過傳真方式發送的部份)應被構成一份相同的文件。
 

 7.
 The parties to this Agreement have been advised to seek independent professional and legal advice with regard to this Agreement.
 本協議各方已被忠告就本協議尋求獨立專業及法律意見。
 

 8.
 This Agreement shall be governed by and construed in accordance with the laws of the PRC and the parties hereto submit to the non-exclusive jurisdiction of the PRC courts for the purpose of determining or enforcing any claim arising hereunder.
 本協議應受並按照中國的法律解釋而本協議各方均同意中國法院擁有非專
 

 3
 

 

 

 
 

 

 屬管轄權。
 

 9.
 The translation of the terms of this Agreement in Chinese is for reference only.  In the event of any inconsistency between the English version and the Chinese version, the English version shall prevail.
 本協議的中文翻譯條款僅作參考用途。如英文和中文版本出現任何歧義,應以英文版本為准。
 

 The parties hereto have executed this Agreement the day and year first above written.
 本協議雙方於此在本協議開首的日期簽署本協議
 

 

 MPM
 

 Signed by Ms. HUANG Lisha, director, 
 )
 由黃麗莎,董事
 )
 for and on behalf of
 ) /s/ Lisha Huang
 代表
 )
 MEDISUN PRECISION MEDICINE LTD.
 )
 in the presence of:
 )
 在以下見證人面前簽署
 )
 

 

 

 

 

 

 

 

 

 ZHENGDA 正大
 Signed by Mr. YANG Guofeng, director
 )
 由楊國峰,董事
 )
 For and on behalf of 
 ) /s/ Guofeng Yang
 代表
 )
 ZHENGDA GENE LIFE SCIENCE
 )
 SHARES LIMITED
 )
 正大基因生命科學股份有限公司
 )
 in the presence of:
 )
 在以下見證人面前簽署
 )
 

 

 4

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