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Exhibit 4.9  

        THIS
WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR EXEMPTION FROM REGISTRATION UNDER THE FOREGOING LAWS. 

        THIS
WARRANT SHALL BE VOID AFTER 5:00 P.M. EASTERN TIME ON AUGUST 16, 2007 (the "EXPIRATION DATE"). 

No. A-3

 
 

ODETICS, INC.    
    
    WARRANT TO PURCHASE 62,500 SHARES OF
  CLASS A COMMON STOCK, PAR VALUE $0.10 PER SHARE    
  

        For VALUE RECEIVED, Roth Capital Partners, LLC ("Warrantholder"), is entitled to purchase, subject to the
provisions of this Warrant, from Odetics, Inc., a Delaware corporation ("Company"), at any time not later than 5:00 P.M., Eastern time, on
the Expiration Date (as defined above), at an exercise price per share equal to $1.95 (the exercise price in effect being herein called the "Warrant
Price"), 62,500 shares ("Warrant Shares") of the Company's Class A Common Stock, par value $0.10 per share
("Common Stock"). The number of Warrant Shares purchasable upon exercise of this Warrant and the Warrant Price shall be subject to adjustment from time
to time as described herein. 

        Section 1.    Registration.    The Company shall maintain books for the transfer and registration of this
Warrant. Upon the initial issuance of this Warrant, the Company shall issue and register the Warrant in the name of the Warrantholder. 

        Section 2.    Transfers.    As provided herein, this Warrant may be transferred only pursuant to a registration
statement filed under the Securities Act of 1933, as amended ("Securities Act"), or an exemption from such registration. Subject to such restrictions,
the Company shall transfer this Warrant from time to time upon the books to be maintained by the Company for that purpose, upon surrender thereof for transfer properly endorsed or accompanied by
appropriate instructions for transfer and such other documents as may be reasonably required by the Company, including, if required by the Company, an opinion of counsel to the Warrantholder to the
effect that such transfer is exempt from the registration requirements of the Securities Act, to establish that such transfer is being made in accordance with the terms hereof, and a new Warrant shall
be issued to the transferee and the surrendered Warrant shall be canceled by the Company. 

        Section 3.    Exercise of Warrant.    Subject to the provisions hereof, the Warrantholder may exercise this
Warrant in whole or in part at any time prior to the Expiration Date upon surrender of this Warrant, together with delivery of the duly executed Warrant exercise form attached hereto as
Appendix A (the "Exercise Agreement") and payment by cash, certified check or wire transfer of funds for the aggregate Warrant Price for that
number of Warrant Shares then being purchased, to the Company during normal business hours on any business day at the Company's principal executive offices (or such other office or agency of the
Company as it may designate by notice to the holder hereof). Warrant Shares purchased pursuant to this Section 3(a) shall be deemed to be issued to the holder hereof or such holder's designee,
as the record owner of such shares, as of the close of business on the date on which this Warrant shall have been surrendered (or evidence of loss, theft or destruction thereof and security or
indemnity satisfactory to the Company), the Warrant Price shall have been paid and the completed Exercise Agreement shall have been delivered. Certificates for the Warrant Shares so purchased,
representing the aggregate number of shares specified in the Exercise Agreement, shall be delivered to the holder hereof within a reasonable time, not exceeding three (3) business days, after
this Warrant shall have been so exercised. The certificates so delivered shall be in such denominations as may be requested by the holder hereof and shall be registered in the name of 

 

such holder or such other name as shall be designated by such holder. If this Warrant shall have been exercised only in part, then, unless this Warrant has expired, the Company shall, at its expense,
at the time of delivery of such certificates, deliver to the holder a new Warrant representing the number of shares with respect to which this Warrant shall not then have been exercised. As used
herein, "business day" means a day, other than a Saturday or Sunday, on which banks in New York City are open for the general transaction of business. 

        Section 4.    Compliance with the Securities Act.    The Company may cause the legend set forth on the first
page of this Warrant to be set forth on each Warrant or similar legend on any security issued or issuable upon exercise of this Warrant, unless counsel for the Company is of the opinion as to any such
security that such legend is unnecessary. 

        Section 5.    Certification of Investment Purpose.    By accepting this Warrant, the Warrantholder:
(a) represents that this Warrant is being acquired for the account of the Warrantholder and for investment purposes only and that such Warrant is not being acquired with a view to, or for sale
in connection with, any distribution, and (b) covenants and agrees that, unless a current registration statement under the Securities Act shall be in effect with respect to the Warrant Shares
to be issued upon exercise of this Warrant, at the time of exercise hereof, the Warrantholder will deliver to the Company a written certification executed by the Warrantholder that the Warrant Shares
acquired by it upon exercise hereof are for the account of such Warrantholder and acquired for investment purposes only and that such Warrant Shares are not acquired with a view to, or for sale in
connection with, any distribution. 

        Section 6.    Payment of Taxes.    The Company will pay any documentary stamp taxes attributable to the initial
issuance of Warrant Shares issuable upon the exercise of this Warrant; provided, however, that the Company shall not be required to pay any tax or taxes
which may be payable in respect of any transfer involved in the issuance or delivery of any certificates for Warrant Shares in a name other than that of the registered holder of this Warrant in
respect of which such shares are issued, and in such case, the Company shall not be required to issue or deliver any certificate for Warrant Shares or any Warrant until the person requesting the same
has paid to the Company the amount of such tax or has established to the Company's reasonable satisfaction that such tax has been paid. The holder shall be responsible for income taxes due under
federal, state or other law, if any such tax is due. 

        Section 7.    Mutilated or Missing Warrants.    In case this Warrant shall be mutilated, lost, stolen or
destroyed, the Company shall issue in exchange and substitution of and upon cancellation of the mutilated Warrant, or in lieu of and substitution for the Warrant lost, stolen or destroyed, a new
Warrant of like tenor and for the purchase of a like number of Warrant Shares, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction of the
Warrant, and with respect to a lost, stolen or destroyed Warrant, reasonable indemnity or bond with respect thereto, if requested by the Company. 

        Section 8.    Reservation of Common Stock.    The Company hereby represents and warrants that there have been
reserved, and the Company shall at all applicable times keep reserved until issued (if necessary) as contemplated by this Section 8, out of the authorized and unissued shares of Common Stock,
sufficient shares to provide for the exercise of the rights of purchase represented by this Warrant. The Company agrees that all Warrant Shares issued upon due exercise of this Warrant shall be, at
the time of delivery of the certificates for such Warrant Shares, duly authorized, validly issued, fully paid and non-assessable shares of Common Stock of the Company. 

        Section 9.    Adjustments.    Subject and pursuant to the provisions of this Section 9, the Warrant
Price and number of Warrant Shares subject to this Warrant shall be subject to adjustment from time to time as set forth hereinafter. 

2

 

        (a)  If
the Company shall, at any time or from time to time while this Warrant is outstanding, pay a dividend or make a distribution on its Common Stock in shares of Common
Stock, subdivide its outstanding shares of Common Stock into a greater number of shares or combine its outstanding shares of Common Stock into a smaller number of shares or issue by reclassification
of its outstanding shares of Common Stock any shares of its capital stock (including any such reclassification in connection with a consolidation or merger in which the Company is the continuing
corporation), then the number of Warrant Shares purchasable upon exercise of this Warrant and the Warrant Price in effect immediately prior to the date upon which such change shall become effective,
shall be adjusted by the Company so that the Warrantholder thereafter exercising this Warrant shall be entitled to receive the number of shares of Common Stock or other capital stock which the
Warrantholder would have received if this Warrant had been exercised immediately prior to such event upon payment of a Warrant Price that has been adjusted to reflect a fair allocation of the
economics of such event to the Warrantholder. Such adjustments shall be made successively whenever any event listed above shall occur. 

        (b)  If
any capital reorganization, reclassification of the capital stock of the Company, consolidation or merger of the Company with another corporation in which the Company
is not the survivor, or sale, transfer or other disposition of all or substantially all of the Company's assets to another corporation shall be effected, then, as a condition of such reorganization,
reclassification, consolidation, merger, sale, transfer or other disposition, lawful and adequate provision shall be made whereby each Warrantholder shall thereafter have the right to purchase and
receive upon the basis and upon the terms and conditions herein specified and in lieu of the Warrant Shares immediately theretofore issuable upon exercise of this Warrant, such shares of stock,
securities or assets as would have been issuable or payable with respect to or in exchange for a number of Warrant Shares equal to the number of Warrant Shares immediately theretofore issuable upon
exercise of this Warrant, had such reorganization, reclassification, consolidation, merger, sale, transfer or other disposition not taken place, and in any such case appropriate provision shall be
made with respect to the rights and interests of each Warrantholder to the end that the provisions hereof (including, without limitation, provision for adjustment of the Warrant Price) shall
thereafter be applicable, as nearly equivalent as may be practicable in relation to any shares of stock, securities or assets thereafter deliverable upon the exercise thereof. The Company shall not
effect any such consolidation, merger, sale, transfer or other disposition unless prior to or simultaneously with the consummation thereof the successor corporation (if other than the Company)
resulting from such consolidation or merger, or the corporation purchasing or otherwise acquiring such assets or other appropriate corporation or entity shall assume the obligation to deliver to the
holder of this Warrant, at the last address of such holder appearing on the books of the Company, such shares of stock, securities or assets as, in accordance with the foregoing provisions, such
holder may be entitled to purchase, and the other obligations under this Warrant. The provisions of this paragraph (b) shall similarly apply to successive reorganizations, reclassifications,
consolidations, mergers, sales, transfers or other dispositions. 

        (c)  In
case the Company shall fix a payment date for the making of a distribution to all holders of Common Stock (including any such distribution made in connection with a
consolidation or merger in which the Company is the continuing corporation) of evidences of indebtedness or assets (other than cash dividends or cash distributions payable out of consolidated earnings
or earned surplus or dividends or distributions referred to in Section 9(a)), or subscription rights or warrants, the Warrant Price to be in effect after such payment date shall be determined
by multiplying the Warrant Price in effect immediately prior to such payment date by a fraction, the numerator of which shall be the total number of shares of Common Stock outstanding multiplied by
the Market Price (as defined below) per share of Common Stock immediately prior to such payment date, less the fair market value (as
determined in good faith by the Company's Board of Directors) of said assets or evidences of indebtedness so distributed, or of such subscription rights or warrants, and the denominator of which shall
be the total number of shares of Common Stock outstanding multiplied by such Market Price per share of Common Stock immediately prior to such payment date. "Market
Price" as of a particular date 

3

 

(the "Valuation Date") shall mean the following: (a) if the Common Stock is then listed on a national securities exchange, the closing sale
price of one share of Common Stock on such exchange on the last trading day prior to the Valuation Date; (b) if the Common Stock is then quoted on The Nasdaq Stock Market, Inc.
("Nasdaq"), the closing sale price of one share of Common Stock on Nasdaq on the last trading day prior to the Valuation Date or, if no such closing
sale price is available, the average of the high bid and the low asked price quoted on Nasdaq on the last trading day prior to the Valuation Date; or (c) if the Common Stock is not then listed
on a national stock exchange or quoted on Nasdaq, the fair market value of one share of Common Stock as of the Valuation Date shall be determined in good faith by the Board of Directors of the
Company. 

        (d)  For
the term of this Warrant, in addition to the provisions contained above, the Warrant Price shall be subject to adjustment as provided below. An adjustment to the
Warrant Price shall become effective immediately after the payment date in the case of each dividend or distribution and immediately after the effective date of each other event which requires an
adjustment. 

        (e)  In
the event that, as a result of an adjustment made pursuant to this Section 8, the holder of this Warrant shall become entitled to receive any shares of capital
stock of the Company other than shares of Common Stock, the number of such other shares so receivable upon exercise of this Warrant shall be subject thereafter to adjustment from time to time in a
manner and on terms as nearly equivalent as practicable to the provisions with respect to the Warrant Shares contained in this Warrant. 

        (f)    Except
as provided in subsection (g) hereof, if and whenever the Company shall issue or sell, or is, in accordance with any of subsections (f)(l) through (f)(7)
hereof, deemed to have issued or sold, any shares of Common Stock for no consideration or for a consideration per share less than the Warrant Price in effect immediately prior to the time of such
issue or sale, then and in each such case (a "Trigger Issuance") the then-existing Warrant Price, shall be reduced, as of the close of
business on the effective date of the Trigger Issuance, to a price determined as follows: 

	 	Adjusted Warrant Price	 	=	 	(A × B) + D
 A+C

        where

        "A" equals the number of shares of Common Stock outstanding, including Additional Shares (as defined below) deemed to be issued hereunder,
immediately preceding such Trigger Issuance; 

        "B" equals the Warrant Price in effect immediately preceding such Trigger Issuance; 

        "C" equals the number of Additional Shares of Common Stock issued or deemed issued hereunder as a result of the Trigger Issuance; and 

        "D" equals the aggregate consideration, if any, received or deemed to be received by the Company upon such Trigger Issuance; 

provided, however, that in no event shall the Warrant Price after giving effect to such Trigger Issuance be greater than the Warrant Price in effect
prior to such Trigger Issuance. 

        For
purposes of this subsection (f), "Additional Shares of Common Stock" shall mean all shares of Common Stock issued by the Company or
deemed to be issued pursuant to this subsection (f), other than Excluded Issuances (as defined in subsection (g) hereof). 

        Notwithstanding
the foregoing, no adjustment in the Warrant Price shall result in the Warrant Price being less than $1.20 (appropriately adjusted for any stock split, reverse stock
split, stock dividend or other reclassification or combination of the Common Stock occurring after the date hereof) (the "Floor Price"). In the event
that any adjustment in the Warrant Price required by this Warrant would 

4

 

result in the Warrant Price being adjusted to a price lower than the Floor Price, the Warrant Price shall be reduced to the Floor Price. 

        For
purposes of this subsection (f), the following subsections (f)(l) to (f)(7) shall also be applicable: 

        (f)(1)    Issuance of Rights or Options. In case at any time the Company shall in any manner grant (directly and not by
assumption in a merger or otherwise) any warrants or other rights to subscribe for or to
purchase, or any options for the purchase of, Common Stock or any stock or security convertible into or exchangeable for Common Stock (such warrants, rights or options being called
"Options" and such convertible or exchangeable stock or securities being called "Convertible
Securities") whether or not such Options or the right to convert or exchange any such Convertible Securities are immediately exercisable, and the price per share for which
Common Stock is issuable upon the exercise of such Options or upon the conversion or exchange of such Convertible Securities (determined by dividing (i) the sum (which sum shall constitute the
applicable consideration) of (x) the total amount, if any, received or receivable by the Company as consideration for the granting of such Options, plus (y) the aggregate amount of
additional consideration payable to the Company upon the exercise of all such Options, plus (z), in the case of such Options which relate to Convertible Securities, the aggregate amount of additional
consideration, if any, payable upon the issue or sale of such Convertible Securities and upon the conversion or exchange thereof, by (ii) the total maximum number of shares of Common Stock
issuable upon the exercise of such Options or upon the conversion or exchange of all such Convertible Securities issuable upon the exercise of such Options) shall be less than the Warrant Price in
effect immediately prior to the time of the granting of such Options, then the total number of shares of Common Stock issuable upon the exercise of such Options or upon conversion or exchange of the
total amount of such Convertible Securities issuable upon the exercise of such Options shall be deemed to have been issued for such price per share as of the date of granting of such Options or the
issuance of such Convertible Securities and thereafter shall be deemed to be outstanding for purposes of adjusting the Warrant Price. Except as otherwise provided in subsection 9(f)(3), no adjustment
of the Warrant Price shall be made upon the actual issue of such Common Stock or of such Convertible Securities upon exercise of such Options or upon the actual issue of such Common Stock upon
conversion or exchange of such Convertible Securities. 

        (f)(2)    Issuance of Convertible Securities. In case the Company shall in any manner issue (directly and not by assumption in a
merger or otherwise) or sell any Convertible Securities, whether or not the rights to exchange or convert any such Convertible Securities are immediately exercisable, and the price per share for which
Common Stock is issuable upon such conversion or exchange (determined by dividing (i) the sum (which sum shall constitute the applicable consideration) of (x) the total amount received
or receivable by the Company as consideration for the issue or sale of such Convertible Securities, plus (y) the aggregate amount of additional consideration, if any, payable to the Company
upon the conversion or exchange thereof, by (ii) the total number of shares of Common Stock issuable upon the conversion or exchange of all such Convertible Securities) shall be less than the
Warrant Price in effect immediately prior to the time of such issue or sale, then the total maximum number of shares of Common Stock issuable upon conversion or exchange of all such Convertible
Securities shall be deemed to have been issued for such price per share as of the date of the issue or sale of such Convertible Securities and thereafter shall be deemed to be outstanding for purposes
of adjusting the Warrant Price, provided that (a) except as otherwise provided in subsection 9(f)(3), no adjustment of the Warrant Price shall be
made upon the actual issuance of such Common Stock upon conversion or exchange of such Convertible Securities and (b) no further adjustment of the Warrant Price shall be made by reason of the
issue or sale of Convertible Securities upon exercise of any Options to purchase any 

5

 

such Convertible Securities for which adjustments of the Warrant Price have been made pursuant to the other provisions of subsection 9(f). 

        (f)(3)    Change in Option Price or Conversion Rate. Upon the happening of any of the following events, namely, if the purchase
price provided for in any Option referred to in subsection 9(f)(l) hereof, the
additional consideration, if any, payable upon the conversion or exchange of any Convertible Securities referred to in subsections 9(f)(l) or 9(f)(2), or the rate at which Convertible Securities
referred to in subsections 9(f)(l) or 9(f)(2) are convertible into or exchangeable for Common Stock shall change at any time (including, but not limited to, changes under or by reason of provisions
designed to protect against dilution), the Warrant Price in effect at the time of such event shall forthwith be readjusted to the Warrant Price which would have been in effect at such time had such
Options or Convertible Securities still outstanding provided for such changed purchase price, additional consideration or conversion rate, as the case may be, at the time initially granted, issued or
sold. On the termination of any Option for which any adjustment was made pursuant to this subsection 9(f) or any right to convert or exchange Convertible Securities for which any adjustment was made
pursuant to this subsection 9(f) (including without limitation upon the redemption or purchase for consideration of such Convertible Securities by the Company), the Warrant Price then in effect
hereunder shall forthwith be changed to the Warrant Price which would have been in effect at the time of such termination had such Option or Convertible Securities, to the extent outstanding
immediately prior to such termination, never been issued. 

        (f)(4)    Stock Dividends. Subject to the provisions of this Section 9(f), in case the Company shall declare a dividend
or make any other distribution upon any stock of the Company (other than the Common Stock) payable in Common Stock, Options or Convertible Securities, then any Common Stock, Options or Convertible
Securities, as the case may be, issuable in payment of such dividend or distribution shall be deemed to have been issued or sold without consideration. 

        (f)(5)    Consideration for Stock. In case any shares of Common Stock, Options or Convertible Securities shall be issued or sold
for cash, the consideration received therefor shall be deemed to be the net amount received by the Company therefor, after deduction therefrom of any expenses incurred or any underwriting commissions
or concessions paid or allowed by the Company in connection therewith. In case any shares of Common Stock, Options or Convertible Securities shall be issued or sold for a consideration other than
cash, the amount of the consideration other than cash received by the Company shall be deemed to be the fair value of such consideration as determined in good faith by the Board of Directors of the
Company, after deduction of any expenses incurred or any underwriting commissions or concessions paid or allowed by the Company in connection therewith. In case any Options shall be issued in
connection with the issue and sale of other securities of the Company, together comprising one integral transaction in which no specific consideration is allocated to such Options by the parties
thereto, such Options shall be deemed to have been issued for such consideration as determined in good faith by the Board of Directors of the Company. If Common Stock, Options or Convertible
Securities shall be issued or sold by the Company and, in connection therewith, other Options or Convertible Securities (the "Additional Rights") are
issued, then the consideration received or deemed to be received by the Company shall be reduced by the fair market value of the Additional Rights (as determined using the Black-Scholes option pricing
model or another method mutually agreed to by the Company and the Warrantholder). The Board of Directors of the Company shall respond promptly, in writing, to an inquiry by the Warrantholder as to the
fair market value of the Additional Rights. In the event that the Board of Directors of the Company and the Warrantholder are unable to agree upon the fair market value of the Additional Rights, the
Company and the Warrantholder shall jointly select an appraiser, who is experienced in such matters. The decision of such appraiser shall be final and conclusive, and the cost of such appraiser shall
be borne evenly by the Company and the Warrantholder. 

6

 

        (f)(6)    Record Date. In case the Company shall take a record of the holders of its Common Stock for the purpose of entitling
them (i) to receive a dividend or other distribution payable in Common Stock, Options or Convertible Securities or (ii) to subscribe for or purchase Common Stock, Options or Convertible
Securities, then such record date shall be deemed to be the date of the issue or sale of the shares of Common Stock deemed to have been issued or sold upon the declaration of such dividend or the
making of such other distribution or the date of the granting of such right of subscription or purchase, as the case may be. 

        (f)(7)    Treasury Shares. The number of shares of Common Stock outstanding at any given time shall not include shares owned or
held by or for the account of the Company or any of its wholly-owned subsidiaries, and the disposition of any such shares (other than the cancellation or retirement thereof) shall be considered an
issue or sale of Common Stock for the purpose of this subsection (f). 

        (g)  Anything
herein to the contrary notwithstanding, the Company shall not be required to make any adjustment of the Warrant Price in the case of the issuance of
(A) capital stock, Options or Convertible Securities issued to directors, officers, employees or consultants of the Company in connection with their service as directors or advisory board
members of the Company, their employment by the Company or their retention as consultants by the Company pursuant to an equity compensation program approved by the Board of Directors of the Company or
the compensation committee of the Board of Directors of the Company, (B) shares of Common Stock issued upon the conversion or exercise of Options or Convertible Securities issued prior to the
date hereof, (C) securities issued pursuant to that certain Subscription Agreement dated August 7, 2002, among the Company and the Purchasers named therein (the
"Purchase Agreement") and securities issued upon the exercise or conversion of those securities, (D) warrants issued to Roth Capital Partners,
LLC pursuant to that certain Letter Agreement, dated July 2, 2002, among Roth Capital Partners, LLC and the Company and securities issued upon the exercise of those warrants, and
(E) shares of Common Stock issued or issuable by reason of a dividend, stock split or other distribution on shares of Common Stock (but only to the extent that such a dividend, split or
distribution results in an adjustment in the Warrant Price pursuant to the other provisions of this Warrant) (collectively, "Excluded Issuances"). 

        Section 10.    Fractional Interest.    The Company shall not be required to issue fractions of Warrant Shares
upon the exercise of this Warrant. If any fractional share of Common Stock would, except for the provisions of the first sentence of this Section 10, be deliverable upon such exercise, the
Company, in lieu of delivering such fractional share, shall pay to the exercising holder of this Warrant an amount in cash equal to the Market Price of such fractional share of Common Stock on the
date of exercise. 

        Section 11.    Benefits.    Nothing in this Warrant shall be construed to give any person, firm or corporation
(other than the Company and the Warrantholder) any legal or equitable right, remedy or claim, it being agreed that this Warrant shall be for the sole and exclusive benefit of the Company and the
Warrantholder. 

        Section 12.    Notices to Warrantholder.    Upon the happening of any event requiring an adjustment of the
Warrant Price, the Company shall promptly give written notice thereof to the Warrantholder at the address appearing in the records of the Company, stating the adjusted Warrant Price and the adjusted
number of Warrant Shares resulting from such event and setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based. Failure to give such notice to
the Warrantholder or any defect therein shall not affect the legality or validity of the subject adjustment. 

        Section 13.    Identity of Transfer Agent.    The Transfer Agent for the Common Stock is U.S. Stock Transfer
Corporation. Upon the appointment of any subsequent transfer agent for the Common Stock or other shares of the Company's capital stock issuable upon the exercise of the rights of purchase 

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represented by this Warrant, the Company will mail to the Warrantholder a statement setting forth the name and address of such transfer agent. 

        Section 14.    Notices.    Unless otherwise provided, any notice required or permitted under this Warrant shall
be given in writing and shall be deemed effectively given as hereinafter described (i) if given by personal delivery, then such notice shall be deemed given upon such delivery, (ii) if
given by telex or facsimile, then such notice shall be deemed given upon receipt of confirmation of complete transmittal, (iii) if given by mail, then such notice shall be deemed given upon the
earlier of (A) receipt of such notice by the recipient or (B) three (3) business days after such notice is deposited in first class mail, postage prepaid, and (iv) if given
by an internationally recognized overnight air courier, then such notice shall be deemed given one (1) business day after delivery to such carrier. All notices shall be addressed as follows: if
to the Warrantholder, at its address as set forth in the Company's books and records and, if to the Company, at the address as follows, or at such other address as the Warrantholder or the Company may
designate by ten (10) days' advance written notice to the other: 

        If
to the Company: 

Odetics, Inc.

1515 South Manchester Avenue

Anaheim, California 92802

Attention: Gregory A. Miner

Fax: (714) 780-7857 

        With
a copy to: 

Brobeck,
Phleger & Harrison LLP

38 Technology Drive

Irvine, California 92618

Attention: Ellen S. Bancroft, Esq.

Fax: (949) 790-6301 

        Section 15.    Registration Rights.    

        (a)    Piggyback Registration.    If the Company determines to register for its own account or the account of others
under the Securities Act any of its equity securities (including, without limitation, any registration pursuant to Section 2(a) of the Registration Rights Agreement, dated August 16,
2002, by and among the Company and the Purchasers named in the Purchase Agreement), other than on Form S-4 or Form S-8 or their then equivalents relating to
equity securities to be issued solely in connection with any acquisition of any entity or business, or equity securities issuable in connection with stock option or other employee benefit plans, the
Company shall send to each holder of Warrants or Warrant Shares written notice of such determination and, if within ten (10) business days after receipt of such notice, such holder shall so
request in writing (hereafter a "Selling Holder"), the Company shall include in such Registration Statement all or any part of the Warrant Shares
issuable or issued upon exercise of this Warrant (the "Registrable Securities") such Selling Holder requests to be registered;  provided, however, that a
Warrant Share shall cease to be a Registrable Security, and the Company's obligation to include such Warrant Share in a
Registration Statement pursuant to this Section 15(a) shall terminate, upon (i) the sale of such Warrant Share pursuant to a Registration Statement or Rule 144 under the
Securities Act, or (ii) such Warrant Share becoming eligible for sale by the holder pursuant to Rule 144(k). In the event that the managing underwriter for an offering advises the
Company in writing that the inclusion of such Warrant Shares in the offering would be materially detrimental to the offering, such securities shall nevertheless be included in the Registration
Statement, provided that each holder desiring to have its Warrant Shares included in the Registration Statement agrees in writing, for a period of
90 days following such offering, not to sell or otherwise dispose of such Warrant Shares pursuant to such Registration Statement, which Registration Statement 

8

 

the Company shall keep updated and effective for a period of at least nine months following the expiration of such 90-day period. 

        (b)    Obligations of the Selling Holders.    

          (i)  Each
Selling Holder shall furnish in writing 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. At least five (5) business prior to the first anticipated filing date of any Registration Statement,
the Company shall notify each Selling Holder of the information the Company requires from such Selling Holder if such Investor elects to have any of the Registrable Securities included in the
Registration Statement. A Selling Holder shall provide such information to the Company at least two (2) business days prior to the first anticipated filing date of such Registration Statement
if such Selling Holder elects to have any of the Registrable Securities included in the Registration Statement. 

        (ii)  Each
Selling Holder by such Selling Holder's acceptance of the Registrable Securities agrees to cooperate with the Company as reasonably requested by the Company in
connection with the preparation and filing of the Registration Statement hereunder, unless such Selling Holder has notified the Company in writing of such Selling Holder's election to exclude all of
such Selling Holder's Registrable Securities from the Registration Statement. 

        (iii)  Upon
the receipt of any notice from the Company that (A) the Company is in possession of material non-public information the disclosure of which at
the time is not, in the good faith judgment of the Company, in the best interests of the Company and (B) the Company is suspending the use of a Prospectus which forms a part of a Registration
Statement covering Registrable Securities, a Selling Holder will immediately discontinue disposition of such Registrable Securities pursuant to such Prospectus. Following the receipt of such notice,
such Selling Holder will not recommence dispositions of such Registrable Securities pursuant to such Prospectus until it has either (x) been advised by the Company that the material-nonpublic
information has been disclosed in a filing with the SEC that is incorporated by reference into such Prospectus or (y) received from the Company copies of the supplemented or amended Prospectus
filed with the SEC and declared effective. If so directed by the Company, such Selling Holder shall deliver to the Company (at the expense of the Company) or destroy (and deliver to the Company a
certificate of destruction) all copies in such Selling Holder's possession of the Prospectus current at the time of receipt of such notice. Any suspension of the use of a Prospectus covering
Registrable Securities pursuant to this Section 15(b)(iii) shall not exceed twenty (20) consecutive days. Further, the Company shall not suspend the use of any Prospectus covering
Registrable Securities for more than forty-five (45) days in any twelve (12) month period. In no event, without the prior written consent of a Selling Holder, shall the
Company disclose to such Selling Holder any of the facts or circumstances regarding the material non-public information giving rise to a suspension of the use of a Prospectus. 

        (iv)  Upon
receipt of any notice from the Company pursuant to Section 15(c)(iv)(E) below, a Selling Holder will immediately discontinue disposition of Registrable
Securities pursuant to a Prospectus which forms a part of a Registration Statement covering such Registrable Securities. Following the receipt of such notice, such Selling Holder will not recommence
dispositions of such Registrable Securities pursuant to such Prospectus until it has either (x) been advised by the Company that the untrue statement or omission has been corrected by a filing
with the SEC that is incorporated by reference into such Prospectus or (y) received from the Company copies of the supplemented or amended Prospectus filed with the SEC and declared effective.
If so directed by the Company, such Selling Holder shall deliver to the Company (at the expense of the Company) 

9

 

or destroy (and deliver to the Company a certificate of destruction) all copies in such Selling Holder's possession of the Prospectus current at the time of receipt of such notice. 

        (v)  No
Selling Holder may participate in any underwritten registration hereunder unless such Selling Holder (i) agrees to sell the Registrable Securities on the basis
provided in any underwriting arrangements in usual and customary form entered into by the Company, (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably required under the terms of such underwriting arrangements, and (iii) agrees to pay its pro rata share of all underwriting discounts and commissions
and other fees and expenses of investment bankers and any manager or managers of such underwriting, except as provided in Section 15(e) below. Notwithstanding the foregoing, no Selling Holder
shall be required to make any representations to such underwriter, other than those with respect to itself and the Registrable Securities owned by it, including its right to sell the Registrable
Securities, and any indemnification in favor of the underwriter by the Selling Holders shall be several and not joint and limited in the case of any Selling Holder, to the proceeds received by such
Selling Holder from the sale of its Registrable Securities. The scope of any such indemnification in favor of an underwriter from the Selling Holders shall be limited to the same extent as the
indemnity provided in Section 15(f) hereof. 

        (c)    Obligations of the Company.    If and whenever the Company is required to effect a registration of Registrable
Securities pursuant to Section 15(a), the Company will, as expeditiously as possible: 

          (i)  prepare
and file with the SEC, as soon as practicable, a Registration Statement relating to the registration on any appropriate form under the Securities Act, which
form shall be available for the sale of the Registrable Securities in accordance with the intended method or methods of distribution thereof, and use commercially reasonable efforts to cause such
Registration Statement to become effective; provided that at least five (5) days prior to filing a Registration Statement or Prospectus or any
amendment or supplements thereto, including documents incorporated by reference after the initial filing of any Registration Statement, the Company will furnish to the Selling Holders of the
Registrable Securities covered by such Registration Statement copies of all such documents to be filed, which documents will be subject to the review of such Selling Holders; 

        (ii)  if
a Registration Statement covering Registrable Securities is on Form S-3, use commercially reasonable efforts to cause such Registration Statement
to remain continuously effective for a period that will terminate upon the earlier of (i) the date on which all Registrable Securities covered by such Registration Statement as amended from
time to time, have been sold, and (ii) the date on which all Registrable Securities covered by such Registration Statement may be sold pursuant to Rule 144(k); 

        (iii)  if
a Registration Statement covering Registrable Securities is on a form other than Form S-3 (including, but not limited to,
Form S-1), prepare and file with the SEC such amendments and post-effective amendments to such Registration Statement as may be necessary to keep such Registration
Statement effective for a reasonable period or as otherwise provided herein; cause the related Prospectus to be supplemented by any required Prospectus supplement, and as so supplemented to be filed
pursuant to Rule 424 under the Securities Act; 

        (iv)  notify
the Selling Holders of Registrable Securities promptly, and (if requested by any such Selling Holder) confirm such advice in writing, (A) when a
Registration Statement, Prospectus or any
Prospectus supplement or post-effective amendment has been filed, and, with respect to a Registration Statement or any post-effective amendment, when the same has become
effective; (B) of any request by the SEC for amendments or supplements to a Registration Statement or related Prospectus or for additional information; (C) of the issuance by the SEC of
any stop order suspending the effectiveness of a Registration Statement or the initiation of any 

10

 

proceedings for that purpose; (D) of the receipt by the Company of any notification with respect to the suspension of the qualification of any of the Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for such purpose; and (E) of the happening of any event that makes any statement of a material fact made in a Registration
Statement, a Prospectus or any document incorporated therein by reference untrue or which requires the making of any changes in a Registration Statement or Prospectus so that they will not contain any
untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading; 

        (v)  use
commercially reasonable efforts to (A) prevent the issuance of any stop order or other suspension of effectiveness and, (B) if such order is issued,
obtain the withdrawal of any such order at the earliest possible moment; 

        (vi)  furnish
to each Selling Holder of Registrable Securities, without charge, at least one signed copy of a Registration Statement and any amendment thereto; 

      (vii)  deliver
to each Selling Holder of Registrable Securities, without charge, as many copies of a Prospectus (including each preliminary Prospectus) and any amendment or
supplement thereto as such Selling Holder may reasonably request; 

      (viii)  prior
to any public offering of Registrable Securities, use commercially reasonable efforts to register or qualify or cooperate with the Selling Holders of
Registrable Securities and their respective counsel in connection with the registration or qualification of such Registrable Securities for offer and sale under the securities or blue sky laws of such
jurisdictions within the United States as any Selling Holder reasonably requests, keep each such registration or qualification effective during the period such Registration Statement is required to be
kept effective and do any and all other acts or things necessary or advisable to enable the disposition in such jurisdictions of the Registrable Securities covered by the applicable Registration
Statement; provided that the Company will not be required to (x) qualify to do business in any jurisdiction where it is not then so qualified,
(y) subject itself to general taxation in any jurisdiction where it would not otherwise by so subject or (z) take any action which would subject the Company to general service of process
in any jurisdiction where it is not at the time so subject; 

        (ix)  cooperate
with the Selling Holders of Registrable Securities to facilitate the timely preparation and delivery of certificates representing Registrable Securities to be
sold and not bearing any restrictive legends; 

        (x)  upon
the occurrence of any event contemplated by Section 15(d)(iv)(E) above and if requested by a Selling Holder, prepare a supplement or
post-effective amendment to the applicable Registration Statement or related Prospectus or any document incorporated therein by reference or file any other required document so that, as
thereafter delivered to the purchasers of the Registrable Securities being sold thereunder, such Prospectus will not contain an untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein not misleading (unless the Company has exercised its right to suspend use of such Prospectus pursuant to Section 15(b)(iii)); 

        (xi)  with
respect to each issue or class of Registrable Securities, use its best efforts to cause all Registrable Securities covered by a Registration Statements to be
listed on each securities exchange, interdealer quotation system or other market on which similar securities issued by the Company are then listed; 

      (xii)  if
the registration is in connection with an underwritten offering, enter into and perform its reasonable obligations under an underwriting agreement, in usual and
customary form, including, without limitation, customary indemnification and contribution obligations, with the underwriter(s) of the offering; 

11

 

      (xiii)  if
required by the underwriter, or if any Selling Holder is described in the Registration Statement as an underwriter, the Company shall furnish, on the effective
date of the Registration Statement (except with respect to clause (A) below) and on the date that Registrable Securities are delivered to an underwriter, if any, for sale in connection with the
Registration Statement (including any Investor deemed to be an underwriter), (A) (1) in the case of an underwritten offering, an opinion, dated as of the closing date of the sale of Registrable
Securities to the underwriters, from outside legal counsel representing the Company for purposes of such Registration Statement, in form, scope and substance as is customarily given in an underwritten
public offering, addressed to the underwriters and the Selling Holders participating in such underwritten offering or (2) in the case of an "at the market" offering, an opinion, dated as of or
promptly after the effective date of the Registration Statement to the Investors, from outside legal counsel representing the Company for purposes of such Registration Statement, in form, scope and
substance as is customarily given in a public offering, addressed to the Selling Holders, and (B) a letter, dated as of the effective date of such Registration Statement and confirmed as of the
applicable dates described above, from the Company's independent certified public accountants in form and substance as is customarily given by independent certified public accountants to underwriters
in an underwritten public offering, addressed to the underwriters (including any Selling Holder deemed to be an underwriter); 

      (xiv)  make
available for inspection by one or more representatives of the Selling Holders of Registrable Securities and any attorney or accountant retained by such Selling
Holders, all financial and other records, pertinent corporate documents and properties of the Company, and cause the Company's
officers, directors and employees to supply all information reasonably requested by any such representatives; and 

      (xv)  otherwise
use commercially reasonable efforts to comply with all applicable federal and state securities rules and regulations; take such other action as may be
reasonably necessary to facilitate the registration and qualification of the Registrable Securities hereunder; and make available to its security holders, as soon as reasonably practicable, but not
later than the Availability Date (as defined below), an earnings statement covering a period of at least twelve (12) months, beginning after the effective date of each Registration Statement
covering Registrable Securities, which earnings statement shall satisfy the provisions of Section 11(a) of the 1933 Act, including Rule 158 promulgated thereunder (for the purpose of
this Section 3(k), "Availability Date" means the 45th day following the end of the fourth fiscal quarter that includes the effective date of such
Registration Statement, except that, if such fourth fiscal quarter is the last quarter of the Company's fiscal year, "Availability Date" means the 90th
day after the end of such fourth fiscal quarter).. 

        Except
as otherwise provided in this Agreement, the Company shall have sole control in connection with the preparation, filing, withdrawal, amendment or supplementing of each
Registration Statement, the selection of underwriters, and the distribution of any preliminary prospectus included in the Registration Statement, and may include within the coverage thereof additional
shares of Common Stock or other securities for its own account or for the account of one or more of its other security holders. 

        (d)    Expenses of Registration.    All expenses incurred in connection with registrations, filings or qualifications
pursuant to this Section 15, including, without limitation, all registration, listing and qualification fees, printers and accounting fees and the fees and disbursements of counsel for the
Company and the Selling Holders, shall be borne by the Company; provided, however, that (i) each Selling Holder shall pay (A) its pro rata
share of discounts and commissions in connection with an underwritten offering and (B) all brokerage commissions in connection with sales of its Registrable Securities, and (ii) the
Company shall only be required to bear the fees and out-of-pocket expenses of one legal counsel selected by the Selling Holders in connection with such any registration. 

12

 

        (e)    Indemnification.    

        (i)    Indemnification by the Company.    The Company will indemnify and hold harmless each Selling Holder and its
officers, directors, members, employees and agents, successors and assigns, and each other person, if any, who controls such Selling Holder within the meaning of the Securities Act, against any
losses, claims, damages or liabilities, joint or several, to which they may become subject under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon: (A) any untrue statement or alleged untrue statement of any material fact contained in any Registration Statement, any preliminary prospectus or
final prospectus
contained therein, or any amendment or supplement thereof, or the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements
therein not misleading; (B) any violation by the Company or its agents of any rule or regulation promulgated under the Securities Act applicable to the Company or its agents and relating to
action or inaction required of the Company in connection with such registration; (C) any blue sky application or other document executed by the Company, or based upon written information
furnished by the Company, filed in any state or other jurisdiction in order to qualify any or all of the Registrable Securities for sale under the securities laws thereof (any such application,
document or information herein called a "Blue Sky Application"); or (D) any failure to register or qualify the Registrable Securities included in
any Registration Statement in any state where the Company or its agents has affirmatively undertaken or agreed in writing that the Company will undertake such registration or qualification on a
Selling Holder's behalf (the undertaking of any underwriter chosen by the Company being attributed to the Company), and will reimburse such Selling Holder, and each such officer, director, member,
employee, agent, successor, assign and controlling person for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company will not be liable in any such case if and to
the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission so made in conformity with
information furnished by such Selling Holder or any such controlling person in writing specifically for use in such Registration Statement or Prospectus. 

        (ii)    Indemnification by the Selling Holders.    In connection with any registration covering Registrable
Securities, each Selling Holder will furnish to the Company in writing such information as the Company reasonably requests concerning itself, the Registrable Securities held by it and the intended
method of disposition of the Registrable Securities held by it for use in connection with any Registration Statement or Prospectus and agrees, severally but not jointly, to indemnify and hold
harmless, to the fullest extent permitted by law, the Company, its directors, officers, employees, stockholders and each person who controls the Company (within the meaning of the Securities Act)
against any losses, claims, damages, liabilities and expense (including reasonable attorney fees) resulting from any untrue statement of a material fact or any omission of a material fact required to
be stated in the Registration Statement or Prospectus or preliminary prospectus or amendment or supplement thereto or necessary to make the statements therein not misleading, to the extent, but only
to the extent that such untrue statement or omission is contained in any information furnished in writing by such Selling Holder to the Company specifically for inclusion in such Registration
Statement or Prospectus or amendment or supplement thereto. In no event shall the liability of a Selling Holder be greater in amount than the dollar amount of the proceeds (net of all expense paid by
such Selling Holder in connection with any claim relating to this Section 15(e) and the amount of any damages such holder has otherwise been required to pay by reason of such untrue statement
or omission) received by such Selling Holder upon the sale of the Registrable Securities included in the Registration Statement giving rise to such indemnification obligation. 

13

 

        (iii)    Conduct of Indemnification Proceedings.    Any person entitled to indemnification hereunder shall
(i) give prompt notice to the indemnifying party of any claim with respect to which it seeks indemnification and (ii) permit such indemnifying party to assume the defense of such claim
with counsel reasonably satisfactory to the indemnified party; provided that any person entitled to indemnification hereunder shall have the right to
employ separate counsel and to participate in the
defense of such claim, but the fees and expenses of such counsel shall be at the expense of such person unless (a) the indemnifying party has agreed to pay such fees or expenses, or
(b) the indemnifying party shall have failed to assume the defense of such claim and employ counsel reasonably satisfactory to such person or (c) in the reasonable judgment of any such
person, based upon written advice of its counsel, a conflict of interest exists between such person and the indemnifying party with respect to such claims (in which case, if the person notifies the
indemnifying party in writing that such person elects to employ separate counsel at the expense of the indemnifying party, the indemnifying party shall not have the right to assume the defense of such
claim on behalf of such person); and provided, further, that the failure of any indemnified party to give notice as provided herein shall not relieve
the indemnifying party of its obligations hereunder, except to the extent that such failure to give notice shall materially adversely affect the indemnifying party in the defense of any such claim or
litigation. It is understood that the indemnifying party shall not, in connection with any proceeding in the same jurisdiction, be liable for fees or expenses of more than one separate firm of
attorneys at any time for all such indemnified parties. No indemnifying party will, except with the consent of the indemnified party, 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 such indemnified party of a release from all liability in respect of such claim or litigation. 

        (iv)    Contribution.    If for any reason the indemnification provided for in the preceding paragraphs (a) and
(b) is unavailable to an indemnified party or insufficient to hold it harmless, other than as expressly specified therein, then the indemnifying party shall contribute to the amount paid or
payable by the indemnified party as a result of such loss, claim, damage or liability in such proportion as is appropriate to reflect the relative fault of the indemnified party and the indemnifying
party, as well as any other relevant equitable considerations. No person guilty of fraudulent misrepresentation within the meaning of Section 11(f) of the Securities Act shall be entitled to
contribution from any person not guilty of such fraudulent misrepresentation. In no event shall the contribution obligation of a Selling Holder of Registrable Securities be greater in amount than the
dollar amount of the proceeds (net of all expenses paid by such Selling Holder in connection with any claim relating to this Section 15(e) and the amount of any damages such Selling Holder has
otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission) received by it upon the sale of the Registrable Securities giving rise to such
contribution obligation. 

        (f)    Assignment of the Registration Rights.    The rights to have the Company register Registrable Securities
pursuant to this Agreement shall be automatically assigned by the Warrantholders to transferees or assignees of all or any portion of such Registrable Securities only if: (i) the Warrantholder
agrees in writing with the transferee or assignee to assign such rights, (ii) the Company is promptly furnished with written notice of the name and address of such transferee or assignee,
(iii) such assignment complies with all laws applicable thereto, and (iv) at or before the time the Company received the written notice contemplated by clause (ii) above, the
transferee or assignee agrees in writing with the Company to be bound by all of the provisions contained herein. 

        (g)    Reports Under Exchange Act.    With a view to making available to the holders of Registrable Securities the
benefits of Rule 144 (or its successor rule) and any other rule or regulation of the SEC 

14

 

that may at any time permit such holders to sell such securities to the public without registration, the Company agrees to: 

          (i)  make
and keep public information available, as those terms are understood and defined in Rule 144, until the earlier of (A) six months after such date as
all of the Registrable Securities may be resold pursuant to Rule 144(k) or any other rule of similar effect or (B) such date as all of the Registrable Securities shall have been sold
pursuant to a Registration Statement or under Rule 144; and 

        (ii)  file
with the SEC in a timely manner all reports and other documents required of the Company under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"); and 

        (iii)  furnish
to each holder of Registrable Securities upon request, as long as such holder owns any Registrable Securities, (A) a written statement by the Company
that it has complied with the reporting requirements of the Exchange Act, (B) a copy of the Company's most recent Annual Report on Form 10-K or Quarterly Report on
Form 10-Q, and (C) such other information as may be reasonably requested in order to avail such holder of any rule or regulation of the SEC that permits the selling of any
such Registrable Securities without registration. 

        Section 16.    Successors.    All the covenants and provisions hereof by or for the benefit of the
Warrantholder shall bind and inure to the benefit of its respective successors and assigns hereunder. 

        Section 17.    Governing Law.    This Warrant shall be governed by, and construed in accordance with, the
internal laws of the State of California, without reference to the choice of law provisions thereof. The Company and, by accepting this Warrant, the Warrantholder, each irrevocably submits to the
exclusive jurisdiction of the courts of the State of California located in Orange County and the United States District Court for the Southern District of California for the purpose of any suit,
action, proceeding or judgment relating to or arising out of this Warrant and the transactions contemplated hereby. Service of process in connection with any such suit, action or proceeding may be
served on each party hereto anywhere in the world by the same methods as are specified for the giving of notices under this Warrant. The Company and, by accepting this Warrant, the Warrantholder, each
irrevocably consents to the jurisdiction of any such court in any such suit, action or proceeding and to the laying of venue in such court. The Company and, by accepting this Warrant, the
Warrantholder, each irrevocably waives any objection to the laying of venue of any such suit, action or proceeding brought in such courts and irrevocably waives any claim that any such suit, action or
proceeding brought in any such court has been brought in an inconvenient forum. 

        Section 18.    Call Provision.    Notwithstanding any other provision contained herein to the contrary, in the
event that the closing bid price of a share of Common Stock as traded on the Nasdaq (or such other exchange or stock market on which the Common Stock may then be listed or quoted) equals or exceeds
$3.90 (appropriately adjusted for any stock split, reverse stock split, stock dividend or other reclassification or combination of the Common Stock occurring after the date hereof) for twenty
(20) consecutive trading days, the Company, upon thirty (30) days prior written notice (the "Notice
Period") following such twenty (20) trading day period, to the Warrantholder, may call this Warrant, in whole but not in part, at a redemption price equal to $0.01 per
share of Common Stock then purchasable pursuant to this Warrant; provided, however, that all of the shares of Common Stock issuable hereunder either
(a) are registered pursuant to an effective Registration Statement which is available for sales of such shares of Common Stock during the Notice Period or (b) no longer constitute
Registrable Securities. Notwithstanding any such notice by the Company, the Warrantholder shall have the right to exercise this Warrant prior to the end of the Notice Period. 

        Section 19.    No Rights as Stockholder.    Prior to the exercise of this Warrant, the Warrantholder shall not
have or exercise any rights as a stockholder of the Company by virtue of its ownership of this Warrant. 

15

 

        Section 20.    Amendment; Waiver.    This Warrant may not be changed, amended, terminated, augmented, rescinded
or discharged (other than by performance), in whole or in part, except by a writing executed by the Company and the Warrantholder, and no waiver of any of the provisions or conditions of this Warrant
or any of the rights of the Company or Warrantholder hereunder shall be effective or binding unless such waiver shall be in writing and signed by the party claimed to have given or consented thereto. 

        Section 21.    Section Headings.    The section headings in this Warrant are for the convenience of the Company
and the Warrantholder and in no way alter, modify, amend, limit or restrict the provisions hereof. 

16

 

        IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed, as of the 16th day of August, 2002. 

	 	 	ODETICS, INC.
	

 	
 	

By:	

/s/  GREGORY A. MINER      

	 	 	Name:	Gregory A. Miner
	 	 	Title:	Chief Executive Officer and

Chief Financial Officer
	

 	
 	

ROTH CAPITAL PARTNERS, LLC.
	

 	
 	

By:	

/s/  BYRON C. ROTH      

	 	 	Name:	Byron C. Roth
	 	 	Title:	Chairman and Chief Executive Officer

17

 
 

APPENDIX A
  ODETICS, INC.
  WARRANT EXERCISE FORM    
  

To:
Odetics, Inc.: 

        The
undersigned hereby irrevocably elects to exercise the right of purchase represented by the within Warrant ("Warrant") for, and to
purchase thereunder by the payment of the Warrant Price and surrender of the Warrant,                          shares of
Class A Common Stock ("Warrant Shares") provided for
therein, and requests that certificates for the Warrant Shares be issued as follows: 

	
 Name
	 
	
 Address
	 
	

	 
	
 Federal Tax ID or Social Security No.

	

 	
 	

and delivered by	
 	

(certified mail to the above address, or
	 	 	 	 	(electronically (provide DWAC Instructions: _____________), or
	 	 	 	 	(other (specify): _____________________________________).

and,
if the number of Warrant Shares shall not be all the Warrant Shares purchasable upon exercise of the Warrant, that a new Warrant for the balance of the Warrant Shares purchasable upon exercise of
this Warrant be registered in the name of the undersigned Warrantholder or the undersigned's Assignee as below indicated and delivered to the address stated below. 

Dated:
_______________________, _______ 

	

Note: The signature must correspond with	
 	

Signature:	
 	

 
	the name of the registered holder as written	 	 	 	

	on the first page of the Warrant in every	 	 	 	 
	particular, without alteration or enlargement or any change whatever, unless the Warrant has been assigned.	 	
 Name (please print)

	

 	
 	

 Address

	

 	
 	

 Federal Identification No. or Social Security No.
	

 	
 	

Assignee:
	 	 	 	 	 
	 	 	

	 	 	 	 	 
	 	 	

QuickLinks

ODETICS, INC. WARRANT TO PURCHASE 62,500 SHARES OF CLASS A COMMON STOCK, PAR VALUE $0.10 PER SHARE

APPENDIX A ODETICS, INC. WARRANT EXERCISE FORMsec document

                                                                     EXHIBIT 4.4
                          REGISTRATION RIGHTS AGREEMENT

            THIS  REGISTRATION  RIGHTS  AGREEMENT (the  "Agreement") is made and
entered  into  as of  August  22,  2002  by and  among  NuCo2  Inc.,  a  Florida
corporation (the "Company"), and those persons (the "Purchasers") identified on,
and a party to, an executed  copy of the  Subscription  Agreement  to which this
Agreement is an Exhibit (the "Subscription Agreement").

            This  Agreement is made pursuant to the  Subscription  Agreement and
the Stock Purchase  Agreement that is included as Exhibit A to the  Subscription
Agreement (the "Stock Purchase  Agreement"),  by and between the Company and the
Purchasers, pursuant to which the Company is issuing and selling up to 1,793,000
shares of its common  stock,  $0.001 par value per share (the "Common  Stock" or
the  "Shares") to the  Purchasers.  The Shares are being offered and sold to the
Purchasers  without  registration  under the  Securities Act of 1933, as amended
(the  "Securities  Act"),  in  reliance  upon the  exemption  from  registration
provided by Section 4(2) of the  Securities  Act, and the provisions of Rule 506
of Regulation D,  promulgated  under the Securities  Act. In order to induce the
Purchasers to enter into the Stock Purchase Agreement, the Company has agreed to
provide to the Purchasers (and their direct and indirect permitted  transferees,
if any) the registration  rights set forth in this Agreement with respect to the
resale  of the  Shares.  The  execution  and  delivery  of this  Agreement  is a
condition to the Closing under the Stock Purchase  Agreement.  Capitalized terms
used but not  defined  herein  shall  have the  meaning  provided  in the  Stock
Purchase Agreement.

            In  consideration  of the foregoing  premises and for other good and
valuable  consideration,  the  receipt  and  sufficiency  of  which  are  hereby
acknowledged, the parties, intending to be legally bound, agree as follows:

                                    SECTION 1

                               REGISTRATION RIGHTS

            1.1. FILING OF FORM S-3 RESALE  REGISTRATION  STATEMENT.  As soon as
practical  and,  within ten (10) business days after the Closing under the Stock
Purchase  Agreement,  the Company  shall file with the  Securities  and Exchange
Commission (the "SEC" or the "Commission") a registration  statement on Form S-3
pursuant to Rule 415 under the Securities Act, or, in the event that Form S-3 is
unavailable to the Company, a registration statement on such other SEC Form that
is  available  to  the  Company  (together  with  any  exhibits,  amendments  or
supplements  thereto,  and any documents  incorporated by reference therein, the
"Registration  Statement"),  with  respect to the resale of the Shares,  and any
securities  of the  Company  issued as a  dividend  or other  distribution  with
respect to, or in exchange for or in replacement of, the Shares.  The securities
described in the preceding  sentence are collectively  referred to herein as the
"Registrable Securities"; provided, that the term "Registrable Securities" shall
not include  securities  subject to the  Registration  Statement  or  securities
transferred to a person other than a permitted transferee.

            1.2.  EFFECTIVENESS  OF REGISTRATION  STATEMENT.  The Company shall,
subject to Section 6 hereof,  use its commercially  reasonable  efforts to cause
the Registration Statement to become effective as soon as practicable and within
60 days, if the SEC does not review the Registration  Statement,  or 90 days, if
the SEC reviews the Registration Statement,  after the filing thereof, and shall
use its  commercially  reasonable  efforts  to keep the  Registration  Statement
continuously  effective  from  the  date  such  Registration  Statement  becomes
effective  until the earlier of (i) the date on which all  Securities  have been
resold  under  such  Registration  Statement,  and (ii)  the  date on which  all
Registrable Securities may be resold without restriction or limitation.

            1.3.  SUPPLEMENTS;  AMENDMENTS.  Subject  to  Section 6 hereof,  the
Company shall supplement or amend the Registration Statement, (i) as required by
Form S-3,  including,  without limitation,  the instructions  applicable to Form
S-3, or by the Securities  Act, the Securities  Exchange Act of 1934, as amended
(the  "Exchange  Act"),  or the  rules  and  regulations  promulgated  under the
Securities  Act or the Exchange  Act,  respectively,  and (ii) to include in the
Registration   Statement  any  additional  securities  that  become  Registrable
Securities by operation of the definition thereof.  The Company shall furnish to
the holders of the Registrable  Securities,  or their permitted transferees,  as
appropriate  (collectively,  the "Holders"), to which the Registration Statement
relates copies of any such supplement or amendment  sufficiently in advance (but
in no event  less than five (5)  business  days in  advance)  of its use  and/or
filing with the  Commission  to allow the Holders a  meaningful  opportunity  to
comment thereon with respect to the information  contained therein regarding the
Holders  and any plan for  resale of the  Registrable  Securities.  The  Holders
acknowledge that they have within five (5) business days of Closing supplied the
information  regarding  themselves and their plan of resale in the  Registration
Statement to be filed and hereby  waive any notice of the initial  filing of the
Registration  Statement,  and that such Holders and their successors and assigns
will promptly notify the Company of any changes in such information.

                                    SECTION 2

                                    EXPENSES

            The  Company  shall pay all  expenses,  fees and costs  incurred  in
connection with the preparation,  filing,  distribution and effectiveness of the
Registration Statement and any supplements or amendments thereto, whether or not
the Registration  Statement becomes effective,  and whether all, none or some of
the  Registrable  Securities  are sold pursuant to the  Registration  Statement,
including,  without  limitation,  all  registration  and filing  fees,  printing
expenses,  fees and  disbursements  of counsel for the  Company,  fees and state
securities, or "blue sky," fees and expenses and reasonable fees and expenses of
one counsel for all the Holders,  not to exceed $15,000,  and the expense of any
special audits  incident to or required by, or in connection with the filing and
effectiveness of the  Registration  Statement (but excluding the compensation of
regular  employees  of the  Company,  which  shall  be paid in any  event by the
Company).  The Holders shall pay all  underwriting  fees and discounts,  selling
commissions,   brokerage  fees  and  stock  transfer  taxes  applicable  to  the
Registrable  Securities  sold by such Holder and the fees and  expenses of their
counsel, if any.

                                    SECTION 3

                             REGISTRATION PROCEDURES

            3.1.  REGISTRATION.  The  Company  will advise the Holders as to the
status  of  the  preparation,  filing  and  effectiveness  of  the  Registration
Statement and, at the Company's expense, will do the following:

                        (a)  furnish to each  Holder a copy of the  Registration
            Statement  (including  all  exhibits  thereto)  and  any  prospectus
            forming a part thereof and any  amendments and  supplements  thereto
            (including  all documents  incorporated  or deemed  incorporated  by
            reference  therein prior to the  effectiveness  of the  Registration
            Statement and including each  preliminary  prospectus) and any other
            prospectus  filed  under Rule 424 under the  Securities  Act,  which
            documents,  other than documents incorporated or deemed incorporated
            by  reference,  will be  subject  to the  review of the  information
            contained  therein  regarding the Holders and any plan for resale of
            the Registrable  Securities by the Holders and any such  underwriter
            for a period of at least five (5)  business  days,  and the  Company
            shall not file the Registration  Statement or such prospectus or any
            amendment or supplement to the Registration  Statement or prospectus
            if any Holder shall reasonably object within three (3) business days
            after the receipt thereof unless the Company shall have been advised
            by its counsel that the Registration Statement or such prospectus or
            amendment or supplement thereto is required under the Securities Act

                                       2

            or the rules or regulations  adopted  thereunder in connection  with
            the  distribution  of  Registrable  Securities by the Holders or the
            Company.  A Holder  shall be deemed to have  reasonably  objected to
            such  filing  only  if  the   Registration   Statement,   amendment,
            prospectus or supplement,  as  applicable,  as proposed to be filed,
            contains a material  misstatement  or omission  with respect to such
            Holder or its plan of resale;

                        (b)  furnish to each  Holder one  conformed  copy of the
            Registration  Statement and of each amendment and supplement thereto
            (in each case  including  all exhibits) and such number of copies of
            the  prospectus  forming  a  part  of  the  Registration   Statement
            (including each  preliminary  prospectus)  and any other  prospectus
            filed under Rule 424 under the  Securities  Act, in conformity  with
            the  requirements of the Securities  Act, and such other  documents,
            including,  without limitation,  documents incorporated or deemed to
            be  incorporated  by reference  prior to the  effectiveness  of such
            Registration   Statement,  as  each  of  the  Holders  or  any  such
            underwriter, from time to time may reasonably request;

                        (c) to the extent practicable,  promptly upon the filing
            of any document  that is to be  incorporated  by reference  into the
            Registration   Statement  or  prospectus   forming  a  part  thereof
            subsequent to the effectiveness  thereof,  and in any event no later
            than five (5)  business  days after such  document is filed with the
            Commission,  provide  copies of such  document  to the  Holders,  if
            requested,  and make  representatives  of the Company  available for
            discussion  of such  document  and  other  customary  due  diligence
            matters;  and  provide  promptly  to the  Holders  upon  request any
            document  filed by the Company with the  Commission  pursuant to the
            requirements of Section 13 and Section 15 of the Exchange Act;

                        (d) make available at reasonable times for inspection by
            the Holders,  and any  attorney,  accountant,  financial  adviser or
            other representative  (collectively,  "Representatives") retained by
            the Holders,  subject to the recipient's  prior written agreement to
            keep such  information  confidential and not use or disclose it, all
            financial  and other  records,  pertinent  corporate  documents  and
            properties  of the Company  and cause the  officers,  directors  and
            employees  of the  Company  to  supply  all  information  reasonably
            requested  by the  Holders or their  respective  Representatives  in
            connection with the  preparation,  filing and  effectiveness  of the
            Registration Statement;

                        (e)  use  its  commercially  reasonable  efforts  (i) to
            register  or  qualify  all  Registrable  Securities  covered  by the
            Registration  Statement under state securities,  or "blue sky," laws
            of such States of the United  States of America  where  required and
            where  an  exemption  is  not   available  and  as  the  Holders  of
            Registrable  Securities covered by the Registration  Statement shall
            reasonably request,  (ii) to keep such registration or qualification
            in effect for so long as the  Registration  Statement is required to
            be effective hereunder, and (iii) to take any other action which may
            be  reasonably  necessary  or  advisable  to enable  the  Holders to
            consummate  the  disposition  of the  securities  to be  sold by the
            Holders  in  such   jurisdictions,   consistent  with  the  plan  of
            distribution   described   in  the   prospectus   included   in  the
            Registration  Statement,  except that the Company  shall not for any
            such  purpose be required to qualify  generally  to do business as a
            foreign   corporation  in  any  jurisdiction  where  it  is  not  so
            qualified,  or to execute a general consent to service of process in
            effecting such registration, qualification or compliance, unless the
            Company is already  subject  to  service  in such  jurisdiction  and
            except as may be required by the Securities Act or applicable  rules
            or regulations thereunder;

                                       3

                        (f) use its commercially reasonable efforts to cause all
            Registrable  Securities covered by the Registration  Statement to be
            registered  or  qualified  with or approved by all other  applicable
            Governmental  Authorities  as may be  necessary,  in the  opinion of
            counsel to the Company  and  counsel to the  Holders of  Registrable
            Securities,  to  enable  the  Holders  thereof  the  consummate  the
            disposition of such Registrable Securities;

                        (g)  subject to Section 6 hereof,  promptly  notify each
            Holder  of  Registrable   Securities  covered  by  the  Registration
            Statement (i) upon  discovery  that,  or upon the  occurrence of any
            event as a result of  which,  the  prospectus  forming a part of the
            Registration  Statement,  as  then in  effect,  includes  an  untrue
            statement  of a material  fact or omits to state any  material  fact
            required to be stated  therein or necessary  to make the  statements
            therein,  in the light of the  circumstances  under  which they were
            made, not misleading,  (ii) of the issuance by the Commission of any
            stop  order   suspending  the   effectiveness  of  the  Registration
            Statement or the initiation of proceedings  for that purpose,  (iii)
            of  any  request  by  the  Commission  for  (A)  amendments  to  the
            Registration  Statement or any document incorporated or deemed to be
            incorporated  by reference  in the  Registration  Statement,  or (B)
            supplements  to the  prospectus  forming a part of the  Registration
            Statement, or (C) additional information,  or (iv) of the receipt by
            the Company of any  notification  with respect to the  suspension of
            the  registration,  qualification or exemption from  registration or
            qualification  of any of the Registrable  Securities for sale in any
            jurisdiction  or the  initiation of any proceeding for such purpose,
            and at the request of any such Holder  promptly  prepare and file an
            amendment  to the  Registration  Statement  or a  supplement  to the
            prospectus as the Company may deem  necessary so that, as thereafter
            delivered to the  purchasers  of such  securities,  such  prospectus
            shall not include an untrue  statement of a material fact or omit to
            state a material fact required to be stated  therein or necessary to
            make the statements therein, in the light of the circumstances under
            which they were made, not  misleading;  and furnish to each Holder a
            reasonable  number of copies of such supplement to, or amendment of,
            such registration  statement and prospectus,  and, in the event of a
            stop order,  use its commercially  reasonable  efforts to obtain the
            withdrawal  of any order  suspending  the  effectiveness  of any the
            Registration  Statement,  or the  lifting of any  suspension  of the
            qualification  (or  exemption  from  qualification)  of  any  of the
            Registrable Securities for sale in any jurisdiction;

                        (h) if reasonably requested by any Holder or if required
            by law or SEC or  other  applicable  rule  or  regulation,  promptly
            incorporate  in  the   Registration   Statement   such   appropriate
            information  as the Holder may  reasonably  request to have included
            therein  by  filing  a Form  8-K,  or  filing  a  supplement  to the
            prospectus,  to reflect any change in the information  regarding the
            Holder, and make all required filings with the Commission in respect
            of any offer or sale of  Registrable  Securities or any amendment or
            supplement to the Registration Statement or related prospectus;

                        (i) otherwise use its commercially reasonable efforts to
            comply with all applicable rules and regulations, and make available
            to its  security  holders,  as soon as  reasonably  practicable,  an
            earnings  statement  covering the period of at least 12 months,  but
            not more than 18  months,  beginning  with the first  full  calendar
            month after the effective date of the Registration Statement,  which
            earnings  statement shall satisfy the provisions of Section 11(a) of
            the Securities Act and Rule 158 promulgated thereunder; and

                        (j) use its commercially reasonable efforts to cause all
            Registrable  Securities included in the Registration Statement to be
            listed on Nasdaq and each securities exchange on which securities of
            the same  class  are then  listed,  or,  if not then  listed  on any
            securities  exchange or Nasdaq,  to be  eligible  for trading in any
            over-the-counter market or trading system in which securities of the
            same class are then traded.

                                       4

            3.2.  UNDERWRITING.  If Holders  of at least 50% of the  Registrable
Securities   ("Initiating   Holders")   intend  to  distribute  the  Registrable
Securities  covered by their request by means of an underwriting,  they shall so
notify  the  Company.  The  Holders  whose  shares  are to be  included  in such
registration  and the  Company  shall  (together  with  all  other  stockholders
proposing to distribute their securities through such  underwriting)  enter into
underwriting and related agreements in customary form with the representative of
the underwriter or underwriters selected for such underwriting by the Initiating
Holders  and  reasonably   acceptable  to  the  Company.   In  any  case,   such
representative shall be of recognized standing. Such underwriting agreement will
contain such  representations and warranties by the Company and such other terms
and  provisions  as are customary for  underwriting  agreements  with respect to
secondary  distributions,   including,   without  limitation,   indemnities  and
contribution,  the provision of opinions of counsel and accountants' letters and
the  representations and warranties by, and the other agreements on the part of,
the  Company to and for the benefit of such  underwriters  shall also be made to
and for the benefit of the Holders.  The Company shall  cooperate fully with the
Holders and the  underwriters  in  connection  with any  underwritten  offering.
Notwithstanding  any other provision of this Section 3.2, if the  representative
of the  underwriters  advises  the  Holders in writing  that  marketing  factors
require a limitation on the number of shares to be underwritten,  the securities
of  the  Company  held  by  other  stockholders  shall  be  excluded  from  such
registration  to the  extent  so  required  by such  limitation.  If,  after the
exclusion of such shares,  still further reductions are required,  the number of
shares  included in the  registration  by each Holder  shall be reduced on a pro
rata basis (based on the number of shares held by such Holder),  by such minimum
number of shares as is necessary  to comply with such  request;  provided,  that
there shall be no reduction in the number of shares included in the registration
by any Holders  until all shares of other  stockholders  have been excluded from
such registration.  No Registrable  Securities or any other securities  excluded
from the underwriting by reason of the underwriter's  marketing limitation shall
be included in such  registration.  If any other  stockholder  who has requested
inclusion in such registration as provided above disapproves of the terms of the
underwriting,  such person may elect to withdraw  therefrom by written notice to
the Company,  the  underwriter  and the  Initiating  Holders.  The securities so
withdrawn shall also be withdrawn from registration.  If the underwriter has not
limited  the  number  of  Registrable  Securities  or  other  securities  to  be
underwritten,  the Company and officers and directors of the Company may include
its or their  securities for its or their own account in such  registration,  or
for the account of others, if the  representative so agrees and if the number of
Registrable  Securities  and other  securities  which would  otherwise have been
included in such registration and underwriting will not thereby be limited.

                                    SECTION 4

                                 INDEMNIFICATION

            4.1.  INDEMNIFICATION BY THE COMPANY.  The Company will indemnify:

                  (a)    each of the Holders, as applicable,

                  (b)    each of the Holder's officers,  directors,  members and
                         partners, and

                  (c)    each  individual,  partnership,  joint  stock  company,
                         corporation,    trust,   unincorporated   organization,
                         government agency or political subdivision (each of the
                         foregoing,  a "Person") controlling each of the Holders
                         within the meaning of SEC Rule 405 under the Securities
                         Act,

                                       5

with  respect to the  Registration  Statement,  against  all  expenses,  claims,
losses,  damages and liabilities (or actions,  investigations  or proceedings in
respect thereof) (collectively, a "Claim") arising out of or based on any actual
or alleged  untrue  statement of a material  fact, or any omission of a material
fact required to be stated  therein or necessary in order to make the statements
included therein not misleading,  contained in the Registration  Statement,  any
prospectus  or other  offering  document  (including  any  related  registration
statement, notification or the like) incident to the registration, qualification
or  compliance,  or any  violation by the Company of the  Securities  Act or the
Exchange Act or any other laws or any rule or regulation  thereunder  applicable
to the  Company and  relating  to action or inaction  required of the Company in
connection with any such  registration,  qualification  or compliance,  and will
reimburse  each of the Holders,  each of its  officers,  directors,  members and
partners, and each Person controlling each of the Holders, for any legal and any
other  expenses   reasonably  incurred  in  connection  with  investigating  and
defending any such Claim; provided, however, that the Company will not be liable
in any such case to the extent that any such Claim (i) arises out of or is based
on any untrue statement or omission based upon written information  furnished to
the  Company  by  the  Holders  or  their   Representatives  and  stated  to  be
specifically for use therein,  or (ii) is finally judicially  determined to have
resulted primarily from the gross negligence or willful misconduct of any person
or entity set forth in subsections (a) through (c) above.

            4.2.  INDEMNIFICATION  BY THE HOLDERS.  Each of the Holders will, if
Registrable  Securities  held by it are included in the  securities  as to which
such Registration  Statement is being effected,  indemnify the Company,  each of
its directors and officers,  and each Person who  "controls"  the Company within
the meaning of SEC Rule 405 under the  Securities  Act,  and each other  Holder,
against  all Claims  arising  out of or based on any  actual or  alleged  untrue
statement of a material  fact, or any omission or a material fact required to be
stated  therein  or  necessary  in  order  to make  the  statement  included  or
incorporated  therein not misleading,  contained in the Registration  Statement,
prospectus,  or other offering document made by or on behalf of such Holder, and
will  reimburse the Company and each other  Holder,  its  respective  directors,
officers,  partners,  members  or  control  Persons  for any  legal or any other
expenses  reasonably incurred in connection with investigating and defending any
such Claim, in each case to the extent, but only to the extent, that such untrue
statement (or alleged  untrue  statement)  or omission (or alleged  omission) is
made in the Registration  Statement,  prospectus,  offering  memorandum or other
document in reliance upon and in conformity with written  information  furnished
to the Company by or on behalf of such Holder and stated to be specifically  for
use therein;  provided,  however,  that the  obligations  of each of the Holders
hereunder  shall be limited to an amount equal to the net  proceeds  received by
such  Holder  from  the  sale  of the  Registrable  Securities  pursuant  to the
Registration Statement.

            4.3. PROCEDURES.  Each party entitled to indemnification  under this
Agreement (each, an "Indemnified Party") shall give notice to the party required
to  provide  indemnification  (the  "Indemnifying  Party")  promptly  after such
Indemnified Party has actual knowledge of any Claim as to which indemnity may be
sought,  and shall  permit the  Indemnifying  Party to assume the defense of any
such Claim;  provided that counsel for the Indemnifying Party, who shall conduct
the defense of such Claim,  shall be approved by the  Indemnified  Party  (whose
approval shall not  unreasonably  be withheld),  and the  Indemnified  Party may
participate  in such defense at such  party's  expense  (unless the  Indemnified
Party shall have  reasonably  concluded that there may be a conflict of interest
between the  Indemnifying  Party and the  Indemnified  Party in such action,  in
which case the fees and expenses of one such counsel for all Indemnified Parties
shall be at the expense of the  Indemnifying  Party),  and provided further that
the failure of any Indemnified Party to give notice as provided herein shall not
relieve the  Indemnifying  Party of its obligations  under this Agreement unless
the Indemnifying Party is materially  prejudiced thereby. No Indemnifying Party,
in the investigation or defense of any such Claim shall, except with the consent
of each Indemnified  Party (which consent shall not be unreasonably  withheld or
delayed),  consent  to entry of any  judgment  or enter into any  settlement  or
compromise which does not include an  unconditional  release of the Indemnifying
Party from all liability in respect to such Claim.  Each Indemnified Party shall

                                       6

furnish  such  information  regarding  itself  or the  Claim in  question  as an
Indemnifying  Party may reasonably request in writing and as shall be reasonably
required in connection with the investigation and defense of such Claim.

            4.4.  CONTRIBUTION.  If the  indemnification  provided  for in  this
Agreement is held by a court of competent  jurisdiction  to be unavailable to an
Indemnified  Party with respect to any Claim,  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
which  resulted  in  such  Claim,  as  well  as  any  other  relevant  equitable
considerations;  provided,  however,  that the Company will not be liable in any
such case to the extent that any such Claim (i) arises out of or is based on any
untrue  statement or omission  based upon written  information  furnished to the
Company by the Holders or their  Representatives  and stated to be  specifically
for use  therein,  or (ii) is finally  judicially  determined  to have  resulted
primarily  from the gross  negligence  or  willful  misconduct  of any person or
entity set forth in Section 4.1(a)  through 4.1(c) above.  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 (or alleged  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,
and  provided  that each  Holder  shall not be required  to  contribute,  in the
aggregate,  more than the net proceeds  received by the Holders from the sale of
the Registrable Securities pursuant to the Registration Statement.

                                    SECTION 5

                     PROVISION OF INFORMATION BY THE HOLDERS

            Each of the Holders whose Registrable Securities are included in the
Registration  Statement shall furnish to the Company such information  regarding
such  Holder as the Company  may  reasonably  request in writing and as shall be
reasonably   required  or  advisable  in  connection   with  any   registration,
qualification  or compliance  referred to in this Agreement,  and shall promptly
notify the Company if such  information  becomes  incorrect  or  misleading,  or
requires  amendment  or  updating.  Each of the Holders  agrees that the plan of
distribution  included in any prospectus relating to the Registrable  Securities
shall be as set forth on  Schedule  B-1  hereto  and that such  Holder  will not
resell any Registrable  Securities pursuant to the Registration Statement in any
manner other than as provided therein or herein. The other information regarding
the Holders  required for the initial filing of the  Registration  Statement has
been  provided  by  each  Holder  on the  Subscription  Agreement.  Each  Holder
represents, warrants and covenants to the Company that the information regarding
such Holder that appears in the  Subscription  Agreement  and/or Schedule B-2 is
accurate  and  complete in all  material  respects  consistent  with  Commission
Regulation  S-K,  Items 507 and 508.  The  Purchaser  will  confirm  promptly by
delivery of a signed copy of Schedule  B-2,  the sale of any Shares  pursuant to
Rule 144 or the Registration Statement.

                                    SECTION 6

                             HOLDBACK; POSTPONEMENT

          Notwithstanding  the other provisions of this Agreement,  if (a) there
is material  non-public  information  regarding  the Company which the Company's
Board of  Directors  reasonably  and in good faith  determines  not to be in the
Company's  best  interest  to disclose  and which the  Company is not  otherwise
required  to  disclose,  or (b) there is a  extraordinary  business  opportunity
(including  but not limited to the  acquisition  or disposition of assets (other

                                       7

than in the ordinary  course of business) or any merger,  consolidation,  tender
offer or other similar  extraordinary  transaction not in the ordinary course of
business)  available  to the  Company  which the  Company's  Board of  Directors
reasonably and in good faith determines not to be in the Company's best interest
to disclose, then the Company may postpone or suspend filing or effectiveness of
a registration  statement for a period not to exceed 60 days,  provided that the
Company may not postpone or suspend  filing or  effectiveness  of a registration
statement for more than 120 days in the aggregate  during any 365-day period and
there  shall be an  aggregate  of not more than two (2)  suspensions  during any
365-day period;  provided,  however that no postponement or suspension  shall be
permitted for  consecutive 60 day periods  arising out of the same set of facts,
circumstances or transactions.

                                    SECTION 7

                            RULE 144 REPORTING, ETC.

            7.1. SEC REPORTING  COMPLIANCE.  With a view to making available the
benefits of certain rules and  regulations  of the  Commission  which may at any
time  permit  the  sale of the  Registrable  Securities  to the  public  without
registration,  through the second  anniversary  of this  Agreement,  the Company
will:

                        (a) make and keep "current public information" regarding
            the Company  available,  as defined in Commission  Rule 144(c) under
            the Securities Act;

                        (b) use its commercially reasonable efforts to file with
            the  Commission in a timely manner all SEC Reports and other filings
            and documents  required of the Company under the  Securities Act and
            the Exchange Act; and

                        (c) so long as a Holder owns any Registrable Securities,
            furnish the Holder forthwith upon request a written statement by the
            Company as to its compliance with the reporting  requirements  under
            the Securities Act and the Exchange Act,  including  compliance with
            SEC Rule  144(c),  a copy of the most  recent  annual  or  quarterly
            report of the Company,  and such other  reports and documents of the
            Company and other  information  in the  possession of, or reasonably
            obtainable  by, the  Company as a Holder may  reasonably  request in
            availing itself of any rule or regulation of the Commission allowing
            a Holder to sell any such securities without registration.

            7.2. STOCK  PURCHASE  AGREEMENT  COVENANTS.  The Company will comply
with its covenants  under Section 4 of the Stock Purchase  Agreement,  which are
incorporated herein by this reference.

                                    SECTION 8

                                  MISCELLANEOUS

            8.1.  ASSIGNMENT.  The  registration  rights set forth herein may be
assigned,  in whole or in part,  to any  transferee  of  Registrable  Securities
permitted in accordance  with the Stock Purchase  Agreement,  which  transferee,
upon  registration on the Company's or its transfer agent's books and records as
a holder of record of Registrable Securities,  shall be considered thereafter to
be a Holder (provided that any transferee who is not an affiliate of a Purchaser
shall be a Holder only with respect to such  Registrable  Securities so acquired
and any stock of the  Company  issued as a dividend or other  distribution  with
respect  to,  or  in  exchange  for  or  in  replacement  of,  such  Registrable
Securities)  and  shall be  bound by all  obligations  and  limitations  of this
Agreement and the Stock Purchase Agreement.

                                       8

            8.2. SECTION  HEADINGS.  The titles and headings of the sections and
subsections of this Agreement are inserted for convenience only and shall not be
deemed to constitute a part thereof.

            8.3.  GOVERNING  LAW.  This  Agreement  shall  be  governed  by  and
construed in  accordance  with the laws of the State of New York without  giving
effect to the conflict of law rules  thereof to the extent that the  application
of the law of another jurisdiction would be required thereby.

            8.4.  NOTICES.

                  (a)  All  communications  under  this  Agreement  shall  be in
            writing and shall be delivered by  facsimile,  by hand,  by reliable
            overnight  delivery service such as UPS or FedEx or by registered or
            certified mail, postage prepaid:

                                   (i) if to the Company,  to the address listed
                  in the Stock Purchase  Agreement,  or at such other address as
                  it may have furnished in writing to the Purchasers;

                                   (ii) if to the  Purchasers,  at the addresses
                  listed on Subscription  Agreement,  or at such other addresses
                  as may have been furnished the Company in writing.

                        (b) Any notice so addressed  shall be deemed to be given
            (i) if delivered by hand, on the date of such delivery, (ii) if sent
            by reliable  overnight delivery service such as UPS or FedEx, on the
            first  business day  following  the date of delivery to such service
            for overnight delivery, (iii) if delivered by facsimile, on the date
            of such  facsimile,  or (iv) if mailed by  registered  or  certified
            mail, on the third  business day after the date of such mailing.  In
            the event that any notice is sent by facsimile  transmission  to the
            Company,   such  transmission  shall  be  followed   immediately  by
            overnight delivery to the Company of such notice.

            8.5.  SUCCESSORS  AND ASSIGNS;  NO THIRD PARTY  BENEFICIARIES.  This
Agreement  shall inure to the benefit of and be binding upon the  successors and
permitted  assigns of each of the  parties.  No other  person is  intended to or
shall have any rights or remedies hereunder, whether as a third part beneficiary
or otherwise.

            8.6.  COUNTERPARTS.  Persons may become parties to this Agreement be
entering into the Subscription  Agreement,  which may be executed in one or more
identical  counterparts,  each of which shall be deemed an  original  and all of
which shall be one and the same  agreement.  Any signature  that is delivered by
facsimile  signature  page shall be valid and  binding,  with the same force and
effect as if an original, manually signed counterpart.

            8.7. REMEDIES. Each Holder of Registrable Securities, in addition to
being  entitled to exercise  all rights  granted by law,  including  recovery of
damages,  will be  entitled  to specific  performance  of its rights  under this
Agreement.  The  Company  agrees  that  monetary  damages  would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions
of this  Agreement  and  hereby  agrees to waive the  defense  in any action for
specific performance that a remedy at law would be adequate.

            8.8. SEVERABILITY.  In the event that any provision contained herein
is  unenforceable,  the remaining  provisions  shall  continue in full force and
effect.

            8.9. DELAYS OR OMISSIONS.  It is agreed that no delay or omission to
exercise any right, power or remedy accruing to the Holders,  upon any breach or
default of the Company under this Agreement,  shall impair any such right, power
or remedy,  nor shall it be construed to be a waiver of any provision hereof, or

                                       9

of any similar breach or default thereafter  occurring;  nor shall any wavier of
any single  breach or default be deemed a waiver of any other  breach or default
theretofore  or  thereafter  occurring.  It is further  agreed  that any waiver,
permit,  consent or approval of any kind or  character by a Holder of any breach
or default under this Agreement,  or any waiver by a Holder of any provisions or
conditions of this Agreement,  must be in writing and shall be effective only to
the extent specifically set forth in the writing, and that all remedies,  either
under this  Agreement,  or by law or  otherwise  afforded to a Holder,  shall be
cumulative and not alternative.

            8.10.  ATTORNEY'S  FEES.  If  any  action  at law  or in  equity  is
necessary to enforce or interpret the terms of this  Agreement,  the  prevailing
party shall be entitled  to  reasonable  attorney's  fees,  costs and  necessary
disbursements  in  addition  to any  other  relief  to which  such  party may be
entitled.

            8.11.  ENTIRE  AGREEMENT;   AMENDMENT.  This  Agreement,  the  Stock
Purchase  Agreement,  the  Subscription  Agreement and the  Operative  Documents
constitute the entire understanding and agreement of the parties with respect to
the subject  matter hereof and supersede  all prior  understandings,  written or
otherwise,  among such parties.  This Agreement may be amended only in a writing
signed  by the  Company  and the  Holders  of at  least a  majority  of the then
outstanding Registrable Securities.

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