NATIONAL HEALTHCARE TECHNOLOGY, INC.
INVESTOR RIGHTS AGREEMENT
This
Investor Rights Agreement (this "Agreement") is made and entered
into
as of June 30, 2005, (the "Effective Date")
by and among National Healthcare
Technology, Inc., a Colorado California
corporation (the "Company") and Crown
Partners, Inc., a Nevada corporation
("Crown").
RECITALS
A. This
Agreement is made and entered into in connection with that
certain
Exchange Agreement, dated as of June __,
2005 (the "Exchange Agreement") between
the Company, Crown, Special Stone Surfaces
Es3, a Nevada corporation ("Es3") and
certain shareholders of Es3.
B. Under
the Exchange Agreement, the Company has acquired all or
substantially all of the outstanding Common
Stock of Es3, with the shareholders
of Es3 acquiring a controlling interest in
the Company.
C. The
Company has agreed to provide certain piggyback registration
and
anti-dilution protection rights to Crown in
connection with 905,438 shares of
the Company's Common Stock (the "Shares")
issued as the Crown Shares to Crown
under the Exchange Agreement.
NOW,
THEREFORE, in consideration of the foregoing recitals and the
mutual
promises hereinafter set forth, the parties
hereto agree as follows:
AGREEMENT
1.
REGISTRATION RIGHTS.
1.1 Definitions. For purposes of this Section 1:
(a) Registration. The terms "register," "registered," and
"registration" refer to a registration
effected by preparing and filing a
registration statement in compliance with
the Securities Act of 1933, as amended
(the "Securities Act"), and the declaration
or ordering of effectiveness of such
registration statement.
(b) Registrable Securities. The term "Registrable Securities"
means: (i) the Shares and (ii) any shares
of Common Stock issued as (or issuable
upon the conversion or exercise of any
warrant, right or other security which is
issued as) a dividend or other distribution
with respect to, in exchange for or
in replacement of the Shares. The term
"Registrable Securities" shall exclude in
all cases, however, any shares sold by a
person in a transaction in which rights
under this Section 1 are not assigned in
accordance with this Agreement or any
shares sold to the public or sold pursuant
to Rule 144 promulgated under the
Securities Act.
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(c) Registrable Securities Then Outstanding. The term
"Registrable Securities Then Outstanding"
shall mean those shares of Common
Stock which are Registrable Securities and
(1) are then issued and outstanding
or (2) are then issuable pursuant to the
exercise or conversion of
then-outstanding and then-exercisable
options, warrants or convertible
securities.
(d) Holder. For purposes of this Section 1 and Section 2
hereof, the term "Holder" or "Holders"
means any person or persons owning
Registrable Securities.
(e) SEC. The term "SEC" means the United States Securities and
Exchange Commission.
1.2 Piggyback Registrations. The Company shall notify all Holders
of
Registrable Securities in writing at least
thirty (30) days prior to filing any
registration statement under the Securities
Act for purposes of effecting a
public offering of securities of the
Company (including, but not limited to,
registration statements relating to
secondary offerings of securities of the
Company, but excluding registration
statements relating to any employee benefit
plan or a corporate reorganization) and
will afford each such Holder an
opportunity to include in such registration
statement all or any part of the
Registrable Securities then held by such
Holder. Each Holder desiring to include
in any such registration statement all or
any part of the Registrable Securities
held by such Holder shall, within twenty
(20) days after receipt of the
above-described notice from the Company, so
notify the Company in writing, and
in such notice shall inform the Company of
the number of Registrable Securities
such Holder wishes to include in such
registration statement. If a Holder
decides not to include all of its
Registrable Securities in any registration
statement thereafter filed by the Company,
such Holder shall nevertheless
continue to have the right to include any
Registrable Securities in any
subsequent registration statement or
registration statements as may be filed by
the Company with respect to offerings of
its securities, all upon the terms and
conditions set forth herein.
(a) Underwriting. If a registration statement under which the
Company gives notice under this Section 1.3
is for an underwritten offering,
then the Company shall so advise the
Holders of Registrable Securities. In such
event, the right of any such Holder to
include Registrable Securities in a
registration pursuant to this Section 1.3
shall be conditioned upon such
Holder's participation in such underwriting
and the inclusion of such Holder's
Registrable Securities in the underwriting
to the extent provided herein. All
Holders proposing to distribute their
Registrable Securities through such
underwriting shall enter into an
underwriting agreement in customary form with
the managing underwriter or underwriter(s)
selected for such underwriting by the
Company. Notwithstanding any other
provision of this Agreement, if the managing
underwriter(s) determine(s) in good faith
that marketing factors require a
limitation of the number of shares to be
underwritten, then the managing
underwriter(s) may exclude shares
(including Registrable Securities) from the
registration and the underwriting, and the
number of shares that may be included
in the registration and the underwriting
shall be allocated, first, to the
Company, and second, to each of the Holders
requesting inclusion of their
Registrable Securities in such registration
statement on a pro rata basis based
on the total number of Registrable
Securities then held by each such Holder;
provided, however, that the Company shall
not reduce the number of Registrable
Securities to be included in such
registration and underwriting to less than
thirty-three percent (33%) of the total
number of shares to be underwritten;
provided further, that no shares shall be
included in such registration other
than shares for the account of the Company
or the Holders. In the event of a
limitation by the Company of the number of
Registrable Securities to be included
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<PAGE>
in such registration and underwriting, the
Company shall so advise all Holders
requesting registration, and the number of
shares or securities that are
entitled to be included in the registration
and underwriting shall be allocated
among all Holders in proportion, as nearly
as practicable, to the respective
amounts of Registrable Securities held by
each Holder at the time of filing of
the registration statement. If any Holder
disapproves of the terms of any such
underwriting, such Holder may elect to
withdraw therefrom by written notice to
the Company and the underwriter, delivered
at least ten (10) business days prior
to the effective date of the registration
statement. Any Registrable Securities
excluded or withdrawn from such
underwriting shall be excluded and withdrawn
from the registration. For any Holder which
is a partnership, limited liability
company or corporation, the partners,
retired partners, members and shareholders
of such Holder, or the estates and family
members of any such partners, retired
partners and members and any trusts for the
benefit of any of the foregoing
persons shall be deemed to be a single
"Holder," and any pro rata reduction with
respect to such "Holder" shall be based
upon the aggregate number of Registrable
Securities owned by all entities and
individuals included in such "Holder," as
defined in this sentence.
(b) Expenses. All Registration Expenses incurred in connection
with a registration pursuant to this
Section 1.2 shall be borne by the Company.
Each Holder participating in a registration
pursuant to this Section 1.2 shall
bear such Holder's proportionate share
(based on the total number of shares sold
in such registration other than for the
account of the Company) of all Selling
Expenses incurred in connection with a
registration pursuant to this Section
1.2.
1.3 Obligations of the Company. Whenever required to affect the
registration of any Registrable Securities
under this Agreement, the Company
shall, as expeditiously as reasonably
possible:
(a) prepare and file with the SEC a registration statement
with respect to such Registrable Securities
and use its best efforts to cause
such registration statement to become
effective, and, upon the request of the
Holders of a majority of the Registrable
Securities registered thereunder, keep
such registration statement effective for
up to one hundred twenty (120) days.
(b) prepare and file with the SEC such amendments and
supplements to such registration statement
and the prospectus used in connection
with such registration statement as may be
necessary to comply with the
provisions of the Securities Act with
respect to the disposition of all
securities covered by such registration
statement;
(c) furnish to the Holders such number of copies of a
prospectus, including a preliminary
prospectus, in conformity with the
requirements of the Securities Act, and
such other documents as they may
reasonably request in order to facilitate
the disposition of the Registrable
Securities owned by them that are included
in such registration;
(d) use its best efforts to register and qualify the
securities covered by such registration
statement under such other securities or
Blue Sky laws of such jurisdictions as
shall be reasonably requested by the
Holders, provided that the Company shall
not be required in connection therewith
or as a condition thereto to qualify to do
business or to file a general consent
to service of process in any such states or
jurisdictions;
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<PAGE>
(e) in the event of any underwritten public offering, enter
into and perform its obligations under an
underwriting agreement, in usual and
customary form, with the managing
underwriter(s) of such offering (it being
understood and agreed that, as a condition
to the Company's obligations under
this clause (e), each Holder participating
in such underwriting shall also enter
into and perform its obligations under such
an agreement);
(f) notify
each Holder of Registrable Securities covered by
such registration statement at any time
when a prospectus relating thereto is
required to be delivered under the
Securities Act of the happening of any event
as a result of which the prospectus
included in such registration statement, as
then in effect, includes an untrue
statement of a material fact or omits to
state a material fact required to be stated
therein or necessary to make the
statements therein not misleading in light
of the circumstances then existing;
(g) furnish, at the request of any Holder requesting
registration of Registrable Securities, on
the date that such Registrable
Securities are delivered to the
underwriters for sale, if such securities are
being sold through underwriters, or, if
such securities are not being sold
through underwriters, on the date that the
registration statement with respect
to such securities becomes effective, (i)
an opinion, dated as of such date, of
the counsel representing the Company for
the purposes of such registration, in
form and substance as is customarily given
to underwriters in an underwritten
public offering and reasonably satisfactory
to a majority in interest of the
Holders requesting registration, addressed
to the underwriters, if any, and to
the Holders requesting registration of
Registrable Securities and (ii) a
"comfort" letter dated as of such date,
from the independent certified public
accountants of the Company, in form and
substance as is customarily given by
independent certified public accountants to
underwriters in an underwritten
public offering and reasonably satisfactory
to a majority in interest of the
Holders requesting registration, addressed
to the underwriters, if any, and to
the Holders requesting registration of
Registrable Securities;
(h) cause all such Registrable Securities registered hereunder
to be listed on each securities exchange on
which similar securities issued by
the Company are then listed; and
(i) provide a transfer agent and registrar for all Registrable
Securities registered pursuant hereunder
and a CUSIP number for all such
Registrable Securities, in each case not
later than the effective date of such
registration.
1.4 Furnish Information. It shall be a condition precedent to
the
obligations of the Company to take any
action pursuant to Section 1.2 hereof
that the selling Holders shall furnish to
the Company such information regarding
themselves, the Registrable Securities held
by them and the intended method of
disposition of such securities as shall be
required to timely effect the
registration of their Registrable
Securities.
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<PAGE>
1.5 Delay of Registration. No Holder shall have any right to
obtain
or seek an injunction restraining or
otherwise delaying any such registration as
the result of any controversy that might
arise with respect to the
interpretation or implementation of this
Section 1.
1.6 Indemnification. In the event any Registrable Securities
are
included in a registration statement under
Section 1.2 hereof:
(a) By the Company. To the extent permitted by law, the
Company will indemnify and hold harmless
each Holder, the partners, members,
officers, directors and attorneys of each
Holder, any underwriter (as defined in
the Securities Act) for such Holder and
each person, if any, who controls such
Holder or underwriter within the meaning of
the Securities Act or the Exchange
Act, against any losses, claims, damages,
or liabilities (joint or several) to
which they may become subject under the
Securities Act, the Exchange Act or
other federal or state law, insofar as such
losses, claims, damages, or
liabilities (or actions in respect thereof)
arise out of or are based upon any
of the following statements, omissions or
violations (each a "Violation"):
(i) any untrue statement or alleged untrue statement of
a material fact contained in such
registration statement, including any
preliminary prospectus or final prospectus
contained therein or any amendments
or
