COMPREHENSIVE HEALTHCARE
SOLUTIONS, INC.
REGISTRATION RIGHTS
AGREEMENT
THIS REGISTRATION RIGHTS
AGREEMENT (the
“ Agreement ”) is made as of August 3, 2005 by
and between COMPREHENSIVE HEALTHCARE SOLUTIONS,
INC. , a Delaware corporation (the “ Company
”), and COMPREHENSIVE ASSOCIATES LLC , a New
York limited liability company (together with its successors and
assigns, the “ Holder ”).
R E C I T A L
S:
Pursuant to the terms of Convertible Debentures,
dated as of the date hereof, in the aggregate principal amount of
$235,000 (the “ Aggregate Principal Amount ”)
executed by the Company in favor of the Holder (the “
Debentures ”), and pursuant to the terms of Warrants,
dated as of the date hereof, for the purchase of an aggregate of
5,000,000 shares of Common Stock, par value $.10 per share, of the
Company (“ Common Stock ”) executed by the
Company in favor of the Holder (the “ Warrants
”), the Holder will have the right to acquire in the future
certain shares of Common Stock. The Debentures and Warrants are
collectively are referred to herein as the “
Securities .”
The parties desire to set forth herein their
agreement as to the terms and conditions of certain registration
rights relating to the Common Stock issuable upon conversion or
exercise of the Securities, as applicable, by the
Holder.
A G R E E M E N
T:
The parties hereto agree as follows:
1.
Certain Definitions
. As used in this Agreement, the
following terms shall have the following respective
meanings:
“ Commission ” shall mean the
Securities and Exchange Commission.
“ Exchange Act ” shall mean
the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission promulgated thereunder, all as the
same shall be in effect from time to time.
“ Holder ” shall mean the
Holder (as hereinabove defined) and any Person who shall have
acquired Registrable Securities from the Holder, either
individually or jointly, as the case may be, in a transaction
pursuant to which registration rights are transferred pursuant to
Section 7 hereof.
“ Person ” shall mean an
individual, a partnership, a corporation, a limited liability
company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization or a governmental or
quasi-governmental entity, or any department, agency or political
subdivision thereof or any other entity of any kind.
“ Prospectus ” shall mean the
prospectus included in the Registration Statement (including,
without limitation, a prospectus that includes any information
previously omitted from a prospectus filed as part of an effective
Registration Statement in reliance upon Rule 430A promulgated under
the Securities Act), as amended or supplemented by any prospectus
supplement, with respect to the terms of the offering of any
portion of the Registrable Securities covered by the Registration
Statement, and all other amendments and supplements to the
Prospectus, including post-effective amendments, and all material
incorporated by reference or deemed to be incorporated by reference
in such Prospectus.
“ Registrable Securities ”
shall mean (i) any and all shares of Common Stock issuable
upon conversion of the Debentures, and (ii) any and all shares of
Common Stock issuable upon exercise of the Warrants.
The terms “ register ,”
“ registered ” and “ registration
” refer to a registration effected by preparing, filing and
having declared effective a registration statement in compliance
with the Securities Act.
“ Registration Expenses ”
shall mean (i) all expenses, other than Selling Expenses (defined
below), incurred by the Company in complying with Section 2 hereof,
including without limitation, all registration, qualification and
filing fees, exchange or quotation medium listing fees, printing
and delivery expenses, escrow and custodian fees, fees and
disbursements of counsel for the Company, blue sky fees and
expenses and the expenses of accountants for the Company including
the expenses of any special audits incident to or required by any
such registration and (ii) the reasonable fees and disbursements of
one counsel chosen by the Holder in connection with the
Registration Statement.
“ Registration Statement ”
shall mean an initial registration statement which is required to
register the resale of all Registrable Securities and, in each
case, the Prospectus, amendments and supplements to such
registration statement or Prospectus, including pre- and
post-effective amendments, all exhibits thereto, and all material
incorporated by reference or deemed to be incorporated by reference
in such registration statement.
“ Securities Act ” shall mean
the Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder, all as the
same shall be in effect from time to time.
“ Selling Expenses ” shall
mean all underwriting discounts, selling commissions and stock
transfer taxes and the costs, fees and expenses of any accountants,
attorneys (other than the cost, fees and expenses of attorneys
which are Registration Expenses) or other experts retained by the
Holder.
2.
Required Registration
.
(a) The Company shall prepare and file, as soon as
is reasonably practicable, but in no event later than the thirtieth
(30 th ) day following the date hereof (the “
Filing Date ”), a Registration Statement under the
Securities Act covering the resale of the Registrable Securities
and shall use its best efforts to cause the Registration Statement
to become effective as expeditiously as possible, but in no event
later than the earlier of (i) the one hundred twentieth (120
th ) day following the date hereof or (ii) the third day
following the date on which the Company is notified by the
Commission that the Registration Statement will not be reviewed or
is no longer subject to further review and comments (the “
Effectiveness Date ”), and shall use its best efforts
to keep the Registration Statement continuously effective under the
Securities Act until the date which is six (6) years following the
date hereof (the “ Effectiveness Period
”).
(i) the Registration Statement is not filed with
the Commission on or prior to the Filing Date (if the Company files
the Registration Statement with the Commission without affording
the Holder the opportunity to review and comment on the same as
required by Section 5(a), the Company shall be deemed not to have
filed the Registration Statement with the Commission on or prior to
the Filing Date), or
(ii) the Company fails to file with the Commission a
request for acceleration in accordance with Rule 461 promulgated
under the Securities Act, within two (2) days of the date that the
Company is notified (orally or in writing, whichever is earlier) by
the Commission that the Registration Statement will not be
“reviewed,” or not subject to further review,
or
(iii) the Registration Statement filed or required to
be filed hereunder is not declared effective by the Commission by
the Effectiveness Date, or
(iv) after the date that the Registration Statement
is initially declared effective by the Commission (the “
Effective Date ”), the Registration Statement ceases
for any reason to remain continuously effective as to all
Registrable Securities, or the Holder is not permitted to utilize
the Prospectus therein to resell such Registrable Securities,
(any such failure or breach being referred to as an “
Event ,” and for purposes of clause (i), (iii) or
(iv), the date on which such Event occurs, or for purposes of
clause (ii) the date on which such two (2) day period is exceeded,
being referred to as “ Event Date ”), then for
an Event: (x) on each such Event Date, the Company shall pay to the
Holder an amount in cash, as liquidated damages and not as a
penalty, equal to one and one-half percent (1.5%) of the initial
Aggregate Principal Amount; and (y) on each monthly anniversary of
each such Event Date (if the applicable Event shall not have been
cured by such date) until the applicable Event is cured, the
Company shall pay to the Holder an amount in cash, as liquidated
damages and not as a penalty, equal to one and one-half percent
(1.5%) of the initial Aggregate Principal Amount. Notwithstanding
the foregoing, no damages shall be payable with respect to an Event
if liquidated damages are payable hereunder with respect to another
Event at such time.
If the Company
fails to pay any liquidated damages pursuant to this Section in
full within fifteen (15) days after the date payable, the Company
will pay interest thereon at a rate of sixteen percent (16%) per
annum (or such lesser maximum amount that is permitted to be paid
by applicable law) to the Holder, accruing daily from the date such
liquidated damages are due until such amounts, plus all such
interest thereon, are paid in full.
(c) [ intentionally omitted ]
(d) The Company represents and warrants that it is
not a party to, or otherwise subject to, any agreement, other than
this Agreement, granting registration rights to any other Person
with respect to any securities of the Company and agrees that it
will not include any securities of the Company, other than the
Registrable Securities, in the Registration Statement.
Notwithstanding the foregoing, the Company may include in the
Registration Statement up to 50,000 shares of Common Stock on
behalf of Anslow & Jaclin, LLP.
3.
Expenses of
Registration .
All Registration Expenses incurred in connection
with the Registration Statement pursuant to Section 2 hereof shall
be borne by the Company. All Selling Expenses relating to
securities registered on behalf of the Holder shall be borne by the
Holder.
The Company agrees not to effect any public sale
or distribution of its equity securities, or any securities
convertible into or exchangeable or exercisable for such
securities, during the ten (10) day period prior to, and during the
ninety (90) day period following, the Effective Date. None of the
Company’s executive officers, directors, or holders of at
least 5% of the outstanding Common Stock will effect any public
sale or distribution (including sales pursuant to Rule 144) of any
such securities during such periods.
5.
Registration
Procedures .
The Company will use its best efforts to effect
the registration of the Registrable Securities in accordance with
the intended method or methods of distribution thereof, and
pursuant thereto the Company will under the time frames provided
herein, or if not so provided, as expeditiously as
possible:
(a) prepare and file with the Commission the
Registration Statement on any appropriate form for which the
Company qualifies with respect to such Registrable Securities and
use its best efforts to cause the Registration Statement to become
effective ( provided that before filing the Registration
Statement or Prospectus or any amendments or supplements thereto,
the Company will (i) furnish to the counsel selected by the Holder
copies of all such documents proposed to be filed, which documents
will be subject to the review of such counsel for a period of seven
(7) days following the receipt thereof, and (ii) notify the Holder
covered by such registration of any stop order issued or threatened
by the Commission);
(b) prepare and file with the Commission such
amendments and supplements to the Registration St