REGISTRATION RIGHTS AGREEMENT

 

REGISTRATION RIGHTS AGREEMENT (the “Agreement”), dated as of the ___ day of
February, 2012, executed and delivered by DOCUMENT SECURITY SYSTEMS, INC., a New
York corporation (the “Company”), and Holders (as defined below).

 

RECITALS

 

WHEREAS, simultaneously with the execution and delivery of this Agreement, the
Company, pursuant to terms and conditions set forth in the Subscription
Agreement, dated February __, 2012, including the exhibits thereto and any and
all supplements thereof and amendments thereto, and all documents incorporated
by reference therein (collectively, the “Subscription Documents”) is offering
for sale (the “Offering”) up to a maximum of 30 units of the Company securities,
at a price of $100,000 per unit (the “Units”), each Unit consisting of (i)
32,258 (“Shares”) of its common Stock, par value $.02 per share (“Common Stock”)
and (ii) a warrant (“Warrant”) to purchase up to an aggregate of 16,129 Shares
of Common Stock (the “Warrant Shares”).

 

WHEREAS, the investor in the Offering whose name appears on Exhibit A annexed
hereto is the Holder in this Offering; and

 

WHEREAS, the terms and conditions of the Offering provide for the execution and
delivery of this Agreement.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged by the Company, the Company hereby agrees as
follows:

 

1. Automatic Registration.

 

(a) The Company shall use its best efforts to file a registration statement
(“Registration Statement”) with the Securities and Exchange Commission under the
Securities Act of 1933 (the “Act”), on appropriate form, and such other
documents, including a prospectus, as may be necessary (in the opinion of
counsel for the Company), in order to comply with the provisions of the Act,
within 30 business days after the final closing of the Offering, so as to allow
for the resale under the Act by any Holder or combination of Holders of all
Registerable Shares (as defined in Section 2) held by all of the Holders, at the
sole expense of the Company, so as to permit the public resale by the Holder of
the Registerable Shares pursuant thereto.

 

Reg. Rights Agreement  

 

 

(b) If (i) a Registration Statement covering the resale of all of the
Registrable Shares (as defined below) required to be covered thereby and
required to be filed by the Company pursuant to this Agreement is (A) not filed
with the SEC on or before the 30th calendar day after the date hereof (a “Filing
Failure”) or (B) not declared effective (the date such Registration Statement is
declared effective, the “Effective Date”) by the Securities and Exchange
Commission (the “SEC”) on or before 60th calendar day after the date hereof (or
the 90th calendar day after the date hereof in the event that such Registration
Statement is subject to a full review by the SEC) (an “Effectiveness Failure”),
(ii) other than during an Allowable Grace Period (as defined below), on any day
after the Effective Date of a Registration Statement sales of all of the
Registrable Shares required to be included on such Registration Statement cannot
be made pursuant to such Registration Statement (including, without limitation,
because of a failure to keep such Registration Statement effective, a failure to
disclose such information as is necessary for sales to be made pursuant to such
Registration Statement, a suspension or delisting of (or a failure to timely
list) the shares of Common Stock on the Principal Market (as defined in the
Subscription Documents), or a failure to register a sufficient number of shares
of Common Stock or by reason of a stop order) or the prospectus contained
therein is not available for use for any reason (a “Maintenance Failure”), or
(iii) if a Registration Statement is not effective for any reason or the
prospectus contained therein is not available for use for any reason, the
Company fails to file with the SEC any required reports under Section 13 or
15(d) of the 1934 Act (as defined in the Subscription Documents) such that it is
not in compliance with Rule 144(c)(1) (or Rule 144(i)(2), if applicable) of Act
(as defined in the Subscription Documents”) (a “Current Public Information
Failure”) as a result of which any of the Holders are unable to sell Registrable
Shares without restriction under Rule 144 of the Act (“Rule 144”)(including,
without limitation, volume restrictions), then, as partial relief for the
damages to any holder by reason of any such delay in, or reduction of, its
ability to sell the underlying shares of Common Stock (which remedy shall not be
exclusive of any other remedies available at law or in equity), the Company
shall pay to each holder of Registrable Shares relating to such Registration
Statement an amount in cash equal to one percent (1.0%) of the aggregate
Purchase Price (as such term is defined in the Securities Purchase Agreement) of
such Holder on each of the following dates: (1) on the date of such Filing
Failure, Effectiveness Failure, Maintenance Failure or Current Public
Information Failure, as applicable, and (2) on every thirty (30) day anniversary
of (I) a Filing Failure until such Filing Failure is cured; (II) an
Effectiveness Failure until such Effectiveness Failure is cured; (III) a
Maintenance Failure until such Maintenance Failure is cured; and (IV) a Current
Public Information Failure until the earlier of (i) the date such Current Public
Information Failure is cured and (ii) such time that such public information is
no longer required pursuant to Rule 144 (in each case, pro rated for periods
totaling less than thirty (30) days). The payments to which a holder of
Registrable Shares shall be entitled pursuant to this 1(b) are referred to
herein as “Registration Delay Payments.” Following the initial Registration
Delay Payment for any particular event or failure (which shall be paid on the
date of such event or failure, as set forth above), without limiting the
foregoing, if an event or failure giving rise to the Registration Delay Payments
is cured prior to any thirty (30) day anniversary of such event or failure, then
such Registration Delay Payment shall be made on the third (3rd) Business Day
after such cure. In the event the Company fails to make Registration Delay
Payments in a timely manner in accordance with the foregoing, such Registration
Delay Payments shall bear interest at the rate of one percent (1.0%) per month
(prorated for partial months) until paid in full. Notwithstanding the foregoing,
no Registration Delay Payments shall be owed to a Holder (other than with
respect to a Maintenance Failure resulting from a suspension or delisting of (or
a failure to timely list) the shares of Common Stock on the Principal Market)
with respect to any period during which all of such Holder’s Registrable Shares
may be sold by such Holder under Rule 144.

 

(c) Notwithstanding anything to the contrary herein (but subject to the last
sentence of this Section 1(c)), at any time after the Effective Date of a
particular Registration Statement, the Company may delay the disclosure of
material, non-public information concerning the Company or any of its
Subsidiaries the disclosure of which at the time is not, in the good faith
opinion of the board of directors of the Company, in the best interest of the
Company and, upon the advice of counsel to the Company, otherwise required (a
“Grace Period”), provided that the Company shall promptly notify the Holders in
writing of the (i) existence of material, non-public information giving rise to
a Grace Period (provided that in each such notice the Company shall not disclose
the content of such material, non-public information to any of the Holders) and
the date on which such Grace Period will begin and (ii) date on which such Grace
Period ends, provided further that (I) no Grace Period shall exceed ten (10)
consecutive days and during any three hundred sixty five (365) day period all
such Grace Periods shall not exceed an aggregate of thirty (30) days, (II) the
first day of any Grace Period must be at least five (5) trading days after the
last day of any prior Grace Period and (III) no Grace Period may exist during
the sixty (60) trading day period immediately following the Effective Date of
such Registration Statement (provided that such sixty (60) trading day period
shall be extended by the number of trading days during such period and any
extension thereof contemplated by this proviso during which such Registration
Statement is not effective or the prospectus contained therein is not available
for use) (each, an “Allowable Grace Period”). For purposes of determining the
length of a Grace Period above, such Grace Period shall begin on and include the
date the Holders receive the notice referred to in clause (i) above and shall
end on and include the later of the date the Holders receive the notice referred
to in clause (ii) above and the date referred to in such notice. Notwithstanding
anything to the contrary contained in this Section 1(c), the Company shall cause
its transfer agent to deliver unlegended shares of Common Stock to a transferee
of an Holder in accordance with the terms of the Securities Purchase Agreement
in connection with any sale of Registrable Shares with respect to which such
Holder has entered into a contract for sale, and delivered a copy of the
prospectus included as part of the particular Registration Statement to the
extent applicable, prior to such Holder’s receipt of the notice of a Grace
Period and for which the Holder has not yet settled.

 

Reg. Rights Agreement- 2 - 

 

 

2. Registerable Shares. For purposes of this Agreement, the term “Registerable
Shares” shall include (a) the shares purchased as a component of the Units in
the Offering; (b) any securities issued or issuable with respect to the
Warrants; (c) Warrant Shares; or (d) any other shares of Common Stock issued to
the Holders by way of stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization or otherwise. Anything herein contained to the contrary
notwithstanding, the provisions of this Agreement shall not apply to, and the
term “Registerable Shares” as used in this Agreement shall not include, shares
of Common Stock or Warrant Shares after they have been sold by a Holder pursuant
to an effective Registration Statement under the Act or sold pursuant to Rule
144.

 

3. Additional Covenants of the Company With Respect to Registration.

 

The Company covenants and agrees as follows:

 

(a) In connection with any registration under Section 1 above, the Company shall
file the Registration Statement no later than 30 business days following the
final closing of the Offering, and use reasonable efforts to have such
Registration Statement declared effective at the earliest possible time.

 

(b) In connection with any registration of Registerable Shares pursuant to
Section 1 above, the Company shall furnish each Holder of Registerable Shares
included in a Registration Statement with such reasonable number of copies of
such Registration Statement, related preliminary prospectus and prospectus
meeting the requirements of the Act, and other documents necessary or incidental
to the registration and public offering of such Registerable Shares, as shall be
reasonably requested by the Holder to permit the Holder to make a public
distribution of such Registerable Shares.

 

(c) Once effective, the Company covenants and agrees to use its best efforts to
maintain the effectiveness of any Registration Statement until the earlier of
(i) a date which is two years from the final closing date of the Offering, or
(ii) the date that the Holders of the Registerable Shares receive an opinion of
counsel to the Company that all of the Registerable Shares may be freely traded
(without limitation or restriction as to quantity or timing and without
registration under the Act) pursuant to Rule 144 or otherwise; provided,
however, the Company may suspend the use of any Registration Statement for a
period not to exceed 45 days in any 12-month period for valid business reasons
(not including avoidance of the Company’s obligations hereunder), including the
acquisition or divestiture of assets, public filings with the SEC, pending
corporate developments and similar events.

 

(d) If any stop order shall be issued by the SEC in connection with any
Registration Statement filed pursuant to Section 1 above, the Company will use
its best efforts to obtain the removal of such order.

 

(e) The Company shall pay all costs, fees, and expenses in connection with all
Registration Statements filed pursuant to Section 1 above, including, without
limitation, the Company’s legal and accounting fees, printing expenses, and blue
sky fees and expenses; provided, however, that the Holder shall be solely
responsible for the fees of any counsel retained by the Holders in connection
with such registration and any transfer taxes or underwriting discounts,
commissions or fees applicable to the Registerable Shares sold by the Holder
pursuant thereto.

 

Reg. Rights Agreement- 3 - 

 

 

4. Indemnification.

 

(a) In the event any Registrable Shares are included in any Registration
Statement under this Agreement, to the fullest extent permitted by law, the
Company will, and hereby does, indemnify, hold harmless and defend each Holder
and each of its directors, officers, shareholders, members, partners, employees,
agents, advisors, representatives (and any other Persons (as defined in the
Subscription Documents) with a functionally equivalent role of a Person holding
such titles notwithstanding the lack of such title or any other title) and each
Person, if any, who controls such Holder within the meaning of the Act or the
1934 Act and each of the directors, officers, shareholders, members, partners,
employees, agents, advisors, representatives (and any other Persons with a
functionally equivalent role of a Person holding such titles notwithstanding the
lack of such title or any other title) of such controlling Persons (each, an
“Indemnified Person”), against any losses, obligations, claims, damages,
liabilities, contingencies, judgments, fines, penalties, charges, costs
(including, without limitation, court costs, reasonable attorneys’ fees and
costs of defense and investigation), amounts paid in settlement or expenses,
joint or several, (collectively, “Claims”) incurred in investigating, preparing
or defending any action, claim, suit, inquiry, proceeding, investigation or
appeal taken from the foregoing by or before any court or governmental,
administrative or other regulatory agency, body or the SEC, whether pending or
threatened, whether or not an indemnified party is or may be a party thereto
(“Indemnified Damages”), to which any of them may become subject insofar as such
Claims (or actions or proceedings, whether commenced or threatened, in respect
thereof) arise out of or are based upon: (i) any untrue statement or alleged
untrue statement of a material fact in a Registration Statement or any
post-effective amendment thereto or in any filing made in connection with the
qualification of the offering under the securities or other “blue sky” laws of
any jurisdiction in which Registrable Shares are offered (“Blue Sky Filing”), or
the omission or alleged omission to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, (ii) any
untrue statement or alleged untrue statement of a material fact contained in any
preliminary prospectus if used prior to the effective date of such Registration
Statement, or contained in the final prospectus (as amended or supplemented, if
the Company files any amendment thereof or supplement thereto with the SEC) or
the omission or alleged omission to state therein any material fact necessary to
make the statements made therein, in light of the circumstances under which the
statements therein were made, not misleading or (iii) any violation or alleged
violation by the Company of the Act, the 1934 Act, any other law, including,
without limitation, any state securities law, or any rule or regulation
thereunder relating to the offer or sale of the Registrable Shares pursuant to a
Registration Statement (the matters in the foregoing clauses (i) through (iii)
being, collectively, “Violations”). Subject to Section 4(c), the Company shall
reimburse the Indemnified Persons, promptly as such expenses are incurred and
are due and payable, for any legal fees or other reasonable expenses incurred by
them in connection with investigating or defending any such Claim.
Notwithstanding anything to the contrary contained herein, the indemnification
agreement contained in this Section 4(a): (i) shall not apply to a Claim by an
Indemnified Person arising out of or based upon a Violation which occurs in
reliance upon and in conformity with information furnished in writing to the
Company by such Indemnified Person for such Indemnified Person expressly for use
in connection with the preparation of such Registration Statement or any such
amendment thereof or supplement thereto and (ii) shall not be available to a
particular Holder to the extent such Claim is based on a failure of such Holder
to deliver or to cause to be delivered the prospectus made available by the
Company (to the extent applicable), including, without limitation, a corrected
prospectus, if such prospectus or corrected prospectus was timely made available
by the Company and then only if, and to the extent that, following the receipt
of the corrected prospectus no grounds for such Claim would have existed; and
(iii) shall not apply to amounts paid in settlement of any Claim if such
settlement is effected without the prior written consent of the Company, which
consent shall not be unreasonably withheld or delayed. The indemnity and
contribution agreements contained herein shall be in addition to (i) any cause
of action or similar right of the Indemnified Party or Indemnified Person
against the indemnifying party or others, and (ii) any liabilities the
indemnifying party may be subject to pursuant to the law.

 

Reg. Rights Agreement- 4 - 

 

(b) In connection with any Registration Statement in which an Holder is
participating, such Holder agrees to severally and not jointly indemnify, hold
harmless and defend, to the same extent and in the same manner as is set forth
in Section 4(a), the Company, each of its directors, each of its officers who
signs the Registration Statement and each Person, if any, who controls the
Company within the meaning of the Act or the 1934 Act (each, an “Indemnified
Party”), against any Claim or Indemnified Damages to which any of them may
become subject, under the Act, the 1934 Act or otherwise, insofar as such Claim
or Indemnified Damages arise out of or are based upon any Violation, in each
case, to the extent, and only to the extent, that such Violation occurs in
reliance upon and in conformity with written information furnished to the
Company by such Holder expressly for use in connection with such Registration
Statement; and, subject to Section 4(c) and the below provisos in this Section
4(b), such Holder will reimburse an Indemnified Party any legal or other
expenses reasonably incurred by such Indemnified Party in connection with
investigating or defending any such Claim; provided, however, the indemnity
agreement contained in this Section 4(b) and the agreement with respect to
contribution contained in Section 5 shall not apply to amounts paid in
settlement of any Claim if such settlement is effected without the prior written
consent of such Holder, which consent shall not be unreasonably withheld or
delayed, provided further that such Holder shall be liable under this Section
4(b) for only that amount of a Claim or Indemnified Damages as does not exceed
the net proceeds to such Holder as a result of the applicable sale of
Registrable Shares pursuant to such Registration Statement. Such indemnity shall
remain in full force and effect regardless of any investigation made by or on
behalf of such Indemnified Party and shall survive the transfer of any of the
Registrable Shares by any of the Holders hereunder.

 

(c) Promptly after receipt by an Indemnified Person or Indemnified Party (as the
case may be) under this Section 4 of notice of the commencement of any action or
proceeding (including, without limitation, any governmental action or
proceeding) involving a Claim, such Indemnified Person or Indemnified Party (as
the case may be) shall, if a Claim in respect thereof is to be made against any
indemnifying party under this Section 4, deliver to the indemnifying party a
written notice of the commencement thereof, and the indemnifying party shall
have the right to participate in, and, to the extent the indemnifying party so
desires, jointly with any other indemnifying party similarly noticed, to assume
control of the defense thereof with counsel mutually satisfactory to the
indemnifying party and the Indemnified Person or the Indemnified Party (as the
case may be); provided, however, an Indemnified Person or Indemnified Party (as
the case may be) shall have the right to retain its own counsel with the fees
and expenses of such counsel to be paid by the indemnifying party if: (i) the
indemnifying party has agreed in writing to pay such fees and expenses; (ii) the
indemnifying party shall have failed promptly to assume the defense of such
Claim and to employ counsel reasonably satisfactory to such Indemnified Person
or Indemnified Party (as the case may be) in any such Claim; or (iii) the named
parties to any such Claim (including, without limitation, any impleaded parties)
include both such Indemnified Person or Indemnified Party (as the case may be)
and the indemnifying party, and such Indemnified Person or such Indemnified
Party (as the case may be) shall have been advised by counsel that a conflict of
interest is likely to exist if the same counsel were to represent such
Indemnified Person or such Indemnified Party and the indemnifying party (in
which case, if such Indemnified Person or such Indemnified Party (as the case
may be) notifies the indemnifying party in writing that it elects to employ
separate counsel at the expense of the indemnifying party, then the indemnifying
party shall not have the right to assume the defense thereof and such counsel
shall be at the expense of the Indemnifying Party, provided further that in the
case of clause (iii) above the indemnifying party shall not be responsible for
the reasonable fees and expenses of more than one (1) separate legal counsel for
such Indemnified Person or Indemnified Party (as the case may be). The
Indemnified Party or Indemnified Person (as the case may be) shall reasonably
cooperate with the indemnifying party in connection with any negotiation or
defense of any such action or Claim by the indemnifying party and shall furnish
to the indemnifying party all information reasonably available to the
Indemnified Party or Indemnified Person (as the case may be) which relates to
such action or Claim. The indemnifying party shall keep the Indemnified Party or
Indemnified Person (as the case may be) reasonably apprised at all times as to
the status of the defense or any settlement negotiations with respect thereto.
No indemnifying party shall be liable for any settlement of any action, claim or
proceeding effected without its prior written consent; provided, however, the
indemnifying party shall not unreasonably withhold, delay or condition its
consent. No indemnifying party shall, without the prior written consent of the
Indemnified Party or Indemnified Person (as the case may be), consent to entry
of any judgment or enter into any settlement or other compromise which does not
include as an unconditional term thereof the giving by the claimant or plaintiff
to such Indemnified Party or Indemnified Person (as the case may be) of a
release from all liability in respect to such Claim or litigation, and such
settlement shall not include any admission as to fault on the part of the
Indemnified Party. Following indemnification as provided for hereunder, the
indemnifying party shall be subrogated to all rights of the Indemnified Party or
Indemnified Person (as the case may be) with respect to all third parties, firms
or corporations relating to the matter for which indemnification has been made.
The failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action shall not relieve such
indemnifying party of any liability to the Indemnified Person or Indemnified
Party (as the case may be) under this Section 4, except to the extent that the
indemnifying party is materially and adversely prejudiced in its ability to
defend such action.

Reg. Rights Agreement- 5 - 

 

 

(d) No Person involved in the sale of Registrable Shares who is guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) in
connection with such sale shall be entitled to indemnification from any Person
involved in such sale of Registrable Shares who is not guilty of fraudulent
misrepresentation.

(e) The indemnification required by this Section 4 shall be made by periodic
payments of the amount thereof during the course of the investigation or
defense, as and when bills are received or Indemnified Damages are incurred.

5. Contribution.

To the extent any indemnification by an indemnifying party is prohibited or
limited by law, the indemnifying party agrees to make the maximum contribution
with respect to any amounts for which it would otherwise be liable under Section
4 to the fullest extent permitted by law; provided, however: (i) no contribution
shall be made under circumstances where the maker would not have been liable for
indemnification under the fault standards set forth in Section 4 of this
Agreement, (ii) no Person involved in the sale of Registrable Shares which
Person is guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) in connection with such sale shall be entitled to contribution
from any Person involved in such sale of Registrable Shares who was not guilty
of fraudulent misrepresentation; and (iii) contribution by any seller of
Registrable Shares shall be limited in amount to the amount of net proceeds
received by such seller from the applicable sale of such Registrable Shares
pursuant to such Registration Statement. Notwithstanding the provisions of this
Section 5, no Holder shall be required to contribute, in the aggregate, any
amount in excess of the amount by which the net proceeds actually received by
such Holder from the applicable sale of the Registrable Shares subject to the
Claim exceeds the amount of any damages that such Holder has otherwise been
required to pay, or would otherwise be required to pay under Section 4(b), by
reason of such untrue or alleged untrue statement or omission or alleged
omission.

The provisions of Section 4 shall remain in full force and effect regardless of
any investigation made by or on behalf of any Holder or the Company or any other
persons who are entitled to indemnification pursuant to the provisions of
Section 4, and shall survive the sale by a Holder of Registerable Shares
pursuant to the Registration Statement.

 

Reg. Rights Agreement- 6 - 

 

 

6. Amendments. This Agreement may not be amended, modified or supplemented, and
waivers of or consents to departures from the provisions of this Agreement may
not be given, unless it would not have an adverse effect upon the rights of any
of the Holders and the Company has obtained the written consent of Holders then
holding a majority of the Registerable Shares.

 

7. Notices. Except as otherwise provided in this Agreement, all notices,
requests and other communications (which shall include publication) to any
person provided for hereunder shall be in writing and shall be given by hand
delivery, registered or certified mail or by any courier providing overnight
delivery (i) if to the Company, or the initial Holder, at the address set forth
in the Subscription Agreement and (ii) if to a subsequent Holder, to the address
set forth on the books and records of the Company. All such notices, requests or
communications shall not be effective until received.

 

8. Assignment. This Agreement shall be binding upon and inure to the benefit of
and be enforceable by the parties hereto. In addition, and whether or not any
express assignment shall have been made, the provisions of this Agreement which
are for the benefit of Holder shall also be for the benefit of and enforceable
by any subsequent holder of the Registerable Shares. Holder agrees, by accepting
any portion of the Registerable Shares after the date hereof, to the provisions
of this Agreement.

 

9. Governing Law.

 

(a) THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE
RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAWS OF THE STATE OF NEW YORK
WITHOUT REFERENCE TO THE PRINCIPLES OF CONFLICTS OF LAWS.

 

(b) Each of the Company and Holder hereby irrevocably and unconditionally
consents to submit to the exclusive jurisdiction of any State Court in The City
of New York, Borough of Manhattan and the United States District Court for the
Southern District of New York (the “NY Courts”) for any litigation arising out
of or relating to this Agreement and the transactions contemplated hereby (and
agrees not to commence any litigation relating thereto except in such courts),
waives any objection to the laying of venue of any such litigation in the NY
Courts and agrees not to plead or claim that such litigation brought in any NY
Courts has been brought in an inconvenient forum.

 

10. Counterparts. This Agreement may be executed by facsimile or e-mail PDF and
may be signed simultaneously in any number of counterparts, each of which shall
be deemed an original, but all such counterparts shall together constitute one
and the same instrument.

 

11. Entire Agreement. This Agreement embodies the entire agreement of between
the Company relating to the subject matter hereof and supersedes all prior
agreements and understandings relating to such subject matter.

 

12. Severability. If any provision of this Agreement, or the application of such
provisions to any person or circumstance, shall be held invalid, the remainder
of this Agreement, or the application of such provision to persons or
circumstances other than those to which it is held invalid, shall not be
affected thereby.

 

13. Third Party Beneficiaries. The Holders from time to time shall each be a
third party beneficiary of the agreements of the Company contained herein.

 

Reg. Rights Agreement- 7 - 

 

 

14. Headings. The headings which are contained in this Agreement are for the
sole purpose of convenience of reference, and shall not limit or otherwise
affect the interpretation of any of the provisions hereof.

 

15. Further Assurances. The Company will from time to time after the date hereof
take any and all actions, and execute, acknowledge and deliver any and all
documents and instruments, at its cost and expense, as any Holder may from time
to time reasonably request in order to more fully perfect or protect the rights
intended to be granted to it hereunder.

 

16. Interpretation. As used in this Agreement, unless the context otherwise
requires: words describing the singular number shall include the plural and vice
versa; words denoting any gender shall include all genders; words denoting
natural persons shall include corporations, partnerships and other entities, and
vice versa; and the words “hereof”, “herein” and “hereunder”, and words of
similar import, shall refer to this Agreement as a whole, and not to any
particular provision of this Agreement.

 

17. Waiver. The failure of the Company or any Holder to at any time enforce any
of the provisions of this Agreement shall not be deemed or construed to be a
waiver of any such provision, nor to in any way affect the validity of this
Agreement or any provision hereof or the right of the Company or any Holder to
thereafter enforce each and every provision of this Agreement.

 

 

[signature page appears next]

 

Reg. Rights Agreement- 8 - 

 

 

IN WITNESS WHEREOF, the undersigned has duly executed and delivered this
Agreement effective as of the date first above written.

 

 

  DOCUMENT SECURITY SYSTEMS, INC.                     By:         Name: Patrick
White       Title: Chief Executive Officer  

 

 

Accepted and Agreed Holders:     By:     Name:     By:     Name:     By:    
Name:

 

Reg. Rights Agreement  

 

 

EXHIBIT A

LIST OF HOLDERS

 

(Attached)

 

Reg. Rights Agreement