Exhibit 10.5

 

MEDICOR LTD.

 

REGISTRATION RIGHTS AGREEMENT

 

This REGISTRATION RIGHTS AGREEMENT (this “Agreement”), is made as
of               2006, by and among MediCor Ltd., a Delaware corporation
(MediCor Ltd. and any successor by way of corporate reorganization or otherwise
is referred to as (the “Company”)), the holders of equity securities of the
Company listed on Exhibit A hereto (each, a “Holder” and together, the
“Holders”).

 

The parties hereby agree as follows:

 

ARTICLE I

REGISTRATION RIGHTS

 

1.1                               Certain Definitions.  For purposes of this
Agreement:

 

(a)                                  “Agreement for Sale and Purchase” shall
mean the Agreement for the Sale and Purchase of the Shares of Biosil Limited and
Nagor Limited, dated 13 September 2005, between the Company and the Sellers
identified therein.

 

(b)                                 The term “Common Stock” means the Company’s
common stock, par value $0.001 per share.

 

(c)                                  The term “Form S-3” means such form under
the Securities Act as in effect on the date hereof or any successor form under
the Securities Act.

 

(d)                                 The term “Holder” means any person owning
Registrable Securities or any assignee thereof in accordance with Section 1.11
of this Agreement.

 

(e)                                  The term “Institutional Investor” shall
mean a purchaser of at least $5,000,000 of Common Stock for cash pursuant to an
offering of at least $20,000,000 in cash and which purchase must occur within
one hundred eighty (180) days following the Completion Date under the Agreement
for Sale and Purchase.

 

(f)                                    The terms “register,” “registered,” and
“registration” refer to a registration effected by preparing and filing a
registration statement or similar document in compliance with the Securities Act
of 1933 (the “Securities Act”), and the declaration or ordering of effectiveness
of such registration statement or document.

 

(g)                                 The term “Registrable Securities” means the
Common Stock issued to the Holders pursuant to the Agreement for Sale and
Purchase; provided, however, that the foregoing definition shall exclude in all
cases (i) shares of Common Stock that have been disposed of under any effective
registration statement relating to such Registrable Securities, and (ii) shares
of Common Stock sold or otherwise transferred pursuant to the safe harbor
provided by Rule 144 promulgated under the Securities Act or other applicable
exemption from registration under the Securities Act.

 

(h)                                 The number of shares of “Registrable
Securities then outstanding” shall be determined by the number of shares of
Common Stock outstanding which are, and the number of shares

 

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of Common Stock issuable pursuant to then exercisable or convertible securities
which are, Registrable Securities.

 

(i)                                     The term “SEC” means the Securities and
Exchange Commission.

 

1.2                               Demand Registration.

 

(a)                                  If the Company shall receive a written
request from a Holder or Holders of Registrable Securities, that the Company
file a registration statement under the Securities Act covering the registration
of such Registrable Securities held by such Holder or Holders as such Holder or
Holders (each an “Initiating Holder” or collectively, the “Initiating Holders”)
may specify (provided that the anticipated aggregate gross proceeds, before
underwriting discounts and commissions, from the sale of such Registrable
Securities to the Holders would exceed $2,500,000), then the Company shall,
within ten (10) days of the receipt thereof, give written notice of such request
to all Holders (the “Company Notice”) and shall, subject to the limitations of
subsection 1.2(b), use its reasonable best efforts to effect as soon as
practicable, and in any event within ninety (90) days of the receipt of such
request, the registration under the Securities Act of all Registrable Securities
which the Initiating Holders and any other Holders electing to participate in
such registration request to be registered; provided however, that the Company
shall not be obligated to register such securities until the earlier of (i) the
date it is eligible to file a registration statement on Form S-3 (provided that
the Company continues to be eligible to use a Form S-3 for the entire period of
such registration) and (ii) ninety (90) days subsequent to the Completion Date
under the Agreement for Sale and Purchase (the “Registration Start Date”).  The
Company shall effect a registration on Form S-3, if such form is then available
for use by the Company and, if not, on such form promulgated by the SEC for
which the Company qualifies.  Any such election to participate in such
registration shall be received by the Company within thirty (30) days of the
mailing of the Company Notice by the Company in accordance with Section 2.3.

 

(b)                                 If the Initiating Holders intend to
distribute the Registrable Securities covered by their request by means of an
underwriting, they shall so advise the Company as a part of their request made
pursuant to this Section 1.2 and the Company shall include such information in
the written notice referred to in subsection 1.2(a).  The underwriter (or
underwriters) will be selected by the Company and shall be reasonably acceptable
to a majority of the Initiating Holders.  In such event, the right of any other
Holder to include its, his or her Registrable Securities in such registration
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 securities
through such underwriting shall (together with the Company as provided in
subsection 1.4(e) and any other stockholders of the Company distributing their
securities through such underwriting) enter into an underwriting agreement in
customary form with the underwriter or underwriters selected for such
underwriting by the Company.  Notwithstanding any other provision of this
Section 1.2, if the underwriter (or lead managing underwriter in the case of
multiple underwriters) advises the Company in writing that marketing factors
require a limitation of the number of shares to be underwritten, then the
Company shall so advise all Holders of Registrable Securities which would
otherwise be included in the underwriting pursuant hereto, and the number of
shares of Registrable Securities of Holders that may be included in the
underwriting shall be allocated among all such Holders, in proportion (as nearly
as practicable) to the amount of Registrable Securities of the Company owned by
each such Holder; provided, however, that the number of shares of Registrable
Securities of the Initiating Holders to be included in such underwriting shall
not be reduced unless all other securities are first entirely excluded from the
underwriting.  No Registrable Securities excluded from the underwriting by
reason of the underwriter’s marketing limitation shall be included in such
registration.

 

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(c)                                  Notwithstanding the foregoing, if the
Company shall furnish to the Initiating Holders requesting a registration
statement pursuant to this Section 1.2, a certificate signed by the Chief
Executive of the Company stating that it would be seriously detrimental to the
Company and its stockholders for such registration statement to be filed, the
Company shall have the right to defer such filing for a period of not more than
ninety (90) days after receipt of the request of the Initiating Holder;
provided, however, that the Company may not utilize this right more than once in
any twelve month period.

 

(d)                                 In addition, the Company shall not be
obligated to effect, or to take any action to effect, any registration pursuant
to this Section 1.2:

 

(i)                                     After the Company has effected four
registrations pursuant to this Section 1.2, including any registration that has
been withdrawn pursuant to Section 1.8;

 

(ii)                                  During the period starting with the date
sixty (60) days prior to the Company’s good faith estimate of the date of filing
of, and ending on a date ninety (90) days after the effective date of, a
registration subject to Section 1.3 hereof (or such longer period, not to exceed
180 days, as the Company may be required to keep such registration effective
pursuant to Section 1.4(a)), provided that the Company is using its reasonable
best efforts to cause such registration statement to become effective; or

 

(iii)                               If the Company exercises its rights pursuant
to Section 1.8(d).

 

(e)                                  Notwithstanding the Registration Start
Date, the Initiating Holders may, on or prior to the Completion Date under the
Agreement for Sale and Purchase, elect to have any or all of their Registrable
Securities included in the Registration Statement on Form SB-2, first filed with
the SEC on January 4, 2005.  Such registration shall count against the limit
identified in Section 1.2(d)(i). 

 

(f)                                    The Company shall not be required to file
a Registration Statement under this Section 1.2 with respect to any Registrable
Securities owned by a Holder registered by an effective Registration Statement
on Form S-3 pursuant to Rule 415 under the Securities Act requested by such
Holder for so long as such Registration Statement remains effective and shares
may be sold freely pursuant to such Registration Statement.

 

1.3                               Company Registration.  If (but without any
obligation to do so) at any time the Company proposes to register any of its
securities for sale under the Securities Act in connection with the public
offering of such securities (for the Company’s own account or for the account of
stockholders of the Company other than the Holders) solely for cash (other than
a registration relating solely to the sale of securities to participants in a
Company stock plan, a registration relating solely to a Rule 145 transaction
under the Securities Act, or any registration on any form which does not include
(or incorporate) substantially the same information as would be required to be
included in a registration statement covering the sale of the Registrable
Securities), the Company shall, at such time, promptly give each Holder written
notice of such registration.  Upon the written request of each Holder given
within thirty (30) days after mailing of such notice by the Company in
accordance with Section 2.3, the Company shall, subject to the provisions of
Section 1.7 and Section 1.8, cause to be registered under the Securities Act all
of the Registrable Securities that each such Holder has requested to be
registered.  The Company shall have the right to terminate or withdraw any
registration initiated by it under this Section 1.3 prior to the effectiveness
of such registration if the Company has elected to abandon its proposal to
register its securities, whether or not any Holder has elected to include
securities in such registration without thereby incurring any liability to any
Holder.  The expenses of any such withdrawn registration shall be borne by the
Company in accordance with Section 1.8 hereof.

 

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1.4                               Obligations of the Company.  Whenever required
under this Article I to effect the registration of any Registrable Securities,
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
reasonable 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 ninety (90) days or such shorter period until the Registrable Securities
are sold; provided, however, that such 90-day period shall be extended for a
period of time equal to the period the Holder refrains from selling any
securities included in such registration at the request of an underwriter of
Common Stock (or other securities) of the Company. Notwithstanding the foregoing
or any other provision of this Agreement, such Holder or Holders understand that
there may be periods during which the Company may determine, in good faith, that
it is in the best interests of the Company and its security holders to defer
disclosure of material, non-public information that it has a bona-fide business
purpose for preserving as confidential until such information has reached a more
advanced stage and that during such periods the Company shall have the right to
suspend or delay sales of Registrable Securities and the effectiveness of any
registration statement covering Registrable Securities for an aggregate period
not to exceed 90 days in any twelve-month period.  Such Holder or Holders agree
that upon receipt of any notice from the Company of the development of any such
non-public information, such Holder or Holders will forthwith discontinue such
Holder’s or Holders’ disposition of Registrable Securities pursuant to the
registration statement relating to such Registrable Securities until such
Holder’s or Holders’ receipt of copies of an appropriately supplemented or
amended prospectus and, if so directed by the Company, such Holder or Holders
will use its commercially reasonable best efforts to deliver to the Company (at
the Company’s expense) all copies, other than permanent file copies then in such
Holder’s or Holders’ possession, of the prospectus relating to such Registrable
Securities current at the time of receipt of such notice.  In the event the
Company shall give any such notice, the applicable time period during which a
Registration Statement is to remain effective shall be extended by the number of
days during the period from and including the date of the giving of such notice
to and including the date when each seller of a Registrable Security covered by
such registration statement shall have received the copies of the appropriate
supplemented or amended prospectus.

 

(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 Registrable Securities covered by such registration statement and to use
its reasonable best efforts to keep it effective for up to ninety (90) days (or
such longer period as required pursuant to Section 1.4(a)).

 

(c)                                  Furnish to the Holders such numbers 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 Registrable
Securities owned by them.

 

(d)                                 Use its commercially reasonable efforts to
register and qualify the securities covered by such registration statement under
such other United States federal securities or state Blue Sky laws 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 jurisdiction
unless the Company is already subject to service in such jurisdiction and except
as may be required by the Act.

 

(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

 

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underwriter of such offering and, as applicable, use its reasonable best efforts
to cause any other parties thereto to enter into such agreement.  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 the light of the
circumstances then existing, such obligation to continue for up to ninety (90)
days from the effective date of such registration statement (or such longer
period as required pursuant to Section 1.4(a)).

 

(g)                                 Cause all such Registrable Securities
registered pursuant hereunder to be listed on each securities exchange or
nationally recognized quotation system on which similar securities issued by the
Company are then listed.

 

(h)                                 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.

 

(i)                                     Use it reasonable best efforts to cause
to be furnished, at the request of any Holder requesting registration of
Registrable Securities pursuant to this Article I, on the date that such
Registrable Securities are delivered to the underwriters for sale in connection
with a registration pursuant to this Article I, 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 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, addressed to the underwriters, if any, and to the Holders requesting
registration of Registrable Securities and (ii) a letter dated 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, addressed to the underwriters,
if any, and to the Holders requesting registration of Registrable Securities.

 

(j)                                     In the event that any contemplated
public offering is underwritten, use its commercially reasonable efforts to
obtain a “comfort” letter from the Company’s independent registered public
accountants in customary form and covering such matters of the type customarily
covered by “comfort” letters as the Holders of a majority (by number of shares)
of the Registrable Securities being registered thereunder reasonably request,
and provided that such request is reasonable in the underwriter’s point of view.

 

1.5                               Furnish Information.  It shall be a condition
precedent to the obligations of the Company to take any action pursuant to this
Article I with respect to the Registrable Securities of any selling Holder that
such Holder shall furnish to the Company, upon the Company’s written request,
such information regarding itself, the Registrable Securities held by it, and
the intended method of disposition of such securities as shall be required to
effect the registration of such Holder’s Registrable Securities.  The Company
shall have no obligation with respect to any registration requested pursuant to
Section 1.2 of this Agreement if, as a result of the application of the
preceding sentence, the number of shares or the anticipated aggregate offering
price of the Registrable Securities to be included in the registration does not
equal or exceed the number of shares or the anticipated aggregate offering price
required to originally trigger the Company’s obligation to initiate such
registration as specified in subsection 1.2(a).

 

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1.6                               Expenses of Registration.

 

(a)                                  Demand Registration.  All expenses other
than underwriting discounts and commissions incurred in connection with
registrations, filings or qualifications pursuant to Section 1.2, including
(without limitation) all federal and state and stock exchange or quotation
system registration, filing and qualification fees, printers’ and accounting
fees, fees and disbursements of counsel for the Company, and the reasonable and
documented fees and disbursements of one counsel for the selling Holders
selected by them, in an amount not to exceed $25,000 per registration, shall be
borne by the Company; provided, however, that the Company shall not be required
to pay for any expenses of any registration proceeding initiated pursuant to
Section 1.2 if the registration request is subsequently withdrawn at the request
of the Initiating Holders (in which case such Initiating Holders shall bear such
expenses); provided further, however, that if at the time of such withdrawal,
the Holders have learned of a material adverse change in the condition or
business of the Company from that known to the Holders at the time of their
request and have withdrawn the request with reasonable promptness following
disclosure by the Company of such material adverse change, then the Holders
shall not be required to pay any of such expenses and shall retain their rights.

 

(b)                                 Company Registration.  All expenses other
than underwriting discounts and commissions incurred in connection with
registrations, filings or qualifications of Registrable Securities pursuant to
Section 1.3 for each Holder, including (without limitation) all federal and
state and stock exchange or quotation system registration, filing, stock
exchange or quotation system, and qualification fees, printers’ and accounting
fees, fees and disbursements of counsel for the Company and the reasonable fees
and disbursements of one counsel for the selling Holder or Holders selected by
them, in an amount not to exceed $25,000 per registration, shall be borne by the
Company.

 

1.7                               Underwriting Requirements.  In connection with
any offering involving an underwriting of shares of the Company’s capital stock,
the Company shall not be required under Section 1.3 to include any of the
Holders’ securities in such underwriting unless they accept the terms of the
underwriting as agreed upon between the Company and the underwriters selected by
it, and then only in such quantity as the underwriters determine that, due to
marketing factors, will not jeopardize the success of the offering by the
Company or any holders of superior registration rights.  Each Holder proposing
to distribute its securities through such underwriting shall enter into an
underwriting agreement in customary form with the underwriter or underwriters
selected for the offering.  If the total amount of securities, including
Registrable Securities, requested by stockholders to be included in such
offering exceeds the amount of securities sold other than by the Company (and by
Institutional Investors having superior registration rights, if applicable) that
the underwriters determine that, due to marketing factors, is incompatible with
the success of the offering, then the Company shall be required to include in
the offering only that number of such securities, including Registrable
Securities, which the underwriters determine in their reasonable discretion will
not jeopardize the success of the offering but in no event shall (i) any
Registrable Securities be excluded from such offering unless all securities of
selling stockholders (other than holders of superior registration rights) other
than Holders of Registrable Securities shall have been excluded on a pro rata
basis according to the amount of securities requested by each such Holder to be
included in the offering or (ii) the amount of securities of the selling Holders
included in the offering be reduced below twenty-five percent (25%) of the total
amount of securities included in such offering.  If any Registrable Securities
are to be excluded from the offering, the amount to be excluded shall be
apportioned among the selling Holders pro rata according to the amount of
Registrable Securities requested by each such Holder to be included in the
offering.  For purposes of the preceding sentences concerning apportionment, for
any selling Holder of Registrable Securities or other holder of securities which
is a partnership or corporation, the partners, retired partners and stockholders
of such holders, or the estates and family members of any such partners and
retired partners and any trusts for the benefit of any of the foregoing Persons
shall each be deemed to be a single “selling Holder,” and any pro-rata reduction
with respect to such “selling

 

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Holder” shall be based upon the aggregate amount of shares carrying registration
rights owned by all entities and individuals included in such “selling Holder,”
as defined in this sentence.

 

1.8                               Delays and Withdrawals. 

 

(a)                                  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 Article I.

 

(b)                                 If, at any time after giving written notice
pursuant to Section 1.3 of its intention to register any equity securities and
prior to the effective date of the registration statement filed in connection
with such registration, the Company shall determine not to register or to delay
registration of such equity securities, the Company may, at its election, give
written notice of such determination to all Holders and, in the case of a
determination not to register, shall be relieved of its obligation to register
any Registrable Securities in connection with such abandoned registration,
without prejudice, however, to the rights of Holders under Sections 1.2 and 1.6.

 

(c)                                  If, at any time after having requested the
Company to file a registration statement pursuant to Section 1.2, an Initiating
Holder shall determine for any reason to withdraw such registration, such
Initiating Holder may, at its election, give notice of such determination to the
Company and any other Holders proposing to participate in the registration of
such determination.  On receipt of such notice the Company shall be relieved of
its obligation to effect such registration.  Subject to the second proviso of
Section 1.6(a), the expenses of such registration incurred by the Company shall
be borne by the Initiating Holders.  Any notice of withdrawal given by an
Initiating Holder pursuant to this Section 1.8(c) shall be irrevocable.

 

(d)                                 The Company may at any time within ten
(10) days of its receipt of a notice from an Initiating Holder requesting a
registration pursuant to Section 1.2 elect to convert the proposed demand
registration into a Company registration subject to Section 1.3 by notifying the
Initiating Holders in writing.  Upon making any such election, the Company shall
notify all Holders (including the Initiating Holders) of its intent to file a
registration statement in accordance with Section 1.3 and such Holders shall
have the right (subject to the provisions of this Article I) to include some or
all of their Registrable Securities in such registration.  Anything in this
Agreement to the contrary notwithstanding, the Company shall use its reasonable
best efforts to effect as soon as practicable, and in any event within ninety
(90) days after making such election, such registration.

 

(e)                                  Any Holder (other than an Initiating
Holder) shall have the right to withdraw its request for inclusion of its
Registrable Securities in any registration statement filed pursuant to this
Article I by giving written notice to the Company of its request to withdraw;
provided, that (i) such request must be made in writing prior to the earlier of
the execution of the underwriting agreement or the execution of the custody
agreement with respect to such registration and (ii) such withdrawal shall be
irrevocable and, after making such withdrawal, a Holder shall no longer have any
right to include Registrable Securities in the registration as to which such
withdrawal was made.

 

1.9                               Indemnification.  In the event any Registrable
Securities are included in a registration statement under this Article I:

 

(a)                                  The Company will indemnify and hold
harmless each Holder, any underwriter (as defined in the Securities Act) for
such Holder and each of its officers, directors, and partners, and each person,
if any, who controls such Holder or underwriter within the meaning of the
Securities Act or the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), against any losses, claims, damages,

 

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or liabilities (joint or several) to which they may become subject under the
Securities Act, the Exchange Act or other United States 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 (collectively, 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 supplements thereto or (ii) 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; and the Company will
pay to each such Holder, and each of its officers, directors, and partners,
underwriter or controlling person, as incurred, 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
indemnity agreement contained in this subsection 1.9(a) shall not apply to
amounts paid in settlement of any such loss, claim, damage, liability, or action
if such settlement is effected without the consent of the Company (which consent
shall not be unreasonably withheld or delayed), nor shall the Company be liable
to any Holder, underwriter or controlling person for any such loss, claim,
damage, liability, or action to the extent that it arises out of or is based
upon a Violation which occurs (I) in reliance upon and in conformity with
written information furnished expressly for use in connection with such
registration by any such Holder, underwriter or controlling person or (II) as
the result of the failure of any Holder to deliver a prospectus or a prospectus
or prospectus supplement containing corrected or supplemented information.

 

(b)                                 Each selling Holder will indemnify and hold
harmless the Company, each of its directors, each of its officers who has signed
the registration statement, each person, if any, who controls the Company within
the meaning of the Securities Act, any underwriter, any other Holder selling
securities in such registration statement and any controlling person of any such
underwriter or other Holder, against any losses, claims, damages, or liabilities
(joint or several) to which any of the foregoing persons may become subject,
under the Securities Act, the Exchange Act or other United States 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 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 by such Holder; and
each such Holder will pay, as incurred, any legal or other expenses reasonably
incurred by any person intended to be indemnified pursuant to this
subsection 1.9(b), in connection with investigating or defending any such loss,
claim, damage, liability, or action; provided, however, that the indemnity
agreement contained in this subsection 1.9(b) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Holder (which consent shall
not be unreasonably withheld or delayed); provided, that in no event shall any
indemnity under this subsection 1.9(b) exceed the net proceeds from the offering
received by such Holder.

 

(c)                                  Promptly after receipt by an indemnified
party under this Section 1.9 of notice of the commencement of any action
(including any governmental action), such indemnified party will, if a claim in
respect thereof is to be made against any indemnifying party under this
Section 1.9, 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 the defense
thereof with counsel mutually satisfactory to the parties; provided, however,
that an indemnified party (together with all other indemnified parties which may
be represented without conflict by one counsel) shall have the right to retain
one separate counsel, with the reasonable fees and expenses to be paid by the
indemnifying party, if representation of such indemnified party by the counsel
retained by the indemnifying party would be inappropriate due to actual or
potential differing interests between such indemnified party and any other party
represented by such counsel in such proceeding.  The failure to deliver written
notice to the indemnifying party within a reasonable time of the commencement of
any such action, if prejudicial to its ability to defend such action, shall
relieve such indemnifying party of any liability to the indemnified party under
this

 

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Section 1.9, but the omission so to deliver written notice to the indemnifying
party will not relieve it of any liability that it may have to any indemnified
party otherwise than under this Section 1.9.

 

(d)                                 If the indemnification provided for in this
Section 1.9 is held by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, liability, claim, damage or expense
referred to therein, 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 that resulted in such loss,
liability, claim, damage or expense as well as any other relevant equitable
considerations; provided, that in no event shall any contribution by a Holder
under this subsection 1.9(d) exceed the net proceeds from the offering received
by such Holder.  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 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.

 

(e)                                  Notwithstanding the foregoing, to the
extent that the provisions on indemnification and contribution contained in the
underwriting agreement entered into in connection with the underwritten public
offering are in conflict with the foregoing provisions, the provisions in the
underwriting agreement shall control.

 

(f)                                    The obligations of the Company and
Holders under this Section 1.9 shall survive the completion of any offering of
Registrable Securities in a registration statement under this Article I.

 

1.10                        Reports Under the Exchange Act.  With a view to
making available to the Holders the benefits of Rule 144 promulgated under the
Securities Act and any other rule or regulation of the SEC that may at any time
permit a Holder to sell securities of the Company to the public without
registration or pursuant to a registration on Form S-3, the Company agrees to:

 

(a)                                  make and keep public information available,
as those terms are understood and defined in SEC Rule 144, at all times after
ninety (90) days after the effective date of the first registration statement
filed by the Company for a public offering;

 

(b)                                 file with the SEC in a timely manner all
reports and other documents required of the Company under the Securities Act and
the Exchange Act; and

 

(c)                                  furnish to any Holder, so long as the
Holder owns any Registrable Securities, forthwith upon request (i) a written
statement by the Company that it has complied with the reporting requirements of
SEC Rule 144, the Securities Act and the Exchange Act (at any time after it has
become subject to such reporting requirements), or that it qualifies as a
registrant whose securities may be resold pursuant to Form S-3 (at any time
after it so qualifies), (ii) a copy of the most recent annual or quarterly
report of the Company and such other reports and documents so filed by the
Company, and (iii) such other information as may be reasonably requested in
availing any Holder of any rule or regulation of the SEC which permits the
selling of any such securities without registration or pursuant to such form.

 

1.11                        Assignment of Registration Rights.  The rights to
cause the Company to register Registrable Securities pursuant to this Article I
may be assigned (but only with all related obligations) by a Holder to a
transferee or assignee of at least 250,000 shares of Registrable Securities;
provided that the Company is, within a reasonable time after such transfer,
furnished with written notice of the name and

 

9

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address of such transferee or assignee and the securities with respect to which
such registration rights are being assigned; and provided further, that such
assignment shall be effective only if immediately following such transfer the
further disposition of such securities by the transferee or assignee is
restricted under the Securities Act; and provided further, still, that the right
to demand a registration pursuant to Section 1.2 may only be assigned to a
transferee or assignee acquiring all shares of Registrable Securities then held
by a Holder entitled to exercise rights under Section 1.2.  For the purposes of
determining the number of shares of Registrable Securities held by a transferee
or assignee, the holdings of transferees and assignees of a partnership who are
partners or retired partners of such partnership (including spouses and
ancestors, lineal descendants and siblings of such partners or spouses who
acquire Registrable Securities by gift, will or intestate succession) shall be
aggregated together and with the partnership; provided that all assignees and
transferees who would not qualify individually for assignment of registration
rights shall have a single attorney-in-fact for the purpose of exercising any
rights, receiving notices or taking any action under Article I.

 

1.12                        Limitations on Subsequent Registration Rights.  As
of September 6, 2005, the Company has not granted, and there are no holders or
prospective holders of, any registration (or similar) rights equal to or more
favorable than those granted to the Holders pursuant to this Agreement.  From
and after the date of this Agreement, the Company shall not, without the prior
written consent of the Holders of a majority of the then outstanding Registrable
Securities, enter into any agreement with any holder or prospective holder of
any securities of the Company which would allow such holder or prospective
holder (a) to include such securities in any registration filed under
Section 1.2 hereof, unless under the terms of such agreement, such holder or
prospective holder may include such securities in any such registration only to
the extent that the inclusion of his Securities will not reduce the amount of
the Registrable Securities of the Holders which is included, (b) to make a
demand registration which could result in such registration statement being
declared effective prior to the earlier of either of the dates set forth in
subsection 1.2(a) or within ninety (90) days of the effective date of any
registration effected pursuant to Section 1.2 or (c) to exercise any rights more
favorable than those granted to the Holders pursuant to this Agreement.  The
terms of this Section 1.12 shall not apply to Institutional Investors to the
extent provided in any agreement with such Institutional Investors.

 

1.13                        “Market Stand-Off” Agreement.  Each Holder hereby
agrees that, for a period of ninety (90) days (or such shorter period as may be
specified in writing by the Company and an underwriter of Common Stock or other
securities of the Company), following the date of the final prospectus
distributed in connection with a public offering, it shall not, directly or
indirectly sell, offer to sell, contract to sell (including, without limitation,
any short sale or hedging arrangement), grant any option to purchase or
otherwise transfer or dispose of (other than to donees who agree to be similarly
bound) any Registrable Securities held by it at any time during such period
(other than in connection with the respective Put and Call Option Agreement
dated as of the date hereof between the Company and each of Gordon Evans, Nancy
Evans, John Alsop and Joseph Gallagher) except Registrable Securities included
in such registration; provided, however, that:

 

(a)                                  all executive officers and directors of the
Company, all five-percent securityholders, and all other Persons with
registration rights (whether or not pursuant to this Agreement) shall be
similarly bound; and

 

(b)                                 any waiver or termination of the prohibition
set forth in this Section 1.13 by the Company or any underwriter shall apply to
all Persons who are subject hereto or any similar such obligation on a pro rata
basis.

 

In order to enforce the foregoing covenant, the Company may impose stop transfer
instructions with respect to the Registrable Securities of each Holder (and the
shares or securities of every

 

10

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other Person subject to the foregoing restriction) until the end of such period,
and each Holder agrees that, if so requested, such Holder will execute an
agreement in the form provided by the underwriter containing terms which are
consistent with the provisions of this Section 1.13.

 

Notwithstanding the foregoing, the obligations described in this Section 1.13
shall not apply to a registration relating solely to employee benefit plans on
Form S-1 or Form S-8 or similar forms which may be promulgated in the future, or
a registration relating solely to an SEC Rule 145 transaction on Form S-4 or
similar forms which may be promulgated in the future.  The terms of this
Section 1.13 shall not apply to Institutional Investors to the extent provided
in any agreement with such Institutional Investors.

 

1.14                        Termination of Registration Rights.  No Holder shall
be entitled to exercise any right provided for in this Article I after the
earlier of (i) five (5) years from the date hereof, or (ii) such time as
Rule 144 or another similar exemption under the Securities Act is available for
the sale of all of such Holder’s shares during a three (3)-month period without
registration.

 

ARTICLE II

 

MISCELLANEOUS

 

2.1                               Successors and Assigns.  Except as otherwise
provided in this Agreement, the terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective permitted successors
and assigns of the parties (including transferees of any Registrable
Securities).  Nothing in this Agreement, express or implied, is intended to
confer upon any party other than the parties hereto or their respective
successors and assigns any rights, remedies, obligations, or liabilities under
or by reason of this Agreement, except as expressly provided in this Agreement.

 

2.2                               Amendments and Waivers.  Any term of this
Agreement may be amended or waived in writing and only with the written consent
of the Company and the holders of a majority of the Registrable Securities then
outstanding, except that Sections 1.2 and 1.12 may only be amended or waived
with the consent of the holders of a majority of the then outstanding
Registrable Securities in addition to the consent of the Company and the holders
of a majority of the Registrable Securities then outstanding.  Any amendment or
waiver effected in accordance with this Section 2.2 shall be binding upon each
Holder of any Registrable Securities then outstanding, each future Holder of all
such Registrable Securities, and the Company.

 

2.3                               Notices.  Unless otherwise provided, any
notice required or permitted by this Agreement shall be in writing and shall be
deemed effective either (i) upon delivery, when delivered personally or by
overnight courier or sent by fax, or (ii) four (4) Business Days after being
deposited in the U.S. mail as certified or registered mail with postage prepaid,
and addressed to the party to be notified at such party’s address or fax number
as set forth below or on Exhibit A hereto or as subsequently modified by written
notice.  A copy of such notice shall also be delivered via electronic mail For
purposes of this Agreement, the term “Business Day” shall mean any day other
than (i) a Saturday or Sunday, or (ii) any day on which banking institutions
located in New York, New York are authorized or obligated to close.

 

2.4                               Severability.  If one or more provisions of
this Agreement are held to be unenforceable under applicable law, such provision
shall be automatically reformed so as to be enforceable while as nearly as
possible preserving the original intent of the parties.

 

2.5                               Governing Law.  This Agreement and all acts
and transactions pursuant hereto shall be governed, construed and interpreted in
accordance with the laws of the State of New York.

 

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2.6                               Counterparts.  This Agreement may be executed
in two or more counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.

 

2.7                               Titles and Subtitles.  The titles and
subtitles used in this Agreement are used for convenience only and are not to be
considered in construing or interpreting this Agreement.

 

2.8                               Aggregation of Stock.  All Registrable
Securities held or acquired by Affiliated Entities or Persons shall be
aggregated together for the purpose of determining the availability of any
rights under this Agreement.  For purposes of this Agreement, “Affiliated Entity
or Person” means, with respect to any Person, any other Person that, directly or
indirectly Controls, or is Controlled by, or is under common Control with such
specified Person, and (i) with respect to any Person that is an individual, his
or her Immediate Family Members, or any trust (including a charitable remainder
trust) limited partnership or limited liability companies Controlled by or for
the benefit of the Immediate Family Member of such individual, and (ii) with
respect to any partnership, the general or limited partners thereof and the
record owners of equity securities of such general or limited partners. 
Notwithstanding the foregoing, neither the Company nor any Person Controlled by
the Company shall be deemed to be an Affiliate of any Holder for purposes of
this Agreement.  For purposes of this Agreement, “Control” (including the terms
“Controlling,” “Controlled by” and “under common Control with” as used with
respect to any Person, means the power to direct the management and policies of
such Person, whether through the ownership of voting securities, by contract or
otherwise.  For purposes of this Agreement, the term “Immediate Family Member”
means, with respect to any individual, the spouse, parents, parents-in-law,
siblings, siblings-in-law, children and grandchildren of such individual, and
includes step and adoptive relationships.  For purposes of this Agreement, the
term “Person” means any individual, company, limited liability company, limited
or general partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.

 

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EXHIBIT A

 

Holders:

 

John Gordon Evans of 1, Sea Cliff Road, Onchan, Isle of Man, IM3 2JE

 

Jessie Anne Evans (known as Nancy Evans) of 1, Sea Cliff Road, Onchan, Isle of
Man, IM3 2JE

 

John A. Alsop of The Old Stables, Harbour Road, Onchan, Isle of Man IM3 IBG

 

Joseph S.Gallagher, of 44 Glendockart Drive, Craigmarloch, Cumbernauld, G68 0FG

 

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The parties have executed this Registration Right Agreement as of the date first
above written.

 

 

Company:

 

 

 

 

 

MEDICOR LTD.

 

 

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

Address:

4560 South Decatur Boulevard

 

 

Suite 300

 

 

Las Vegas, Nevada 89103

 

 

 

 

 

 

 

Attn: Theodore Maloney

 

 

Tel:  +1 (702) 932-4564

 

 

Fax: +1 (702) 932-4561

 

 

E-mail:  tmaloney@medicorltd.com

 

 

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Holders:

 

 

 

 

 

Signed by:

 

 

 

 

 

 

 

 

Mr John Gordon Evans

 

 

 

 

 

Date:

 

 

 

 

 

 

 

 

 

 

 

Mr Jessie Anne Evans

 

 

 

 

 

Date:

 

 

 

 

 

 

 

 

 

 

 

Mr John A. Alsop

 

 

 

 

 

Date:

 

 

 

 

 

 

 

 

 

 

 

Mr Joseph S. Gallagher

 

 

 

 

 

Date:

 

 

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