EXHIBIT 10.5


CHARYS HOLDING COMPANY, INC.


REGISTRATION RIGHTS AGREEMENT


February 16, 2007


MCMAHAN
SECURITIES CO. L.P.


500
West Putnam Avenue


Greenwich, CT 06830


 


Charys Holding
Company, Inc., a Delaware corporation (the “Company”),
proposes to issue and sell to the initial purchaser (the “Initial
Purchaser”) named in the purchase agreement, dated February 14,
2007  (the “Purchase
Agreement”), by and among the Initial Purchaser, the Company and
certain of the Company’s subsidiaries from time to time serving as guarantors
under the Indenture (as defined below) (the “Guarantors”),
up to 201,250 units (“Units”) of the
Company’s securities, each Unit consisting of $1,000 principal amount of its
8.75% Senior Convertible Notes due 2012 (the “Notes”)
and warrants to purchase shares of the Common Stock (as defined below) (the “Warrants” and, collectively with the Notes and the
Guarantees (as defined below), the “Securities”),
upon the terms and subject to the conditions set forth in such Purchase
Agreement.  As an inducement to the
Initial Purchaser to enter into the Purchase Agreement and in satisfaction of a
condition to the obligations of the Initial Purchaser thereunder, the Company
agrees (on behalf of itself and the Guarantors) with the Initial Purchaser for
the benefit of Holders (as defined below) as follows:


1.             Definitions.


Capitalized terms used
herein without definition shall have the meanings ascribed to them in the
Purchase Agreement.  As used in this
Registration Rights Agreement (this “Agreement”),
the following defined terms shall have the following meanings:


“415 Reduction”
has the meaning set forth in Section 2(c) hereof.


“Additional Interest”
has the meaning set forth in Section 7 hereof.


“Additional Shares”
has the meaning ascribed thereto in Section 3.8 of the Indenture.


“Affiliate” of
any specified person means any other person which, directly or indirectly, is
in control of, is controlled by, or is under common control with such specified
person.  For purposes of this definition,
control of a person means the power, direct or indirect, to direct or cause the
direction of the management and policies of such person whether by contract or
otherwise; and the terms “controlling” and “controlled” have meanings
correlative to the foregoing.


“Applicable Amount”
has the meaning set forth in Section 7 hereof.













“Business Day” means
each Monday, Tuesday, Wednesday, Thursday and Friday that is not a day on which
banking institutions in the City of New York, State of New York are authorized
or obligated by law or executive order to close.


“Comfort Letter” has
the meaning set forth in Section 5(u) hereof.


“Commission” means
the United States Securities and Exchange Commission, or any other federal
agency at the time administering the Exchange Act or the Securities Act,
whichever is the relevant statute for the particular purpose.


“Common Stock” means
the Company’s common stock, par value $0.001 per share.


“Effective” shall
mean, with respect to any Registration Statement, that (a) such Registration
Statement is declared effective by the Commission, and (b) the Registrable
Securities covered by such Registration Statement are listed for trading or
quoted by the Company’s then principal Trading Market, and the term “Effectiveness” shall have the correlative meaning.


“Effectiveness Period” has
the meaning set forth in Section 3(a)(i) hereof.


“Effective Date” means,
with respect to a particular Registration Statement, the date as of which such
Registration Statement becomes Effective.


“Exchange Act” means
the United States Securities Exchange Act of 1934, as amended.


“Guarantees”
means the full and unconditional guarantees by the Guarantors of the Company’s
obligations under the Notes as set forth in the Indenture.


“Holder” means,
as of the time of determination, any person holding Registrable Securities.


“Indenture”
means the Indenture, dated as of February 16, 2007, by and among the Company,
the Guarantors and the Trustee, pursuant to which the Securities are to be
issued, and as amended and supplemented from time to time in accordance with
its terms.


“Initial Purchaser’s Warrants”
means the warrants to purchase shares of Common Stock issued or issuable to the
Initial Purchaser and/or one or more of its Affiliates in connection with the
purchase and sale of Securities pursuant to the Purchase Agreement.


“Issue Date”
means the first date of original issuance of the Securities.


“Loss” has the
meaning set forth in Section 8(a) hereof.


“Notice and Questionnaire” means
a Notice of Registration Statement and Selling Securityholder Election and
Questionnaire substantially in the form of Appendix A
hereto.



 2
 









The term “person” means an individual, partnership, limited liability
company, corporation, trust or unincorporated organization, or a government or
agency or political subdivision thereof.


“Prospectus” means
the prospectus included in any Registration Statement, 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 any
Registration Statement, including all material incorporated by reference in
such prospectus and all documents filed after the date of such prospectus by
the Company under the Securities Act or the Exchange Act and incorporated by
reference therein.


“Registrable Securities” means
all or any portion of the Securities issued from time to time under the
Indenture and the Warrant Agent Agreement and the shares of Common Stock issued
or issuable upon exercise or conversion of such Securities (including, without
limitation, Additional Shares, if any); provided, that, “Registrable Securities”
shall not include (a) Securities which are no longer outstanding, or (b) shares
of Common Stock which have been (i) sold to or through a broker or dealer or
underwriter in a public distribution, or (ii) sold in a transaction exempt from
the registration and Prospectus delivery requirements of the Securities Act
under Section 4(1) thereof, in either case (i) or (ii), in such a manner
that, upon the consummation of such sale, all transfer restrictions and
restrictive legends with respect to such shares are removed upon the
consummation of such sale


“Registration” means
a registration effected pursuant to Section 2 hereof.


“Registration Statement” means
a “shelf” registration statement filed under the Securities Act providing for
the registration of, and the sale on a continuous or delayed basis by the
Holders of, all of the Registrable Securities pursuant to Rule 415, filed by
the Company and the Guarantors pursuant to the provisions of Section 2 or
Section 5(a) of this Agreement, including the Prospectus contained therein, any
amendments and supplements to such registration statement and Prospectus,
including post-effective amendments, and all exhibits and all material
incorporated by reference in such registration statement and Prospectus.


“Requisite Holders”
shall mean, as of the date of determination, one or more Holders who in the
aggregate hold not less than a majority of the shares of Common Stock included
in the then outstanding Registrable Securities (including shares of Common
Stock issuable upon conversion of the Notes and exercise of the Warrants
included in the then outstanding Registrable Securities); provided, that, if
the matter in question relates to a particular Registration, then the term “Requisite
Holders” shall mean one or more Selling Securityholders who in the aggregate
hold not less than a majority of the shares of Common Stock included in the
then outstanding Registrable Securities held by all Selling Securityholders
(including shares of Common Stock issuable upon conversion of the Notes and
exercise of the Warrants included in the then outstanding Registrable
Securities).


“Rule 415”
shall mean Rule 415 promulgated by the Commission pursuant to the Securities
Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the Commission having substantially the same
effect as such Rule.



 3
 









“Securities Act” means
the United States Securities Act of 1933, as amended.


“Selling Securityholder” has
the meaning set forth in Section 2(a) hereof.


“Suspension Period”
has the meaning set forth in Section 3(b) hereof.


“Trading Market” shall
mean whichever of the New York Stock Exchange, the American Stock Exchange, the
Nasdaq Global Select Market, the Nasdaq Global Market, the Nasdaq Capital
Market or the Over-the-Counter Bulletin Board upon which the Common Stock is
listed or quoted on for trading on the date in question.


“Transfer Opinion”
has the meaning set forth in Section 5(t) hereof.


“Trustee” means
Bank of New York Corporate Trust Company, N.A.


“Trust Indenture Act” means
the Trust Indenture Act of 1939, or any successor thereto, and the rules,
regulations and forms promulgated thereunder, as the same shall be amended from
time to time.


The term “underwriter” means any underwriter, or any person deemed to
be an underwriter pursuant to the Securities Act and Exchange Act and the
respective rules and regulations thereunder, as in effect at any relevant time,
of Registrable Securities in connection with an offering thereof under a
Registration Statement.


“Warrant Agent”
means Bank of New York Corporate Trust Company, N.A..


“Warrant Agent Agreement”
means the Warrant Agent Agreement, dated as of February 16, 2007, between the
Company and the Warrant Agent, relating to the Warrants, and as amended and
supplemented from time to time in accordance with its terms.


2.             Mandatory
Registration.


(a)           Subject to Sections
2(b) below, the Company shall (and shall cause the Guarantors to), as soon as
practicable, but no later than the 60th calendar day following the Issue Date, file
with the Commission a Registration Statement relating to the offer and sale of
the Registrable Securities by the Holders in accordance with the methods of
distribution elected by the Requisite Holders; and, thereafter, shall use its
best efforts (and shall cause each Guarantor to use its best efforts) to cause
such initial Registration Statement to be declared Effective under the
Securities Act no later than the 150th calendar day following the Issue Date.  Further, if, at any time during the
Effectiveness Period and in any event upon the later of (i) 180 days following
the date as of which the then most recent registration statement registering the
issuance and/or sale of the Company’s securities has been declared effective by
the Commission, and (ii) 60 days after the date as of which substantially all
of the Registration Securities included in any prior Registration Statement
have been sold, less than 100% of the Registrable Securities are included in an
Effective Registration Statement, then subject to the following provisions of
this Section 2, the Company shall (and shall cause each of the Guarantors to),
as expeditiously as possible, in consultation with the Requisite Holders and their
counsel, prepare and file with the Commission (i) such pre- or post-effective
amendments to any existing Registration Statement as shall be 



 4
 









necessary to Register the offer and sale of previously
excluded Registrable Securities, or (ii) one or more separate Registration
Statements with respect to previously excluded Registrable Securities, and use
its commercially reasonable best efforts to cause such existing Registration
Statement, as so amended, or such separate Registration Statement(s), as applicable,
to be declared Effective as soon as possible. 
Notwithstanding the foregoing, only Holders who have timely delivered to
the Company their signed and completed Notice and Questionnaire shall be
entitled to be named as a selling securityholder in any Registration Statement
or to use the Prospectus forming a part thereof for offers and resales of
Registrable Securities.  With respect to
any particular Registration Statement, a Holder of Registrable Securities covered
thereby is sometimes referred to as a “Selling Securityholder.”


(b)           If, by reason of a
415 Reduction, the total number of Registrable Securities exceeds the maximum
amount of securities that may be included in any Registration Statement, then
the Company shall (and shall cause the Guarantors to) include in such
Registration (i) first, the Notes, the related
Guarantees and the shares of Common Stock issued or issuable upon conversion
thereof, up to the maximum amount of securities that may be included in such
Registration, and (ii) second, the balance
of the Registrable Securities, in each case, pro rata,
among the Selling Securityholders in proportion, as nearly as practicable, to
their respective number of shares of Common Stock included among their
Registrable Securities; and


(c)           In the event that
the Commission (i) determines that a Registration Statement  (A) constitutes a primary offering of
securities of the Company, or (B) requires any Holder to be named as an
underwriter and such Holder does not consent to being named as an underwriter in
such Registration Statement, or (ii) promulgates any rule or issues any
bulletin, no action letter, telephone interpretation or other guidance which
establishes, changes or clarifies the criteria or standards for a registration
and sale of securities on a continuous or delayed basis pursuant to Rule 415 so
as to (x) limit the number of Registrable Securities that may be included in a
Registration Statement, or (y) delay the filing or Effectiveness of any
Registration Statement by reason of a previously filed registration statement
registering the Company’s securities, then the Company may (and may permit the
Guarantors to) reduce the number of Registrable Securities to be included in
such Registration (a “415 Reduction”)
in the manner set forth in Section 2(b) above.


(d)           Unless otherwise
agreed to in writing by the Requisite Holders, no Registration Statement shall
include, by amendment or otherwise, securities other than Registrable
Securities.


3.             Effectiveness Period;
Suspension Period.


(a)           Subject to Section 3(b)
below, the Company shall use its best efforts (and shall cause each Guarantor
to use its best efforts) to keep any Registration Statement continuously
Effective, supplemented and amended as required by the provisions of
Section 5(k) hereof, in order to permit the Prospectus forming a part
thereof to be usable by Selling Securityholders until the earlier of (A) two
years from the last date of original issuance of any Securities, and (B) the
date as of which all Registrable Securities registered under the Registration
Statements have been sold “Effectiveness Period”).  The
Company and each Guarantor shall be deemed not to have used its best efforts to
keep a Registration Statement 



 5
 









Effective with respect to a period of time if the
Company or any Guarantor voluntarily takes any action that results in Selling
Securityholders not being able to offer and sell Registrable Securities under
such Registration Statement during such period, unless such action is (1)
required by applicable law and the Company thereafter promptly complies with
the requirements of Section 5(k) hereof, or (2) permitted pursuant to
Section 3(b) below.


(b)           The Company may
suspend the use of any Prospectus for a period not to exceed 20 consecutive
days or an aggregate of 60 calendar days in any 12-month calendar period (each
such period, a “Suspension Period”), with the
first day of any Suspension Period being at least 10 Business Days after the
end of any prior Suspension Period, if:


(i)            an event has
occurred and is continuing as a result of which the Registration Statement
would, in the Company’s reasonable judgment, contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading;


(ii)           the Company
determines in good faith that the disclosure of such event at such time would
have a material adverse effect on the Company and its subsidiaries (including,
without limitation, the Guarantors) taken as a whole; and


(iii)         the Company sends written
notice of such suspension to the affected Selling Securityholders.


4.             Underwritten
Offerings.  In the
event that a Registration is an underwritten offering, then each Selling
Securityholder shall, unless otherwise agreed by the Company and the Requisite
Holders, offer and sell such Registrable Securities using the same underwriter
or underwriters.  Notwithstanding the
foregoing, only Requisite Holders may elect to involve an underwriter in the
offering and in such event shall select the underwriter or underwriters to
manage the offering (which underwriter or underwriters shall be reasonably
acceptable to the Company).  In all
underwritten offerings of Registrable Securities, the Company shall (and shall
cause each Guarantor to) enter into an underwriting agreement with all of the
Selling Securityholders and the managing underwriter or underwriters. Such
underwriting agreement shall be in customary form containing conventional
representations, warranties, allocation of expenses, and customary closing conditions,
including, but not limited to, opinions of counsel and accountants’ cold
comfort letters, provided, however, that no such Selling Securityholder shall
be required to make any representations or warranties or agreements other than
representations, warranties and agreements regarding the valid existence of
such Selling Securityholder, his, her or its title to Registrable Securities
and the truth and accuracy of any information provided in writing by such
Selling Securityholder for inclusion in the Registration Statement; and
provided, further, that such Selling Securityholders may require that any or
all representations, warranties, conditions precedent and other agreements by
the Company and/or any Guarantor for the benefit of the underwriter shall also
be for the benefit of such Selling Securityholders.


5.             Registration
Procedures.  In
connection with the Registration Statements, the following provisions shall
apply:



 6















(a)           Notice and Questionnaire.  The Company shall distribute the
Notice and Questionnaire (i) to all of the Holders not less than 45 calendar
days prior to the time the Company (or any Guarantor) in good faith intends to
have any Registration Statement declared Effective, and (ii) to any particular
Holder promptly following request therefor. The Company shall (and shall cause
each Guarantor to) name as a “selling securityholder” in the initial
Registration Statement and any subsequent Registration Statement each Holder
that completes, executes and delivers a Notice and Questionnaire to the Company
within a reasonable time prior to the date as of which any such Registration
Statement is declared Effective (it being understood that delivery of a
completed and signed Notice and Questionnaire at least two Business Days prior
to the Effective Date shall be considered reasonable prior time) so that the
Holder delivering such Notice and Questionnaire is named as a selling
securityholder in such Registration Statement and is permitted to deliver the
Prospectus to purchasers of such Holder’s Registrable Securities in accordance
with applicable law.  Thereafter, if the
Company shall receive a completed and signed Notice and Questionnaire from any
Holder who is not already named as a selling securityholder in the initial
Registration Statement or any subsequent Registration Statement, the Company
shall (and shall cause each Guarantor to), as soon as reasonably practicable,
prepare and file with the Commission (A) a supplement to the Prospectus or, if
required by applicable law, a post-effective amendment to such Registration
Statement, and any other document required by applicable law, so that the
Holder delivering such Notice and Questionnaire is named as a selling securityholder
in such Registration Statement and is permitted to deliver the Prospectus to
purchasers of such Holder’s Registrable Securities in accordance with
applicable law, and (B) use its commercially reasonable best efforts to cause
any post-effective amendment or such additional Registration Statement to
become Effective under the Securities Act as promptly as is practicable.    Except as provided by the
foregoing, neither the Company nor any Guarantor shall be required to take any
action to name any Holder as a selling securityholder in any Registration
Statement or to enable any Holder to use the Prospectus forming a part thereof
for resales of Registrable Securities unless such Holder has returned a
completed and signed Notice and Questionnaire to the Company.


(b)           Opportunity
to Review.  Within a
reasonable period of time (and in any event at least five Business Days) prior
to filing, the Company shall furnish to each Selling Securityholder for his,
her or its review and comment and the comment of such Selling Securityholder’s
legal counsel, a draft of each Registration Statement (and each pre- or
post-effective amendment or supplement thereto other than supplements solely
for the purpose of including one or more additional Selling Securityholders)
and the Company will use its best efforts to incorporate any comments as such
Selling Securityholders and their respective counsel may reasonably propose.


(c)           Commission
Comments and Acceleration. 
Subject to Section 3(b), the Company shall (and shall cause each Guarantor
to) respond to each item of correspondence from the Commission or the staff of
the Commission relating to each Registration Statement as promptly as
practicable.  If, to the actual knowledge
of a senior officer of the Company or any Guarantor or to the knowledge of the
Company’s or any Guarantor’s outside counsel, the Commission and the staff of
the Commission have no comments (or no further comments) concerning a
Registration Statement, subject to Section 3(b), the Company shall (and shall
cause each Guarantor to) as soon as practicable thereafter, but in any case
within five Business Days



 7
 









thereafter,
request acceleration of Effectiveness of the Registration Statement from the
Commission.


(d)           Amendments
and Supplements.  The
Company shall (and shall cause each Guarantor to) promptly take such action as
may be necessary so that (i) each Registration Statement and any amendment or
supplement thereto and the Prospectus forming a part thereof and any amendment
or supplement thereto (and each report or other document incorporated therein
by reference in each case) complies in all material respects with the
Securities Act and the Exchange Act and the respective rules and regulations
thereunder, as in effect at any relevant time, (ii) each Registration Statement
and any amendment or supplement thereto does not, when it becomes Effective,
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, and
(iii) each Prospectus forming a part of any Registration Statement, and any
amendment or supplement to such Prospectus, in the form delivered to purchasers
of the Registrable Securities during the Effectiveness Period, does not include
an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.


(e)           Advice
and Information.  The
Company shall promptly advise each Selling Securityholder, and shall confirm
such advice in writing if so requested by any such Selling Securityholder:


(i)            when
any Registration Statement has been filed with the Commission and when any Registration
Statement has become Effective, in each case making a public announcement
thereof by publishing the information on the Company’s website or through such
other broad, public medium as the Company may reasonably and in good faith see
fit;


(ii)           when
any supplement to a Prospectus, a Registration Statement or post-effective
amendment to a Registration has been filed with the Commission and, with
respect to a Registration Statement or any post-effective amendment, when the
same has been made Effective;


(iii)         of
any request by the Commission for amendments or supplements to any Registration
Statement or the Prospectus included therein or for additional information;


(iv)          of
the issuance by the Commission of any stop order suspending the Effectiveness
of any Registration Statement or the initiation of any proceedings for such
purpose;


(v)            of
the receipt by the Company or any Guarantor of any notification with respect to
the suspension of the qualification of the securities included in any
Registration Statement for sale in any jurisdiction or the initiation of any
proceeding for such purpose; and


(vi)          of
the happening of any event or the existence of any state of facts that requires
the making of any changes in any Registration Statement or the Prospectus included
therein so that, as of such date, such Registration Statement and Prospectus do
not contain an



 8
 









untrue statement
of a material fact and do not omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading (which advice shall be
accompanied by an instruction to such Selling Securityholders to suspend the
use of the Prospectus until the requisite changes have been made, and shall
specify the nature of the event giving rise to such suspension).


(f)            No
Stop Orders. The Company shall use its best efforts (and
shall cause each Guarantor to use its best efforts) to prevent the issuance,
and if issued to obtain the withdrawal at the earliest possible time, of any
order suspending the Effectiveness of any Registration Statement.


(g)           Copies
of Registration Statements, Etc.  The
Company shall furnish to any Selling Securityholder and its legal counsel,
promptly after the same is prepared and filed with the Commission and without
charge, at least one copy of the Registration Statement and any amendment
thereto, and such number of copies of each Prospectus and all amendments and
supplements thereto, and such other documents as such Selling Securityholder
may reasonably request in order to facilitate the disposition of such Selling
Securityholder’s Registrable Securities.


(h)           Use
of Prospectus.  The
Company, on its behalf and on the behalf of each Guarantor, consents (except
during a Suspension Period or during the continuance of any event described in
Section 5(e)(iii)-(vi) above) to the use of the Prospectus and any
amendment or supplement thereto by each of the Selling Securityholders in
connection with the offering and sale of the Registrable Securities covered by
the Prospectus and any amendment or supplement thereto during the Effectiveness
Period.


(i)            Blue
Sky.  Prior to any
offering of Registrable Securities pursuant to a Registration Statement, the
Company shall (and shall cause each Guarantor to) (i) register or qualify or
cooperate with the Selling Securityholders and their respective counsel in
connection with the registration or qualification (or exemption from such
registration or qualification) of such Registrable Securities for offer and sale
under the securities or “blue sky” laws of such jurisdictions within the United
States as any Selling Securityholder may reasonably request in writing, (ii)
keep such registrations or qualifications or exemptions therefrom in effect and
comply with such laws so as to permit the continuance of offers and sales in
such jurisdictions for so long as may be necessary to enable any Selling
Securityholder or underwriter, if any, to complete its distribution of
Registrable Securities pursuant to such Registration Statement, and (iii) take
any and all other actions necessary or advisable to enable the disposition in
such jurisdictions of such Registrable Securities; provided, however, that in no event shall the Company or any
Guarantor be obligated to (A) qualify as a foreign corporation or as a dealer
in securities in any jurisdiction where it would not otherwise be required to
so qualify but for this Section 5(i), or (B) subject itself to general or
unlimited service of process or to taxation in any such jurisdiction if it is
not now so subject.


(j)            Delivery
of Stock Certificates.  Unless
any Registrable Securities shall be in book-entry only form, the Company shall
(and shall cause each Guarantor to) cooperate with the Selling Securityholders
to facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be sold pursuant to any Registration Statement, which



 9
 









certificates, if
so required by any securities market or exchange upon which any Registrable
Securities are quoted or listed, shall be penned, lithographed or engraved, or
produced by any combination of such methods, on steel engraved borders, and
which certificates shall be free of any restrictive legends and in such
permitted denominations and registered in such names as Selling Securityholders
may request in connection with the sale of Registrable Securities pursuant to
such Registration Statement.


(k)           Corrections.  Upon the occurrence of any event or the
existence of any fact contemplated by paragraph 5(e)(vi) above, subject to
Section 3(b) above, the Company shall (and shall cause each Guarantor to)
promptly, but in any event within 10 Business Days following such occurrence or
existence, prepare and file (and have declared Effective) a post-effective
amendment to any Registration Statement or an amendment or supplement to the
related Prospectus included therein or file any other document with the
Commission so that, as thereafter delivered to purchasers of the Registrable
Securities, the Prospectus will not include an untrue statement of a material
fact or omit to state any material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading.  If the Company notifies the Selling
Securityholders of the occurrence of any event or the existence of any fact
contemplated by paragraph 5(e)(vi) above, the Selling Securityholders shall
suspend the use of the Prospectus until the requisite supplement or amendment
to the Prospectus has been made or a post-effective amendment to the applicable
Registration Statement shall become Effective.


(l)            Transfer
Agent and CUSIP.  Not
later than the Effective Date of a Registration Statement, the Company shall
provide (i) a transfer agent and registrar, which may be a single entity, and
(ii) the Company shall provide a CUSIP number for, the Registrable Securities
to be sold pursuant thereto.


(m)          Compliance
with Laws.  The Company
shall (and shall cause each Guarantor to) comply with all applicable laws
related to a Registration Statement filed pursuant to this Agreement and
offering and sale of securities covered by the Registration Statement and all
applicable rules and regulations of governmental authorities in connection
therewith (including, without limitation, the Securities Act and the Exchange
Act).


(n)           Earnings
Statement.  The Company
shall use its commercially reasonable best efforts to make available to the
Holders earnings statements (which need not be audited) satisfying the
provisions of Section 11(a) of the Securities Act and Rule 158 thereunder (or
any similar rule promulgated under the Securities Act) no later than 45 days
after the end of any 12 month period (or 90 days after the end of any 12 month
period if such period is a fiscal year), or such shorter period as required by
the Securities Act and the Exchange Act and the respective rules and
regulations thereunder, as in effect at any relevant time.


(o)           Due
Diligence and Road Shows.  In
connection with any underwritten offering of Registrable Securities, the
Company shall (and shall cause each Guarantors to) reasonably participate in,
and cause the officers and directors and independent accountants of the Company
and each Guarantor to reasonably participate in “due diligence” sessions with
representatives of, and counsel for, the underwriters, and “road show” and
other presentations to,



 10
 









and conferences
with, potential investors, all as reasonably requested by the managing
underwriter or underwriters.


(p)           Qualification
of Indenture.  Not
later than the Effective Date of the initial Registration Statement, the
Company shall use its commercially reasonable best efforts to cause the
Indenture to be qualified under the Trust Indenture Act; in connection with
such qualification, the Company shall (and shall cause each Guarantor to)
cooperate with the Trustee under the Indenture to effect such changes to the
Indenture as may be required for such Indenture to be so qualified in
accordance with the terms of the Trust Indenture Act; and the Company shall
(and shall cause each Guarantor to) execute, and shall use commercially
reasonable best efforts to cause the Trustee to execute, all documents that may
be required to effect such changes and all other forms and documents required
to be filed with the Commission to enable such Indenture to be so qualified in
a timely manner.  In the event that any
such amendment or modification referred to in this Section 5(p) involves
the appointment of a new trustee under the Indenture, the Company shall (and
shall, if required by the Indenture, cause each Guarantor to) appoint a new
trustee thereunder pursuant to the applicable provisions of the Indenture.


(q)           Inspection
of Company Records.  The
Company shall (and shall cause each Guarantor to) make reasonably available for
inspection by one or more representatives of the Selling Securityholders, any
underwriter participating in any disposition pursuant to any Registration
Statement, and any attorney, accountant or other agent retained by such Selling
Securityholders or any such underwriter all relevant financial and other
records, pertinent corporate documents and properties of the Company and its
subsidiaries (including, without limitation, the Guarantors), and shall cause
the officers, directors and employees of the Company and each Guarantor to make
available for inspection all information reasonably requested by such Selling
Securityholders or any such underwriter, attorney, accountant or agent in
connection with such Registration Statement, in each case, as is customary for
similar due diligence examinations.


(r)           Listing.  The Company will use its
commercially reasonable best efforts to cause the Common Stock issuable upon
conversion or exercise of the Securities to be quoted or listed on the Trading
Market on or prior to the Effective Date of each Registration Statement
hereunder.


(s)           Cooperation
with the NASD.  The
Company will (and will cause each Guarantor to) cooperate and assist in any
filings required to be made with the National Association of Securities
Dealers, Inc.


(t)            Opinions.  The Company will cause its
legal counsel (and legal counsel to each Guarantor) to timely deliver to the
transfer agent, the managing underwriter(s), if any, and the Selling
Securityholders a legal opinion (a “Transfer Opinion”),
dated as of the Effective Date of such registration, in form and substance as
is customarily given in connection with the registration and offering of equity
securities and reasonably acceptable to the transfer agent and managing
underwriter(s) stating (i) that the applicable Registration Statement has
become Effective under the Securities Act; (ii) that no stop order suspending
the Effectiveness thereof has been issued and no proceedings for that purpose
have been instituted or, to the knowledge of such counsel, are pending or
contemplated under the Securities Act; (iii) that the Registration



 11
 









Statement, the
related Prospectus and each amendment or supplement thereof comply as to form
in all material respects with the requirements of the Securities Act (except
that such counsel need not express any opinion as to financial statements or
other financial data contained therein); (iv) with respect to such other
matters of law as reasonably may be requested by the transfer agent or
underwriters.  The Company will also
cause its counsel (and legal counsel to each Guarantor) to deliver to the
recipients of the Transfer Opinion a written statement that, to the knowledge
of such counsel, the Registration Statement does not contain any untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements contained therein, in light of the circumstances
in which they were made, not misleading.


(u)           Accountant
Letters.  If so
requested by the managing underwriter(s), if any, the Company will cause to be
timely furnished to the underwriters and each Selling Securityholder, a letter
(a “Comfort Letter”) from the Company’s
independent certified public accountants, dated as of the Effective Date of
such registration, in form and substance as is customarily given by independent
certified public accountants to underwriters in an underwritten public offering
stating that they are independent accountants within the meaning of the
Securities Act and that, in the opinion of such accountants, the consolidated
financial statements of the Company included in the Registration Statement or
the Prospectus, or any amendment or supplement thereto, comply as to form in
all material respects with the applicable accounting requirements of the
Securities Act, and such letter shall additionally cover such other financial
matters (including information as to the period ending no more than five
Business Days prior to the date of such letter) with respect to such
registration as such underwriters and Selling Securityholders reasonably
request.


(v)            Selling
Securityholder Information.  If,
and to the extent that the Company requires information from any Selling
Securityholder for inclusion in a Registration Statement or otherwise in
connection with the Company’s performance of its duties hereunder, the Company
will make requests for such information in writing reasonably in advance of the
date on which such information is actually required.  The Company shall (and shall cause each
Guarantor to) hold in confidence and not make any disclosure of non-public
information concerning any Selling Securityholder provided to, or at the
request of, the Company or any Guarantor by such Selling Securityholder unless
(i) disclosure of such information is reasonably necessary to comply with
federal or state securities laws, rules, statutes or regulations, (ii) the
disclosure of such information is reasonably necessary to avoid or correct a
misstatement or omission in any Registration Statement or other public filing
by the Company, (iii) the release of such information is ordered pursuant to a
subpoena or other order from a court or governmental body of competent
jurisdiction or is otherwise required by applicable law or legal process, (iv)
such information has been made generally available to the public other than by
disclosure in violation of this or any other agreement, or (v) such Selling
Securityholder consents to the form and content of any such disclosure.  The Company agrees that it shall (and shall
cause each Guarantor to), upon learning that disclosure of such information
concerning any Selling Securityholder is sought in or by a court or
governmental body of competent jurisdiction or through other means, give prompt
notice to such Selling Securityholder prior to making such disclosure, and
allow such Selling Securityholder, at its expense, to undertake appropriate
action to prevent disclosure of, or to obtain a protective order for, such
information.



 12
 









(w)           Further
Actions.  The Company
shall use its best efforts (and shall cause each Guarantor to use its best efforts)
to take all other steps necessary to effect the registration, offering and sale
of the Registrable Securities covered by each Registration Statement
contemplated hereby, including entering into such customary agreements and
taking all such other necessary actions in connection therewith.


6.             Registration
Expenses.  The Company
shall bear all fees, costs and expenses incurred in connection with the
performance by the Company of its obligations under this Agreement whether or
not any of the Registration Statements are declared Effective.  Such fees, costs and expenses shall include,
without limitation: (a) all registration, qualification and filing fees
(including, without limitation, fees and expenses (i) with respect to filings
required to be made with the National Association of Securities Dealers, Inc.,
and (ii) of compliance with United States federal and state securities or “blue
sky” laws (including under the laws of such jurisdictions as the Selling
Securityholders may reasonably designate), (b) printing expenses (including,
without limitation, expenses of printing Prospectuses and certificates for
Registrable Securities in a form eligible for deposit with The Depository Trust
Company), (c) duplication expenses relating to copies of any Registration
Statement or Prospectus delivered to any Holders hereunder, (d) internal
expenses (including, without limitation, all salaries and expenses of the
Company’s and any its subsidiary’s officers and employees performing legal or
accounting duties), (e) fees and expenses incurred by the Company or any
Guarantors in connection with the listing of Registrable Securities for
trading, (f) fees and disbursements of counsel and independent accountants for
the Company and the Guarantors (or any one of them) in connection with the
Registration Statement (including, expense of any Transfer Opinion or other
legal opinion), (g) accounting fees and expenses, including, without
limitation, costs associated with the delivery by independent certified
accountants of a Comfort Letter or Comfort Letters, and expenses of any special
audit incident to or required by any Registration), (h) escrow fees, (i) fees
and expenses of any special experts retained by the Company or any Guarantor in
connection with any Registration, (j) reasonable fees and disbursements of the
Trustee, the Warrant Agent and their respective counsel and of the registrar
and transfer agent for the Common Stock and the Warrants, (k) messenger, word
processing, duplication, telephone and delivery expenses, (l) Securities Act
liability insurance, if the Company (or any Guarantor) purchases such
insurance, and (m) transfer taxes. In addition, with respect to the initial
Registration Statement and any post-effective amendment or subsequent
Registration Statement, the Company shall bear or reimburse the Holders for
reasonable fees and disbursements of one firm of legal counsel for the Holders,
which shall initially be counsel to the Initial Purchaser, but which may, upon
the written consent of the Initial Purchaser (which shall not be unreasonably
withheld), be another nationally recognized law firm experienced in securities
law matters designated by the Company.


7.             Additional Interest.  In addition to interest payable to
Holders pursuant to and under the Notes, the Company shall be required to pay
to each Holder additional interest (“Additional Interest”),
from and including the 181st day following the Issue Date to but excluding
the 2nd year anniversary of the Issue Date, at a rate
per annum equal to 2.0% of such Holder’s Applicable Amount.  For purposes hereof, a Holder’s “Applicable Amount” shall mean, as of the time of
computation, the principal amount of Notes converted or convertible into
Registrable Securities by such Holder the resale of which is not covered
by an Effective Registration Statement; provided, that, the foregoing shall not
include (a) Registrable Securities



 13
 









the resale of which is
covered by a Registration Statement the Effectiveness of which is subject to
suspension pursuant to Section 3(b) except to the extent that such Suspension
Period has exceeded 60 days, or (b) Registrable Securities which have been
excluded from Registration by reason of a 415 Reduction.  Additional Interest, if any, shall be payable
to Holders quarterly in arrears (and contemporaneously with interest payments
under the Notes) by wire transfer of immediately available funds or by federal
funds check; provided, that, the Company may postpone payment of Additional
Interest payable to any Holder who has not yet delivered to the Company an
executed and completed Notice and Questionnaire until delivery of the same
shall have been made, but such postponement of payment may be made only if the
Company delivers notice of the same to the affected Holder.


8.             Indemnification
and Contribution.


(a)           Indemnification by the Company.  The Company shall indemnify
and hold harmless each Holder, the Initial Purchaser, each underwriter of
Registrable Securities, each person, if any, who controls any such Holder,
Initial Purchaser or underwriter within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act and the respective
officers, directors, partners, employees, representatives and agents of any
such Holder, the Initial Purchaser, underwriter or any controlling person, from
and against any loss, claim, damage, liability, cost or expense whatsoever as
incurred (including, but not limited to, attorneys’ fees and any and all
expenses whatsoever incurred in investigating, preparing or defending against
any litigation, commenced or threatened, or any claim whatsoever, and any and
all amounts paid in settlement of any claim or litigation) (collectively, “Losses”), joint or several, to which they or any of them
may become subject under the Securities Act, the Exchange Act or otherwise,
insofar as any such Loss (or action in respect thereof) arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement or any amendment thereto or
supplement thereof or any related preliminary prospectus or the Prospectus or
any amendment thereto or supplement thereof, (ii) the omission or alleged
omission to state therein any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, or (iii) any violation or alleged
violation by the Company or any Guarantor of the Securities Act, the Exchange
Act or any other applicable Federal, State or common law rule or regulation applicable
to the Company or any Guarantor in connection with the matters contemplated by
this Agreement; provided, however, that the Company shall not be liable to any
such indemnified party in any such case to the extent that any such Loss arises
out of, or is based upon, any such untrue statement or alleged untrue statement
or omission or alleged omission made therein in reliance upon and in conformity
with written information furnished to the Company by or on behalf of such
indemnified party specifically for use in the subject Registration Statement;
and provided further, however, that the Company shall not be liable to any such
indemnified party in any such case to the extent that such Loss arises from an
offer or sale by a Holder of Registrable Securities during a Suspension Period,
if such indemnified party is a Holder that received from the Company written
notice of the commencement of such Suspension Period prior to the making of
such offer or sale.  The foregoing
indemnity agreement is in addition to any liability that the Company or any
Guarantor may otherwise have to any indemnified party.  The Company shall not be liable under this
Section 8(a) for any settlement of any action effected without its written
consent, which shall not be unreasonably withheld; provided, however, that with
respect to actions pursuant to clauses (i), (ii) and (iii) of
Section 8(c), no such consent shall be required.



 14















(b)           Indemnification by the Holders. 
Each Holder, severally and not jointly, shall
indemnify and hold harmless the Company, any affiliate or subsidiary thereof
(including, without limitation, the Guarantors), the Initial Purchaser, each
underwriter of Registrable Securities, each other Holder, each person, if any,
who controls the Company, any Guarantor, the Initial Purchaser, such
underwriter or another Holder within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act and the respective
officers, directors, partners, employees, representatives and agents of the
Company, any affiliate or subsidiary thereof (including, without limitation,
the Guarantors), the Initial Purchaser, such underwriter, any other Holder or
any controlling person, from and against any Loss, joint or several, to which
they or any of them may become subject under the Securities Act, the Exchange
Act or otherwise, insofar as any such Loss (or action in respect thereof)
arises out of, or is based upon, any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or any
amendment thereto or any related preliminary prospectus or the Prospectus or
any amendment thereto or supplement thereof, or arises out of, or is based
upon, the omission or alleged omission to state therein any material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, in each
case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission made therein was made
in reliance upon and in conformity with written information furnished to the
Company by or on behalf of such Holder specifically for use therein.  In no event shall the liability of any
selling Holder hereunder be greater in amount than the dollar amount of the net
proceeds received by such Holder upon the sale of the Registrable Securities
pursuant to the Registration Statement giving rise to such indemnification
obligation.  The foregoing indemnity
agreement is in addition to any liability that any Holder may otherwise have to
the Company, any Guarantor, the Initial Purchaser, any underwriter of
Registrable Securities, any other Holder and any such other person.


(c)           Notices of Claims, Etc.  Promptly
after receipt by an indemnified party under this Section 8 of notice of
any claim or the commencement of any action, the indemnified party shall, if a
claim in respect thereof is to be made against the indemnifying party under
this Section 8, notify the indemnifying party in writing of the claim or
the commencement of that action; provided, however, that the failure to notify
the indemnifying party shall not relieve it from any liability that it may have
under this Section 8.  If any such
claim or action shall be brought against an indemnified party, and it shall
notify the indemnifying party thereof, the indemnifying party shall be entitled
to participate therein and, to the extent that it wishes, jointly with any
other similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party.  After notice from the indemnifying party to the
indemnified party of its election to assume the defense of such claim or
action, the indemnifying party shall not be liable to the indemnified party
under this Section 8 for any legal or other expenses subsequently incurred
by the indemnified party in connection with the defense thereof other than
reasonable costs of investigation; provided, however, that the indemnified
party shall have the right to employ counsel to represent jointly the
indemnified party and its respective officers, directors, partners, employees,
representatives, agents and controlling persons who may be subject to liability
arising out of any claim in respect of which indemnity may be sought by the
indemnified party against the indemnifying party under this Section 8 if
(i) employment of such counsel has been authorized in writing by the
indemnifying party, or (ii) such indemnifying party shall not have employed
counsel to have charge of the defense of such proceeding within



 15
 









30 days of the receipt of
notice thereof, or (iii) such indemnified party shall have reasonably concluded
that the representation of such indemnified party and those officers,
directors, partners, employees, representatives, agents and controlling persons
by the same counsel representing the indemnifying party would be inappropriate
under applicable standards of professional conduct due to actual or potential
differing interests between them or where there may be one or more defenses
available to them that are different from, additional to or in conflict with
those available to the indemnifying party, and in any such event ((i), (ii) or
(iii)) the fees and expenses of such separate counsel shall be paid by the
indemnifying party as incurred.  It is
understood that the indemnifying party shall not be liable for the fees and
expenses of more than one separate firm (in addition to local counsel in each
jurisdiction, if necessary) for all indemnified parties in connection with any
proceeding or related proceedings.  No
indemnifying party shall, without the prior written consent of the indemnified
parties, effect any settlement or compromise of, or consent to the entry of
judgment with respect to, any pending or threatened claim, investigation,
action, suit or proceeding in respect of which indemnity or contribution may be
or could have been sought hereunder (whether or not the indemnified party or
parties are actual or potential parties thereto) unless (A) such settlement,
compromise or judgment (1) includes an unconditional release of such
indemnified party from all liability arising out of such claim, investigation,
action, suit or proceeding, and (2) does not include a statement as to or an
admission of fault, culpability or failure to act by or on behalf of any
indemnified party, and (B) the indemnifying party confirms in writing its
indemnification obligations hereunder with respect to such settlement,
compromise or judgment.


(d)           Contribution.  If
the indemnification provided for in this Section 8 is unavailable or
insufficient to hold harmless an indemnified party under subsections (a) or (b)
above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the Losses (or actions in
respect thereof) referred to in subsection (a) or (b) above (i) in such
proportion as is appropriate to reflect the relative benefits received by the
indemnifying party or parties on the one hand and the indemnified party on the
other from the registration of the Registrable Securities pursuant to the
Registration, or (ii) if the allocation provided by the foregoing clause (i) is
not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the indemnifying party or parties on the one hand and the
indemnified party on the other in connection with the statements or omissions
that resulted in such Losses (or actions in respect thereof) as well as any
other relevant equitable considerations. 
The relative fault of the parties shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or any Guarantor, on the one
hand, or such Holder or such other indemnified party, as the case may be, on
the other, and the parties’ relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.  The amount paid by an indemnified party as a
result of the Losses referred to in the first sentence of this
Section 8(d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any action or claim which is the subject of this Section 8(d).  The Company (on its behalf and on behalf of
each Guarantor) and the Holders agree that it would not be just and equitable
if contribution pursuant to this Section 8(d) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to herein.  Notwithstanding any other provision of this
Section 8(d), no Holder of the



 16
 









Registrable Securities
shall be required to contribute any amount in excess of the amount by which the
net proceeds received by such Holder from the sale of its Registrable
Securities pursuant to the Registration Statement exceeds the amount of damages
which such Holder has otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged omission.  No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.  For purposes
of this Section 8(d), each officer, director, partner, employee,
representative or agent of an indemnified party, and each person, if any, who
controls such indemnified party within the meaning of the Securities Act or the
Exchange Act, shall have the same rights to contribution as such indemnified
party and each officer, director, partner, employee, representative and agent
of the Company or Guarantor, and each person, if any, who controls the Company
or Guarantor within the meaning of the Securities Act or the Exchange Act,
shall have the same rights to contribution as the Company.  The Holders’ respective obligations to
contribute pursuant to this Section 8(d) are several in proportion to the
respective amount of Registrable Securities they have sold pursuant to a
Registration Statement and not joint. 
The remedies provided for in this Section 8(d) are not exclusive
and shall not limit any rights or remedies which may otherwise be available to
any indemnified party at law or in equity.


(e)           Survival.  The
indemnity and contribution provisions contained in this Section 8 shall
remain operative and in full force and effect regardless of (i) any termination
of this Agreement, (ii) any investigation made by or on behalf of the Initial
Purchaser, any underwriter of Registrable Securities, any Holder, any officer,
director, partner, employee, representative or agent of the Initial Purchaser,
underwriter or any Holder, or any person controlling the Initial Purchaser,
underwriter or any Holder, or by or on behalf of the Company, any Guarantor,
their respective officers, directors, partners, employees, representatives or
agents or any person controlling the Company or any Guarantor, and (iii) any
sale or other transfer of Registrable Securities pursuant to a Registration
Statement or otherwise.


9.             Holder’s Obligations.  Each Holder agrees, by
acquisition of the Registrable Securities, that no Holder of Registrable
Securities shall be entitled to sell any of such Registrable Securities
pursuant to a Registration Statement or to receive a Prospectus relating
thereto, unless such Holder has furnished the Company with a Notice and
Questionnaire as required pursuant to Section 5(a) hereof (including the
information required to be included in such Notice and Questionnaire) and the
information set forth in the next sentence. 
Each Holder agrees to promptly furnish to the Company all information
required under applicable law, or in response to a request for information by
the Commission, to be disclosed in any Registration Statement, as the Company
may from time to time reasonably request. 
Any sale of any Registrable Securities by any Holder pursuant to a
Registration Statement shall constitute a representation and warranty by such
Holder that the information relating to such Holder and its plan of
distribution is as set forth in the Prospectus delivered by such Holder in
connection with such disposition, that such Prospectus does not, as of the time
of such sale, contain any untrue statement of a material fact relating to or provided
by such Holder or its plan of distribution and that such Prospectus does not,
as of the time of such sale, omit to state any material fact relating to or
provided by such Holder or its plan of distribution necessary in order to make
the statements in such Prospectus, in the light of the circumstances under
which they were made, not misleading.



 17
 









10.          Rule 144.  The Company covenants to
the Holders of the Registrable Securities that the Company shall use its best
efforts (and, if applicable, shall cause each Guarantor to use its best
efforts) to timely file the reports required to be filed by it under the
Exchange Act (including the reports under Section 13 and 15(d) of the Exchange
Act referred to in subparagraph (c)(1) of Rule 144 of the Securities Act) and
the rules and regulations adopted by the Commission thereunder, all to the
extent required from time to time to enable such Holder to sell Registrable
Securities without registration under the Securities Act within the limitations
of the exemption provided by Rule 144 under the Securities Act, as such may be
amended from time to time, or any similar or successor rule or regulation
hereafter adopted by the Commission. 
Upon the request of any Holder of Registrable Securities in connection
with that Holder’s sale pursuant to Rule 144, the Company shall deliver to such
Holder a written statement as to whether it (and, if applicable, each
Guarantor) has complied with such requirements.


11.          Company Lock-Up.  The Company agrees not to
effect (and will not permit any Guarantor to effect) any public sale or
distribution of any of the Company’s equity securities during the 30 days prior
to and during the 90 days following the date as of which any Registration which
includes Registrable Securities is declared Effective, except with the consent
of the Requisite Holders; provided, that, the foregoing restriction shall not
be deemed to preclude the registration of securities on Form S-8 or any
successor form thereto and the sale by the Company of the securities so registered.


12.          Mergers, Recapitalizations; Etc.


(a)           The Company shall
not, directly or indirectly, enter into any merger, consolidation or
reorganization in which the Company shall not be the surviving corporation
unless the proposed surviving corporation shall, prior to such merger,
consolidation, or reorganization, agree in writing to assume the obligations of
the Company under this Agreement, and for that purpose references hereunder to “Registrable
Securities” shall be deemed to be references to the securities that the Holders
would be entitled to receive in exchange for Registrable Securities under the
terms of any such merger, consolidation, or reorganization; provided, however,
that the provisions of this Agreement shall not apply in the event of any merger,
consolidation, or reorganization in which the Company is not the surviving
corporation if all Selling Securityholders are entitled to receive in exchange
for their Registrable Securities consideration consisting solely of (i) cash,
(ii) securities of the acquiring corporation that may be immediately sold to
the public without registration under the Securities Act, or (iii) a
combination of both.  Further, the
Company shall not permit any Guarantor to enter into any merger, consolidation
or reorganization in which it is not the surviving entity.


(b)           If, and as often
as, there is any change in the Common Stock by way of a stock split,
combination, stock dividend, reclassification, or the like, or through a
merger, consolidation, reorganization or recapitalization, or by any other
means, appropriate adjustment shall be made in the provisions hereof so that
the rights and privileges granted hereby to the Holders with respect to the
Registrable Securities shall not be diminished or adversely affected.


13.          Limitation on Registration
Rights.  From and after
the date of this Agreement and until all Registrable Securities required to be
registered under Section 2 hereof have been so registered, the Company shall
not, without the prior written consent of the Requisite Holders,



 18
 









enter into any agreement
with any holder or prospective holder of any securities of the Company giving
such holder or prospective holder (a) the right to require the Company to
initiate any registration of any securities of the Company, or (b) the right to
require the Company, upon any registration of any of its securities, to
include, among the securities which the Company is then registering, securities
owned by such holder, except for rights with respect to registration of
securities of the Company which are currently existing (including, without
limitation, registration rights with respect to the Initial Purchaser’s
Warrants) or which are not inconsistent with, and which expressly provide that
such rights are subordinate in all respects to, the rights of the Holders
hereunder.  Further, the Company shall
not permit any Guarantor to grant any rights with respect to the registration
of its securities other than the rights provided for herein.


14.          Miscellaneous.


(a)           Specific Performance.  The parties hereto
acknowledge that there would be no adequate remedy at law if the Company fails
to perform any of its obligations hereunder and that the Initial Purchaser and
the Holders from time to time may be irreparably harmed by any such failure, and
accordingly agree that the Initial Purchaser and such Holders, in addition to
any other remedy to which they may be entitled at law or in equity and without
limiting the remedies available to the Holders under Section 7 hereof,
shall be entitled to compel specific performance of the obligations of the
Company under this Agreement in accordance with the terms and conditions of
this Agreement, in any court of the United States or any State thereof having
jurisdiction.


(b)           Amendments
and Waivers.  This
Agreement, including this Section 14(b), may be amended, and waivers or
consents to departures from the provisions hereof may be given, only by a
written instrument duly executed by the Company and the Requisite Holders.  Each Holder of Registrable Securities outstanding
at the time of any such amendment, waiver or consent or thereafter shall be
bound by any amendment, waiver or consent effected pursuant to this
Section 14(b), whether or not any notice, writing or marking indicating
such amendment, waiver or consent appears on the Registrable Securities or is
delivered to such Holder.


(c)           Notices.  All notices and other
communications provided for or permitted hereunder shall be made in writing,
shall be delivered by hand delivery, by telecopier, by courier guaranteeing
overnight delivery or by first-class mail, return receipt requested, and shall
be deemed given (i) when made, if made by hand delivery, (ii) upon
confirmation, if made by confirmed facsimile transmission (provided notice is
also given by some other means permitted by this Section 14(c)), (iii) one
Business Day after being deposited with such courier, if made by overnight
courier or (iv) on the date indicated on the notice of receipt, if made by
first-class mail, to the parties as follows:


if
to a Holder of Registrable Securities, at the most current address given by
such Holder to the Company in a Notice and Questionnaire or any amendment
thereto;



 19
 









if
to the Company, to:


Charys Holding Company, Inc.
                 1117 Perimeter Center
West, Suite N-415
                 Atlanta, Georgia  30338
                 Attention:  Mr. Billy V. Ray, Jr., Chief Executive
Officer
                 Facsimile:  (678) 443-2320


with a copy to:


Morris, Manning & Martin, LLP
                 1600 Atlanta Financial
Center
                 3343 Peachtree Road, N.E.
                 Atlanta, Georgia  30326
                 Attention:  Larry W. Shackelford, Esq.
                 Facsimile:  (404) 365-9532


if to the Initial Purchaser, to:


McMahan Securities Co. L.P.
                 500 West Putnam Avenue
                 Greenwich, Connecticut
06830
                 Attention: Alan Streiter,
Senior Managing Director
                 Facsimile: (203) 618-3401


with a copy to:


Mintz, Levin, Cohn, Ferris, Glovsky and Popeo P.C.
                 666 Third Avenue, 25th Floor
                 New York, New York 10017
                 Attention: Stephen J.
Gulotta, Jr., Esq.
                 Facsimile: (212) 935-3000


or to such other address
as such person may have furnished to the other persons identified in this
Section 13(c) in writing in accordance herewith.


(d)           Parties in Interest.  The
parties to this Agreement intend that all Holders of Registrable Securities
shall be entitled to receive the benefits of this Agreement and that any
Selling Securityholder shall be bound by the terms and provisions of this
Agreement by reason of such Selling Securityholder’s election to include
Registrable Securities in a Registration Statement (which election shall be
deemed made by delivering to the Company an executed and completed Notice and
Questionnaire).  All of the terms and
provisions of this Agreement shall be binding upon, shall inure to the benefit
of and shall be enforceable by the respective successors and assigns of the
parties hereto and any Holder from time to time of the Registrable Securities
to the aforesaid extent.  In the event
that any transferee of any Holder of Registrable Securities shall acquire
Registrable Securities, in any manner, whether by gift, bequest, purchase,
operation of law or otherwise, such transferee shall, without any further
writing or action of any kind, be entitled to receive the benefits of and, if a
Selling Securityholder, be conclusively deemed to



 20
 









have agreed to be bound
by and to perform all of the terms and provisions of this Agreement to the
aforesaid extent.


(e)           Counterparts; Facsimile Signatures.  This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.  Facsimile signatures shall constitute
original signatures for all purposes of this Agreement.


(f)            Construction.  This Agreement shall be deemed to have been
drafted by both the Company and the Holders and shall not be construed against
either party as the principal draftsperson hereof.  Any reference to any federal, state, local or
foreign statute or law shall be deemed also to refer to all rules and
regulations promulgated thereunder and any applicable common law, unless the
context requires otherwise.  The word “including”
shall mean including, without limitation, and is used in an illustrative sense
rather than a limiting sense.  Terms used
with initial capital letters will have the meanings specified applicable to
singular and plural forms for all purposes of this Agreement.  Reference to any gender will be deemed to
include all genders and the neutral form. 
The headings in this Agreement are used for convenience of reference
only and shall not be considered in construing or interpreting this Agreement.


(g)           Governing Law.  This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York, without giving effect to any provisions relating to
conflicts of law.


(h)           Severability.  In
the event that any one or more of the provisions contained herein, or the
application thereof in any circumstances, is held invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions hereof shall not be in any way impaired or affected
thereby, it being intended that all of the rights and privileges of the parties
hereto shall be enforceable to the fullest extent permitted by law.


(i)            Survival.  The
respective indemnities, agreements, covenants, representations, warranties and
other provisions set forth in this Agreement or made pursuant hereto shall
remain in full force and effect, regardless of any investigation (or any
statement as to the results thereof) made by or on behalf of the Initial
Purchaser, any Holder, or any officer, director, partner, employee,
representative or agent of the Initial Purchaser or such Holder, any agent or
underwriter, any officer, director, partner, employee, representative or agent
or of such agent or underwriter, or any controlling person of any of the
foregoing, and shall survive the transfer and registration of the Registrable
Securities of such Holder.


(j)            Submission to Jurisdiction; Appointment of Agent for Service. The
Company agrees that any suit, action or proceeding against the Company arising
out of or based upon this Agreement or the transactions contemplated hereby may
be instituted in any state or federal court in The City of New York, New York,
and waives any objection which it may now or hereafter have to the laying of
venue of any such proceeding, and irrevocably submits to the exclusive
jurisdiction of such courts in any suit, action or proceeding.  The Company expressly accepts the exclusive
jurisdiction of any such court in respect of any such suit, action or





 21
 









proceeding.  The Company agrees that a final judgment in
any such proceeding brought in any such court shall be conclusive and binding thereupon
and may be enforced in any other court in the jurisdiction to which the Company
is or may be subject by suit upon such judgment.


(k)           Further Assurances.  Each party shall do and
perform, or cause to be done and performed, all such further acts and things,
and shall execute and deliver all such other agreements, certificates,
instruments and documents, as any other party may reasonably request in order
to carry out the intent and accomplish the purposes of this Agreement and the
consummation of the transactions contemplated hereby.


(l)            No Third Party Beneficiaries.  This Agreement shall not
confer any rights or remedies upon any person other than the parties hereto,
the Holders, their permitted successors and assigns and parties eligible for
indemnification or contribution under Section 8, and only in accordance with
the express terms of this Agreement.


(m)          Incorporation of Exhibits, Annexes and
Schedules.  The
Exhibits, Annexes and Schedules identified in this Agreement, if any, are
incorporated herein by reference and made a part hereof.


{REMAINDER OF PAGE INTENTIONALLY LEFT BLANK;
SIGNATURE PAGE IN COUNTERPARTS FOLLOWS}


 



 22















 


[SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]


Please confirm that the
foregoing correctly sets forth the agreement between the Company and you.


	
  

  	
  Very truly yours,

  
	
   

  	
   

  	
   

  
	
   

  	
  Charys Holding Company, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Billy V. Ray, Jr.

  	
   

  
	
   

  	
   

  	
  Name: Billy V. Ray, Jr.

  
	
   

  	
   

  	
  Title: Chief Executive Officer

  
					



 


	
  

  	
  Accepted for the benefit of the Holders,

  as of the date first above written:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  McMahan Securities Co. L.P.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Alan Streiter

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Alan Streiter

  	
   

  
	
   

  	
   

  	
  Title: Senior Managing Director

  	
   

  



 

















 


APPENDIX
A


CHARYS HOLDING COMPANY, INC.


FORM OF SELLING SECURITYHOLDER NOTICE AND QUESTIONNAIRE


The undersigned
beneficial holder of 8.75% Senior Convertible Notes due February 16, 2012 (the “Notes”) of CHARYS HOLDING COMPANY, INC. (the “Company”), warrants (the “Warrants”)
to purchase shares of the Company’s common stock, par value $0.001 per share
(the “common stock”), guarantees of the
Company’s obligations under the Notes (“Guarantees”)
made by certain of the Company’s subsidiaries (each a “Guarantor”
and, collectively with the Company, the “Registrant”),
or common stock understands that the Registrant has filed or intends to file
with the Securities and Exchange Commission (the “Commission”)
a registration statement (the “Registration Statement”)
for the registration and resale under Rule 415 of the Securities Act of
1933, as amended (the “Securities Act”),
of the Notes, the Warrants, Guarantees and the shares of Common Stock issued or
issuable upon exercise or conversion of the Notes and Warrants (collectively,
the “Registrable Securities”), in
accordance with the terms of the Registration Rights Agreement (the “Registration Rights Agreement”), among the Company and the
initial purchaser named therein. A copy of the Registration Rights Agreement is
available from the Company upon request at the address set forth below. Each
capitalized term not otherwise defined herein shall have the meaning ascribed
thereto in the Registration Rights Agreement.


Each beneficial owner of
Registrable Securities is entitled to the benefits of the Registration Rights
Agreement. In order to sell or otherwise dispose of any Registrable Securities
pursuant to the Registration Statement, a beneficial owner of Registrable
Securities generally will be required to be named as a selling securityholder
in the related prospectus, deliver a prospectus to purchasers of Registrable
Securities and be bound by those provisions of the Registration Rights
Agreement applicable to such beneficial owner (including certain
indemnification provisions, as described below). Beneficial owners that do not
complete this Notice and Questionnaire and deliver it to the Company as
provided below will not be named as selling securityholders in the prospectus
and, therefore, will not be permitted to sell any Registrable Securities
pursuant to the Registration Statement. Beneficial owners are encouraged to
complete and deliver this Notice and Questionnaire prior to the Effectiveness
of the Registration Statement so that such beneficial owners may be named as selling
securityholders in the related prospectus at the time of Effectiveness. The
Company has agreed to pay additional amounts pursuant to the Registration
Rights Agreement under certain circumstances as set forth therein.


Certain legal
consequences arise from being named as a selling securityholder in the
Registration Statement and the related prospectus. Accordingly, holders and
beneficial owners of Registrable Securities are advised to consult their own
securities law counsel regarding the consequences of being named or not being
named as a selling securityholder in the Registration Statement and the related
prospectus.



 A-1
 








NOTICE


The undersigned
beneficial owner (the “Selling Securityholder”)
of Registrable Securities hereby gives notice to the Company of its intention
to sell or otherwise dispose of Registrable Securities beneficially owned by it
and listed below in Item 3 pursuant to the Registration Statement. The
undersigned, by signing and returning this Notice and Questionnaire,
understands that it will be bound by the terms and conditions of this Notice
and Questionnaire and the Registration Rights Agreement.


Pursuant to the
Registration Rights Agreement, the undersigned has agreed to indemnify and hold
harmless the Company, each Guarantor, the Company’s and each Guarantor’s
directors and officers, each person, if any, who controls the Company or any
Guarantor within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act of 1934, as amended (the “Exchange Act”), and other persons identified in the
Registration Rights Agreement, from and against certain losses arising in
connection with statements concerning the undersigned made in the Registration
Statement or the related prospectus in reliance upon the information provided
in this Notice and Questionnaire.


The undersigned hereby
provides the following information to the Company and represents and warrants
that such information is accurate and complete.



 A-2
 








QUESTIONNAIRE


	
  1.

  	
  (a)

  	
   

  	
  Full Legal Name of Selling Securityholder:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
   

  	
  Full Legal Name of Registered Holder (if not the
  same as (a) above) through which Registrable Securities listed in Item 3
  below are held:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
   

  	
  Full Legal Name of DTC Participant (if applicable
  and if not the same as (b) above) through which Registrable Securities listed
  in Item 3 below are held:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  



 


	
  2.

  	
  Address for Notices to Selling Securityholder:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Fax:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Contact Person:

  	
   

  
						



 


 


	
  3.

  	
  Beneficial Ownership of Registrable Securities:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
   

  	
  Type and Principal Amount (if applicable) of
  Registrable Securities beneficially owned:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Notes:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Warrants:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Common Stock:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
   

  	
  CUSIP No(s). of such Registrable Securities
  beneficially owned:

  
	
   

  	
   

  	
   

  
							



 


	
  4.

  	
  Beneficial Ownership of Other Securities of the
  Company or any Guarantor owned by the Selling  Securityholder:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  



 



 A-3
 








Except as set
forth below in this Item 4, the undersigned is not the beneficial or
registered owner of any securities of the Company or any Guarantor other than
the Registrable Securities listed above in Item 3.


 


	
  

  	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
   

  	
  Type and Amount of Other Securities beneficially
  owned by the Selling Securityholder:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
   

  	
  CUSIP No(s). of such Other Securities beneficially
  owned:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  



 


	
  5.

  	
   

  	
  Relationship(s) with the Company and/or any
  Guarantor:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Except as set forth below, neither the undersigned
  nor any of its affiliates, officers, directors or principal equity holders
  (5% or more) has held any position or office or has had any other material
  relationship with the Company or any Guarantor (or its predecessors or
  affiliates) during the past three years.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  State any exceptions here:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  6.

  	
   

  	
  Plan of Distribution:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Except as set forth below, the undersigned
  (including its donees or pledgees) intends to distribute the Registrable
  Securities listed above in Item 3 pursuant to the Registration Statement
  only as follows (if at all). Such Registrable Securities may be sold from
  time to time directly by the undersigned or, alternatively, through
  underwriters, broker-dealers or agents. If the Registrable Securities are
  sold through underwriters or broker-dealers, the Selling Securityholder will
  be responsible for underwriting discounts or commissions or agent’s
  commissions. Such Registrable Securities may be sold in one or more
  transactions at fixed prices, at prevailing market prices at the time of
  sale, at varying prices determined at the time of sale, or at negotiated
  prices. Such sales may be effected in transactions (which may involve block
  transactions) (i) on any national securities exchange or quotation
  service on which the Registrable Securities may be listed or quoted at the
  time of sale, (ii) in the over-the-counter market, or (iii) in
  transactions otherwise than on such exchanges or services or in the
  over-the-counter market. The undersigned may also loan or pledge Registrable
  Securities to broker-dealers that in turn may sell such securities.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  State any exceptions here:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  



 


Note: The
undersigned acknowledges that it understands its obligation to comply with the
provisions of the Exchange Act and the rules thereunder relating to stock
manipulation, particularly Regulation M thereunder (or any successor rules or
regulations), in connection with any offering of Registrable Securities
pursuant to the Registration Rights Agreement. The undersigned agrees that neither
it nor any person acting on its behalf will engage in any transaction in
violation of such provisions.



 A-4
 








The Selling
Securityholder hereby acknowledges its obligations under the Registration
Rights Agreement to indemnify and hold harmless certain persons as set forth
therein. Pursuant to the Registration Rights Agreement, the Company has agreed
under certain circumstances to indemnify the Selling Securityholder against
certain liabilities. In accordance with the undersigned’s obligation under the
Registration Rights Agreement to provide such information as may be required by
law for inclusion in the Registration Statement, the undersigned agrees to
promptly notify the Company of any inaccuracies or changes in the information
provided herein that may occur subsequent to the date hereof at any time while
the Registration Statement remains effective. All notices hereunder and
pursuant to the Registration Rights Agreement shall be made in writing at the
address set forth below. In the event that the undersigned transfers all or any
portion of the Registrable Securities listed in Item 3 above after the
date on which such information is provided to the Company, the undersigned
agrees to notify the transferee(s) at the time of transfer of its rights and obligations
under this Notice and Questionnaire and the Registration Rights Agreement. By
signing below, the undersigned consents to the disclosure of the information
provided in response to Items 1 through 6 above and the inclusion of such
information in the Registration Statement and the related prospectus. The
undersigned understands that such information will be relied upon by the
Company and the Guarantors in connection with the preparation or amendment of
the Registration Statement and the related prospectus.


 


IN WITNESS WHEREOF, the undersigned, by authority duly
given, has caused this Notice and Questionnaire to be executed and delivered
either in person or by its duly authorized agent.


	
   

  	
   

  	
   

  
	
  

  	
   

  	
  Beneficial Owner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
  Date:

  	
   

  	
   

  	
   

  	
   

  
					



 


 


PLEASE RETURN THE
COMPLETED AND EXECUTED NOTICE AND

QUESTIONNAIRE TO THE COMPANY AT:


 


Charys Holding Company, Inc.

1117 Perimeter Center West, Suite N-415

Atlanta, Georgia  30338

Attention:  Mr. Billy V. Ray, Jr., Chief
Executive Office

Facsimile:  (678) 443-2320



 A-5
 








 


EXHIBIT 1 TO NOTICE AND
QUESTIONNAIRE


 


NOTICE OF TRANSFER
PURSUANT

TO REGISTRATION STATEMENT


Charys
Holding Company, Inc.

1117 Perimeter Center West, Suite N-415

Atlanta, Georgia  30338


Re:
         Charys Holding Company, Inc.


Ladies and Gentlemen:


Please be advised that
                
has transferred
$               principal
amount of 8.75% Senior Convertible Notes due 2012 (the “Notes”), warrants to
purchase
               
shares of the Company’s common stock (“Warrants”), guarantees of the Company’s
obligations under the Notes (“Guarantees”) and/or
                
shares of the Company’s common stock issued upon conversion or exercise of
Notes and/or Warrants, pursuant to the Registration Statement on Form S-3 (File
No. 333-                )
filed by the Company and/or certain of its subsidiaries.


 


We hereby certify that
the prospectus delivery requirements, if any, of the Securities Act of 1933, as
amended, have been satisfied with respect to the transfer described above and
that the above named beneficial owner of the Notes, Warrants, Guarantees and/or
common stock is named as a selling securityholder in the Prospectus, dated
                ,
or in amendments or supplements thereto, and that the aggregate principal
amount of the Notes, number of Warrants, Guarantees and/or number of shares of
common stock transferred are [all or a portion of] the Notes, Warrants,
Guarantees and/or common stock listed in such Prospectus, as amended or
supplemented, opposite such owner’s name.


	
   

  	
   

  	
  Very truly yours,

  
	
   

  	
   

  	
  [name]

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  (Authorized Signature)

  
	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
					



 



 A-6