Exhibit 10.6


 


REGISTRATION RIGHTS AGREEMENT


 


This Registration Rights Agreement (this
“Agreement”) is made and entered into as of March 22, 2004, by and between
TIME AMERICA, INC., a Nevada corporation (the “Company”), and Laurus Master
Fund, Ltd. (the “Purchaser”).


 


This Agreement is made pursuant to the
Securities Purchase Agreement, dated as of the date hereof, by and between the
Purchaser and the Company (the “Securities Purchase Agreement”), and pursuant
to the Note and the Warrants referred to therein.


 


The Company and the Purchaser hereby agree as
follows:


 


1.                                       Definitions.  Capitalized terms used and not otherwise
defined herein that are defined in the Securities Purchase Agreement shall have
the meanings given such terms in the Securities Purchase Agreement.  As used in this Agreement, the following
terms shall have the following meanings:


 


“Commission” means the Securities and
Exchange Commission.


 


“Common Stock” means shares of the
Company’s common stock, par value $0.005 per share.


 


“Effectiveness Date” means the 90th day
following the date hereof.


 


“Effectiveness Period” shall have the
meaning set forth in Section 2(a).


 


“Exchange Act” means the Securities
Exchange Act of 1934, as amended, and any successor statute.


 


“Filing Date” means, with respect to the
Registration Statement required to be filed hereunder, a date no later than
forty-five (45) days following the date upon which the principal amount of the
Term Loan to the Company in original principal amount of $2,000,000 has been
funded to the Company.


 


“Holder” or “Holders” means the Purchaser
or any of its affiliates or transferees to the extent any of them hold
Registrable Securities.


 


“Indemnified Party” shall have the meaning
set forth in Section 5(c).


 


“Indemnifying Party” shall have the meaning
set forth in Section 5(c).


 


“Note” has the meaning set forth in the
Securities Purchase Agreement.


 

















 


“Proceeding” means an action, claim, suit,
investigation or proceeding (including, without limitation, an investigation or
partial proceeding, such as a deposition), whether commenced or threatened.


 


“Prospectus” means the prospectus included
in the Registration Statement (including, without limitation, a prospectus that
includes any information previously omitted from a prospectus filed as part of
an effective registration statement in reliance upon Rule 430A promulgated
under the Securities Act), as amended or supplemented by any prospectus
supplement, with respect to the terms of the offering of any portion of the
Registrable Securities covered by the Registration Statement, and all other
amendments and supplements to the Prospectus, including post-effective
amendments, and all material incorporated by reference or deemed to be
incorporated by reference in such Prospectus.


 


“Registrable Securities” means the shares
of Common Stock issuable upon the conversion of the Note and upon exercise of
the Warrants.


 


“Registration Statement” means each
registration statement required to be filed hereunder, including the
Prospectus, amendments and supplements to such registration statement or
Prospectus, including pre- and post-effective amendments, all exhibits thereto,
and all material incorporated by reference or deemed to be incorporated by
reference in such registration statement.


 


“Rule 144” means Rule 144 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.


 


“Rule 415” means 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.


 


“Rule 424” means Rule 424 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.


 


“Securities Act” means the Securities Act
of 1933, as amended, and any successor statute.


 

















 


“Securities Purchase Agreement” means the
agreement between the parties hereto calling for the issuance by the Company of
up to $2,000,000 of convertible Notes plus Warrants.


 


“Trading Market” means any of the NASD OTC
Bulletin Board, NASDAQ SmallCap Market, the Nasdaq National Market, the
American Stock Exchange or the New York Stock Exchange.


 


“Warrants” means the Common Stock purchase
warrants issued pursuant to the Securities Purchase Agreement.


 


2.             Registration.


 


(a)                                  On
or prior to the Filing Date the Company shall prepare and file with the
Commission a Registration Statement covering the Registrable Securities for an
offering to be made on a continuous basis pursuant to Rule 415.  The Registration Statement shall be on Form
S-2, Form SB-2 or Form S-3 (except if the Company is not then eligible to
register for resale the Registrable Securities on such Forms , in which case
such registration shall be on another appropriate form in accordance
herewith).  The Company shall cause the
Registration Statement to become effective and remain effective as provided
herein.  The Company shall use its
reasonable commercial efforts to cause the Registration Statement to be
declared effective under the Securities Act as promptly as possible after the
filing thereof, but in any event no later than the Effectiveness Date.  The Company shall use its reasonable
commercial efforts to keep the Registration Statement continuously effective
under the Securities Act until the date which is the earlier date of when (i)
all Registrable Securities have been sold or (ii) all Registrable Securities
may be sold immediately without registration under the Securities Act and
without volume restrictions pursuant to Rule 144(k), as determined by the
counsel to the Company pursuant to a written opinion letter to such effect,
addressed and acceptable to the Company’s transfer agent and the affected
Holders (the  “Effectiveness Period”).


 


(b)                                 If:
(i) the Registration Statement is not declared effective by the Commission by
the Effectiveness Date; (ii) after the Registration Statement is filed with and
declared effective by the Commission, the Registration Statement ceases to be
effective (by suspension or otherwise) as to all Registrable Securities to
which it is required to relate at any time prior to the expiration of the
Effectiveness Period (without being succeeded immediately by an additional
registration statement filed and declared effective) for a period of time which
shall exceed 45 days in the aggregate per year or more than 20 consecutive
calendar days (defined as a period of 365 days commencing on the


 

















 


date the Registration Statement is declared
effective); or (iii) the Common Stock is not listed or quoted, or is suspended
from trading on any Trading Market for a period of three (3) consecutive
Trading Days (provided the Company shall not have been able to cure such
trading suspension within 30 days of the notice thereof or list the Common
Stock on another Trading Market); (any such failure or breach being referred to
as an “Event,” and for purposes of clause (i) the date on which such Event
occurs, or for purposes of clause (ii) the date which such 30 day or 20
consecutive day period (as the case may be) is exceeded, or for purposes of
clause (iii) the date on which such three (3) Trading Day period is exceeded,
being referred to as “Event Date”), then until the applicable Event is cured,
the Company shall pay to each Holder an amount in cash, as liquidated damages
and not as a penalty, equal to1.0% for each thirty (30) day period (prorated
for partial periods) on a daily basis of the original principal amount of the
Note.  While such Event continues, such
liquidated damages shall be paid not less often than each thirty (30)
days.  Any unpaid liquidated damages as
of the date when an Event has been cured by the Company shall be paid within
three (3) days following the date on which such Event has been cured by the
Company.


 


(c)                                  Within
three business days of the Effectiveness Date, the Company shall cause its
counsel to issue a blanket opinion in the form attached hereto as Exhibit A, to
the transfer agent stating that the shares are subject to an effective
registration statement and can be reissued free of restrictive legend upon
notice of a sale by Laurus and confirmation by Laurus that it has complied with the prospectus delivery requirements,
provided that the Company has not advised the transfer agent orally or in
writing that the opinion has been withdrawn. Copies of the blanket opinion
required by this Section  2(c) shall be delivered to Laurus within the
time frame set forth above.


 


3.                                       Registration
Procedures.  If and whenever the
Company is required by the provisions hereof to effect the registration of any
Registrable Securities under the Securities Act, the Company will, as
expeditiously as possible:


 


(a)                                  prepare
and file with the Commission the Registration Statement with respect to such
Registrable Securities, respond as promptly as possible to any comments
received from the Commission, and use its best efforts to cause the
Registration Statement to become and remain effective for the Effectiveness
Period with respect thereto, and promptly provide to the Purchaser copies of
all filings and Commission letters of comment relating thereto;


 

















 


(b)                                 prepare
and file with the Commission such amendments and supplements to the
Registration Statement and the Prospectus used in connection therewith as may
be necessary to comply with the provisions of the Securities Act with respect
to the disposition of all Registrable Securities covered by the Registration
Statement and to keep such Registration Statement effective until the
expiration of the Effectiveness Period;


 


(c)                                  furnish
to the Purchaser such number of copies of the Registration Statement and the
Prospectus included therein (including each preliminary Prospectus) as the
Purchaser reasonably may request to facilitate the public sale or disposition
of the Registrable Securities covered by the Registration Statement;


 


(d)                                 use
its commercially reasonable efforts to register or qualify the Purchaser’s
Registrable Securities covered by the Registration Statement under the
securities or “blue sky” laws of such jurisdictions within the United States as
the Purchaser may reasonably request, provided, however, that the Company shall
not for any such purpose be required to qualify generally to transact business
as a foreign corporation in any jurisdiction where it is not so qualified or to
consent to general service of process in any such jurisdiction;


 


(e)                                  list
the Registrable Securities covered by the Registration Statement with any
securities exchange on which the Common Stock of the Company is then listed;


 


(f)                                    immediately
notify the Purchaser at any time when a Prospectus relating thereto is required
to be delivered under the Securities Act, of the happening of any event of
which the Company has knowledge as a result of which the Prospectus contained
in such Registration Statement, as then in effect, includes an untrue statement
of a material fact or omits to state a material fact required to be stated
therein or necessary to make the statements therein not misleading in light of
the circumstances then existing; and


 


(g)                                 make
available for inspection by the Purchaser and any attorney, accountant or other
agent retained by the Purchaser, all publicly available, non-confidential
financial and other records, pertinent corporate documents and properties of
the Company, and cause the Company’s officers, to supply all publicly available,
non-confidential information reasonably requested by the attorney, accountant
or agent of the Purchaser.


 


4.                                       Registration
Expenses.  All expenses relating to
the Company’s compliance with Sections 2 and 3 hereof, including, without
limitation, all registration and filing fees, printing expenses, fees and
disbursements of counsel and independent


 

















 


public accountants for the Company, fees and expenses (including
reasonable counsel fees) incurred in connection with complying with state
securities or “blue sky” laws, fees of the NASD, transfer taxes, fees of
transfer agents and registrars, fees of, and disbursements incurred by, one
counsel for the Holders (upon prior agreement by the parties and to the extent
such counsel is required due to Company’s failure to meet any of its
obligations hereunder), are called “Registration Expenses”. All selling
commissions applicable to the sale of Registrable Securities, including any
fees and disbursements of any special counsel to the Holders beyond those included
in Registration Expenses, are called “Selling Expenses.”   The Company shall only be responsible for
all Registration Expenses.


 


5.                                       Indemnification.


 


(a)                                  In
the event of a registration of any Registrable Securities under the Securities
Act pursuant to this Agreement, the Company will indemnify and hold harmless
the Purchaser, and its officers, directors and each other person, if any, who
controls the Purchaser within the meaning of the Securities Act, against any
losses, claims, damages or liabilities, joint or several, to which the
Purchaser, or such persons may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in any Registration
Statement under which such Registrable Securities were registered under the
Securities Act pursuant to this Agreement, any preliminary Prospectus or final
Prospectus contained therein, or any amendment or supplement thereof, or arise
out of or are based upon 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 will reimburse the Purchaser, and each such person
for any reasonable legal or other expenses incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that the Company will not be liable in any such case if and
to the extent that any such loss, claim, damage or liability arises out of
Purchaser’s failure to comply with the prospectus delivery requirements under
the Securities Act or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission so made in conformity with
information furnished by or on behalf of the Purchaser or any such person in
writing specifically for use in any such document.


 


(b)                                 In
the event of a registration of the Registrable Securities under the Securities
Act pursuant to this Agreement, the Purchaser will indemnify and hold harmless
the Company, and its officers, directors and each other person, if any, who
controls the Company within the meaning of the Securities


 

















 


Act, against all losses, claims, damages or
liabilities, joint or several, to which the Company or such persons may become
subject under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of any material fact
which was furnished in writing by the Purchaser to the Company expressly for
use in (and such information is contained in) the Registration Statement under
which such Registrable Securities were registered under the Securities Act
pursuant to this Agreement, any preliminary Prospectus or final Prospectus
contained therein, or any amendment or supplement thereof, or arise out of or
are based upon 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 will reimburse the Company and each such person for any
reasonable legal or other expenses incurred by them in connection with investigating
or defending any such loss, claim, damage, liability or action, provided,
however, that the Purchaser will be liable in any such case if and only to the
extent that any such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission so made in conformity with information furnished in writing to the
Company by or on behalf of the Purchaser specifically for use in any such
document.  Notwithstanding the
provisions of this paragraph, the Purchaser shall not be required to indemnify
any person or entity in excess of the amount of the aggregate net proceeds
received by the Purchaser in respect of Registrable Securities in connection
with any such registration under the Securities Act.


 


(c)                                  Promptly
after receipt by a party entitled to claim indemnification hereunder (an
“Indemnified Party”) of notice of the commencement of any action, such
Indemnified Party shall, if a claim for indemnification in respect thereof is
to be made against a party hereto obligated to indemnify such Indemnified Party
(an “Indemnifying Party”), notify the Indemnifying Party in writing thereof,
but the omission so to notify the Indemnifying Party shall not relieve it from
any liability which it may have to such Indemnified Party other than under this
Section 5(c) and shall only relieve it from any liability which it may
have to such Indemnified Party under this Section 5(c) if and to the
extent the Indemnifying Party is prejudiced by such omission. In case any such
action shall be brought against any Indemnified Party and it shall notify the
Indemnifying Party of the commencement thereof, the Indemnifying Party shall be
entitled to participate in and, to the extent it shall wish, to assume and undertake
the defense thereof with counsel satisfactory to such Indemnified Party, and,
after notice from the Indemnifying Party to such Indemnified Party of its
election so to assume and undertake the defense thereof, the Indemnifying Party
shall not be liable to such Indemnified


 

















 


Party under this Section 5(c) for any
legal expenses subsequently incurred by such Indemnified Party in connection
with the defense thereof; if the Indemnified Party retains its own counsel,
then the Indemnified Party shall pay all reasonable fees, costs and expenses of
such counsel, provided, however, that, if the defendants in any such action
include both the indemnified party and the Indemnifying Party and the
Indemnified Party shall have reasonably concluded that there may be reasonable
defenses available to it which are different from or additional to those
available to the Indemnifying Party or if the interests of the Indemnified
Party reasonably may be deemed to conflict with the interests of the
Indemnifying Party, the Indemnified Party shall have the right to select one
separate counsel and to assume such legal defenses and otherwise to participate
in the defense of such action, with the reasonable expenses and fees of such
separate counsel and other expenses related to such participation to be
reimbursed by the Indemnifying Party as incurred.


 


(d)                                 In
order to provide for just and equitable contribution in the event of joint
liability under the Securities Act in any case in which either (i) the
Purchaser, or any officer, director or controlling person of the Purchaser,
makes a claim for indemnification pursuant to this Section 5 but it is
judicially determined (by the entry of a final judgment or decree by a court of
competent jurisdiction and the expiration of time to appeal or the denial of
the last right of appeal) that such indemnification may not be enforced in such
case notwithstanding the fact that this Section 5 provides for
indemnification in such case, or (ii) contribution under the Securities Act may
be required on the part of the Purchaser or such officer, director or
controlling person of the Purchaser in circumstances for which indemnification
is provided under this Section 5; then, and in each such case, the Company
and the Purchaser will contribute to the aggregate losses, claims, damages or
liabilities to which they may be subject (after contribution from others) in
such proportion so that the Purchaser is responsible only for the portion
represented by the percentage that the public offering price of its securities
offered by the Registration Statement bears to the public offering price of all
securities offered by such Registration Statement, provided, however, that, in
any such case, (A) the Purchaser will not be required to contribute any amount
in excess of the public offering price of all such securities offered by it
pursuant to such Registration Statement; and (B) no person or entity guilty of
fraudulent misrepresentation (within the meaning of Section 10(f) of the
Act) will be entitled to contribution from any person or entity who was not
guilty of such fraudulent misrepresentation.


 

















 


6.                                       Representations
and Warranties.


 


(a)                                  The
Common Stock of the Company is registered pursuant to Section 12(b) or
12(g) of the Exchange Act and, except with respect to certain matters which the
Company has disclosed to the Purchaser on Schedule 4.21 to the Securities
Purchase Agreement, the Company has timely filed all proxy statements, reports,
schedules, forms, statements and other documents required to be filed by it under
the Exchange Act.  The Company has filed
(i) its Annual Report on Form 10-KSB for the fiscal year ended June 30,
2003 and (ii) its Quarterly Report on Form 10-QSB for the fiscal quarters ended
September 30, 2003 and December 31, 2003 and all Current Reports on
Form 8-K that the Company was required to file (collectively, the “SEC
Reports”).  Each SEC Report was, at the
time of its filing, in substantial compliance with the requirements of its
respective form and none of the SEC Reports, nor the financial statements (and
the notes thereto) included in the SEC Reports, as of their respective filing
dates, contained any untrue statement of a material fact or omitted 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.  The financial statements of
the Company included in the SEC Reports comply as to form in all material
respects with applicable accounting requirements and the published rules and
regulations of the Commission or other applicable rules and regulations with
respect thereto.  Such financial
statements have been prepared in accordance with generally accepted accounting
principles (“GAAP”) applied on a consistent basis during the periods involved
(except (i) as may be otherwise indicated in such financial statements or the
notes thereto or (ii) in the case of unaudited interim statements, to the
extent they may not include footnotes or may be condensed) and fairly present
in all material respects the financial condition, the results of operations and
the cash flows of the Company and its subsidiaries, on a consolidated basis, as
of, and for, the periods presented in each such SEC Report.


 


(b)                                 The
Common Stock is listed for trading on the National Association of Securities
Dealers, Inc. Over the Counter Bulletin Board (“NASD OTCBB”) and satisfies all
requirements for the continuation of such listing.  The Company has not received any notice that its Common Stock
will be delisted from the NASD OTCBB (except for prior notices which have been
fully remedied) or that the Common Stock does not meet all requirements for the
continuation of such listing.


 


(c)                                  Neither
the Company, nor any of its affiliates, nor any person acting on its or their
behalf, has directly or indirectly made any offers or sales


 

















 


of any security or solicited any offers to
buy any security under circumstances that would cause the offering of the
Securities pursuant to the Securities Purchase Agreement to be integrated with
prior offerings by the Company for purposes of the Securities Act which would
prevent the Company from selling the Common Stock pursuant to Rule 506 under
the Securities Act, or any applicable exchange-related stockholder approval
provisions, nor will the Company or any of its affiliates or subsidiaries take
any action or steps that would cause the offering of the Securities to be
integrated with other offerings.


 


(d)                                 The
Warrants, the Note and the shares of Common Stock which the Purchaser may acquire
pursuant to the Warrants and the Note are all restricted securities under the
Securities Act as of the date of this Agreement.  The Company will not issue any stop transfer order or other order
impeding the sale and delivery of any of the Registrable Securities at such
time as such Registrable Securities are registered for public sale or an
exemption from registration is available, except as required by federal or
state securities laws.


 


(e)                                  The
Company understands the nature of the Registrable Securities issuable upon the
conversion of the Note and the exercise of the Warrant and recognizes that the
issuance of such Registrable Securities may have a potential dilutive
effect.  The Company specifically
acknowledges that its obligation to issue the Registrable Securities is binding
upon the Company and enforceable regardless of the dilution such issuance may
have on the ownership interests of other shareholders of the Company.


 


(f)                                    Except
for agreements made in the ordinary course of business, there is no agreement
that has not been filed with the Commission as an exhibit to a registration
statement or to a form required to be filed by the Company under the Exchange
Act, the breach of which could reasonably be expected to have a material and
adverse effect on the Company and its subsidiaries, or would prohibit or
otherwise interfere with the ability of the Company to enter into and perform
any of its obligations under this Agreement in any material respect.


 


(g)                                 The
Company will at all times have authorized and reserved a sufficient number of
shares of Common Stock for the full conversion of the Note and exercise of the
Warrants.


 


7.                                       Miscellaneous.


 


(a)                                  Remedies.  In the event of a breach by the Company or
by a Holder, of any of their respective obligations under this Agreement, each
Holder or the Company, as the case may be, in addition to being entitled to


 

















 


exercise all rights granted by law and under
this Agreement, including recovery of damages, will be entitled to specific
performance of its rights under this Agreement.


 


(b)                                 No
Piggyback on Registrations.  Except
as and to the extent specified in Schedule 7(b) hereto or provided that
the Holders give their consent, neither the Company nor any of its security
holders (other than the Holders in such capacity pursuant hereto) may include
securities of the Company in any Registration Statement other than the
Registrable Securities, and the Company shall not after the date hereof enter
into any agreement providing any such right for inclusion of shares in the
Registration Statement to any of its security holders. Except as and to the
extent specified in Schedule 7(b) hereto, the Company has not previously
entered into any agreement granting any registration rights with respect to any
of its securities to any Person that have not been fully satisfied.


 


(c)                                  Compliance.  Each Holder covenants and agrees that it
will comply with the prospectus delivery requirements of the Securities Act as
applicable to it in connection with sales of Registrable Securities pursuant to
the Registration Statement.


 


(d)                                 Discontinued
Disposition.  Each Holder agrees by
its acquisition of such Registrable Securities that, upon receipt of a notice
from the Company of the occurrence of a Discontinuation Event (as defined
below), such Holder will forthwith discontinue disposition of such Registrable
Securities under the applicable Registration Statement until such Holder’s
receipt of the copies of the supplemented Prospectus and/or amended
Registration Statement or until it is advised in writing (the “Advice”) by the
Company that the use of the applicable Prospectus may be resumed, and, in
either case, has received copies of any additional or supplemental filings that
are incorporated or deemed to be incorporated by reference in such Prospectus
or Registration Statement. The Company may provide appropriate stop orders to
enforce the provisions of this paragraph. 
For purposes of this Section 7(d), a “Discontinuation Event” shall
mean (i) when the Commission notifies the Company whether there will be a
“review” of such Registration Statement and whenever the Commission comments in
writing on such Registration Statement (the Company shall provide true and
complete copies thereof and all written responses thereto to each of the
Holders); (ii) any request by the Commission or any other Federal or state
governmental authority for amendments or supplements to such Registration
Statement or Prospectus or for additional information; (iii) the issuance by
the Commission of any stop order suspending the effectiveness of such
Registration Statement covering any or all of the Registrable Securities or


 

















 


the initiation of any Proceedings for that
purpose; (iv) the receipt by the Company of any notification with respect to
the suspension of the qualification or exemption from qualification of any of
the Registrable Securities for sale in any jurisdiction, or the initiation or
threatening of any Proceeding for such purpose; and/or (v) the occurrence of
any event or passage of time that makes the financial statements included in
such Registration Statement ineligible for inclusion therein or any statement
made in such Registration Statement or Prospectus or any document incorporated
or deemed to be incorporated therein by reference untrue in any material respect
or that requires any revisions to such Registration Statement, Prospectus or
other documents so that, in the case of such Registration Statement or
Prospectus, as the case may be, it will not contain any untrue statement of a
material fact or omit to state 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.


 


(e)                                  Piggy-Back
Registrations.  If at any time
during the Effectiveness Period there is not an effective Registration
Statement covering all of the Registrable Securities and the Company shall
determine to prepare and file with the Commission a registration statement
relating to an offering for its own account or the account of others under the
Securities Act of any of its equity securities, other than on Form S-4 or Form
S-8 (each as promulgated under the Securities Act) or their then equivalents
relating to equity securities to be issued solely in connection with any
acquisition of any entity or business or equity securities issuable in
connection with stock option or other employee benefit plans, then the Company
shall send to each Holder written notice of such determination and, if within
fifteen days after receipt of such notice, any such Holder shall so request in
writing, the Company shall include in such registration statement all or any
part of such Registrable Securities such holder requests to be registered to
the extent the Company may do so without violating registration rights of
others which exist as of the date of this Agreement, subject to customary
underwriter cutbacks applicable to all holders of registration rights and
subject to obtaining any required the consent of any selling stockholder(s) to
such inclusion under such registration statement.


 


(f)                                    Amendments
and Waivers.  The provisions of this
Agreement, including the provisions of this sentence, may not be amended,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given, unless the same shall be in writing and
signed by the Company and the Holders of the then outstanding Registrable
Securities. Notwithstanding the foregoing, a waiver or consent to depart from
the provisions hereof with respect to a matter that relates exclusively to the
rights of certain Holders and that does not directly or indirectly affect the
rights of


 

















 


other Holders may be given by Holders of at
least a majority of the Registrable Securities to which such waiver or consent
relates; provided, however, that the provisions of this sentence may not be
amended, modified, or supplemented except in accordance with the provisions of
the immediately preceding sentence.


 


(g)                                 Notices.  Any notice or request hereunder may be given
to the Company or the Purchaser at the respective addresses set forth below or
as may hereafter be specified in a notice designated as a change of address
under this Section 7(g).  Any
notice or request hereunder shall be given by registered or certified mail,
return receipt requested, hand delivery, overnight mail, Federal Express or
other national overnight next day carrier (collectively, “Courier”) or telecopy
(confirmed by mail).  Notices and
requests shall be, in the case of those by hand delivery, deemed to have been
given when delivered to any party to whom it is addressed, in the case of those
by mail or overnight mail, deemed to have been given three (3) business days
after the date when deposited in the mail or with the overnight mail carrier,
in the case of a Courier, the next business day following timely delivery of
the package with the Courier, and, in the case of a telecopy, when
confirmed.  The address for such notices
and communications shall be as follows:


 


	
  If to the Company:

  	
   

  	
  Time
  America, Inc.

  51 West Third Street, Suite 310

  Tempe, Arizona 85281

  Attention: Craig J. Smith

  Facsimile: (480) 967-5444

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  with a copy to:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Gregory R.
  Hall, Esq.

  Squire, Sanders & Dempsey L.L.P.

  Two Renaissance Square

  40 North Central Avenue, Suite 2700

  Phoenix, Arizona 85004

  Facsimile: (602) 253-8129

  



 

















 


	
  If to a Purchaser:

  	
   

  	
  Laurus
  Master Fund, Ltd.

  c/o Ironshore Corporate Services Ltd.

  P.O. Box 1234 G.T.

  Queensgate House, South Church Street

  Grand Cayman, Cayman Islands

  Facsimile: (345) 949-9877

  
	
   

  	
   

  	
   

  
	
  With a copy to:

  	
   

  	
  John E.
  Tucker, Esq.

  825 Third Avenue – 14th Floor

  New York, New York 10022

  Facsimile: (212) 541-4434

  
	
   

  	
   

  	
   

  
	
  If to any other
  Person who

  	
   

  	
   

  
	
  is then the
  registered

  Holder:

  	
   

  	
  To the
  address of such Holder as it

  appears in the stock transfer books of the

  Company

  



 


or such other address as may be
designated in writing hereafter in accordance with this Section 7(g) by
such Person.


 


(h)                                 Successors
and Assigns.  This Agreement shall
inure to the benefit of and be binding upon the successors and permitted
assigns of each of the parties and shall inure to the benefit of each Holder.
The Company may not assign its rights or obligations hereunder without the
prior written consent of each Holder. 
Each Holder may assign their respective rights hereunder in the manner
and to the Persons as permitted under the Notes and the Security Agreement with
the prior written consent of the Company, which consent shall not be
unreasonably withheld.


 


(i)                                     Execution
and Counterparts.  This Agreement
may be executed in any number of 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. In the event that any signature is
delivered by facsimile transmission, such signature shall create a valid
binding obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile
signature were the original thereof.


 


(j)                                     Governing
Law.  All questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall
be governed by and construed and enforced in accordance with the internal laws
of the State of New York, without regard to the principles of conflicts of law
thereof.  Each


 

















 


party agrees that all Proceedings concerning
the interpretations, enforcement and defense of the transactions contemplated
by this Agreement shall be commenced exclusively in the state and federal
courts sitting in the City of New York, Borough of Manhattan. Each party hereto
hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in the City of New York, Borough of Manhattan for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any Proceeding, any claim that it is not
personally subject to the jurisdiction of any such court, that such Proceeding
is improper.  Each party hereto hereby
irrevocably waives personal service of process and consents to process being
served in any such Proceeding by mailing a copy thereof via registered or
certified mail or overnight delivery (with evidence of delivery) to such party
at the address in effect for notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. Each party hereto hereby
irrevocably waives, to the fullest extent permitted by applicable law, any and
all right to trial by jury in any legal proceeding arising out of or relating
to this Agreement or the transactions contemplated hereby. If either party
shall commence a Proceeding to enforce any provisions of a Transaction
Document, then the prevailing party in such Proceeding shall be reimbursed by
the other party for its reasonable attorneys fees and other costs and expenses
incurred with the investigation, preparation and prosecution of such
Proceeding.


 


(k)                                  Cumulative
Remedies.  The remedies provided
herein are cumulative and not exclusive of any remedies provided by law.


 


(l)                                     Severability.  If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to
be invalid, illegal, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions set forth herein shall remain in full
force and effect and shall in no way be affected, impaired or invalidated, and
the parties hereto shall use their reasonable efforts to find and employ an
alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is hereby
stipulated and declared to be the intention of the parties that they would have
executed the remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or
unenforceable.


 

















 


(m)                               Headings.
 The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.


 


[BALANCE OF PAGE INTENTIONALLY
LEFT BLANK;

SIGNATURE PAGE FOLLOWS]


 

















 


IN WITNESS WHEREOF, the parties have executed
this Registration Rights Agreement as of the date first written above.


 


	
  TIME
  AMERICA, INC.

  	
   

  	
  LAURUS
  MASTER FUND, LTD.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  



 

















 


EXHIBIT A


 


[               ,
2004]


 


[               
Stock Transfer
   & Trust Company

[Address]


 


 Attn:[                              ]


 


Re:                               Time
America, Inc. Registration Statement on Form [SB-2]


 


Ladies and Gentlemen:


 


As counsel
to[company name] , a Delaware corporation (the “Company”), we have been
requested to render our opinion to you in connection with the resale by the
individuals or entitles listed on Schedule A attached hereto (the “Selling
Stockholders”), of an aggregate of [amount]shares (the “Shares”) of the
Company’s Common Stock.


 


A Registration
Statement on Form [SB-2] under the Securities Act of 1933, as amended (the
“Act”), with respect to the resale of the Shares was declared effective by the
Securities and Exchange Commission on [date]. 
Enclosed is the Prospectus dated [date].  We understand that the Shares are to be offered and sold in the
manner described in the Prospectus.


 


Based upon the
foregoing, upon request by the Selling Stockholders at any time while the
registration statement remains effective, it is our opinion that the Shares
have been registered for resale under the Act and new certificates evidencing
the Shares upon their transfer or re-registration by the Selling Stockholders
may be issued without restrictive legend. 
We will advise you if the registration statement is not available or
effective at any point in the future.


 


Very truly yours,


 


 


[Company counsel]


 

















 


Schedule A


 


	
  Selling
  Stockholder

  	
   

  	
  R/N/O

  	
   

  	
  Shares

  Being Offered