**Exhibit 10.10**

 

**AMENDMENTNO. 1 TO**

**REGISTRATIONRIGHTS AGREEMENT**

 

This AMENDMENT NO. 1 TO REGISTRATION RIGHTSAGREEMENT (the “Amendment”) is entered into as of November       ,2005 (the “Amendment Date”), by and among DynTek, Inc., a Delawarecorporation (the “Company”) and the investors set forth on Schedule 1 hereto(the “Amending Purchasers”).  Capitalizedterms used herein but not otherwise defined herein shall have the meaningascribed to such terms in the Registration Rights Agreement (as defined in theRecitals below).

 

**RECITALS**

 

A.            WHEREAS,the Company entered into that certain Registration Rights Agreement dated as ofOctober 15, 2004, by and among the Company and the purchasers set forth onSchedule 1 thereto (the “Original Purchasers”) (the “Agreement”);

 

B.            WHEREAS,Section 10 of the Registration Rights Agreement permits the amendment ofsuch Agreement upon the consent in writing by the Company and each Original Purchaser;

 

C.            WHEREAS,to induce the Amending Purchasers to amend their certain 9% Senior SubordinatedConvertible Notes, each dated as of October 15, 2004, sold and issued tothe respective Amending Purchasers thereof (each an “Original Note” andcollectively, the “Original Notes”), the Company has agreed, contemporaneouslywith the issuance to each such Amending Purchaser of that certain Amended andRestated 9% Senior Subordinated Convertible Note, each dated as of an even dateherewith (each an “Amended Note” and collectively, the “Amended Notes”), toprovide to the Amending Purchasers certain registration rights, with respect tothe Additional Note Shares (as defined in the Amended Notes), under theSecurities Act of 1933, as amended (the “Securities Act”), and applicable statesecurities laws;

 

D.            WHEREAS,to further induce the Amending Purchasers to enter into the Amended Notes, theCompany has agreed to amend and restate those certain Warrants, each dated asof October 15, 2004, sold and issued to each respective Amending Purchaserthereof (each an “Original Warrant” and collectively, the “Original Warrants”)to reduce the exercise price and increase the number of shares exercisablethereunder (each an “Amended Warrant” and collectively, the “Amended Warrants”);

 

E.             WHEREAS,in connection with the issuance of the Amended Warrants, the Company has agreedto provide to the Amending Purchasers certain registration rights, with respectto the Additional Warrant Shares (as defined in the Amended Warrants), underthe Securities Act, and applicable state securities laws;

 

F.             WHEREAS,the Amending Purchasers and the Company desire to further amend theRegistration Rights Agreement as more particularly set forth in this Amendmentto provide for the rights of registration with respect to the Additional NoteShares and Additional Warrant Shares, respectively.

 

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**AGREEMENT**

 

NOW, THEREFORE, in consideration of themutual covenants hereinafter set forth and for good and valuable consideration,receipt of which is hereby acknowledged, the parties hereby agree as follows:

 

# **1.              Definitions.**

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(a)          “AdditionalRegistrable Securities” means (i) the Additional Note Shares andAdditional Warrant Shares; (ii) securities issued or issuable upon anystock split, stock dividend, recapitalization or similar event with respect tosuch shares; and (iii) any other security issued as a dividend or otherdistribution with respect to, in exchange for, or in replacement of, thesecurities referred to in the preceding clauses (i) and (ii).

 

(b)          “Holderor Holders” means a holder or holders of Registrable Securities and/or AdditionalRegistrable Securities.

 

(c)          “AdditionalRegistration Statement” means a registration statement or registrationstatements of the Company filed under the Securities Act covering AdditionalRegistrable Securities.

 

(c)          Thedefinitions of Registration Statement, Registrable Securities, Purchaser andNotes in the Agreement are, for purposes of Sections 4 through 12 of theAgreement, hereby amended to include the Additional Registration Statement, AdditionalRegistrable Securities, the Amending Purchasers and the Amended Notes,respectively.

 

# **2.              Piggyback Registration.**

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# **(a)            If the Company proposes to register(including for this purpose a registration effected by the Company forstockholders other than the Holders) any of its stock under the Securities Actin connection with the public offering of such securities solely for cash(other than a registration relating solely to the sale of securities to participantsin a Company stock plan, a transaction covered by Rule 145 under theSecurities Act or a registration relating solely to employee benefit plans),the Company shall, at such time, promptly give each Holder written notice ofsuch registration.  Upon the writtenrequest of each Holder given within ten (10) business days after mailingof such notice by the Company in accordance with Section 12 of theAgreement, the Company shall, subject to the provisions of Section 2(b) herein,use its best efforts to cause to be registered under the Securities Act all ofthe Additional Registrable Securities that each such Holder has requested to beregistered.**

#  

# **(b)            For purposes of this Section 2,if the registration of which the Company gives notice is for a registeredpublic offering involving an underwriting, the Company shall so advise theHolder as a part of the written notice given pursuant to Section 2(a) above.  In such event, the right of the Holder toregistration pursuant to this Section 2 shall be conditioned upon suchHolder’s participation in such underwriting and the inclusion of Holder’sAdditional Registrable Securities in such underwriting to the extent providedherein.  The Holder proposing todistribute its securities through such underwriting shall (together with the Companyand the other Holders of securities of**

 

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# **the Companywith registration rights to participate therein distributing their securitiesthrough such underwriting) enter into an underwriting agreement in customaryform with the representative of the underwriter or underwriters selected by theCompany.   Notwithstanding any other provisionof this Section 2, if the representative of the underwriters advises the Companyin writing that marketing factors require a limitation on the number of sharesto be underwritten, the representative may (subject to the limitations setforth below) exclude all Additional Registrable Securities from, or limit thenumber of Additional Registrable Securities to be included in, the registrationand underwriting.  The Company shall soadvise all holders of securities requesting registration, and the number ofshares of securities that are entitled to be included in the registration andunderwriting shall be allocated first to the Company for securities being soldfor its own account and thereafter to the Holders of Additional RegistrableSecurities, pro rata in accordance with the number of Additional RegistrableSecurities beneficially owned by each such Holder.  If any Holder does not agree to the terms ofany such underwriting, such Holder shall be excluded therefrom by writtennotice from the Company or the underwriter. Any Additional Registrable Securities or other securities excluded orwithdrawn from such underwriting shall be withdrawn from such registration.**

 

3.              MandatoryRegistration.

 

(a)           If at anytime on orafter December 15, 2005, any Additional Registrable Securities shall nothave been registered by the Company pursuant to Section 2 hereof, then theHolders of at least a majority of the Additional Registrable Securities(assuming conversion of the Amended Notes and exercise of the Amended Warrants)shall have the right by delivery of notice to the Company, to request that theCompany effect a registration on Form S-3 covering the resale of all ofthe Additional Registrable Securities, in an amount sufficient to cover theresale of all the Additional Registrable Securities, issuable upon conversionof the Amended Notes and exercise of the Amended Warrants.  The date on which the Company receives suchnotice is referred to herein as the “Demand Date.”  In the event that Form S-3 isunavailable and/or inappropriate for such a registration of all the Additional RegistrableSecurities, the Company shall use such other form or forms as are available andappropriate for such a registration.  TheCompany shall use its commercially reasonable efforts to cause such Additional RegistrationStatement to be filed under the Securities Act as promptly as practicable afterreceipt of notice of such demand, but in any event prior to 30 days followingthe Demand Date and to cause such Additional Registration Statement to bedeclared effective under the Securities Act as promptly as practicable, but inany event prior to 90 days following the Demand Date (the “Demand EffectiveDate”); provided that, if (1) the Additional Registration Statementis not declared effective by the Demand Effective Date, (2) the AdditionalRegistration Statement required to be filed by the Company pursuant to this Section 3shall cease to be available for use by any Holder of the Amended Note which isnamed therein as a selling stockholder for any reason (including, withoutlimitation, by reason of a stop order, a material misstatement or omission insuch Additional Registration Statement or the information contained in such AdditionalRegistration Statement having become outdated), or (3) the Company fails,refuses or is otherwise unable timely to issue, the Note Shares and/or WarrantShares upon conversion of the Amended Notes or upon exercise of the AmendedWarrants in accordance with the terms of thereof, respectively, or stock certificatestherefor, then the Company shall pay to each Purchaser an amount equal to onepercent (1%) per 30-day period of the purchase price paid for the Amended Notespurchased by such Amending Purchaser.  Thereafter,for every 30 days that pass during which any of the events described in clauses(1), (2) and (3) above occurs and is continuing (the “Blackout Period”),the Company shall pay to each Amending Purchaser an additional amount equal toone percent (1%) of the purchase price paid for the Amended Notes purchased bysuch Amending Purchaser.  Each suchpayment shall be due within five days of the end of each calendar month of the

 

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BlackoutPeriod until the termination of the Blackout Period and within five (5) daysafter such termination.  Such paymentsshall be in partial compensation to the Amending Purchaser, and shall notconstitute the Purchaser’s exclusive remedy for such events. The BlackoutPeriod shall terminate upon (x) the effectiveness of the Additional RegistrationStatement in the case of clauses (1) and (2) above, and (z) deliveryof such shares or certificates in the case of clause (3) above.

 

(b)           The Company shalluse its best efforts to keep each Additional Registration Statement effective(pursuant to Rule 415, if available) at all times until such date as isthe earlier of (i) the date on which all of the Additional RegistrableSecurities have been sold and (ii) the date on which the Additional RegistrableSecurities (in the opinion of counsel to each Purchaser and reasonablyacceptable to legal counsel for the Company) may be immediately sold withoutrestriction (including without limitation as to volume restrictions by eachholder thereof) without registration under the Securities Act (the “NewRegistration Period”).

 

(c)           If the AdditionalRegistrable Securities are registered for sale under the Securities Act, theAmending Purchasers shall cease any distribution of such shares under the AdditionalRegistration Statement not more than once in any 12-month period, for up to 30days, upon the request of the Company if: (x) such distribution would requirethe public disclosure of material non-public information concerning anytransaction or negotiations involving the Company or any of its affiliatesthat, in the good faith judgment of the Company’s Board of Directors, wouldmaterially interfere with such transaction or negotiations, (y) suchdistribution would otherwise require premature disclosure of information that,in the good faith judgment of the Company’s Board of Directors, would adverselyaffect or otherwise be detrimental to the Company or (z) the Company proposesto file a registration statement under the Securities Act for the offering andsale of securities for its own account in an underwritten offering and themanaging underwriter therefor shall advise the Company in writing that in itsopinion the continued distribution of the Additional Registrable Securitieswould adversely affect the offering of the securities proposed to be registeredfor the account of the Company.  TheCompany shall promptly notify each Amending Purchaser at such time as (i) suchtransactions or negotiations have been otherwise publicly disclosed orterminated, or (ii) such non-public information has been publiclydisclosed or counsel to the Company has determined that such disclosure is notrequired due to subsequent events.

 

(d)           The Company shallpermit a single firm of counsel designated by the Amending Purchasers to reviewsuch Additional Registration Statement with respect to the AdditionalRegistrable Securities only, and all amendments and supplements thereto(collectively, the “Registration Documents”) a reasonable period of time priorto their filing with the SEC, and not file (or send) any Registration Documentsin a form to which such counsel reasonably and promptly objects.  The sections of such Additional RegistrationStatement covering information with respect to the Amending Purchasers, theAmending Purchaser’s beneficial ownership of securities of the Company or theAmending Purchasers intended method of disposition of Additional RegistrableSecurities shall conform to the information provided to the Company by each ofthe Amending Purchasers.

 

4.              Obligations ofthe Company.  In connection with theregistration of the Additional Registrable Securities, the Company shall doeach of the following:

 

(a)            Prepare and filewith the SEC the Additional Registration Statement required by Sections 3 ofthis Amendment, as applicable, and such amendments (including post-effectiveamendments) and supplements to the Additional Registration Statement and theprospectus used in

 

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connectionwith the Additional Registration Statement, as may be necessary to keep the AdditionalRegistration Statement effective at all times during the New RegistrationPeriod, and, during the New Registration Period, to comply with the provisionsof the Securities Act with respect to the disposition of all of the Additional RegistrableSecurities until such time as all of such Additional Registrable Securitieshave been disposed of in accordance with the intended methods of disposition bythe seller or sellers thereof as set forth in the Additional Registration Statement;

 

(b)            The Company shallpromptly furnish, after such Additional Registration Statement required bySections 3 of this Amendment are prepared, filed with the SEC, publiclydisseminated and distributed and received by the Company, to each AmendingPurchaser and its legal counsel, a copy, by facsimile or email or otherwise, ofany such Additional Registration Statement, each preliminary prospectus, eachfinal prospectus, and all amendments and supplements thereto and such otherdocuments as each Amending Purchaser may reasonably request in order tofacilitate the disposition of its Additional Registrable Securities;

 

(c)            Use commerciallyreasonable efforts to (i) register and qualify the Additional RegistrableSecurities covered by the Additional Registration Statement under such othersecurities or blue sky laws, if applicable, of such jurisdictions as thePurchaser may reasonably request, (ii) prepare and file in thosejurisdictions such amendments (including post-effective amendments) andsupplements to such registrations and qualifications as may be necessary tomaintain the effectiveness thereof at all times during the New RegistrationPeriod, (iii) take such other actions as may be necessary to maintain suchregistrations and qualifications in effect at all times during the NewRegistration Period and (iv) take all other actions necessary or advisableto qualify the Additional Registrable Securities for sale in suchjurisdictions, except that the Company shall not for any such purpose berequired to qualify generally to do business as a foreign corporation in anyjurisdiction wherein it would not but for the requirements of this subsection (d) beobligated to be so qualified, or to subject itself to taxation in any suchjurisdiction, or to consent to general service of process in any suchjurisdiction;

 

(d)            List suchsecurities on The Nasdaq National Market, or, if the Company’s securities arenot then listed on such market, then on the OTC Electronic Bulletin Board (the “OTCBB”), and all the other national securities exchanges on which any securitiesof the Company are then listed, and file any filings required by The NasdaqNational Market or OTC BB, as applicable, or such other securities exchanges;

 

(e)            Notify by facsimileor email each Amending Purchaser (i) when or if the prospectus or anyprospectus supplement or post-effective amendment has been filed with the SEC,and, with respect to any Additional Registration Statement or anypost-effective amendment, when the same has been declared effective by the SEC,(ii) of any request by the SEC for amendments or supplements to the AdditionalRegistration Statement or the prospectus or for additional information, (iii) ofthe issuance by the SEC of any stop order suspending the effectiveness of such AdditionalRegistration Statement or the initiation of any proceedings for that purpose, (iv) ofthe receipt by the Company of any notification with respect to the suspensionof the qualification of the Additional Registrable Shares for sale in anyjurisdiction or the initiation or threatening of any proceeding for suchpurpose, and (v) of the happening of any event as a result of which theprospectus included in such Additional Registration Statement, as then ineffect, includes an untrue statement of a material fact or omits to state amaterial fact required to be stated therein or necessary to make the statementstherein not misleading in the light of the circumstances then existing;

 

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(f)             If any factcontemplated by clause (v) of paragraph (e), above, shall exist, promptlyprepare a supplement or post-effective amendment to such Additional RegistrationStatement or the related prospectus or any document incorporated therein byreference or file any other required document so that, as thereafter deliveredto the purchaser of the Additional Registrable Securities, the prospectus willnot contain an untrue statement of material fact or omit to state any materialfact necessary to make the statements therein not misleading;

 

(g)            If the Company hasconsented to an underwritten offering and such offering is underwritten, at therequest of any Amending Purchaser, to furnish on the effective date of theapplicable Additional Registration Statement and on the date that AdditionalRegistrable Securities are delivered to the underwriters for sale pursuant tosuch registration: (i) an opinion dated such date of counsel representingthe Company for the purposes of such registration, addressed to the underwritersand to such Amending Purchaser, stating that such Additional Registration Statementhas become effective under the Securities Act and that (A) to the bestknowledge of such counsel, no stop order suspending the effectiveness thereofhas been issued and no proceedings for that purpose have been instituted or arepending or contemplated under the Securities Act and (B) the Additional RegistrationStatement, the related prospectus and each amendment or supplement thereofcomply as to form in all material respects with the requirements of theSecurities Act (except that such counsel need not express any opinion as tofinancial statements or other financial data contained therein) and (ii) aletter dated such date from the Company’s independent public accountantsaddressed to the underwriters and to such Amending Purchaser, stating that theyare independent public accountants within the meaning of the Securities Act andthat, in the opinion of such accountants, the financial statements of the Companyincluded in the Additional Registration Statement or the prospectus, or anyamendment or supplement thereof, comply as to form in all material respectswith the applicable accounting requirements of the Securities Act, and suchletter shall additionally cover such other financial matters (includinginformation as to the period ending no more than five business days prior tothe date of such letter) with respect to such registration as such underwritersmay reasonably request;

 

(h)            Cooperate with theAmending Purchasers to facilitate the timely preparation and delivery ofcertificates for the Additional Registrable Securities to be offered pursuantto the Additional Registration Statement and to enable such certificates forthe Additional Registrable Securities to be in such denominations or amounts,as the case may be, as the Amending Purchaser may reasonably request, andregistered in such names as the Amending Purchasers may request; and, withinthree business days after a Additional Registration Statement which includesAdditional Registrable Securities is ordered effective by the SEC, the Companyshall deliver, and shall cause legal counsel selected by the Company todeliver, to the transfer agent for the Additional Registrable Securities (withcopies to each Amending Purchaser) an appropriate instruction and opinion ofsuch counsel, satisfactory to the Company, and the Amending Purchaser and itslegal counsel;

 

(i)             Enter intocustomary agreements (including, in the case of an underwritten offering,underwriting agreements in customary form, and including provisions withrespect to indemnification and contribution in customary form and consistentwith the provisions relating to indemnification and contribution containedherein) and take all other customary and appropriate actions in order toexpedite or facilitate the disposition of such Additional RegistrableSecurities and in connection therewith:

 

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(i) make such representations and warranties to each Amending Purchaserand the underwriters, if any, in form, substance and scope as are customarilymade by issuers to underwriters in similar underwritten offerings;

 

(ii) to the extent requested and customary for the relevanttransaction, enter into a securities sales agreement with any AmendingPurchaser and such representative of such Amending Purchaser as such AmendingPurchaser shall select relating to the registration and providing for, amongother things, the appointment of such representative as agent for such AmendingPurchaser for the purpose of soliciting purchases of Additional RegistrableSecurities, which agreement shall be customary in form, substance and scope andshall contain customary representations, warranties and covenants; and

 

(iii) deliver such customary documents and certificates as may bereasonably requested by any Amending Purchaser whose Additional RegistrableSecurities are being sold or by the managing underwriters, if any.

 

(j)             The Company shallhold in confidence and not make any disclosure of information concerning any AmendingPurchaser provided to the Company unless (i) disclosure of suchinformation is necessary to comply with federal or state securities laws and/orthe requests of any self-regulatory organizations, (ii) the disclosure ofsuch information is necessary to avoid or correct a misstatement or omission inany Additional Registration Statement, (iii) the release of suchinformation is ordered pursuant to a subpoena or other order from a court orgovernmental body of competent jurisdiction, or (iv) such information hasbeen made generally available to the public other than by disclosure inviolation of this or any other agreement.  The Company agrees that it shall, uponlearning that disclosure of such information concerning any Amending Purchaseris sought in or by a court or governmental body of competent jurisdiction, giveprompt notice to such Purchaser prior to making such disclosure, and allow suchAmending Purchaser, at its expense, to undertake appropriate action to preventdisclosure of, or to obtain a protective order for, such information.

 

5.              The terms andprovisions of this Amendment are binding only on the Amending Purchasers, and,except as specifically amended pursuant to the terms hereof, the terms andprovisions of the Registration Rights Agreement shall remain in full force andeffect.

 

6.              This Amendment maybe executed in any number of counterparts, each of which when so executed anddelivered shall be deemed an original, and such counterparts together shall constituteone instrument.

 

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IN WITNESSWHEREOF, the undersigned have executed this Amendment No. 1 to RegistrationRights Agreement as of the date first written above.

 
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|   | **AMENDING PURCHASERS** |
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