Exhibit 4.18

                                                            EXECUTION VERSION

                          REGISTRATION RIGHTS AGREEMENT

         This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made as of
January 31, 2003 by and among (i) EP MedSystems, Inc., a New Jersey corporation
(the "Company"), (ii) each purchaser of Common Stock (as defined below) and
Warrants (as defined below) pursuant to the Stock Purchase Agreement (as defined
below) (collectively, the "Initial Investors" and each individually, an "Initial
Investor"), and (iii) each person or entity that subsequently becomes a party to
this Agreement pursuant to, and in accordance with, the provisions of Section 12
hereof (each an "Investor Permitted Transferee" and collectively, the "Investor
Permitted Transferees");

         WHEREAS, the Company has agreed to issue and sell to the Initial
Investors, and the Initial Investors have agreed to purchase from the Company:
up to an aggregate of 3,000,000 shares (the "Purchased Shares") of the Company's
common stock, no par value, $0.001 stated value per share (the "Common Stock")
and (ii) Warrants ("Warrants") to purchase an aggregate of up to 1,200,000
shares of Common Stock (the "Warrant Shares"), all upon the terms and conditions
set forth in that certain Common Stock and Warrant Purchase Agreement, dated of
even date herewith, between the Company and the Initial Investors (the "Stock
Purchase Agreement");

         WHEREAS, each Initial Investor shall be listed on Exhibit A hereto, as
such Exhibit shall be amended as a result of each Additional Closing (as defined
in the Stock Purchase Agreement); and

         WHEREAS, the terms of the Stock Purchase Agreement provide that it
shall be a condition precedent to the closing of the transactions thereunder,
for the Company and the Initial Investors to execute and deliver this Agreement.

         NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the parties hereto hereby agree as follows:

1.               Definitions. The following terms shall have the meanings
 provided therefor below or elsewhere in this Agreement as described below:

                  "Board" shall mean the board of directors of the Company.

                  "Closing" shall have the meaning ascribed to such term in the
Stock Purchase Agreement.

                  "Closing Date" shall have the meaning ascribed to such term in
the Stock Purchase Agreement.

                  "Effectiveness Deadline" shall be ninety (90) days after the
Filing Date Deadline.

                  "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and all of the rules and regulations promulgated thereunder.

                  "Filing Date Deadline" shall be thirty (30) business days
after the Closing Date.
<PAGE>

                  "Investors" shall mean, collectively, the Initial Investors
and the Investor Permitted Transferees; provided, however, that the term
"Investors" shall not include any of the Initial Investors or any of the
Investor Permitted Transferees that ceases to own or hold any Purchased Shares.

                  "Majority Holders" shall mean, at the relevant time of
reference thereto, those Investors holding and/or having the right to acquire,
as the case may be, more than fifty percent (50%) of the Registrable Shares held
by all of the Investors.

                  "NASD" shall mean the National Association of Securities
Dealers, Inc.

                  "Person" shall mean an individual, corporation, company,
partnership, firm, association, joint venture, trust, unincorporated
organization, government, governmental body, agency, political subdivision or
other entity.

                   "Qualifying Holder" shall have the meaning ascribed thereto
in Section 12 hereof.

                  "Registrable Shares" shall mean (i) the Purchased Shares, (ii)
the Warrant Shares and (iii) any Common Stock of the Company issued as (or
issuable upon the conversion or exercise of any warrant, right or other security
that is issued as) a dividend or other distribution (including a stock split or
reverse stock split) with respect to, or in exchange for, or in replacement of,
the shares referenced in (i) or (ii) above after the Closing and prior to the
date upon which the Registration Statement is declared effective by the SEC;
provided, however, such term shall not, after the Mandatory Registration
Termination Date, include any of the Purchased Shares that become or have become
eligible for resale pursuant to subsection (k) of Rule 144.

                  "Rule 144" shall mean Rule 144 promulgated under the
Securities Act and any successor or substitute rule, law or provision.

                  "SEC" shall mean the Securities and Exchange Commission.

                  "Securities Act" shall mean the Securities Act of 1933, as
amended, and all of the rules and regulations promulgated thereunder.

2.   Effectiveness; Termination. This Agreement shall become effective and
     legally binding only if the Closing occurs. This Agreement shall terminate
     and be of no further force or effect, automatically and without any action
     being required of any party hereto, upon the termination of the Stock
     Purchase Agreement pursuant to Section 7 thereof. Nothing contained herein
     or in any agreement or document relating to this transaction, and no action
     taken by any Investor, shall be deemed to constitute the Investors as, or
     to create any presumption that the Investors are in any way acting in
     concert or as, a group with respect to the obligations or transaction
     hereunder. Each Investor shall be entitled to independently protect and
     enforce its rights hereunder.
<PAGE>

3.   Registration.

(a)  Within thirty (30) business days after the Closing Date, the Company shall
     prepare and file with the SEC a registration statement on Form S-3 for the
     purpose of registering under the Securities Act all of the Registrable
     Shares for resale by, and for the account of, the Investors as selling
     stockholders thereunder (the "Registration Statement"). The Registration
     Statement shall permit the Investors to offer and sell, on a delayed or
     continuous basis pursuant to Rule 415 under the Securities Act, any or all
     of the Registrable Shares. The Company shall be required to keep the
     Registration Statement effective until such date that is the earlier of (i)
     the date when all of the Registrable Shares registered thereunder shall
     have been sold or (ii) the date on which all of the Registrable Shares may
     be immediately sold without restriction (including, without any limitation,
     as to volume or manner of sale by each Investor) and without registration
     under the Securities Act (the "Mandatory Registration Termination Date").
     Thereafter, the Company shall be entitled to withdraw the Registration
     Statement and the Investors shall have no further right to offer or sell
     any of the Registrable Shares pursuant to the Registration Statement (or
     any prospectus relating thereto).

(b)  Unless otherwise agreed to by the Company, the offer and sale of the
     Registrable Shares pursuant to the Registration Statement shall not be
     underwritten.

(c)  The Company represents and warrants that, as of the date of this Agreement,
     it meets the requirements for the use of Form S-3 for registration of the
     resale by the Investors of the Registrable Shares, and it will use its
     commercially reasonable efforts to continue to meet such requirements
     during the period in which it takes to have the Registration Statement
     declared effective.

(d)  The Company shall cause all of the Registrable Shares to be listed on The
     Nasdaq National Market or the Nasdaq SmallCap Market.

(e)  This Section 3(e) shall apply to the Company's obligation under Section
     3(a) hereof to file the Registration Statement with the SEC and to cause
     such Registration Statement to become effective. The Company and Initial
     Investors agree that the Investors will suffer damages if the Registration
     Statement is not filed on or prior to the Filing Date Deadline and not
     declared effective by the SEC on or prior to the Effectiveness Deadline.
     The Company and the Initial Investors further agree that it would not be
     feasible to ascertain the extent of such damages with precision.
     Accordingly, if (i) the Registration Statement is not filed on or prior to
     the Filing Date Deadline; or (ii) the Registration Statement is not
     declared effective prior to the Effectiveness Deadline (unless, in each
     case, an Event results, directly or indirectly, from any act of war or
     terrorism) (each of the events listed in (i)-(ii) above being referred to
     as an "Event"), then the Company shall pay to each Initial Investor as
     liquidated damages for any such failure and not as a penalty (the
     "Liquidated Damages") an amount equal to 2.0% of the Purchase Price for the
     Shares paid by such Initial Investor pursuant to the Stock Purchase
     Agreement (the "Liquidated Damages Amount") for each full thirty (30) day
     period following the Event until the applicable Event has been cured. In
     any event, no Liquidated Damages shall accrue after the six (6) month
     anniversary of the Closing Date. Payments to be made pursuant to this
     Section 3(e) shall be due and payable in immediately available funds or in
     the form of Common Stock within three days of such payment becoming payable
     hereunder. The parties agree that the Liquidated Damages represent a
     reasonable estimate on the part of the parties, as of the date of this
     Agreement, of the amount of damages that may be incurred by the Investors
     if the Registration Statement is not filed on or prior to the Filing Date
     Deadline or has not been declared effective by the SEC on or prior to the
     Effectiveness Deadline.
<PAGE>

4.   "Piggyback" Registration Rights.

(a)  If, at any time after the Mandatory Registration Termination Date, the
     Company proposes to register any of its Common Stock under the Securities
     Act, whether as a result of a primary or secondary offering of Common Stock
     or pursuant to registration rights granted to holders of other securities
     of the Company (but excluding in all cases any registrations to be effected
     on Forms S-4 or S-8 or other applicable successor forms), the Company
     shall, each such time, give to the Investors holding Registrable Shares
     written notice of its intent to do so. Upon the written request of any such
     Investor given within 20 days after the giving of any such notice by the
     Company, the Company shall use reasonable efforts to cause to be included
     in such registration the Registrable Shares of such selling Investor, to
     the extent requested to be registered; provided that (1) the number of
     Registrable Shares proposed to be sold by such selling Investor is equal to
     at least twenty-five percent (25%) of the total number of Registrable
     Shares then held by such participating selling Investor, (ii) such selling
     Investor agrees to sell those of its Registrable Shares to be included in
     such registration in the same manner and on the same terms and conditions
     as the other shares of Common Stock which the Company proposes to register
     and (iii) if the registration is to include shares of Common Stock to be
     sold for the account of the Company or any party exercising demand
     registration rights pursuant to any other agreement with the Company, the
     proposed managing underwriter does not advise the Company that in its
     opinion the inclusion of such selling Investor's Registrable Shares
     (without any reduction in the number of shares to be sold for the account
     of the Company or such party exercising demand registration rights) is
     likely to affect materially and adversely the success of the offering or
     the price that would be received for any shares of Common Stock offered, in
     which case the rights of such selling Investor shall be as provided in
     Section 4(b) hereof.

(b)  If a registration pursuant to Section 4(a) hereof involves an underwritten
     offering and the managing underwriter shall advise the Company in writing
     that, in its opinion, the number of shares of Common Stock requested by the
     Investors to be included in such registration is likely to affect
     materially and adversely the success of the offering or the price that
     would be received for any shares of Common Stock offered in such offering,
     then, notwithstanding anything in Section 4(a) to the contrary, the Company
     shall only be required to include in such registration, to the extent of
     the number of shares of Common Stock which the Company is so advised can be
     sold in such offering, (i) first, the number of shares of Common Stock
     proposed to be included in such registration for the account of the Company
     and/or any stockholders of the Company (other than the Investors) that have
     exercised demand registration rights, in accordance with the priorities, if
     any, then existing among the Company and/or such stockholders of the
     Company with registration rights (other than the Investors), and (ii)
     second, the shares of Common Stock requested to be included in such
     registration by all other stockholders of the Company who have piggyback
     registration rights (including, without limitation, the Investors), pro
     rata among such other stockholders (including, without limitation, the
     Investors) on the basis of the number of shares of Common Stock that each
     of them requested to be included in such registration.
<PAGE>

(c)  In connection with any offering involving an underwriting of shares under
     this Section 4, the Company shall not be required under Section 4 hereof or
     otherwise to include the Registrable Shares of any Investor therein unless
     such Investor accepts and agrees to the terms of the underwriting, which
     shall be reasonable and customary, as agreed upon between the Company and
     the underwriters selected by the Company.

5.   Obligations of the Company. In connection with the Company's obligation
     under Section 3 and 4 hereof to file the Registration Statement with the
     SEC and to use its commercially reasonable efforts to cause the
     Registration Statement to become effective, the Company shall, as
     expeditiously as reasonably possible:

(a)  Prepare and file with the SEC 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 Shares covered by the
     Registration Statement; provided, however, that before filing a
     registration statement or prospectus or any amendments or supplements
     thereto, or comparable statements under securities or blue sky laws of any
     jurisdiction, the Company will furnish to one counsel to be designated by
     the Investors participating in the planned offering (the "Designated
     Counsel"), copies of all such documents proposed to be filed (including all
     exhibits thereto), which documents will be subject to the reasonable review
     and reasonable comment of such counsel.

(b)  Furnish to the selling Investors such number of copies of a prospectus,
     including a preliminary prospectus, in conformity with the requirements of
     the Securities Act, and such other documents (including, without
     limitation, prospectus amendments and supplements as are prepared by the
     Company in accordance with Section 5(a) above) as the selling Investors may
     reasonably request in order to facilitate the disposition of such selling
     Investors' Registrable Shares.

(c)  Promptly notify the selling Investors, at any time when a prospectus
     relating to the Registration Statement is required to be delivered under
     the Securities Act, of the happening of any event as a result of which the
     prospectus included in or relating to the Registration Statement contains
     an untrue statement of a material fact or omits any fact necessary to make
     the statements therein not misleading; and, thereafter, the Company will
     promptly prepare (and, when completed, give notice to each selling
     Investor) a supplement or amendment to such prospectus so that, as
     thereafter delivered to the purchasers of such Registrable Shares pursuant
     to the Registration Statement, such prospectus will not contain an untrue
     statement of a material fact or omit to state any fact necessary to make
     the statements therein not misleading; provided that upon such notification
     by the Company of the foregoing and instructing each selling Investor to
     cease to offer and sell Registrable Securities, each selling Investor will
     use it commercially reasonable efforts to cease its offer and sale of
     Registrable Shares until the Company has notified the selling Investors
     that it has prepared a supplement or amendment to such prospectus and
     delivered copies of such supplement or amendment to the selling Investors
     (it being understood and agreed by the Company that the foregoing proviso
     shall in no way diminish or otherwise impair the Company's obligation to
     promptly prepare a prospectus amendment or supplement as above provided in
     this Section 5(c) and deliver copies of same as above provided in Section
     5(b) hereof).
<PAGE>

(d)  Use commercially reasonable efforts to register and qualify the Registrable
     Shares covered by the Registration Statement under such other securities or
     Blue Sky laws of such jurisdictions as shall be reasonably appropriate in
     the opinion of the Company and the managing underwriters, if any, or if
     reasonably requested by the Investors; provided that the Company shall not
     be required in connection therewith or as a condition thereto to qualify to
     do business or to file a general consent to service of process in any such
     states or jurisdictions; and provided further that (notwithstanding
     anything in this Agreement to the contrary with respect to the bearing of
     expenses) if any jurisdiction in which any of such Registrable Shares shall
     be qualified shall require that expenses incurred in connection with the
     qualification therein of any such Registrable Shares be borne by the
     selling Investors, then the selling Investors shall, to the extent required
     by such jurisdiction, pay their pro rata share of such qualification
     expenses.

(e)  Promptly notify (i) each selling Investor (A) any time when a registration
     statement, the prospectus relating thereto or any prospectus supplement
     related thereto or post effective amendment has been filed, and with
     respect to the registration statement or any post-effective amendment, when
     the same has become effective, (B) of the issuance of any stop order by the
     SEC suspending the effectiveness of such registration statement or the
     initiation of any proceedings by any person to such effect, and promptly
     use all commercially reasonable efforts to obtain the release of such
     suspension, (C) of the receipt by the Company of any notification with
     respect to the suspension of the qualification of any Registrable Shares
     for sale under the securities or blue sky laws of any jurisdiction or the
     initiation of any proceeding for such purpose, (D) when a prospectus
     relating to the registration is required to be delivered under the
     Securities Act, or (E) of the happening of any event as a result of which
     the prospectus included in such registration statement, as then in effect,
     includes any untrue statement of a material fact or omits to state a
     material fact required to be stated therein or necessary to make the
     statements therein not misleading in the light of the circumstances then
     existing; and (ii) Designated Counsel of any request by the SEC for
     amendments or supplements to such registration statement or prospectus
     related thereto or for additional information. If the notification relates
     to an event described in Section 5(c), the Company shall in accordance with
     Section 5(a), promptly prepare and furnish to each Investor, if any,
     selling Registrable Shares covered by such registration statement, a
     reasonable number of copies of a prospectus supplemented or amended so
     that, as thereafter delivered to the purchasers of such Registrable Shares,
     such prospectus shall not include 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 the light of the circumstances under which
     they were made not misleading.

(f)  Cause all such Registrable Shares registered pursuant to this Agreement to
     be listed on each securities exchange on which similar securities issued by
     the Company are then listed, if the listing of such Registrable Shares is
     then permitted under the rules of such exchange, or if no similar
     securities are then so listed, to either cause all such Registrable Shares
     to be listed on a national securities exchange or to secure designation of
     all such Registrable Shares as a NASDAQ "national market system security"
     within the meaning of Rule 11Aa2-1 of the Exchange Act, or failing that,
     secure NASDAQ authorization for such Registrable Shares.

(g)  Provide a transfer agent and registrar for all Registrable Shares
     registered pursuant to this Agreement and a CUSIP number for all such
     Registrable Shares, in each case not later than the effective date of such
     registration and, at the time of the sale of the Registrable Shares
     pursuant to an effective registration statement or in accordance with
     Section 6.3 of the Stock Purchase Agreement, use commercially reasonable
     efforts to cause the transfer agent to remove restrictive legends on the
     securities covered by such registration statement.
<PAGE>

(h)  Promptly deliver to Designated Counsel copies of all correspondence between
     the SEC and the Company, its counsel or auditors and all memoranda relating
     to discussions with the SEC or its staff with respect to the registration
     statement, other than those portions of any such memoranda that contain
     information subject to attorney client privilege with respect to the
     Company, and, upon receipt of such confidentiality agreements as the
     Company may reasonably request, make reasonably available for inspection by
     Designated Counsel participating in any disposition to be effected pursuant
     to such registration statement, all pertinent financial and other records,
     pertinent corporate documents and properties of the Company, and cause all
     of the Company's officers, directors and employees to supply all
     information reasonably requested by Designated Counsel in connection with
     such registration statement.

(i)  Use commercially reasonable best efforts to obtain the withdrawal of any
     order suspending the effectiveness of the registration statement.

(j)  Upon written request, furnish to each selling Investor participating in the
     offering, without charge, at least one (1) conformed copy of the
     registration statement and any post-effective amendments thereto, including
     financial statements and schedules, all documents incorporated therein by
     reference and all exhibits (including those incorporated by reference).

(k)  Comply with all applicable rules and regulations of the SEC, and make
     generally available to its security holders, as soon as reasonably
     practicable after the effective' date of the registration statement (and in
     any event within sixteen (16) months thereafter), an earnings statement
     (which need not be audited) covering the period of at least twelve (12)
     consecutive months beginning with the first day of the Company's first
     calendar quarter after the effective date of the registration statement,
     which earnings shall satisfy the provisions of Section 11(a) of the
     Securities Act and Rule 158 thereunder.

6.   Furnish Information. It shall be a condition precedent to the obligations
     of the Company to take any action pursuant to this Agreement (including,
     without limitation, to maintain the accuracy of any information previously
     furnished by Investors for use in the Registration Statement) that the
     selling Investors shall furnish to the Company such information regarding
     them and the securities held by them as the Company shall reasonably
     request and as shall be required by applicable securities laws in order to
     effect any registration by the Company pursuant to this Agreement.

7.   Expenses of Registration. All of the expenses incurred by the Company in
     connection with the registration of the Registrable Shares pursuant to this
     Agreement (excluding underwriting, brokerage and other selling commissions
     and discounts), including without limitation all registration and
     qualification and filing fees, printing, and fees and disbursements of its
     counsel and one counsel to the Investors, shall be borne by the Company,
     whether or not such Registration Statement becomes effective or remains
     effective for the period contemplated hereby.
<PAGE>

8.   Delay of Registration. No Investor shall take any action to restrain,
     enjoin or otherwise delay any registration as the result of any controversy
     which might arise with respect to the interpretation or implementation of
     this Agreement.

9.   Indemnification.

(a)  To the extent permitted by law, the Company will indemnify and hold
     harmless each selling Investor, its directors, officers, employees,
     fiduciaries, members, managers, or general or limited partners (and the
     directors, officers, employees and stockholders thereof), any broker/dealer
     acting on behalf of any selling Investor and each officer and director of
     such selling Investor, such broker/dealer and each person, if any, who
     controls such selling Investor, or broker/dealer and each person who
     controls such broker/dealer within the meaning of the Securities Act,
     against any losses, claims, damages or liabilities, joint or several, and
     expenses (including reasonable fees of counsel and any amounts paid in any
     settlement effected with the Company's prior written consent) to which they
     may become subject (including the settlement of litigation) under the
     Securities Act, the Exchange Act, state securities laws or otherwise,
     insofar as such losses, claims, damages or liabilities (or actions or
     proceedings in respect thereof) arise out of or are based upon (i) any
     untrue or alleged untrue statement of any material fact contained in the
     Registration Statement or in any amendments or supplements to the
     Registration Statement, any registration statement pursuant to which
     Registrable Shares are registered pursuant to Section 4 hereof, or any
     preliminary prospectus or final prospectus relating thereto or any
     amendments or supplements thereto or any such preliminary prospectus or
     final prospectus, 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 or any violation or
     alleged violation by the Company of the Securities Act, the Exchange Act,
     state securities laws, or otherwise or any rule or regulation promulgated
     under the Securities Act, the Exchange Act, state securities laws or NASDAQ
     or (ii) any failure of the Company to fulfill any undertaking included in
     the Registration Statement, or any registration statement pursuant to which
     Registrable Shares are registered pursuant to Section 4 hereof; and will
     reimburse such selling Investor, broker/dealer or such officer, director or
     controlling person for any expenses reasonably incurred by them in
     connection with investigating or defending any such loss, claim, damage,
     liability or action (including reasonable expenses of legal counsel);
     provided, however, that the indemnity agreement contained in this Section
     9(a) shall not apply to amounts paid in settlement of any such loss, claim,
     damage, liability or action if such settlement is effected without the
     consent of the Company (which consent shall not be unreasonably withheld),
     nor shall the Company be liable in any such case for any such loss, damage,
     liability or action to the extent that it arises out of or is based upon an
     untrue statement or alleged untrue statement or omission made in connection
     with the Registration Statement or any registration statement pursuant to
     which Registrable Shares are registered pursuant to Section 4 hereof, or
     any preliminary prospectus or final prospectus relating thereto or any
     amendments or supplements thereto or any such preliminary prospectus or
     final prospectus, in reliance upon and in conformity with written
     information furnished expressly for use in connection with the Registration
     Statement or any such preliminary prospectus or final prospectus by the
     selling Investors or for them or controlling person with respect to them.
     Such indemnity and reimbursement of expenses shall remain in full force and
     effect regardless of any investigation made by or on behalf of such
     indemnified party and shall survive the sale of such Registrable Shares by
     such selling Investor.
<PAGE>

(b)  To the extent permitted by law, each selling Investor will severally, and
     not jointly, indemnify and hold harmless the Company, each of its
     directors, each of its officers who have signed the Registration Statement,
     or any registration statement pursuant to which Registrable Shares are
     registered pursuant to Section 4 hereof, each person, if any, who controls
     the Company within the meaning of the Securities Act, any investment
     banking firm acting as underwriter for the Company or the selling
     Investors, or any broker/dealer acting on behalf of the Company or any
     selling Investor, and all other selling Investors against any losses,
     claims, damages or liabilities to which the Company or any such director,
     officer, controlling person, underwriter, or broker/dealer or such other
     selling Investor may become subject to, under the Securities Act or
     otherwise, insofar as such losses, claims, damages or liabilities (or
     actions in respect thereto) arise out of or are based upon any untrue or
     alleged untrue statement of any material fact contained in the Registration
     Statement, or any registration statement pursuant to which Registrable
     Shares are registered pursuant to Section 4 hereof, or any preliminary
     prospectus or final prospectus relating thereto or in any amendments or
     supplements to the Registration Statement or any registration statement
     pursuant to which Registrable Shares are registered pursuant to Section 4
     hereof, or any such preliminary prospectus or final prospectus, 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, in each case to the extent and only to
     the extent that such untrue statement or alleged untrue statement or
     omission or alleged omission was made in the Registration Statement, or any
     registration statement pursuant to which Registrable Shares are registered
     pursuant to Section 4 hereof, in any preliminary prospectus or final
     prospectus relating thereto or in any amendments or supplements to the
     Registration Statement or any registration statement pursuant to which
     Registrable Shares are registered pursuant to Section 4 hereof, or any such
     preliminary prospectus or final prospectus, in reliance upon and in
     conformity with written information furnished by the selling Investor
     expressly for use in connection with the Registration Statement; or any
     preliminary prospectus or final prospectus; and such selling Investor will
     reimburse any expenses reasonably incurred by the Company or any such
     director, officer, controlling person, underwriter, broker/dealer or other
     selling Investor in connection with' investigating or defending any such
     loss, claim, damage, liability or action (including reasonable expenses of
     legal counsel); provided, however, that the liability of each selling
     Investor hereunder shall be limited to the proceeds (net of underwriting
     discounts and commissions, if any) received by such selling Investor from
     the sale of Registrable Shares covered by the Registration Statement, or
     any registration statement pursuant to which Registrable Shares are
     registered pursuant to Section 4 hereof; and provided, further, however,
     that the indemnity agreement contained in this Section 9(b) shall not apply
     to amounts paid in settlement of any such loss, claim, damage, liability or
     action if such settlement is effected without the consent of those selling
     Investor(s) against which the request for indemnity is being made (which
     consent shall not be unreasonably withheld). Such indemnity and
     reimbursement of expenses shall remain in full force and effect regardless
     of any investigation made by or on behalf of such indemnified party and, as
     relevant, shall survive the sale of such Registrable Shares by any selling
     Investor.

(c)  Promptly after receipt by an indemnified party under this Section 9 of
     notice of the commencement of any action, such indemnified party will, if a
     claim in respect thereof is to be made against any indemnifying party under
     this Section 9, notify the indemnifying party in writing of the
     commencement thereof and the indemnifying party shall have the right to
     participate in and, to the extent the indemnifying party desires, jointly
     with any other indemnifying party similarly noticed, to assume at its
     expense the defense thereof with counsel mutually satisfactory to the
     indemnifying parties with the consent of the indemnified party which
     consent will not be unreasonably withheld, conditioned or delayed. In the
     event that the indemnifying party assumes any such defense, the indemnified
     party may participate in such defense with its own counsel and at its own
     expense; provided, however, that the counsel for the indemnifying party
     shall act as lead counsel in all matters pertaining to such defense or
     settlement of such claim and the indemnifying party shall only pay for such
     indemnified party's expenses for the period prior to the date of its
     participation on such defense. The failure to notify an indemnifying party
     promptly of the commencement of any such action, if prejudicial to his
     ability to defend such action, shall relieve such indemnifying party of any
     liability to the indemnified party under this Section 9, but the omission
     so to notify the indemnifying party will not relieve him of any liability
     which he may have to any indemnified party otherwise other than under this
     Section 9.
<PAGE>

(d)  If the indemnification provided for in this Section 9 is held by a court of
     competent jurisdiction to be unavailable to an indemnified party with
     respect to any loss, claim, damage, liability or expense referred to
     therein, then the indemnifying party, in lieu of indemnifying such
     indemnified party hereunder, shall contribute to the amount paid or payable
     by such indemnified party as a result of such loss, claim, or expense in
     such proportion as is appropriate to reflect the relative fault of the
     indemnifying party on the one hand and of the indemnified party on the
     other in connection with the statements or omissions that resulted in such
     loss, claim or expense as well as any other relevant equitable
     considerations. The relative fault of the indemnifying party and of the
     indemnified party shall be determined by reference to, among other things,
     whether the untrue or alleged untrue statement of a material fact or the
     omission to state a material fact relates to information supplied by the
     indemnifying party or by the indemnified party and the parties' relative
     intent, knowledge, access to information, and opportunity to correct or
     prevent such statement or omission. If, however, the allocation provided in
     the first sentence of this paragraph is not permitted by applicable law,
     then each indemnifying party shall contribute to the amount paid or payable
     by such indemnified party in such proportion as is appropriate to reflect
     not only such relative faults but also the relative benefits of the
     indemnifying party and the indemnified party as well as any other relevant
     equitable considerations. The parties hereto agree that it would not be
     just and equitable if contributions pursuant to this Section 9(d) were to
     be determined by pro rata allocation or by any other method of allocation
     which does not take account of the equitable considerations referred to in
     the preceding sentences of this Section 9(d). The amount paid or payable in
     respect of any claim shall be deemed to include any legal or other expenses
     reasonably incurred by such indemnified party in connection with
     investigating or defending such loss, claim, damage or liability (including
     legal expenses reasonably incurred). 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. Notwithstanding anything in this
     Section 9(d) to the contrary, no indemnifying party shall be required
     pursuant to this Section 9(d) to contribute any amount in excess of the net
     proceeds received by such indemnifying party from the sale of Registrable
     Shares in the offering to which the loss, claims, damage or liability of
     the indemnified parties relate, less the amount of any indemnification
     payment made by such indemnifying party pursuant to Section 9(b).
<PAGE>

(e)  The obligations of the Company and the selling Investors under this Section
     9 shall survive the completion of any offering of Registrable Shares in a
     Registration Statement, or any registration statement pursuant to which
     Registrable Shares are registered pursuant to Section 4 hereof, and
     otherwise.

(f)  Notwithstanding anything to the contrary herein, the indemnifying party
     shall not be entitled to settle any claim, suit or proceeding unless in
     connection with such settlement the indemnified party receives an
     unconditional release with respect to the subject matter of such claim,
     suit or proceeding and such settlement does not contain any admission of
     fault by the indemnified party.

10.  Reports under the Exchange Act. With a view to making available to the
     Investors the benefits of Rule 144 and any other rule or regulation of the
     SEC that may at any time permit the Investors to sell the Purchased Shares
     to the public without registration, the Company agrees to use commercially
     reasonable efforts: (i) to make and keep public information available, as
     those terms are understood and defined in the General Instructions to Form
     S-3, or any successor or substitute form, and in Rule 144; (ii) to file
     with the SEC in a timely manner all reports and other documents required to
     be filed by an issuer of securities registered under the Securities Act or
     the Exchange Act; (iii) as long as any Investor owns any Purchased Shares,
     to furnish in writing upon such Investor's request a written statement by
     the Company that it has complied with the reporting requirements of Rule
     144 and of the Securities Act and the Exchange Act, and to furnish to such
     Investor a copy of the most recent annual or quarterly report of the
     Company, and such other reports and documents so filed by the Company as
     may be reasonably requested in availing such Investor of any rule or
     regulation of the SEC permitting the selling of any such Purchased Shares
     without registration; and (iv) undertake any additional actions reasonably
     necessary to maintain the availability of the Registration Statement or the
     use of Rule 144.

11.  Deferral and Lock-up. Notwithstanding anything in this Agreement to the
     contrary, if the Company shall furnish to the selling Investors a
     certificate signed by the President or Chief Executive Officer of the
     Company stating that the Board of Directors of the Company has made the
     good faith determination (i) that continued use by the selling Investors of
     the Registration Statement, or any registration statement pursuant to which
     Registrable Shares are registered pursuant to Section 4 hereof, for
     purposes of effecting offers or sales of Registrable Shares pursuant
     thereto would require, under the Securities Act, premature disclosure in
     the Registration Statement, or any registration statement pursuant to which
     Registrable Shares are registered pursuant to Section 4 hereof (or the
     prospectus relating thereto) of material, nonpublic information concerning
     the Company, its business or prospects or any proposed material transaction
     involving the Company, (ii) that such premature disclosure would be
     materially adverse to the Company, its business or prospects or any such
     proposed material transaction or would make the successful consummation by
     the Company of any such material transaction significantly less likely and
     (iii) that it is therefore essential to suspend the use by the Investors of
     such Registration Statement, or any registration statement pursuant to
     which Registrable Shares are registered pursuant to Section 4 hereof (and
     the prospectus relating thereto) for purposes of effecting offers or sales
     of Registrable Shares pursuant thereto, then the right of the selling
     Investors to use the Registration Statement, or any registration statement
     pursuant to which Registrable Shares are registered pursuant to Section 4
     hereof (and the prospectus relating thereto) for purposes of effecting
     offers or sales of Registrable Shares pursuant thereto shall be suspended
     for not more than two 15-business day periods in a twelve month period (the
     "Suspension Period(s)") after delivery by the Company of the certificate
     referred to above in this Section 11. In no event, however, will any
     suspension be any longer than is reasonably necessary to avoid the adverse
     effect. During the Suspension Period, none of the Investors shall offer or
     sell any Registrable Shares publicly pursuant to or in reliance upon the
     Registration Statement, or any registration statement pursuant to which
     Registrable Shares are registered pursuant to Section 4 hereof (or the
     prospectus relating thereto).
<PAGE>

12.  Transfer of Registration Rights. None of the rights of any Investor under
     this Agreement shall be transferred or assigned to any person unless (i)
     such person is a Qualifying Holder (as defined below), and (ii) such person
     agrees to become a party to, and bound by, all of the terms and conditions
     of, this Agreement by duly executing and delivering to the Company an
     Instrument of Adherence in the form attached as Exhibit B hereto. For
     purposes of this Section 12, the term "Qualifying Holder" shall mean, with
     respect to any Investor, (i) any partner thereof, (ii) any corporation,
     partnership controlling, controlled by, or under common control with, such
     Investor or any partner thereof, or (iii) any other direct transferee from
     such Investor of at least 250,000 shares included as Registrable Shares on
     the date hereof that are held or that may be acquired by such Investor.
     None of the rights of any Investor under this Agreement shall be
     transferred or assigned to any person (including, without limitation, a
     Qualifying Holder) that acquires Registrable Shares in the event that and
     to the extent that such person is eligible to resell such Registrable
     Shares pursuant to Rule 144(k) of the Securities Act or may otherwise
     resell such Registrable Shares pursuant to an exemption from the
     registration provisions of the Securities Act.

13.  Limitations on Subsequent Registration Rights. From and after the date of
     this Agreement, the Company shall not, without the prior written consent of
     the Investors holding a majority of the Registrable Shares then
     outstanding, enter into any agreement with any holder or prospective holder
     of any securities of the Company that would allow such holder or
     prospective holder to include such securities in any registration statement
     filed pursuant to Section 4 hereof, unless under the terms of such
     agreement, such holder or prospective holder may include such securities in
     any such registration only to the extent that the inclusion of his
     securities will not reduce the amount of the Registrable Shares of the
     Investors that is included.

14.  No Required Sale. Nothing in this Agreement shall be deemed to create an
     independent obligation on the part of any Investor to sell any Registrable
     Shares pursuant to any effective registration statement.

15.  Nominees for Beneficial Owners. If Registrable Shares are held by a nominee
     for the beneficial owner thereof, the beneficial owner thereof may, at its
     option, be treated as the holder of such Registrable Shares for purposes of
     any request or other action by any Investor pursuant to this Agreement (or
     any determination of any number or percentage of shares constituting
     Registrable Shares held by any Investor contemplated by this Agreement);
     provided that the Company shall have received assurances reasonably
     satisfactory to it of such beneficial ownership.
<PAGE>

16.  Entire Agreement. This Agreement along with the schedules and exhibits
     attached hereto and incorporated herewith constitute and contain the entire
     agreement and understanding of the parties with respect to the subject
     matter hereof, and supersedes any and all prior negotiations,
     correspondence, agreements or understandings with respect to the subject
     matter hereof and supercedes all prior agreements, negotiations,
     understandings, representations and statements respecting the subject
     matter hereof, whether oral or written.

17.  Agreement with Respect to Sales of Common Stock. Each Investor will not,
     and will cause each of its affiliates and any person acting on its or their
     behalf not to, directly or indirectly, offer, sell, pledge, transfer or
     otherwise dispose of (or solicit any offers to buy, purchase or otherwise
     acquire or take a pledge of) any of the shares of Common Stock, except in
     compliance with the Securities Act, applicable state securities laws and
     the respective rules and regulations promulgated thereunder.

18.  Limitation on Private Offerings. Until the date which is 30 days following
     the earlier of the Effectiveness Deadline and the date of registration of
     the Registrable Securities pursuant to the terms hereof, the Company will
     not, without the prior consent of the Majority Holders, which consent shall
     not be unreasonably withheld, sell any shares of Common Stock to any Person
     in a private offering exempt from the registration and prospectus delivery
     requirements of the Securities Act, except (i) any shares of Common Stock
     sold pursuant to, and in accordance with, Section 2 of the Stock Purchase
     Agreement, (ii) any shares of Common Stock issuable or issued to employees,
     consultants, directors of vendors of the Company directly or pursuant to a
     stock option plan or restricted stock plan approved by the Board of
     Directors of the Company; (iii) the issuance of Common Stock pursuant to
     the conversion or exercise of convertible or exercisable securities
     authorized by the Board; (iv) the issuance or sale of securities in
     connection with a public offering of the Company's securities or in
     connection with a bona fide business acquisition of or by the Company,
     whether by merger, consolidation, sale of assets, sale or exchange of stock
     or otherwise; or (v) the issuance or sale of stock, warrants or other
     securities or rights to any Persons with which the Company may, at the time
     of issuance, have a strategic or other business relationship, provided that
     such issuance and sale is approved by the Board of Directors and is not
     primarily for capital raising purposes.
<PAGE>

19.  Miscellaneous.


(a)  Amendment. No amendment, modification, alteration, waiver or change in any
     of the terms of this Agreement shall be valid or binding upon the parties
     hereto unless made in writing and duly executed by the Company and (a)
     prior to Closing, not less than two (2) Initial Investors who represent at
     least fifty percent (50%) of the Purchased Shares or (b) following Closing,
     the Majority Holders; provided, however, that in each case, no such
     amendment shall increase the obligations of any Investor without such
     Investor's written consent.

(b)  Governing Law. This Agreement shall be governed by and construed and
     enforced in accordance with the internal laws of the State of New York and
     without regard to any conflicts of laws concepts that would apply the laws
     of another jurisdiction.

(c)  Assignment. The rights and obligations of the parties hereto shall inure to
     the benefit of, and shall be binding upon the authorized successors and
     permitted assigns of each party; provided that the terms and conditions of
     Section 12 hereof are satisfied. This Agreement shall also be binding upon
     and inure to the benefit of any transferee `of any of the Purchased Shares;
     provided the terms and conditions of Section 12 hereof are satisfied.
     Notwithstanding anything in this Agreement to the contrary, if at any time
     any Investor shall cease to own any Registrable Shares, all of such
     Investor's rights under this Agreement shall immediately terminate;
     provided, however, that if such Investor ceases to own Registrable Shares
     because such shares were sold pursuant to an effective registration
     statement filed pursuant to Section 4 hereof, then such Investor shall
     continue to be subject to Section 9 hereof, as provided in Section 9(e)
     hereof. In the event of any assignment by an Investor in accordance with
     the terms of this Agreement, the assignee shall specifically assume and be
     bound by the provisions of the Agreement by executing the Instrument of
     Adherence attached hereto as Exhibit B.
<PAGE>

(d)  Specific Performance. Each of the parties hereto acknowledges and agrees
     that damages will not be an adequate remedy for any material breach or
     violation of this Agreement if such material breach or violation would
     cause immediate and irreparable harm (an "Irreparable Breach").
     Accordingly, in the event of a threatened or ongoing Irreparable Breach,
     each party hereto shall be entitled to seek, in any state or federal court
     in the State of New York, equitable relief of a kind appropriate in light
     of the nature of the ongoing or threatened Irreparable Breach, which relief
     may include, without limitation, specific performance or injunctive relief;
     provided, however, that if the party bringing such action is unsuccessful
     in obtaining the relief sought, the moving party shall pay the non-moving
     party's costs, including actual attorney's fees, incurred in connection
     with defending such action. Such remedies shall not be the parties'
     exclusive remedies, but shall be in addition to all other remedies provided
     in this Agreement.

(e)  Notice. Any notices, reports or other correspondence (hereinafter
     collectively referred to as "correspondence") required or permitted to be
     given hereunder shall be sent by courier (overnight or same day) or
     facsimile or delivered by hand to the party to whom such correspondence is
     required or permitted to be given hereunder. The date of giving any notice
     shall be the date of its actual receipt.

(i)  All correspondence to the Company shall be addressed as follows:

                                    EP MedSystems, Inc.
                                    575 Route 73 North
                                    Building D
                                    West Berlin, New Jersey 08091-9293
                                    Attention:  President and Chief Executive
                                                Officer
                                    Facsimile:  (856) 753-8544

                                    with a copy to:

                                    Kelley Drye & Warren LLP
                                    101 Park Avenue
                                    New York, New York 10178
                                    Attention:  Salvatore J. Vitiello, Esq.
                                    Facsimile:  (212) 808-7897
<PAGE>

(ii) All correspondence to any Investor shall be sent to such Investor at the
     address set forth in Exhibit A.

(iii) Any entity may change the address to which correspondence to it is to be
     addressed by notification as provided for herein.

(f)  Waiver. No waiver of any term, provision or condition of this Agreement,
     whether by conduct or otherwise, in any one or more instances, shall be
     deemed to be, or be construed as, a further or continuing waiver of any
     such term, provision or condition or as a waiver of any other term,
     provision or condition of this Agreement.

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

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  signature page follows)



<PAGE>



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

                       EP MEDSYSTEMS, INC.


                       By:
                               -------------------------------------------------
                               Reinhard Schmidt
                               President and Chief Executive Officer



THE INITIAL INVESTOR'S SIGNATURE TO THE INVESTOR QUESTIONNAIRE DATED EVEN DATE
HEREWITH SHALL CONSTITUTE THE INITIAL INVESTOR'S SIGNATURE TO THIS REGISTRATION
RIGHTS AGREEMENT.


<PAGE>



                                    Exhibit A


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<PAGE>



                                    Exhibit B

                             Instrument of Adherence

         Reference is hereby made to that certain Registration Rights Agreement,
dated as of January 31, 2003, among EP MedSystems, Inc., a New Jersey
corporation (the "Company"), the Initial Investors and the Investor Permitted
Transferees, as amended and in effect from time to time (the "Registration
Rights Agreement"). Capitalized terms used herein without definition shall have
the respective meanings ascribed thereto in the Registration Rights Agreement.

         The undersigned, in order to become the owner or holder of ___________
shares of Company common stock, no par value, $0.001 stated value per share (the
"Common Stock"), hereby agrees that, from and after the date hereof, the
undersigned has become a party to the Registration Rights Agreement in the
capacity of an Investor Permitted Transferee, and is entitled to all of the
benefits under, and is subject to all of the obligations, restrictions and
limitations set forth in, the Registration Rights Agreement that are applicable
to Investor Permitted Transferees. This Instrument of Adherence shall take
effect and shall become a part of the Registration Rights Agreement immediately
upon execution.

         Executed under seal as of the date set forth below under the laws of
the State of New York.

                                Signature:
                                     -------------------------------------
                                Name:
                                     -------------------------------------
                                Title:
                                     -------------------------------------

Accepted:


EP MedSystems, Inc.


   By:
         ---------------------------------------
          Name:   -----------------------------
          Title:
                 -------------------------------


   Date:
         -----------------------------------------------------


<PAGE>




                                Table of Contents

                                                                            Page



1.       Definitions. The following terms shall have the meanings provided
         therefor below or elsewhere in this Agreement as described
         below:................................................................1

2.       Effectiveness;
         Termination...........................................................2

3.
         Registration..........................................................2

4.       "Piggyback" Registration
         Rights................................................................4

5.       Obligations of the
         Company...............................................................5

6.       Furnish
         Information...........................................................7

7.       Expenses of
         Registration..........................................................7

8.       Delay of
         Registration..........................................................8
9.
         Indemnification.......................................................8

10.      Reports under the Exchange
         Act................................................................  11

11.      Deferral and
         Lock-up..............................................................11

12.      Transfer of Registration
         Rights...............................................................12

13.      Limitations on Subsequent Registration
         Rights...............................................................12

14.      No Required
         Sale.................................................................12

15.      Nominees for Beneficial
         Owners...............................................................12

16.      Entire
         Agreement............................................................13

17.      Agreement with Respect to Sales of Common
         Stock................................................................13

18.      Limitation on Private
         Offerings............................................................13

19.
         Miscellaneous........................................................13

Exhibit A.....................................................................17

Exhibit B.....................................................................18