EXHIBIT 10.8


 


REGISTRATION RIGHTS AGREEMENT


 


This REGISTRATION RIGHTS
AGREEMENT, dated as of March 8, 2006, is made by and among DynTek, Inc.,
a Delaware corporation, with headquarters located at 19700 Fairchild Road, Suite 230,
Irvine, California 92612 (the “Company”), and the investors named on the
signature pages hereto (the “Initial Investors”).


 


RECITALS:


 


A.            In
connection with the Securities Purchase Agreement dated March 8, 2006
between the Initial Investors and the Company (the “Purchase Agreement”), the
Company has agreed, upon the terms and subject to the conditions of the
Purchase Agreement, to issue and sell to the Initial Investors such number of
shares of the Company’s Common Stock (the “Common Shares”) and warrants to
purchase shares of the Company’s Common Stock as set forth in the Purchase
Agreement (the “Warrants” and, collectively with the Common Shares, the “Securities”).


 


B.            In
order to induce the Initial Investors to execute and deliver the Purchase
Agreement, the Company has agreed to provide certain registration rights under
the Securities Act and applicable state securities laws with respect to the
Securities.


 


In consideration of the
premises and the mutual covenants contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the Company and the Initial Investors hereby agree as follows:


 


ARTICLE I

DEFINITIONS


 


Capitalized terms used
and not otherwise defined herein have the respective meanings given them set
forth in the Purchase Agreement.  In
addition, as used in this Agreement, the following terms have the following
meanings:


 


1.1           “Closing
Date” means the date on which the initial purchase of the Securities is
consummated pursuant to the Purchase Agreement.


 


1.2           “Common
Shares” means the shares of Common Stock sold pursuant to the Purchase
Agreement.


 


1.3           “Investors”
means the Initial Investors and any of their transferees or assignees who agree
to become bound by the provisions of this Agreement in accordance with Article IX
hereof.


 


1.4           “Registrable
Securities” means the Common Shares and the Warrant Shares, and any shares of
capital stock issued or issuable from time to time (with any adjustments) in
exchange for or otherwise with respect to the Common Shares or Warrant Shares
(including shares issued pursuant to Section 2.2 hereof).


 


1.5           “Registration
Period” means the period between the date of this Agreement and the earlier of (i) the
date on which (x) all of the Registrable Securities have been sold by the
Investors pursuant to the Registration Statement and (y) are freely tradable
under the Securities Act (except that this clause (y) shall not apply with
respect to Shares sold to affiliates), (ii) the second


 

















 


anniversary of the
last date on which Warrant Shares are purchased under any then-outstanding
Warrants, or (iii) the date on which all the Registrable Securities may be
immediately sold by the Investors without registration and without restriction
as to the number of Registrable Securities to be sold, pursuant to Rule 144
or otherwise.


 


1.6           “Registration
Statement” means a Registration Statement of the Company filed under the
Securities Act.


 


1.7           The
terms “register,” “registered,” and “registration” refer to a registration
effected by preparing and filing a Registration Statement or statements in
compliance with the Securities Act and pursuant to Rule 415 and the
declaration or ordering of effectiveness of such Registration Statement by the
SEC.


 


1.8           “Rule 415”
means Rule 415 under the Securities Act, or any successor Rule providing
for offering securities on a continuous basis, and applicable rules and
regulations thereunder.


 


1.9           “Second
Closing Date” shall have the meaning subscribed to it in the Purchase
Agreement.


 


1.10         “Securities”
means the Common Shares and the Warrants sold pursuant to the Purchase
Agreement.


 


1.11         “Warrants”
means the warrants to purchase shares of the Company’s Common Stock sold
pursuant to the Purchase Agreement.


 


1.12         “Warrant
Shares” means the shares of the Company’s Common Stock that may be purchased
upon exercise of the Warrants.


 


ARTICLE II

REGISTRATION


 


2.1           Mandatory
Registration.  The Company shall file
with the SEC a Registration Statement on Form S-1, or such other form as
may then be available to effect a registration of all of the Registrable
Securities, registering all of the Registrable Securities for resale prior to
the earlier of (i) 30 days after the Second Closing Date under the
Purchase Agreement or (ii) June 30, 2006 (the “Required Filing Date”).


 


2.2           Effectiveness
of the Registration Statement.  The
Company will use its best efforts to cause the Registration Statement to be
declared effective by the SEC as soon as practicable after filing, and in any
event no later than the 60th day after the Required Filing Date (the “Required
Effective Date”).  However, so long as
the Company filed the Registration Statement by the Required Filing Date, (a) if
the SEC takes the position that registration of the resale of the Registrable
Securities by the Investors is not available under applicable laws, rules and
regulations and that the Company must register the offering of the Registrable
Securities as a primary offering by the Company, or (b) if the
Registration Statement receives SEC review, then the Required Effective Date
will be the 120th day after the Required Filing Date.  In the case of an SEC response described in
clause (a), the Company will, within 40 business days after the date the
Company receives such SEC response, file a Registration Statement as a primary
offering.  The Company’s best efforts
will


 


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include, but not
be limited to, promptly responding to all comments received from the staff of
the SEC.  If the Company receives
notification from the SEC that the Registration Statement will receive no
action or review from the SEC, then the Company will cause the Registration
Statement to become effective within five business days after such SEC
notification.  Once the Registration
Statement is declared effective by the SEC, the Company will cause the
Registration Statement to remain effective throughout the Registration Period,
except as permitted under Section 3. 
On the date of each monthly anniversary of the date on which any breach
of this Section 2.2 first occurs (including failure to file a Registration
Statement or to cause a Registration Statement to be declared effective within
the time periods set forth herein) until the applicable default is cured (each,
a “Payment Date”), the Company shall pay to each Investor as damages additional
shares of the Company’s Common Stock equal to 2.0% of the Common Shares
purchased by such Investor pursuant to the Purchase Agreement and all such
shares shall become Registrable Securities; provided, that the total
number of shares of the Company’s Common Stock payable pursuant to this Section 2.2
to any Investor shall not exceed the aggregate number of Common Shares
purchased pursuant to the Purchase Agreement by such Investor.  In addition, should a Registration Statement
not be filed by June 30, 2006, the exercise price of the Warrants will be
reduced to $0.01 per share.


 


2.3           Piggyback
Registrations.


 


(a)           If,
at any time prior to the expiration of the Registration Period, the
Registration Statement contemplated in Section 2.1 above is not declared
effective with respect to all of the Registrable Securities and the Company
decides to register any of its securities for its own account or for the
account of others, then the Company will promptly give the Investors written
notice thereof and will use its best efforts to include in such registration
all or any part of the Registrable Securities requested by such Investors to be
included therein (excluding any Registrable Securities previously included in a
Registration Statement which has been declared effective and has not been
withdrawn).  This requirement does not
apply to Company registrations on Form S-4 or S-8 or their equivalents
relating to equity securities to be issued solely in connection with an
acquisition of any entity or business or equity securities issuable in
connection with stock option or other employee benefit plans.  Each Investor must give its request for
registration under this paragraph to the Company in writing within 15 days
after receipt from the Company of notice of such pending registration.  If the registration for which the Company
gives notice is a public offering involving an underwriting, the Company will
so advise the Investors as part of the above-described written notice.  In that event, if the managing underwriter(s)
of the public offering impose a limitation on the number of shares of Common
Stock that may be included in the Registration Statement because, in such
underwriter(s)’ judgment, such limitation would be necessary to effect an
orderly public distribution, then the Company will be obligated to include only
such limited portion, if any, of the Registrable Securities with respect to
which such Investors have requested inclusion hereunder.  Any exclusion of Registrable Securities will
be made pro rata among all holders of the Company’s securities seeking to
include shares of Common Stock in proportion to the number of shares of Common
Stock sought to be included by those holders. 
However, the Company will not exclude any Registrable Securities unless
the Company has first excluded all outstanding securities the holders of which
are not entitled by right to inclusion of such securities in such Registration
Statement or are not entitled pro rata inclusion with the Registrable
Securities.


 


(b)           No
right to registration of Registrable Securities under this Section 2.3
limits in any way the registration required under Section 2.1 above.  The obligations of the Company under this Section 2.3
expire upon the earlier of (i) the effectiveness of the Registration
Statement filed pursuant to Section 2.1 above, (ii) after the Company
has afforded the opportunity for the Investors


 


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to exercise
registration rights under this Section 2.3 for two registrations (provided,
however, that any Investor that has had any Registrable Securities excluded
from any Registration Statement in accordance with this Section 2.3 may
include in any additional Registration Statement filed by the Company the
Registrable Securities so excluded) or (iii) when all of the Registrable
Securities held by any Investor may be sold by such Investor under Rule 144
without being subject to any volume restrictions.


 


ARTICLE III

ADDITIONAL OBLIGATIONS OF THE COMPANY


 


3.1           Continued
Effectiveness of Registration Statement. 
Subject to the limitations set forth in Section 3.6, the Company
will keep the Registration Statement covering the Registrable Securities
effective under Rule 415 at all times during the Registration Period.  In the event that the number of shares
available under a Registration Statement filed pursuant to this Agreement is
insufficient to cover all of the Registrable Securities issued, the Company
will (if permitted) amend the Registration Statement or file a new Registration
Statement (on the short form available therefor, if applicable), or both, so as
to cover all of the Registrable Securities. 
The Company will file such amendment or new Registration Statement as
soon as practicable, but in no event later than 30 business days after the
necessity therefor arises (based upon the market price of the Common Stock and
other relevant factors on which the Company reasonably elects to rely).  The Company will use its best efforts to
cause such amendment or new Registration Statement to become effective as soon
as is practicable after the filing thereof, but in no event later than 90 days
after the date on which the Company reasonably first determines the need
therefor.


 


3.2           Accuracy
of Registration Statement.  Any
Registration Statement (including any amendments or supplements thereto and
prospectuses contained therein) filed by the Company covering Registrable
Securities will not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein, or necessary to make the
statements therein, in light of the circumstances in which they were made, not
misleading.  The Company will prepare and
file with the SEC such amendments (including post-effective amendments) and
supplements to the Registration Statement and the prospectus used in connection
with the Registration Statement as may be necessary to permit sales pursuant to
the Registration Statement at all times during the Registration Period, and,
during such period, will comply with the provisions of the Securities Act with
respect to the disposition of all Registrable Securities of the Company covered
by the Registration Statement until the termination of the Registration Period,
or if earlier, until such time as all of such Registrable Securities have been
disposed of in accordance with the intended methods of disposition by the
seller or sellers thereof as set forth in the Registration Statement.


 


3.3           Furnishing
Documentation.  The Company will
furnish to each Investor whose Registrable Securities are included in a
Registration Statement, or to its legal counsel, (a) promptly after such
document is filed with the SEC, one copy of any Registration Statement filed
pursuant to this Agreement and any amendments thereto, each preliminary
prospectus and final prospectus and each amendment or supplement thereto; and (b) a
number of copies of a prospectus, including a preliminary prospectus, and all
amendments and supplements thereto, and such other documents as the Investor
may reasonably request in order to facilitate the disposition of the
Registrable Securities owned by the Investor. 
The Company will promptly notify by facsimile or email each Investor
whose Registrable Securities are included in any Registration Statement of the
effectiveness of the Registration Statement and any post-effective amendment.


 


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3.4           Additional
Obligations.  The Company will use
its best efforts to (a) register and qualify the Registrable Securities
covered by a Registration Statement under such other securities or blue sky
laws of such jurisdictions as each Investor who holds (or has the right to
hold) Registrable Securities being offered reasonably requests, (b) prepare
and file in those jurisdictions any amendments (including post-effective
amendments) and supplements to such registrations and qualifications as may be
necessary to maintain their effectiveness during the Registration Period, (c) take
any other actions necessary to maintain such registrations and qualifications
in effect at all times during the Registration Period, and (d) take any
other actions reasonably necessary or advisable to qualify the Registrable
Securities for sale in such jurisdictions. 
Notwithstanding the foregoing, the Company is not required, in connection
with such obligations, to (i) qualify to do business in any jurisdiction
where it would not otherwise be required to qualify but for this Section 3.4,
(ii) subject itself to general taxation in any such jurisdiction, (iii) file
a general consent to service of process in any such jurisdiction, (iv) provide
any undertakings that cause material expense or material burden to the Company,
or (v) make any change in its charter or bylaws, which in each case the
Board of Directors of the Company determines to be contrary to the best
interests of the Company and its stockholders.


 


3.5           Underwritten
Offerings.  If the Investors who hold
a majority in interest of the Registrable Securities being offered in an
offering pursuant to a Registration Statement or any amendment or supplement
thereto under this Agreement select underwriters reasonably acceptable to the
Company for such offering, the Company will enter into and perform its
obligations under an underwriting agreement in usual and customary form
including, without limitation, customary indemnification and contribution
obligations, with the managing underwriter of such offering.


 


3.6           Suspension
of Registration.


 


(a)           The
Company will notify (by telephone and also by facsimile and reputable overnight
courier) each Investor who holds Registrable Securities being sold pursuant to
a Registration Statement of the happening of any event of which the Company has
knowledge as a result of which the prospectus included in the 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, in light of the circumstances under which they
were made, not misleading.  The Company
will make such notification as promptly as practicable (but in no event more
than two business days) after the Company becomes aware of the event, will
promptly (but in no event more than ten business days) prepare and file a
supplement or amendment to the Registration Statement to correct such untrue
statement or omission, and will deliver a number of copies of such supplement
or amendment to each Investor as such Investor may reasonably request.


 


(b)           Notwithstanding
the obligations under Section 3.6(a), if in the good faith judgment of the
Company, following consultation with legal counsel, it would be detrimental to
the Company and its stockholders for resales of Registrable Securities to be
made pursuant to the Registration Statement due to the existence of a material
development or potential material development involving the Company which the
Company would be obligated to disclose in the Registration Statement, but which
disclosure would be premature or otherwise inadvisable at such time or would
reasonably be expected to have a material adverse effect upon the Company and
its stockholders, the Company will have the right to suspend the use of the
Registration Statement for a period of not more than forty-five days, provided,
however, that the Company may so defer or suspend the use of the Registration
Statement no more than one time in any twelve-month period.


 


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(c)           Subject
to the Company’s rights under this Section 3, the Company will use its
best efforts to prevent the issuance of any stop order or other suspension of
effectiveness of a Registration Statement and, if such an order is issued, will
use its best efforts to obtain the withdrawal of such order at the earliest
possible time and to notify each Investor that holds Registrable Securities
being sold (or, in the event of an underwritten offering, the managing
underwriters) of the issuance of such order and the resolution thereof.


 


(d)           Notwithstanding
anything to the contrary contained herein or in the Purchase Agreement, if the
use of the Registration Statement is suspended by the Company, the Company will
promptly (but in no event more than two business days) give notice of the
suspension to all Investors whose securities are covered by the Registration
Statement, and will promptly (but in no event more than two business days)
notify each such Investor as soon as the use of the Registration Statement may
be resumed.  Notwithstanding anything to
the contrary contained herein or in the Purchase Agreement, the Company will
cause the Transfer Agent to deliver unlegended shares of Common Stock to a
transferee of an Investor in accordance with the terms of the Purchase
Agreement in connection with any sale of Registrable Securities with respect to
which such Investor has entered into a contract for sale prior to receipt of
notice of such suspension and for which such Investor has not yet settled,
unless otherwise prohibited by law.


 


3.7           Review
by the Investors.  The Company will
permit a single firm of legal counsel, designated by the Investors who hold a
majority in interest of the Registrable Securities being sold pursuant to a
Registration Statement (“Investor’s Counsel”), to review the Registration
Statement and all amendments and supplements thereto a reasonable amount of
time (not to exceed five (5) days) prior to their filing with the SEC, and
will not file any document in a form to which such counsel reasonably objects,
unless otherwise required by law in the opinion of the Company’s counsel.  The sections of any such Registration
Statement including information with respect to the Investors, the Investors’
beneficial ownership of securities of the Company or the Investors’ intended
method of disposition of Registrable Securities must conform to the information
provided to the Company by each of the Investors or Investors Counsel.


 


3.8           Comfort
Letter; Legal Opinion.  At the
request of the Investors who hold a majority in interest of the Registrable
Securities being sold pursuant to a Registration Statement, and on the date
that Registrable Securities are delivered to an underwriter for sale in
connection with the Registration Statement, the Company will furnish to the
Investors and the underwriters (i) a letter, dated such date, from the
Company’s independent certified public accountants, in form and substance as is
customarily given by independent certified public accountants to underwriters
in an underwritten public offering, addressed to the underwriters; and (ii) an
opinion, dated such date, from counsel representing the Company for purposes of
the Registration Statement, in form and substance as is customarily given in an
underwritten public offering, addressed to the underwriters and Investors.


 


3.9           Due
Diligence; Confidentiality.


 


(a)           The
Company will make available for inspection by any Investor whose Registrable
Securities are being sold pursuant to a Registration Statement, any underwriter
participating in any disposition pursuant to the Registration Statement, and
any attorney, accountant or other agent retained by any such Investor or
underwriter (collectively, the “Inspectors”), all pertinent financial and other
records, pertinent corporate documents and properties of the Company
(collectively, the “Records”), as each Inspector reasonably deems necessary to
enable the Inspector


 


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to exercise its
due diligence responsibility.  The
Company will cause its officers, directors and employees to supply all
information that any Inspector may reasonably request for purposes of
performing such due diligence.


 


(b)           Each
Inspector will hold in confidence, and will not make any disclosure (except to
an Investor) of, any Records or other information that the Company determines
in good faith to be confidential, and of which determination the Inspectors are
so notified, unless (i) the disclosure of such Records is necessary to
avoid or correct a misstatement or omission in any Registration Statement, (ii) the
release of such Records is ordered pursuant to a subpoena or other order from a
court or government body of competent jurisdiction, (iii) the information
in such Records has been made generally available to the public other than by
disclosure in violation of this or any other agreement (to the knowledge of the
relevant Inspector), (iv) the Records or other information was developed
independently by an Inspector without breach of this Agreement, (v) the
information was known to the Inspector before receipt of such information from
the Company, or (vi) the information was disclosed to the Inspector by a
third party without restriction.  The
Company is not required to disclose any confidential information in the Records
to any Inspector unless and until such Inspector has entered into a confidentiality
agreement (in form and substance reasonably satisfactory to the Company) with
the Company with respect thereto, substantially in the substance of this Section 3.9(b).  Each Investor will, upon learning that
disclosure of Records containing confidential information is sought in or by a
court or governmental body of competent jurisdiction or through other means,
give prompt notice to the Company and allow the Company, at the Company’s
expense, to undertake appropriate action to prevent disclosure of, or to obtain
a protective order for, the Records deemed confidential.  Nothing herein will be deemed to limit the
Investor’s ability to sell Registrable Securities in a manner that is otherwise
consistent with applicable laws and regulations.


 


(c)           The
Company will hold in confidence, and will not make any disclosure of,
information concerning an Investor provided to the Company under this Agreement
unless (i) disclosure of such information is necessary to comply with
federal or state securities laws, (ii) the disclosure of such information
is necessary to avoid or correct a misstatement or omission in any Registration
Statement, (iii) the release of such information is ordered pursuant to a
subpoena or other order from a court or governmental body of competent
jurisdiction, (iv) such information has been made generally available to
the public other than by disclosure in violation of this Agreement or any other
agreement, (v) the information was disclosed to the Company by a third
party without restriction or (vi) such Investor consents to the form and
content of any such disclosure.  If the
Company learns that disclosure of such information concerning an Investor is
sought in or by a court or governmental body of competent jurisdiction or
through other means, the Company will give prompt notice to such Investor prior
to making such disclosure and allow such Investor, at its expense, to undertake
appropriate action to prevent disclosure of, or to obtain a protective order
for, such information.


 


3.10         Transfer
Agent; Registrar.  The Company will
provide a transfer agent and registrar, which may be a single entity, for the
Registrable Securities not later than the effective date of the Registration
Statement.


 


3.11         Share
Certificates.  The Company will
cooperate with the Investors who hold Registrable Securities being sold and
with the managing underwriter(s), if any, to facilitate the timely preparation
and delivery of certificates (not bearing any restrictive legends) representing
Registrable Securities to be offered pursuant to a Registration Statement and
will enable such certificates to be in such denominations or amounts as the
case may be, and registered in such names as the Investors or


 


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the managing
underwriter(s), if any, may reasonably request, all in accordance with Article V
of the Purchase Agreement.


 


3.12         Plan
of Distribution.  At the request of
the Investors holding a majority in interest of the Registrable Securities
registered pursuant to a Registration Statement, the Company will promptly prepare
and file with the SEC such amendments (including post-effective amendments) and
supplements to the Registration Statement, and the prospectus used in
connection with the Registration Statement, as may be necessary in order to
change the plan of distribution set forth in such Registration Statement.


 


3.13         Securities
Laws Compliance.  The Company will
comply with all applicable laws related to any Registration Statement relating
to the offer and sale of Registrable Securities and with all applicable rules and
regulations of governmental authorities in connection therewith (including,
without limitation, the Securities Act, the Exchange Act and the rules and
regulations promulgated by the SEC).


 


3.14         Further
Assurances.  The Company will take
all other reasonable actions as any Investor or the underwriters, if any, may
reasonably request to expedite and facilitate disposition by such Investor of
the Registrable Securities pursuant to the Registration Statement.


 


ARTICLE IV

OBLIGATIONS OF THE INVESTORS


 


4.1           Investor
Information.  As a condition to the
obligations of the Company to complete any registration pursuant to this
Agreement with respect to the Registrable Securities of each Investor, such
Investor shall furnish to the Company such information regarding itself, the
Registrable Securities held by it and the intended method of disposition of the
Registrable Securities held by it as is reasonably required by the Company to
effect the registration of the Registrable Securities.  At least ten business days prior to the first
anticipated filing date of a Registration Statement for any registration under
this Agreement, the Company will notify each Investor of the information the
Company requires from that Investor if the Investor elects to have any of its Registrable
Securities included in the Registration Statement, other than information
contained in the Selling Securityholder Notice and Questionnaire attached
hereto as Annex A, which shall be completed and delivered to the Company no
later than five days after the Closing Date or Second Closing Date, as
applicable.  If, within two business days
prior to the filing date, the Company has not received the requested
information from an Investor, then the Company may file the Registration
Statement without including Registrable Securities of that Investor.


 


4.2           Further
Assurances.  Each Investor will
cooperate with the Company, as reasonably requested by the Company, in
connection with the preparation and filing of any Registration Statement
hereunder, unless such Investor has notified the Company in writing of such
Investor’s election to exclude all of such Investor’s Registrable Securities
from the Registration Statement.


 


4.3           Suspension
of Sales.  Upon receipt of any notice
from the Company of the happening of any event of the kind described in Section 3.6,
each Investor will immediately discontinue disposition of Registrable
Securities pursuant to the Registration Statement covering such Registrable
Securities until it receives copies of the supplemented or amended prospectus
contemplated by Section 3.6.  If so
directed by the Company, each Investor will deliver to the Company (at the
expense of the Company) or destroy (and deliver to the Company a certificate of
destruction) all


 


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copies in the
Investor’s possession (other than a limited number of file copies) of the
prospectus covering such Registrable Securities that is current at the time of
receipt of such notice.


 


4.4           Underwritten
Offerings.


 


(a)           If
Investors holding a majority in interest of the Registrable Securities being
registered (with the approval of the Initial Investors) determine to engage the
services of an underwriter, each Investor will enter into and perform such
Investor’s obligations under an underwriting agreement, in usual and customary
form, including, without limitation, customary indemnification and contribution
obligations, with the managing underwriter of such offering, and will take such
other actions as are reasonably required in order to expedite or facilitate the
disposition of the Registrable Securities, unless such Investor has notified
the Company in writing of such Investor’s election to exclude all of its
Registrable Securities from such Registration Statement.


 


(b)           Without
limiting any Investor’s rights under Section 2.1 hereof, no Investor may
participate in any underwritten distribution hereunder unless such Investor (a) agrees
to sell such Investor’s Registrable Securities on the basis provided in any
underwriting arrangements approved by the Investors entitled hereunder to
approve such arrangements, (b) completes and executes all questionnaires,
powers of attorney, indemnities, underwriting agreements and other documents
reasonably required under the terms of such underwriting arrangements, and (c) agrees
to pay its pro rata share of all underwriting discounts and commissions
applicable with respect to its Registrable Securities.


 


ARTICLE V

EXPENSES OF REGISTRATION


 


The Company will bear all
reasonable expenses, other than underwriting discounts and commissions, and
transfer taxes, if any, incurred in connection with registrations, filings or
qualifications pursuant to Articles II and III of this Agreement, including,
without limitation, all registration, listing and qualifications fees, printers
and accounting fees, the fees and disbursements of counsel for the Company, and
the reasonable fees and disbursements of one firm of legal counsel selected by
the Initial Investors pursuant to Section 3.7 hereof.


 


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ARTICLE VI

INDEMNIFICATION


 


In the event that any
Registrable Securities are included in a Registration Statement under this
Agreement:


 


6.1           To
the extent permitted by law, the Company will indemnify, defend and hold
harmless each Investor that holds such Registrable Securities, and agents,
employees, attorneys, accountants, underwriters (as defined in the Securities
Act) for such Investors and any directors or officers of such Investor or such
underwriter and any person who controls such Investor or such underwriter
within the meaning of the Securities Act or the Exchange Act (each, an “Investor
Indemnified Person”) against any losses, claims, damages, expenses or
liabilities (collectively, and together with actions, proceedings or inquiries
by any regulatory or self-regulatory organization, whether commenced or
threatened in respect thereof, “Claims”) to which any of them become subject
under the Securities Act, the Exchange Act or otherwise, insofar as such Claims
arise out of or are based upon any of the following statements, omissions or
violations in a Registration Statement filed pursuant to this Agreement, any
post-effective amendment thereof or any prospectus included therein:  (a) any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement or
any post-effective amendment thereof or 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, (b) any untrue statement or
alleged untrue statement of a material fact contained in the prospectus or any
preliminary prospectus (as it may be amended or supplemented) or the omission
or alleged omission to state therein any material fact necessary to make the
statements made therein, in light of the circumstances under which the
statements therein were made, not misleading, or (c) any violation or
alleged violation by the Company of the Securities Act, the Exchange Act or any
other law, including without limitation any state securities law or any rule or
regulation thereunder (the matters in the foregoing clauses (a) through (c) being,
collectively, “Violations”).  Subject to
the restrictions set forth in Section 6.4 with respect to the number of
legal counsel, the Company will reimburse the Investors and each such attorney,
accountant, underwriter or controlling person and each such other Investor
Indemnified Person, promptly as such expenses are incurred and are due and
payable, for any legal fees or other reasonable expenses incurred by them in
connection with investigating or defending any Claim.  Notwithstanding anything to the contrary
contained herein, the indemnification agreement contained in this Section 6.1
(i) does not apply to a Claim by an Investor Indemnified Person arising
out of or based upon a Violation that occurs in reliance upon and in conformity
with information furnished in writing to the Company by such Investor
Indemnified Person expressly for use in the Registration Statement or any such
amendment thereof or supplement thereto, if such prospectus or supplement
thereto was timely made available by the Company pursuant to Section 3.3
hereof; and (ii) does not apply to amounts paid in settlement of any Claim
if such settlement is made without the prior written consent of the Company,
which consent will not be unreasonably withheld. This indemnity obligation will
remain in full force and effect regardless of any investigation made by or on
behalf of the Indemnified Persons and will survive the transfer of the
Registrable Securities by the Investors under Article IX of this
Agreement.


 


6.2           In
connection with any Registration Statement in which an Investor is
participating, each such Investor will indemnify and hold harmless, to the same
extent and in the same manner set forth in Section 6.1 above, the Company,
each of its directors, each of its officers who signs the Registration
Statement, each person, if any, who controls the Company within the meaning of
the Securities Act or the Exchange Act, and any other stockholder selling
securities pursuant to the Registration Statement or any of its directors or
officers or any person who controls such stockholder


 


10

















 


within the meaning
of the Securities Act or the Exchange Act (each a “Company Indemnified Person”)
against any Claim to which any of them may become subject under the Securities
Act, the Exchange Act or otherwise, insofar as such Claim arises out of or is
based upon any Violation, in each case to the extent (and only to the extent)
that such Violation occurs in reliance upon and in conformity with written
information furnished to the Company by such Investor expressly for use in such
Registration Statement.  Subject to the
restrictions set forth in Section 6.4 with respect to the number of legal
counsel, such Investor will promptly reimburse each Company Indemnified Person
for any legal or other expenses (promptly as such expenses are incurred and due
and payable) reasonably incurred by them in connection with investigating or
defending any such Claim.   However, the
indemnity agreement contained in this Section 6.2 does not apply to
amounts paid in settlement of any Claim if such settlement is effected without
the prior written consent of such Investor, which consent will not be
unreasonably withheld, and no Investor will be liable under this Agreement
(including this Section 6.2 and Article VII) for the amount of any
Claim that exceeds the net proceeds actually received by such Investor as a
result of the sale of Registrable Securities pursuant to such Registration
Statement.  This indemnity will remain in
full force and effect regardless of any investigation made by or on behalf of a
Company Indemnified Party and will survive the transfer of the Registrable
Securities by the Investors under Article IX of this Agreement.


 


6.3           If
any proceeding shall be brought or any claim asserted against any person
entitled to indemnity under Sections 6.1 or 6.2 hereof (an “Indemnified Party”),
such Indemnified Party promptly shall notify the person from whom indemnity is
sought (the “Indemnifying Party”) in writing, and the Indemnifying Party shall
assume the defense thereof, including the employment of counsel reasonably
satisfactory to the Indemnified Party and the payment of all reasonable fees
and expenses incurred in connection with defense thereof; provided, however,
that the failure of any Indemnified Party to give such notice shall not relieve
the Indemnifying Party of its obligations or liabilities pursuant to this
Agreement, except (and only) to the extent that such failure shall have
proximately and materially adversely prejudiced the Indemnifying Party.


 


6.4           An
Indemnified Party shall have the right to employ separate counsel in any such
proceeding and to participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Party or
Indemnified Parties unless: (i) the Indemnifying Party has agreed in
writing to pay such fees and expenses; (ii) the Indemnifying Party shall
have failed promptly to assume the defense of such proceeding and to employ
counsel reasonably satisfactory to such Indemnified Party in any such
proceeding; or (iii) the named parties to any such proceeding (including any
impleaded parties) include both such Indemnified Party and the Indemnifying
Party, and such Indemnified Party shall have been advised by counsel that a
conflict of interest is likely to exist if the same counsel were to represent
such Indemnified Party and the Indemnifying Party (in which case, if such
Indemnified Party notifies the Indemnifying Party in writing that it elects to
employ separate counsel at the expense of the Indemnifying Party, the
Indemnifying Party shall not have the right to assume the defense thereof and
such counsel shall be at the reasonable expense of the Indemnifying Party;
provided, however, that in no event shall the Indemnifying Party be responsible
for the fees and expenses of more than one separate counsel).  The Indemnifying Party shall not be liable
for any settlement of any such proceeding effected without its written consent,
which consent shall not be unreasonably withheld.  No Indemnifying Party shall, without the
prior written consent of the Indemnified Party, effect any settlement of any
pending proceeding in respect of which any Indemnified Party is a party, unless
such settlement includes an unconditional release of such Indemnified Party
from all liability on Claims that are the subject matter of such proceeding.


 


11

















 


6.5           Subject
to the foregoing, all reasonable fees and expenses of the Indemnified Party
(including fees and expenses to the extent incurred in connection with
investigating or preparing to defend such proceeding in a manner not
inconsistent with this Section) shall be paid to the Indemnified Party, as
incurred, within ten (10) Business Days of written notice thereof to the
Indemnifying Party, which notice shall be delivered no more frequently than on
a monthly basis (regardless of whether it is ultimately determined that an
Indemnified Party is not entitled to indemnification hereunder; provided, that
the Indemnifying Party may require such Indemnified Party to undertake to
reimburse all such fees and expenses to the extent it is finally judicially
determined that such Indemnified Party is not entitled to indemnification
hereunder).


 


ARTICLE VII

CONTRIBUTION


 


If the indemnification
provided for in Article VI is held by a court of competent jurisdiction to
be unavailable to an indemnified party with respect to any loss, liability,
claim, damage or expense referred to herein, then the indemnifying party, in
lieu of indemnifying such indemnified party hereunder, shall contribute to the
amount paid or payable by such indemnified party as a result of such loss,
liability, claim, damage, or expense in such proportion as is appropriate to
reflect the relative fault of the indemnifying party, on the one hand, and of
the indemnified party, on the other, in connection with the statements or
omissions that resulted in such loss, liability, claim, damage or expense, as
well as any other relevant equitable considerations; provided, that in no event
shall any contribution by a Investor under this Article VII exceed the net
proceeds from the offering received by such Investor, except in the case of
fraud by such Investor.  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.


 


ARTICLE VIII

EXCHANGE ACT REPORTING


 


In order to make
available to the Investors the benefits of Rule 144 or any similar rule or
regulation of the SEC that may at any time permit the Investors to sell
securities of the Company to the public without registration, the Company will:


 


(a)           File
with the SEC in a timely manner, and make and keep available, all reports and
other documents required of the Company under the Securities Act and the
Exchange Act so long as the Company remains subject to such requirements and
file and make available of such reports and other documents as required for the
applicable provisions of Rule 144; and


 


(b)           Furnish
to each Investor, so long as such Investor holds Registrable Securities,
promptly upon the Investor’s request, (i) a written statement by the
Company that it has complied with the reporting requirements of Rule 144,
the Securities Act and the Exchange Act, (ii) a copy of the most recent
annual or quarterly report of the Company and such other reports and documents
filed by the Company with the SEC, and (iii) such other information as may
be reasonably requested to permit the Investors to sell such securities
pursuant to Rule 144 without registration.


 


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ARTICLE IX

ASSIGNMENT OF REGISTRATION RIGHTS


 


The rights of the Initial
Investors hereunder, including the right to have the Company register
Registrable Securities pursuant to this Agreement, may be assigned by the
Initial Investors to transferees or assignees of all or any portion of the
Registrable Securities, but only if (a) the Investor agrees in writing
with the transferee or assignee to assign such rights, and a copy of such
agreement is furnished to the Company within a reasonable time after such
assignment, (b) the Company is, within a reasonable time after such
transfer or assignment, furnished with written notice of the name and address
of such transferee or assignee and the securities with respect to which such
registration rights are being transferred or assigned, (c) after such
transfer or assignment, the further disposition of such securities by the
transferee or assignee is restricted under the Securities Act and applicable
state securities laws, (d) at or before the time the Company received the
written notice contemplated by clause (b) of this sentence, the transferee
or assignee agrees in writing with the Company to be bound by all of the
provisions contained herein, (e) such transfer is made in accordance with
the applicable requirements of the Purchase Agreement, and (f) the
transferee is an “accredited investor” as that term is defined in Rule 501
of Regulation D.


 


ARTICLE X

AMENDMENT OF REGISTRATION RIGHTS


 


This Agreement may be
amended and the obligations hereunder may be waived (either generally or in a
particular instance, and either retroactively or prospectively) only with the
written consent of the Company and of the Investors who then hold a majority of
the Registrable Securities.  Any
amendment or waiver effected in accordance with this Article X is binding
upon each Investor and the Company.


 


ARTICLE XI

MISCELLANEOUS


 


11.1         Conflicting
Instructions.  A person or entity is
deemed to be a holder of Registrable Securities whenever such person or entity
owns of record such Registrable Securities. 
If the Company receives conflicting instructions, notices or elections
from two or more persons or entities with respect to the same Registrable
Securities, the Company will act upon the basis of instructions, notice or
election received from the registered owner of such Registrable Securities.


 


11.2         Notices.  Any notices required or permitted to be given
under the terms of this Agreement will be given as set forth in the Purchase
Agreement.


 


11.3         Waiver.  Failure of any party to exercise any right or
remedy under this Agreement or otherwise, or delay by a party in exercising
such right or remedy, does not operate as a waiver thereof.


 


11.4         Governing
Law.  This Agreement will be governed
by and interpreted in accordance with the federal securities laws and the laws
of the State of California without regard to the principles of conflict of
laws.  The parties hereto hereby submit
to the exclusive jurisdiction of the United States federal and state courts
located in the County of Orange, State of California with respect to any
dispute arising under this Agreement, the agreements entered into in connection
herewith or the transactions contemplated hereby or thereby. EACH PARTY HEREBY
IRREVOCABLY WAIVES


 


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ANY RIGHT THAT IT MAY HAVE
TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE
HEREUNDER OR IN CONNECTION HEREWITH OR WITH ANY TRANSACTION CONTEMPLATED
HEREBY.


 


11.5         Severability.  If any provision of this Agreement is invalid
or unenforceable under any applicable statute or rule of law, then such
provision will be deemed modified in order to conform with such statute or rule of
law.  Any provision hereof that may prove
invalid or unenforceable under any law will not affect the validity or
enforceability of any other provision hereof.


 


11.6         Entire
Agreement.  This Agreement and the
Purchase Agreement (including all schedules and exhibits thereto) constitute
the entire agreement among the parties hereto with respect to the subject
matter hereof and thereof.  There are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein or therein.  This
Agreement supersedes all prior agreements and understandings among the parties
hereto with respect to the subject matter hereof.


 


11.7         Successors
and Assigns.  Subject to the
requirements of Article IX hereof, this Agreement inures to the benefit of
and is binding upon the successors and assigns of each of the parties hereto.  Notwithstanding anything to the contrary
herein, including, without limitation, Article IX, the rights of an
Investor hereunder are assignable to and exercisable by a bona fide pledgee of
the Registrable Securities in connection with an Investor’s margin or brokerage
accounts.


 


11.8         Headings.  The headings of this Agreement are for
convenience of reference only, are not part of this Agreement and do not affect
its interpretation.


 


11.9         Counterparts.  This Agreement may be executed in two or more
counterparts, each of which is deemed an original but all of which constitute
one and the same agreement.  This
Agreement, once executed by a party, may be delivered to the other party hereto
by facsimile transmission, and facsimile signatures are binding on the parties
hereto.


 


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


 


11.11       Consents.  Unless otherwise provided in this Agreement,
all consents and other determinations to be made by the Investors pursuant to
this Agreement will be made by the Investors holding a majority in interest of
the Registrable Securities.


 


11.12       No
Strict Construction.  The language
used in this Agreement is deemed to be the language chosen by the parties to
express their mutual intent, and no rules of strict construction will be
applied against any party.


 


[SIGNATURES ON FOLLOWING PAGE]


 


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IN WITNESS WHEREOF, the undersigned Investors and the
Company have caused this Registration Rights Agreement to be duly executed as
of the date first above written.


 


	
   

  	
  COMPANY:

  
	
   

  	
   

  
	
   

  	
  DYNTEK, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Casper Zublin, Jr.

  
	
   

  	
  Name:

  	
  Casper Zublin, Jr.

  
	
   

  	
  Title:

  	
  Chief Executive Officer

  
					



 


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OMNIBUS SIGNATURE PAGE TO


DYNTEK, INC.


REGISTRATION RIGHTS AGREEMENT


 


The undersigned hereby
executes and delivers the Registration Rights Agreement to which this Signature
Page is attached, which, together with all counterparts of the Agreement
and Signature Pages of the other parties named in said Agreement, shall
constitute one and the same document in accordance with the terms of the
Agreement.


 


	
   

  	
  Investor Name:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Sign Name:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Print Name:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Telephone:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Facsimile:

  	
   

  
	
   

  	
   

  
	
   

  	
  Number of Common Shares:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Number of Warrant
  Shares:

  	
   

  
				



 


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