EXHIBIT 10.3

                         REGISTRATION RIGHTS AGREEMENT
                         -----------------------------

     AGREEMENT dated as of July 19, 2005,  between MERCATOR MOMENTUM FUND, L.P.,
MERCATOR  MOMENTUM FUND III, L.P, MONARCH POINTE FUND, LTD.  (collectively,  the
"Funds")  and M.A.G.  Capital,  LLC ("MAG")  (the Funds and MAG are  referred to
individually as a "Holder" and collectively as the "Holders"),  and Vasomedical,
Inc. a Delaware corporation (the "Company").

     WHEREAS,  the Funds have  purchased,  for an  aggregate of  $2,500,000,  an
aggregate of 25,000 shares of Series D Convertible  Preferred Stock (the "Series
D Stock") from the Company,  and have the right to cause their Series D Stock to
be converted into shares of Common Stock,  $.001 par value (the "Common Stock"),
of the Company,  pursuant to the conversion formula set forth in the Certificate
of Designation ;

     WHEREAS,   each  Fund  and  MAG  have  acquired  Warrants  (together,   the
"Warrants")  from the  Company,  pursuant to which the Holders have the right to
purchase in the aggregate up to 1,892,219 shares of the Common Stock through the
exercise of the Warrants;

     WHEREAS,  the  Company  desires to grant to the  Holders  the  registration
rights set forth herein with respect to the shares of Common Stock issuable upon
the conversion of the Series D Stock and the exercise of the Warrants.

     NOW, THEREFORE, the parties hereto mutually agree as follows:

     1. Registrable Securities.  As used herein the terms "Registrable Security"
means each of the shares of Common Stock (i) issued upon the  conversion  of the
Series D Stock (the  "Conversion  Shares") or (ii) upon exercise of the Warrants
(the "Warrant Shares"),  provided,  however, that with respect to any particular
Registrable  Security,  such security  shall cease to be a Registrable  Security
when,  as of  the  date  of  determination  that  (a) it  has  been  effectively
registered under the Securities Act of 1933, as amended (the "Securities  Act"),
and disposed of pursuant thereto,  or (b) registration  under the Securities Act
is no longer  required for the immediate  public  distribution of such security.
The term "Registrable Securities" means any and/or all of the securities falling
within the foregoing definition of a "Registrable Security." In the event of any
merger,  reorganization,  consolidation,  recapitalization  or other  change  in
corporate structure affecting the Common Stock, such adjustment shall be made in
the definition of  "Registrable  Security" as is appropriate in order to prevent
any dilution or enlargement of the rights granted pursuant to this Section 1.

     2. Registration.

     (a) The Company  shall file a  registration  statement  (the  "Registration
Statement")  with the  Securities  and Exchange  Commission  (the "SEC")  within
forty-five  (45) days after the date of this  Agreement in order to register the
resale of the Registrable  Securities  under the Securities Act. Once effective,
the Company shall maintain the effectiveness of the Registration Statement until
the  earlier of (i) the date that all of the  Registrable  Securities  have been

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sold,  or (ii) the date that the  Company  receives an opinion of counsel to the
Company that all of the  Registrable  Securities  may be freely  traded  without
registration  under the  Securities  Act, under Rule 144  promulgated  under the
Securities Act or otherwise.

     (b) The Company will  initially  include in the  Registration  Statement as
Registrable  Securities Eight Million One Hundred Forty-Two Thousand Two Hundred
Nineteen (8,142,219) shares of Common Stock.

     3.  Covenants  of the Company  with  Respect to  Registration.  The Company
covenants and agrees as follows:

     (a) The  Company  shall use  commercially  reasonable  efforts to cause the
Registration  Statement to become effective with the SEC as promptly as possible
and in no event more than 90 days after filing the  Registration  Statement with
the SEC. If any stop order shall be issued by the SEC in  connection  therewith,
the Company shall use  commercially  reasonable  efforts to obtain  promptly the
removal  of  such  order.  Following  the  effective  date  of the  Registration
Statement,  the Company shall, upon the request of any Holder,  forthwith supply
such  reasonable  number of copies of the  Registration  Statement,  preliminary
prospectus and prospectus  meeting the  requirements  of the Securities Act, and
any other  documents  necessary  or  incidental  to the public  offering  of the
Registrable Securities, as shall be reasonably requested by the Holder to permit
the Holder to make a public distribution of the Holder's Registrable Securities.
The  obligations  of  the  Company   hereunder  with  respect  to  the  Holder's
Registrable  Securities  are subject to the Holder's  furnishing  to the Company
such appropriate  information  concerning the Holder,  the Holder's  Registrable
Securities and the terms of the Holder's offering of such Registrable Securities
as the Company may reasonably request in writing.

     (b) The Company shall pay all costs,  fees and expenses in connection  with
the Registration Statement filed pursuant to Section 2 hereof including, without
limitation, the Company's legal and accounting fees, printing expenses, and blue
sky fees and  expenses;  provided,  however,  that each  Holder  shall be solely
responsible  for the fees of any counsel  retained  by the Holder in  connection
with  such  registration  and any  transfer  taxes  or  underwriting  discounts,
commissions or fees applicable to the Registrable  Securities sold by the Holder
pursuant thereto.

     (c) The Company will take all actions which may be  reasonably  required to
qualify or register  the  Registrable  Securities  included in the  Registration
Statement  for the offer and sale under the  securities or blue sky laws of such
states as are reasonably  requested by each Holder of such securities,  provided
that the Company  shall not be obligated to execute or file any general  consent
to service of process  or to  qualify as a foreign  corporation  to do  business
under the laws of any such jurisdiction.

     4. Additional Terms.

     (a) The Company  shall  indemnify  and hold  harmless  the Holders and each
underwriter,  within the meaning of the Securities Act, who may purchase from or
sell for any Holder,  any Registrable  Securities,  from and against any and all
losses,  claims,  damages and  liabilities  caused by any untrue  statement of a
material fact contained in the Registration  Statement,  any other  registration
statement  filed by the Company  under the  Securities  Act with  respect to the
registration of the Registrable Securities, any post-effective amendment to such
registration  statements,  or any prospectus  included  therein or caused by any

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omission  to state  therein a material  fact  required  to be stated  therein or
necessary to make the statements therein not misleading,  except insofar as such
losses,  claims,  damages or liabilities are caused by any such untrue statement
or omission  based upon  information  furnished  or required to be  furnished in
writing to the Company by the Holders or underwriter  expressly for use therein,
which indemnification shall include each person, if any, who controls any Holder
or  underwriter  within the  meaning  of the  Securities  Act and each  officer,
director, employee and agent of each Holder and underwriter;  provided, however,
that the  indemnification  in this Section  4(a) with respect to any  prospectus
shall not inure to the benefit of any Holder or  underwriter  (or to the benefit
of any  person  controlling  any Holder or  underwriter)  on account of any such
loss, claim, damage or liability arising from the sale of Registrable Securities
by the Holder or underwriter,  if a copy of a subsequent  prospectus  correcting
the untrue statement or omission in such earlier prospectus was provided to such
Holder  or  underwriter  by the  Company  prior  to the  subject  sale  and  the
subsequent  prospectus was not delivered or sent by the Holder or underwriter to
the purchaser  prior to such sale and provided  further,  that the Company shall
not be  obligated to so indemnify  any Holder or any such  underwriter  or other
person  referred to above unless the Holder or underwriter  or other person,  as
the case may be, shall at the same time  indemnify the Company,  its  directors,
each officer  signing the  Registration  Statement and each person,  if any, who
controls the Company within the meaning of the Securities  Act, from and against
any and all  losses,  claims,  damages  and  liabilities  caused  by any  untrue
statement  of a material  fact  contained  in the  Registration  Statement,  any
registration  statement or any  prospectus  required to be filed or furnished by
reason of this  Agreement or caused by any omission to state  therein a material
fact required to be stated therein or necessary to make the  statements  therein
not  misleading,  insofar as such losses,  claims,  damages or  liabilities  are
caused by any untrue statement or omission based upon  information  furnished in
writing to the Company by the Holder or underwriter expressly for use therein.

     (b) If for any reason the  indemnification  provided  for in the  preceding
section 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 thereunder,  shall contribute to the amount paid or payable by
the indemnified  party as a result of such loss,  claim,  damage or liability in
such  proportion  as is  appropriate  to  reflect  the  relative  fault  of  the
indemnified  party and the  indemnifying  party,  as well as any other  relevant
equitable considerations.

     (c) Neither the filing of a Registration  Statement by the Company pursuant
to this Agreement nor the making of any request for  prospectuses  by the Holder
shall impose upon any Holder any  obligation  to sell the  Holder's  Registrable
Securities.

     (d) Each Holder,  upon receipt of notice from the Company that an event has
occurred which requires a Post-Effective Amendment to the Registration Statement
or a supplement to the prospectus included therein,  shall promptly  discontinue
the  sale of  Registrable  Securities  until  the  Holder  receives  a copy of a
supplemented  or amended  prospectus  from the Company,  which the Company shall
provide as soon as practicable after such notice.


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     (e) If the Company  fails to keep the  Registration  Statement  referred to
above  continuously  effective  during the  requisite  period,  then the Company
shall,  promptly  upon the request of any Holder,  use  commercially  reasonable
efforts  to  update  the  Registration  Statement  or  file  a new  registration
statement covering the Registrable  Securities remaining unsold,  subject to the
terms and provisions hereof.

     (f) Each  Holder  agrees to provide  the Company  with any  information  or
undertakings  reasonably  requested  by the  Company in order for the Company to
include any appropriate  information  concerning the Holder in the  Registration
Statement  or in order to promote  compliance  by the Company or the Holder with
the Securities Act.

     (g) The Company agrees that it shall cause each of its directors,  officers
and shareholders  owning ten percent (10%) or more of the Company's  outstanding
Common Stock to refrain from  selling any shares of the  Company's  Common Stock
until the Registration Statement has been declared effective.

     (h) Each Holder,  on behalf of itself and its affiliates,  hereby covenants
and agrees not to,  directly or indirectly,  offer to "short sell",  contract to
"short sell" or otherwise "short sell" any securities of the Company, including,
without limitation,  shares of Common Stock that will be received as a result of
the conversion of the Series D Stock or the exercise of the Warrants.

     5.  Governing  Law.  This  Agreement  shall be deemed to have been made and
delivered  in the  State of New  York and  shall  be  governed  as to  validity,
interpretation,  construction,  effect and in all other respects by the internal
substantive  laws of the State of New New  York,  without  giving  effect to the
choice of law rules thereof.

     6.  Amendment.  This Agreement may only be amended by a written  instrument
executed by the Company and the Holders.

     7. Entire Agreement. This Agreement constitutes the entire agreement of the
parties  hereto with respect to the subject  matter  hereof,  and supersedes all
prior  agreements  and  understandings  of the parties,  oral and written,  with
respect to the subject matter hereof.

     8. Execution in Counterparts. This Agreement may be executed in one or more
counterparts,  each of  which  shall be  deemed  an  original,  but all of which
together shall constitute one and the same document.

     9. Notices.  All communications  hereunder shall be in writing and shall be
hand delivered, mailed by first-class mail, couriered by next-day air courier or
by facsimile at the addresses set forth below.

If to the Holders,      M.A.G. Capital, LLC
                        Mercator Momentum Fund, L.P.
                        Mercator Momentum Fund III, L.P.
                        Monarch Pointe Fund, Ltd.
                        555 South Flower Street, Suite 4200

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                        Los Angeles, CA  90071
                        Attention: David Firestone
        With a copy to  Sheppard Mullin Richter & Hampton LLP
                        333 South Hope Street
                        48th Floor
                        Los Angeles, CA 90071-1448
                        Telephone No.: (213) 620-1780
                        Facsimile No.:  (213) 620-1398
                        Attention:      David C. Ulich

                        If to the Company,

                        Vasomedical Inc
                        180 Linden Avenue
                        Westbury, NY 11590
                        Phone: 516-997-4600
                        Fax: 516-997-2299

                        Attention: Thomas W. Fry


        With a copy to: Beckman, Lieberman & Barandes, LLP
                        100 Jericho Quadrangle
                        Suite 329
                        Jericho, New York  11753
                        Telephone No.:  (516) 433-1200
                        Facsimile No.:   (516) 433-5858
                        Attention:  David H. Lieberman, Esq.


All such notices and communications shall be deemed to have been duly given: (i)
three (3) days after it is  received  if sent by  facsimile  at the  address and
number set forth above;  provided that notices  given by facsimile  shall not be
effective,  unless  either  (a) a  duplicate  copy of such  facsimile  notice is
promptly given by depositing the same in the mail, postage prepaid and addressed
to the party as set forth below or (b) the  receiving  party  delivers a written
confirmation of receipt for such notice by any other method permitted under this
paragraph;  and further  provided  that any notice given by  facsimile  received
after  5:00 p.m.  (recipient's  time) or on a  non-business  day shall be deemed
received on the next  business day; (ii) five (5) business days after deposit in
the United States mail,  certified,  return receipt requested,  postage prepaid,
and  addressed to the party as set forth below;  or (iii) the next  business day
after deposit with an international overnight delivery service, postage prepaid,
addressed  to the  party as set forth  below  with next  business  day  delivery
guaranteed;  provided that the sending party receives  confirmation  of delivery
from the delivery service provider.

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     10. Binding Effect;  Benefits.  Any Holder may assign its rights hereunder.
This  Agreement  shall inure to the benefit of, and be binding upon, the parties
hereto  and  their  respective  heirs,  legal  representatives,  successors  and
assigns.  Nothing herein  contained,  express or implied,  is intended to confer
upon any person other than the parties hereto and their respective heirs,  legal
representatives  and  successors,  any rights or remedies  under or by reason of
this Agreement.

     11.  Headings.  The headings  contained  herein are for the sole purpose of
convenience  of reference,  and shall not in any way limit or affect the meaning
or interpretation of any of the terms or provisions of this Agreement.

     12. Severability.  Any provision of this Agreement which is held by a court
of  competent   jurisdiction   to  be   prohibited  or   unenforceable   in  any
jurisdiction(s) shall be, as to such jurisdiction(s),  ineffective to the extent
of such  prohibition  or  unenforceability  without  invalidating  the remaining
provisions of this Agreement or affecting the validity or enforceability of such
provision in any other jurisdiction.

     13. Attorneys' Fees and Disbursements. If any action at law or in equity is
necessary to enforce or interpret the terms of this  Agreement,  the  prevailing
party or parties  shall be entitled  to receive  from the other party or parties
reasonable  attorneys' fees and disbursements in addition to any other relief to
which the prevailing party or parties may be entitled.

            [The balance of this page is intentionally left blank.]

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     IN WITNESS  WHEREOF,  this Agreement has been executed and delivered by the
parties hereto as of the date first above written.

                        VASOMEDICAL, INC.


                        By:/s/ Thomas Glover
                           ----------------------------------
                        Name:  Thomas Glover
                        Its:   President

                        HOLDERS:

                        MERCATOR MOMENTUM FUND, L.P.

                        By:  M.A.G. CAPITAL, LLC
                        Its:  General Partner

                        By:/s/ David Firestone
                           -----------------------------------
                        Name:  David Firestone
                        Its:   Managing Member

                        MERCATOR MOMENTUM FUND III, L.P.

                        By: M.A.G. CAPITAL, LLC
                        Its: General Partner


                        By:/s/ David Firestone
                           -----------------------------------
                        Name: David Firestone
                        Its:       Managing Member


                        MONARCH POINTE FUND, LTD.

                        By:/s/ David Firestone
                           -----------------------------------
                        Name: David Firestone
                        Its:  President


                        M.A.G. CAPITAL, LLC

                        By:/s/ David Firestone
                           -----------------------------------
                        Name: David Firestone
                        Its:  Managing Member



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