Document:

Exhibit 10.3

 

REGISTRATION RIGHTS
AGREEMENT

 

This Registration Rights
Agreement (this “Agreement”) is made and entered into as of November 20,
2009, by and between Infologix, Inc., a Delaware corporation (the “Company”),
and Hercules Technology Growth  Capital, Inc.,
a Maryland corporation (“Hercules”).

 

This Agreement is made pursuant to the
Amended and Restated Loan and Security Agreement dated as of November 20,
2009 (as amended, restated, supplemented, modified or otherwise in effect from
time to time, the “A/R Loan Agreement”) by and among the Company,
InfoLogix Systems Corporation, Embedded Technologies, LLC, Opt Acquisition LLC
and Infologix-DDMS, Inc. and Hercules.

 

Now, therefore, in
consideration of the mutual covenants contained in this Agreement, and for
other good and valuable consideration the receipt and sufficiency of which are
hereby acknowledged, the Company and Hercules agree as follows:

 

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

 

“Advice” shall have
the meaning set forth in Section 6(c).

 

“Commission” means
the United States Securities and Exchange Commission.

 

“Common Stock” means
the common stock of the Company, par value $0.00001 and any other class of
securities into which such shares may hereafter have been reclassified or
changed.

 

“Demand Notice” shall
have the meaning set forth in Section 2(c).

 

“Demand Registration”
shall means any registration of Registrable Securities under the Securities Act
requested by Hercules pursuant to Section 2(d).

 

“Effectiveness Date”
means the 120th calendar day following the conversion of a Converted Debt
Amount to Common Stock pursuant to Section 2.9 of the A/R Loan Agreement,
extended by a period of 60 additional days if the Commission reviews the
Initial Registration Statement, provided, however, in the event
that the Company is notified by the Commission that the Initial Registration
Statement will not be reviewed or is no longer subject to further review and
comments, the Effectiveness Date as to the Initial Registration Statement shall
be the tenth Trading Day following the date on which the Company is so notified
if such date precedes the dates required above; provided, further,
that if the Effectiveness Date falls on a Saturday, Sunday or other day that
the Commission is closed for business, the Effectiveness Date shall be extended
to the next business day on which the Commission is open for business.

 

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

 

“Holder” or “Holders”
means the holder or holders, as the case may be, from time to time of
Registrable Securities.

 

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

 

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

 

 

“Initial Registrable
Securities” shall have the meaning set forth in Section 2(a).

 

“Initial Registration
Statement” shall have the meaning set forth in Section 2(a).

 

“Liquidated Damages”
shall have the meaning set forth in Section 2(d).

 

“Losses” shall have
the meaning set forth in Section 5(a).

 

“Permitted Shares”
means that number of (a) Shares and (b) Common Stock issued or
issuable upon any stock split, dividend or other distribution, recapitalization
or similar event with respect to the foregoing that the Commission permits the
Company to register for resale, issued by the Company to Hercules, from time to
time.

 

“Proceeding” means an
action, claim, suit, investigation or proceeding (including, without
limitation, an investigation, of which the Company, or any member of its Board
of Directors have actual knowledge, or a partial proceeding, such as a
deposition), whether commenced or threatened.

 

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

 

“Registrable Securities”
means all of the Permitted Shares until, in the case of any such security, (a) the
earliest of (i) its effective registration under the Securities Act and
resale in accordance with the Registration Statement covering it and (ii) its
sale to the public pursuant to Rule 144 (or any similar provision then in
force) under the Securities Act, and (b) as a result of the event or
circumstance described in any of the foregoing clauses, the legend with respect
to transfer restrictions therein is removed or removable in accordance with the
terms of such legend.

 

“Registration Default”
shall have the meaning set forth in Section 2(d).

 

“Registration Default
Date” shall have the meaning set forth in Section 2(d).

 

“Registration Request”
shall have the meaning set forth in Section 2(c).

 

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

 

“Rule 144” means
Rule 144 promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the Commission having substantially the same
purpose and effect as such Rule.

 

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“Rule 415” means
Rule 415 promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the Commission having substantially the same
purpose and effect as such Rule.

 

“Rule 424” means
Rule 424 promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the Commission having substantially the same
purpose and effect as such Rule.

 

“Shares” shall mean
the Common Stock issued by the Company to Hercules (a) pursuant to the A/R
Loan Agreement, including without limitation, pursuant to Section 2.5(a) and
2.9 thereof, from time to time and (b) upon the exercise of the warrant,
dated as of the date hereof, to purchase 250,000 shares of Common Stock.

 

“Subsequent Registrable
Securities Amount” shall have the meaning set forth in Section 2(b).

 

“Subsequent Registration
Statement” shall have the meaning set forth in Section 2(b).

 

“Trading Day” shall
mean any day during which the Nasdaq Stock Market shall be open for business
for trading.

 

“Trading Market”
shall mean the Nasdaq Stock Market.

 

2.                                       Registration.

 

(a)                                  On or prior to
the 120th calendar day following the conversion of a Converted Debt Amount to
Common Stock pursuant to Section 2.9 of the A/R Loan Agreement, the
Company shall prepare and file with the Commission a Registration Statement
covering the resale of at least the greater of (i) the number of shares
issued pursuant to such conversion, and (ii) 25,000,000 shares, of
Registrable Securities (the “Initial Registrable Securities”) for an
offering to be made on a continuous basis pursuant to Rule 415 (the “Initial
Registration Statement”).  The
Initial Registration Statement shall be on Form S-3 (except if the Company
is not then eligible to register for resale the Initial Registrable Securities
on Form S-3, in which case such registration shall be on another
appropriate form in accordance herewith). 
Not less than ten business days prior to filing of the Initial Registration
Statement, the Company shall provide each Holder with a copy of the Initial
Registration Statement proposed to be filed and shall consider all appropriate
comments that are timely provided by such Holder with respect to the Initial
Registration Statement.  Subject to the
terms of this Agreement, the Company shall use its commercially reasonable best
efforts to cause the Initial Registration Statement to be declared effective
under the Securities Act as promptly as possible after the filing thereof, but
in any event prior to the Effectiveness Date, and shall use its commercially
reasonable best efforts to keep the Initial Registration Statement continuously
effective under the Securities Act until (A) the Initial Registrable
Securities have been sold, or (B) subject to the next successive sentence,
(1) Hercules, together with any of its affiliates, owns less than 10% of
the issued and outstanding Common Stock and (2) the Registrable Securities
may be sold free of any restrictions under Rule 144 (the “Effectiveness
Period”).  Upon the Initial
Registration Statement ceasing to be effective in connection with clause (B) of
this section, the Company shall take, at its sole expense, such further action,
including the provision of a legal opinion, as any Holder may  reasonably request from time to time to
enable such Holder to sell the Registrable Securities without registration
under the Securities Act.  The Company
shall notify the Holders via facsimile or electronic mail of the effectiveness
of the Initial Registration Statement within three Trading Days of the 

 

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Company telephonically
confirming effectiveness with the Commission. 
The Company shall, by 9:30 AM Eastern Time on the Trading Day that is
three Trading Days after the 90th calendar day following the Effectiveness
Date, file a Form 424(b)(5) with the Commission.

 

(b)                                 Following the
Effectiveness Period, Hercules may request the filing of an additional
Registration Statement (a “Subsequent Registration Statement”) covering
at least 10,000,000 shares (the “Subsequent Registrable Securities Amount”)
of Registrable Securities (a “Registration Request”).  Upon receipt of a Registration Request, the
Company shall use its commercially reasonable best efforts to, within 30 days
of receipt of such Registration Request, prepare and file a Subsequent
Registration Statement,  if such
Registration Statement is on Form S-3, otherwise within 60 days of receipt
of such Registration Request, covering the Registrable Securities that are the
subject of the Registration Request and shall use its commercially reasonable
best efforts to cause such Subsequent Registration Statement to become
effective as soon as is practicable following its filing.  In filing a Subsequent Registration
Statement, the Company shall follow the same procedure of preparing, filing and
seeking effectiveness of the such Subsequent Registration Statement as it did
for the Initial Registration Statement, provided, however, that
the time periods in this section shall control. 
Upon the sale of all of the Registrable Securities covered by a
Subsequent Registration Statement, Hercules may submit one or more additional
Subsequent Registration Requests requesting the Company to prepare and file
with the Commission a Subsequent Registration Statement coving an additional
amount of Registrable Securities equal to the Subsequent Registrable Securities
Amount and the Company will follow the same procedure of preparing, filing and
seeking effectiveness of such Registration Statement as it did for the first
Subsequent Registration Statement.  The
procedure set forth in this Section 2(b) shall be followed until all
of the Registrable Securities have been sold.

 

(c)                                  At any point
following the Effectiveness Date, if the Company shall receive a notice from
Hercules requesting that the Company effect a Demand Registration (a “Demand
Notice”), for at least 5,000,000 shares of the Registrable Securities
specified in such Demand Notice, the Company shall use its commercially
reasonable best efforts to, within 30 days of receipt of such Demand Notice,
prepare and file a Registration Statement covering the Registrable Securities
that are the subject of the Demand Notice, if such Registration Statement is on
Form S-3, otherwise within 60 days of receipt of such Demand Notice, and
shall use its commercially reasonable best efforts to cause such Registration
Statement to become effective as soon as is practicable following its
filing.  Hercules may request three
Demand Registrations.  In filing a
Registration Statement pursuant this Section 2(c), the Company shall
follow the same procedure of preparing, filing and seeking effectiveness of
such Registration Statement as it did for the Initial Registration Statement, provided,
however, that the time periods in this section shall control.

 

(d)                                 If (i) the
Initial Registration Statement is not filed on or prior to the Effectiveness
Date, (ii) a Subsequent Registration Statement is not filed on or prior to
the date 30 days after the Company receives a Registration Request or 60 days
as applicable, (iii) a Demand Registration is not filed on or prior to the
date 30 days after the Company receives a Demand Notice, or 60 days as
applicable or (iv) the Registration Statement covering the Registrable
Securities ceases to be effective or usable in the case of the Initial
Registration Statement, during the Effectiveness Period, or in the case of any
Subsequent Registration Statement or Demand Registration Statement, at any time
prior to the sale of all Registrable Securities covered in such Registration
Statements, subject to Section 2(g) (without being succeeded on the
same date immediately by a post-effective amendment or supplement to a
Registration Statement that cures such failure and that is itself, in the case
of a post-effective amendment, declared effective within ten Trading Days of
filing with the Commission) or the Holders are not permitted to utilize the
Prospectus 

 

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therein to resell such Registrable Securities for 20
consecutive Trading Days or in any individual case an aggregate of 30 Trading
Days during any twelve-month period (which need not be consecutive Trading
Days) (any of the foregoing being a “Registration Default” and for
purposes of clauses (i), (ii) and (iii) the date on which such
Registration Default occurs, or for purposes of clause (iv) the date on
which such 20 or 30 Trading Day period, as applicable, is exceeded, each being
a “Registration Default Date”) then, subject to Section 3, the
Company shall pay to each Holder an amount in cash, as liquidated damages and
not a penalty (“Liquidated Damages”) equal to 1% of the sum of: (A) the
Converted Debt Amount which was converted into Common Stock pursuant to Section 2.9
of the A/R Loan Agreement, plus (B) any interest paid through the
issuance of Shares pursuant to Section 2.5(a) of the A/R Loan
Agreement, to which the Registration Default relates.  The foregoing represents the sole monetary
remedy to any Holder in connection with any Registration Default.  The Company shall pay the Holders any
Liquidated Damages accrued for the first month after a Registration Default
Date within seven calendar days after the end of such month, and any Liquidated
Damages accrued for any subsequent month within seven calendar days after the
end of such month.  If the Company fails
to pay any Liquidated Damages pursuant to this Section in full within
seven days after the date payable, the Company will pay interest thereon at a
rate of 8% per annum (or such lesser maximum amount that is permitted to be
paid by applicable law) to the Holder, accruing daily from the date such
Liquidated Damages are due until such amounts, plus all such interest thereon,
are paid in full.  A Registration Default
under clauses (i), (ii) and (iii) above shall be cured on the date
that the required Registration Statement is filed with the SEC and a
Registration Default under clause (iv) above shall be cured on the date
that the Registration Statement covering the Permitted Shares is declared
effective by the SEC or is otherwise usable. 
Notwithstanding the foregoing, no Liquidated Damages shall accumulate as
to any Registrable Security from and after the earlier of (x) the date
such security is no longer a Registrable Security and (y) expiration of
the Effectiveness Period.

 

(e)                                  The Company
shall not be liable for any Liquidated Damages under Section 2(d) if
the Holders are not permitted to utilize the Prospectus because the Company is
negotiating a merger, consolidation, acquisition or sale of all or
substantially all of its assets or a similar transaction which, in the good
faith judgment of the Board of Directors, requires any Registration Statement
to be amended to include information in connection with such pending
transaction (including the parties thereto) and such information is not yet
available or publicly disclosable, or the Company is otherwise aware of such
other material non-public information which, in the good faith judgment of the
Board of Directors, requires any Registration Statement to be amended to
include such other material non-public information and such information is not
yet publicly disclosable, for an aggregate of 30 consecutive days.

 

(f)                                    Each Holder
agrees to furnish to the Company (i) a completed selling stockholder
questionnaire not more than ten Trading Days before the filing of any
Registration Statement and (ii) such other information the Company
reasonably requires to prepare any Registration Statement.  Each Holder further agrees that it shall not
be entitled to be named as a selling stockholder in any Registration Statement
or use the Prospectus for offers and resales of Registrable Securities at any
time, unless such Holder has returned this information to the Company.  Each Holder acknowledges and agrees that the
information in the selling stockholder questionnaire or request for further
information as described in this Section 2(f) will be used by the
Company in the preparation of any Registration Statement and hereby consents to
the inclusion of such information in any Registration Statement.

 

(g)                                 Subject to the
subsequent sentence, the Company shall not be required to file or keep
effective any Subsequent Registration Statement or Demand Registration when
Hercules, 

 

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together with any of its affiliates, owns less than
10% of the issued and outstanding Common Stock and the Registrable Securities
may be sold free of any restrictions under Rule 144.  Upon such occurrence, the Company shall take,
at its sole expense, such further action, including the provision of a legal
opinion, as any Holder may reasonably request from time to time to enable such
Holder to sell the Registrable Securities without registration under the
Securities Act.

 

3.                                       Registration
Procedures.

 

In connection with the
Company’s registration obligations hereunder, the Company shall:

 

(a)                                  (i) Prepare
and file with the Commission such amendments, including post-effective
amendments, to any Registration Statement and the Prospectus used in connection
therewith as may be necessary to keep the Registration Statement continuously
effective as to the applicable Registrable Securities for the Effectiveness
Period; (ii) cause the related Prospectus to be amended or supplemented by
any required Prospectus supplement (subject to the terms of this Agreement),
and as so supplemented or amended to be filed pursuant to Rule 424; (iii) respond
as promptly as reasonably possible to any comments received from the Commission
with respect to the Registration Statement or any amendment thereto; and (iv) comply
in all material respects with the provisions of the Securities Act and the
Exchange Act with respect to the disposition of all Registrable Securities
covered by the Registration Statement during the applicable period in
accordance (subject to the terms of this Agreement) with the intended methods
of disposition by the Holders thereof set forth in the Registration Statement
as so amended or in such Prospectus as so supplemented; provided, however, that each Holder shall be responsible for
the delivery of the Prospectus in accordance with Rule 172 under the
Securities Act, and each Holder agrees to dispose of Registrable Securities in
compliance with the plan of distribution described in the Registration
Statement and otherwise in compliance with applicable federal and state
securities laws;

 

(b)                                 Notify the
Holders of Registrable Securities to be sold (which notice shall, pursuant to
clauses (ii) through (v) hereof, be accompanied by an instruction to
suspend the use of the Prospectus until the requisite changes have been made)
as promptly as reasonably possible and (if requested by any such Person)
confirm such notice in writing no later than one Trading Day following the day
(i)(A) when a Prospectus or any Prospectus supplement or post-effective
amendment to the Registration Statement is filed; and (B) with respect to
the Registration Statement or any post-effective amendment, when the same has
become effective; (ii) of any request by the Commission or any other
Federal or state governmental authority for amendments or supplements to the
Registration Statement or Prospectus or for additional information; (iii) of
the issuance by the Commission or any other federal or state governmental
authority of any stop order suspending the effectiveness of the Registration
Statement covering any or all of the Registrable Securities or the initiation
of any Proceedings, for that purpose; (iv) of the receipt by the Company
of any notification with respect to the suspension of the qualification or
exemption from qualification of any of the Registrable Securities for sale in
any jurisdiction, or the initiation or threatening of any Proceeding for such
purpose; and (v) of the occurrence of any event or passage of time that
makes the financial statements included in the Registration Statement
ineligible for inclusion therein or any statement made in the Registration
Statement or Prospectus or any document incorporated or deemed to be
incorporated therein by reference untrue in any material respect or that
requires any revisions to the Registration Statement, Prospectus or other
documents so that, in the case of the Registration Statement or the Prospectus,
as the case may be, it will not contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading; provided that any and all of such 

 

6

 

information provided
pursuant to clause (v) above shall remain confidential to each Holder
until such information otherwise becomes public, and such Holder agrees not to
trade on such information, unless disclosure by a Holder is required by law; provide,
further, notwithstanding each Holder’s agreement to keep such
information confidential, the Holders make no acknowledgement that any such
information is material, non-public information;

 

(c)                                  Use its
commercially reasonable best efforts to avoid the issuance of, or, if issued,
obtain the withdrawal of (i) any order suspending the effectiveness of the
Registration Statement, or (ii) any suspension of the qualification (or
exemption from qualification) of any of the Registrable Securities for sale in
any jurisdiction, as soon as practicable;

 

(d)                                 Furnish to each
Holder, upon written request of such Holder, without charge, at least one
conformed copy of the Registration Statement and each amendment thereto,
including financial statements and schedules, all documents incorporated or
deemed to be incorporated therein by reference to the extent requested by such
Person, and all exhibits to the extent requested by such Person (including
those previously furnished or incorporated by reference); provided, that
the Company shall have no obligation to provide any document pursuant to this
clause that is available on the Commission’s EDGAR system;

 

(e)                                  Promptly
deliver to each Holder, upon written request of such Holder, without charge, as
many copies of the Prospectus or Prospectuses (including each form of
prospectus) and each amendment or supplement thereto as such Persons may
reasonably request in connection with resales by the Holder of Registrable
Securities.  Subject to the terms of this
Agreement, the Company hereby consents to the use of such Prospectus and each
amendment or supplement thereto by each of the selling Holders in connection
with the offering and sale of the Registrable Securities covered by such
Prospectus and any amendment or supplement thereto, except after the giving of
any notice pursuant to Section 3(b);

 

(f)                                    Prior to any
resale of Registrable Securities by a Holder, use its commercially reasonable
efforts to register or qualify or cooperate with the selling Holders in
connection with the registration or qualification (or exemption from the
Registration or qualification) of such Registrable Securities for the resale by
the Holder under the securities or Blue Sky laws of such jurisdictions within
the United States as any Holder reasonably requests in writing, to keep each
registration or qualification (or exemption therefrom) effective during the
Effectiveness Period and to do any and all other acts or things reasonably
necessary to enable the disposition in such jurisdictions of the Registrable
Securities covered by each Registration Statement; provided that the Company
shall not be required to qualify generally to do business in any jurisdiction
where it is not then so qualified or subject the Company to any material tax in
any such jurisdiction where it is not then so subject or file a general consent
to service of process in any such jurisdiction;

 

(g)                                 If requested by
the Holders, cooperate with the Holders to facilitate the timely preparation
and delivery of certificates representing Registrable Securities to be
delivered to a transferee pursuant to the Registration Statement, which
certificates shall be free of all restrictive legends, and to enable such
Registrable Securities to be in such denominations and registered in such names
as any such Holders may request;

 

(h)                                 Upon the
occurrence of any event contemplated by this Section 3, as promptly as
reasonably possible under the circumstances taking into account the Company’s
good faith assessment of any adverse consequences to the Company and its
shareholders of the premature disclosure of such event, prepare a supplement or
amendment, including a post-effective amendment, to any Registration Statement
or a supplement to the related Prospectus or any

 

7

 

document incorporated or
deemed to be incorporated therein by reference, and file any other required
document so that, as thereafter delivered, neither the Registration Statement
nor such Prospectus will contain 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 light of the circumstances under which they were made,
not misleading.  If the Company notifies
the Holders in accordance with clauses (ii) through (v) of Section 3(b) above
to suspend the use of any Prospectus until the requisite changes to such
Prospectus have been made, then the Holders shall suspend use of such
Prospectus.  The Company will use its
commercially reasonable best efforts to ensure that the use of the Prospectus
may be resumed as promptly as is practicable. 
The Company shall be entitled to exercise its right under this Section 3(h) to
suspend the availability of the Registration Statement and Prospectus for a
period not to exceed 90 days (which need not be consecutive days) in any 365
day period;

 

(i)                                     Comply with all
applicable rules and regulations of the Commission and the Trading Market;
and

 

(j)                                     Be permitted to
require each selling Holder to furnish to the Company (i) a certified statement
as to the number of shares of Common Stock beneficially owned by such Holder, (ii) if
required by the Commission, the person thereof that has voting and dispositive
control over the Shares and (iii) any further information required by the
Commission.  During any periods that the
Company is unable to meet its obligations hereunder with respect to the
registration of the Registrable Securities solely because any Holder fails to
furnish such information within five Trading Days of the Company’s request, any
Liquidated Damages that are accruing at such time as to such Holder only shall
be tolled and any Registration Default that may otherwise occur solely because
of such delay shall be suspended as to such Holder only, until such information
is delivered to the Company; provided, however, that if the
failure of any one Holder affects the Company’s ability to meet its obligations
with respect to the registration of all of the Registrable Securities, all
Liquidated Damages that are accruing at such time as to all Holders shall be
tolled and any Registration Default that may otherwise occur solely because of
such delay shall be suspended as to all Holders until such information is
delivered to the Company.

 

4.                                       Registration
Expenses. All fees and expenses incident to the performance
of or compliance with this Agreement by the Company shall be borne by the
Company whether or not any Registrable Securities are sold pursuant to the
Registration Statement.  The fees and
expenses referred to in the foregoing sentence shall include, without
limitation, (i) all registration and filing fees (including, without
limitation, fees and expenses (A) with respect to filings required to be
made with the Trading Market on which the Common Stock are then listed for
trading and (B) in compliance with applicable state securities or Blue Sky
laws reasonably requested by the Holder and reasonably agreed to by the Company
in writing (including, without limitation, fees and disbursements of counsel
for the Company in connection with Blue Sky qualifications or exemptions of the
Registrable Securities and determination of the eligibility of the Registrable
Securities for investment under the laws of such jurisdictions as requested by
the Holders); (ii) printing expenses (including, without limitation,
expenses of printing certificates for Registrable Securities and of printing
prospectuses for a Holder if the printing of prospectuses is reasonably
requested by such Holder); (iii) messenger, telephone and delivery
expenses related to the Company’s obligations hereunder; (iv) fees and
disbursements of counsel for the Company; (v) Securities Act liability
insurance, if the Company so desires such insurance; and (vi) fees and
expenses of all other Persons retained by the Company in connection with the
consummation of the transactions contemplated by this Agreement.  In addition, the Company shall be responsible
for all of its internal expenses incurred in connection with the consummation
of the transactions 

 

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contemplated by this Agreement (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expense of any annual audit and the
fees and expenses incurred in connection with the listing of the Registrable
Securities on any securities exchange as required hereunder, including all fees
and expenses of the depositary.  In no
event shall the Company be responsible for any underwriting, broker or similar
fees or commissions of any Holder.

 

5.                                       Indemnification.

 

(a)                                  (i) Indemnification
by the Company. The Company shall, notwithstanding any termination of this
Agreement, indemnify and hold harmless each Holder, the officers, directors,
members, partners, agents, brokers (including brokers who offer and sell
Registrable Securities as principal as a result of a pledge or any failure to
perform under a margin call of Ordinary Shares), investment advisors and
employees of each of them, each Person who controls any such Holder (within the
meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act) and the officers, directors, members, partners, agents and
employees of each such controlling Person, to the fullest extent permitted by
applicable law, from and against any and all losses, claims, damages,
liabilities, judgments, fines, penalties, charges, costs (including, without
limitation, reasonable attorneys’ fees) and expenses (collectively, “Losses”),
as incurred, arising out of or relating to any untrue or alleged untrue
statement of a material fact contained in the Registration Statement, any
Prospectus or any form of prospectus or in any amendment or supplement thereto
or in any preliminary prospectus, or arising out of or relating to any omission
or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein (in the case of any Prospectus or form
of prospectus or supplement thereto, in light of the circumstances under which
they were made) not misleading, except to the extent, but only to the extent,
that (A) such untrue statements or omissions are based solely upon
information regarding such Holder furnished in writing to the Company by such
Holder expressly for use therein, or to the extent that such information relates
to such Holder or such Holder’s proposed method of distribution of Registrable
Securities and was reviewed and approved in writing by such Holder thereof
expressly for use in the Registration Statement, such Prospectus or such form
of Prospectus or in any amendment or supplement thereto, or (B) in the
case of an occurrence of an event of the type specified in Section 3(b)(ii)-(v),
the use by such Holder of an outdated or defective Prospectus after the Company
has notified such Holder in writing that the Prospectus is outdated or
defective and prior to the receipt by such Holder of the Advice contemplated in
Section 6(c).

 

(ii)  Indemnification
by Holders. Each Holder shall, notwithstanding any termination of this
Agreement, severally and not jointly, indemnify and
hold harmless the Company, its directors, officers, agents and employees, each
Person who controls the Company (within the meaning of Section 15 of the
Securities Act and Section 20 of the Exchange Act), and the directors,
officers, agents or employees of such controlling Persons, to the fullest
extent permitted by applicable law, from and against all Losses, as incurred,
arising out of or are related to any untrue or alleged untrue statement of a
material fact contained in any Registration Statement, any Prospectus, or any
form of prospectus, or in any amendment or supplement thereto or in any
preliminary prospectus, or arising out of or relating to any omission or
alleged omission of a material fact required to be stated therein or necessary
to make the statements therein (in the case of any Prospectus, or any form of
prospectus or supplement thereto, in light of the circumstances under which
they were made) not misleading (i) to the extent, but only to the extent,
that such untrue statements or omissions are based solely upon information
regarding such Holder furnished in writing to the Company by such Holder
thereof expressly for use therein, (ii) to the extent, but only to the
extent, that such information relates to such Holder or such Holder’s proposed
method of distribution of Registrable Securities and was reviewed and approved
in

 

9

 

writing by such Holder or agent thereof
expressly for use in a Registration Statement, such Prospectus or such form of
Prospectus or in any amendment or supplement thereto, or (iii) in the case
of an occurrence of an event of the type specified in Section 3(b)(ii)-(v) to
the extent, but only to the extent, related to the use by such Holder of an
outdated or defective Prospectus after the Company has notified such Holder in
writing that the Prospectus is outdated or defective and prior to the receipt
by such Holder of the Advice contemplated in Section 6(c).

 

(b)                                 Conduct of
Indemnification Proceedings. If any Proceeding shall be
brought or asserted against any Person entitled to indemnity hereunder (an “Indemnified
Party”), such Indemnified Party shall promptly notify the person from whom
indemnity is sought (the “Indemnifying Party”) in writing, and the
Indemnifying Party shall have the right to assume the defense thereof,
including the employment of counsel reasonably satisfactory to the Indemnified
Party and the payment of all fees and expenses incurred in connection with
defense thereof; provided, 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 it
shall be finally determined by a court of competent jurisdiction (which
determination is not subject to appeal or further review) that such failure
shall have prejudiced the Indemnifying Party.

 

An Indemnified Party shall
have the right to employ separate counsel in any such Proceeding and to
participate in the defense thereof, but the reasonable fees and expenses of
such counsel shall be at the expense of such Indemnified Party or 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; (iii) the Indemnifying Party shall
have failed promptly to employ counsel reasonably satisfactory to such
Indemnified Party in any such Proceeding; or (iv) 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 reasonably
believe that a material 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 reasonable fees and expenses of one separate counsel shall
be at the expense of the Indemnifying Party). 
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.

 

The Indemnified Party shall
promptly reimburse the Indemnifying Party for that portion of such reasonable
fees and expenses applicable to such actions for which such Indemnified Party
is not entitled to indemnification hereunder, determined based upon the
relative faults of the parties.

 

(c)                                  Contribution. If the
indemnification under Section 5(a) is unavailable to an Indemnified
Party or insufficient to hold an Indemnified Party harmless for any Losses,
then the Indemnifying Party shall contribute to the amount paid or payable by
such Indemnified Party, in such proportion as is appropriate to reflect the
relative fault of the Indemnifying Party and Indemnified Party in connection
with the actions, statements or omissions that resulted in such Losses as well
as any other relevant equitable considerations. 
The relative fault of such Indemnifying Party and Indemnified Party
shall be determined by reference to, among other 

 

10

 

things, whether any action
in question, including any untrue or alleged untrue statement of a material
fact or omission or alleged omission of a material fact, has been taken or made
by, or relates to information supplied by, such Indemnifying Party or
Indemnified Party, and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such action, statement or
omission.  The amount paid or payable by
a party as a result of any Losses shall be deemed to include, subject to the
limitations set forth in Section 5(b), any reasonable attorneys’ or other
reasonable fees or expenses incurred by such party in connection with any
Proceeding to the extent such party would have been indemnified for such fees
or expenses if the indemnification provided for in this Section was
available to such party in accordance with its terms.

 

The parties hereto agree
that it would not be just and equitable if contribution pursuant to this Section 5(c) were
determined by pro rata allocation or by any other method of allocation that
does not take into account the equitable considerations referred to in the
immediately preceding paragraph.

 

The indemnity and
contribution agreements contained in this Section are in addition to any
other liability that the Indemnifying Parties may have to the Indemnified
Parties.

 

6.                                       Miscellaneous.

 

(a)                                  Remedies. Subject to Section 2(d),
(i) in the event of a breach by the Company or by a Holder, of any of
their obligations under this Agreement, each Holder or the Company, as the case
may be, in addition to being entitled to exercise all rights granted by law and
under this Agreement, including recovery of damages, will be entitled to
specific performance of its rights under this Agreement and (ii) the
Company and each Holder agree that monetary damages would not provide adequate
compensation for any losses incurred by reason of a breach by it of any of the
provisions of this Agreement and hereby further agrees that, in the event of
any action for specific performance in respect of such breach, it shall waive
the defense that a remedy at law would be adequate

 

(b)                                 Compliance.  Each Holder covenants and agrees that it will
comply with the prospectus delivery requirements of the Securities Act as
applicable to it in connection with sales of Registrable Securities pursuant to
the Registration Statement and shall sell the Registrable Securities only in
accordance with a method of distribution described in the Registration
Statement.

 

(c)                                  Discontinued
Disposition.  Each Holder
agrees by its acquisition of such Registrable Securities that, upon receipt of
a notice from the Company of the occurrence of any event of the kind described
in Section 3(b)(ii) through Section 3(b)(v), such Holder will
forthwith discontinue disposition of such Registrable Securities under the
Registration Statement until it is advised in writing (the “Advice”) by
the Company that the use of the applicable Prospectus may be resumed, and has
received copies of any additional or supplemental filings that are incorporated
or deemed to be incorporated by reference in such Prospectus or Registration
Statement subject to Section 3(d). 
The Company agrees and acknowledges that any periods during which the
Holder is required to discontinue the disposition of the Registrable Securities
during the Effectiveness Period hereunder shall be subject to the provisions of
Sections 2(d), 2(e) and 3(h), as applicable.  The Company will use its commercially
reasonable best efforts to ensure that the use of the Prospectus may be resumed
as promptly as it practicable.

 

11

 

(d)                                 Piggy-Back
Registrations. If at any time during the Effectiveness Period
there is not an effective Registration Statement covering all of the
Registrable Securities and the Company shall determine to prepare and file with
the Commission a registration statement relating to an offering for its own
account or the account of others under the Securities Act of any of its equity
securities, other than on Form S-4 or Form S-8 (each as promulgated
under the Securities Act) or their then equivalents relating to equity
securities to be issued solely in connection with any acquisition of any entity
or business or equity securities issuable in connection with the stock option
or other employee benefit plans, then the Company shall send to each Holder a
written notice of such determination and, if within fifteen days after the date
of such notice, any such Holder shall so request in writing, the Company shall
include in such registration statement all or any part of such Registrable
Securities such Holder requests to be registered.

 

Notwithstanding the
foregoing, if any requested registration pursuant to this section involves an
underwritten offering by the Company, and the managing underwriter shall advise
the Company the distribution of all or a portion of the Registrable Securities
requested to be included in the registration concurrently with the securities
being registered by the Company would materially adversely affect the
distribution of such securities by the Company for its own account, then (i) the
number of Registrable Securities so requested to be included in such
registration shall be reduced to that number of shares which, in the good faith
judgment of the managing underwriter, can be sold in such offering, and this
reduced number shall be allocated pro  rata among such Holders on
the basis of the number of Registrable Securities requested to be so registered
by such Holders, and (ii) if the requesting Holders are participating in a
primary offering by the Company, the Company will include in such registration,
to the extent of the number of securities which the Company is so advised can
be sold in such offering, (A) first, securities that the Company proposes
to issue and sell for its own account and any preferred securities proposed to
be so registered, and (B) second, Registrable Securities requested to be
registered by the Holders thereof pursuant to this Section allocated pro
rata among such Holders and such on the basis of the number of
Registrable Securities to be so registered.

 

(e)                                  Amendments and
Waivers.  The provisions of this
Agreement, including the provisions of this sentence, may not be amended,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given, unless the same shall be in writing and
signed by the Company and each Holder of the then outstanding Registrable
Securities.  Notwithstanding the
foregoing, a waiver or consent to depart from the provisions hereof with
respect to a matter that relates exclusively to the rights of Holders and that
does not directly or indirectly affect the rights of other Holders may be given
by Holders of all of the Registrable Securities to which such waiver or consent
relates; provided, however, that the provisions of this sentence
may not be amended, modified, or supplemented except in accordance with the
provisions of the immediately preceding sentence.

 

(f)                                    Notices.  Any and all notices or other communications
or deliveries required or permitted to be provided hereunder shall be delivered
as set forth in the A/R Loan Agreement.

 

(g)                                 Successors and
Assigns.  This Agreement shall inure to
the benefit of and be binding upon the successors and permitted assigns of each
of the parties and shall inure to the benefit of each Holder.  The Company may not assign its rights or
obligations hereunder without the prior written consent of all of the Holders
of the then outstanding Registrable Securities.  Each Holder may assign a portion of their
respective rights hereunder to any purchaser of Registrable Securities in a
transaction not otherwise covered by a Registration Statement, provided such
Holder has transferred to such purchaser shares of Common Stock constituting at

 

12

 

least 5% of the issued and
outstanding shares of Common Stock, and the purchaser executes a joinder to
this Agreement.

 

(h)                                 No Inconsistent
Agreements.  Neither the
Company nor any of its Subsidiaries has entered, as of the date hereof, nor
shall the Company or any of its subsidiaries, on or after the date of this
Agreement, enter into any agreement with respect to its securities, that would
have the effect of impairing the rights granted to the Holders in this
Agreement.

 

(i)                                     Execution and
Counterparts.  This
Agreement may be executed in any number of counterparts, each of which when so
executed shall be deemed to be an original and, all of which taken together
shall constitute one and the same Agreement. 
In the event that any signature is delivered by facsimile transmission
or email via .pdf, such signature shall create a valid binding obligation of
the party executing (or on whose behalf such signature is executed) the same
with the same force and effect as if such facsimile signature were the original
thereof.

 

(j)                                     Governing Law.  All questions concerning the construction,
validity, enforcement and interpretation of this Agreement shall be determined
with the provisions of the A/R/ Loan Agreement.

 

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

 

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

 

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

 

(n)                                 Independent
Nature of Holders’ Obligations and Rights.  The obligations of each Holder hereunder are
several and not joint with the obligations of any other Holder hereunder, and
no Holder shall be responsible in any way for the performance of the
obligations of any other Holder hereunder other than as specified in this
Agreement.  Nothing contained herein or
in any other agreement or document delivered at any closing, and no action
taken by any Holder pursuant hereto or thereto, shall be deemed to constitute
the Holders as a partnership, an association, a joint venture or any other kind
of entity, or create a presumption that the Holders are in any way acting in
concert with respect to such obligations or the transactions contemplated by
this Agreement.  Each Holder shall be
entitled to protect and enforce its rights, including without limitation the
rights arising out of this Agreement, and it shall not be necessary for any
other Holder to be joined as an additional party in any proceeding for such
purpose.

 

****************************

 

13

 

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

 

	
   

  	
  INFOLOGIX,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  David T. Gulian

  
	
   

  	
  Name:

  	
  David
  T. Gulian

  
	
   

  	
  Title:

  	
  Chief
  Executive Officer and President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HERCULES
  TECHNOLOGY GROWTH CAPITAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  K. Nicholas Martitsch

  
	
   

  	
  Name:

  	
  K.
  Nicholas Martitsch

  
	
   

  	
  Title:

  	
  Assistant
  General Counsel

  

 

Signature Page to Registration Rights AgreementExhibit 10.4

 

November 20,
2009

 

InfoLogix
Systems Corporation

101
East County Line Road, Suite 210

Hatboro,
PA 19040

Attn:
John A. Roberts, Chief Financial Officer

 

Re:                                 Earn Out Agreement

 

Dear
Mr. Roberts:

 

Reference
is made to that certain Earn Out Agreement dated May 2, 2008 (the “Earn
Out Agreement”) by and between Delta Health Systems, Inc. (“Delta”) and
InfoLogix Systems Corporation (the “Company”). 
Capitalized terms used but not defined herein shall have the meaning
given to them in the Earn Out Agreement. 
In consideration of the mutual promises made in this letter agreement,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties, intending to be legally bound,
agree as follows:

 

1.                                         The parties acknowledge and
agree that the First Earn Out Amount is $430,000.  In lieu of receiving payment of the First
Earn Out Amount under the terms of the Earn Out Agreement, commencing as of September 1,
2009, Delta will participate in a Commission Plan, the form of which is
attached hereto as Exhibit A (the “Plan”). 
Under the Plan, the Company will pay Delta a monthly commission equal to
11.5% of collected revenue from the Business that the Company generates, if
any, during the applicable month.

 

2.                                         In exchange for the
commission plan  consideration described in this
letter agreement, Delta, for itself and on behalf of all of its directors,
officers, stockholders, successors, assigns and agents, does hereby remise,
release and forever discharge the Company and each and every of its
predecessors, successors, parents, subsidiaries, affiliates, assigns,
directors, officers, stockholders, employees or agents, both current and former
(the “Released Parties”), of and from every claim, demand, right of action or
cause of action whatsoever, and from all debts, obligations, costs (including,
without limitation, attorneys’ fees), expenses, damages, losses and liabilities
whatsoever, whether known or unknown, that Delta ever had, now has, or
hereafter may have against the Released Parties arising out of or relating to
any matter in respect of the First Earn Out Period and the First Earn Out
Amount.  Nothing in this release shall be
construed to alter any of the obligations that the Company has to Delta under that
certain Asset Purchase Agreement dated as of May 2, 2008 between Delta,
the Company and certain other parties named therein and, except as provided
herein, under the Earn Out Agreement.

 

3.                                         All
other terms and conditions of the Earn Out Agreement, including the rights and
obligations of the parties with respect to the Second Earn Out Period and the
Second Earn Out Amount, if any, shall remain unchanged and in full force and
effect.

 

4.                                         Nothing
herein shall be construed to alter or amend the Employment Agreement entered
into between Michael D. Talerico and the Company or the Employment Agreement
entered into between Michael Talerico, II and the Company.

 

5.                                         The
Company represents and warrants that it has obtained all requisite corporate
approvals, authorizations, resolutions, and ratifications to enter into this
letter agreement.  The 

 

 

Company further represents that it has obtained all
requisite approvals and authorizations, if any, that are required by Hercules
Technology Growth Capital, Inc. (“Hercules”) and any other lenders to
enter into this letter agreement.  The Company further represents that
this letter agreement will not violate the terms of any existing agreements
with Hercules or any other lender of the Company.

 

6.                                         This
letter agreement constitutes the entire agreement between the parties with
respect to the subject matter hereof and supersedes all prior negotiations, and
prior written or oral agreements concerning the subject matter hereof. 
This letter agreement may not be amended, supplemented or modified in whole or
in part except by a written agreement signed by the parties hereto.

 

Please
indicate your consent and agreement to be bound by the provisions of this
letter agreement by signing where indicated below.

 

	
   

  	
  Sincerely,

  
	
   

  	
   

  
	
   

  	
  DELTA
  HEALTH SYSTEMS, INC.

  
	
   

  	
   

  
	
   

  	
  /s/
  Michael D. Talerico

  
	
   

  	
  Name:

  	
  Michael
  D. Talerico

  
	
   

  	
  Title:

  	
  President

  

 

ACKNOWLEDGED
AND AGREED:

 

INFOLOGIX SYSTEMS CORPORATION

 

	
  /s/
  David T. Gulian

  	
   

  
	
  Name:

  	
  David
  T. Gulian

  	
   

  
	
  Title:

  	
  President

  	
   

  

 

 

 

 

Exhibit A

 

Commission
Plan

 

	
  Recipient:

  	
  Delta Health
  Systems, Inc.

  
	
  Effective Period:

  	
  September 1, 2009
  until paid in full

  

 

Delta Health Consulting
Engagements

 

Commission
payout based on collected revenue during the effective period will be according
to the payout schedule below.

 

	
  Total Collected

  Revenue up to

  	
   

  	
  Commission Payout

  	
   

  
	
  $0 - $5,000,000

  	
   

  	
  11.5

  	
  %

  

 

Additional terms:

 

If
a sales commission is due another employee or independent contractor of the
Company as the result of referrals and mutually agreed upon account sharing,
the above commission will be reduced so that the total commission liability for
the Company equals 12%.

 

InfoLogix Referral Related Bonus
Plan

 

Bonuses related to collaboratively working with our
internal InfoLogix colleagues to obtain business referrals for software and
services will be payable quarterly at 2% of revenue upon collection.  Commission payment is related to the initial
consulting engagement (up to the first 12 months only) and consulting
extensions are not included as a new bonus eligible item.

 

Payment Schedule:

 

1.                 Commissions will be paid in
the last pay period of the month for the prior month, based on collected
revenues.

 

 

2.                 Referral bonuses will be
paid the first month of a new quarter.

 

Base
Salary:

 

The
first component of executive compensation is an annual base salary. Base
salaries shall be paid in accordance with the Company’s regular payroll cycle.

 

Deductions
from Commission:

 

All
salary and commission payments are subject to withholding of federal, state and
local taxes and social security payments and any voluntary requested
deductions.

 

 

	
  /s/ Michael D. Talerico

  	
   

  	
  /s/ David T. Gulian

  
	
   

  	
   

  	
   

  
	
  Michael D. Talerico

  	
   

  	
  David T. Gulian

  
	
  On behalf of

  	
   

  	
  President and Chief
  Executive Officer

  
	
  Delta Health Systems Inc.

  	
   

  	
  InfoLogix, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  11/20/09

  	
   

  	
  11/20/09

  
	
   

  	
   

  	
   

  
	
  Date

  	
   

  	
  Date

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