\n1. Certain Definitions…………………………………………………………………….3
\n2. Demand Registrations……………………………………………………………………4
\n (a) Right to Request Registration………………………………………………………..4
\n (b) Number of Demand Registrations……………………………………………………….5
\n (c) Priority on Demand Registrations……………………………………………………..5
\n (d) Restrictions on Demand Registrations………………………………………………….5
\n (e) Selection of Underwriters……………………………………………………………6
\n (f) Other Registration Rights……………………………………………………………6
\n (g) Effective Period of Demand Registrations………………………………………………6
\n3. Piggyback Registrations…………………………………………………………………7
\n (a) Right to Piggyback………………………………………………………………….7
\n (b) Priority on Primary Registrations…………………………………………………….7
\n (c) Priority on Secondary Registrations…………………………………………………..7
\n (d) Selection of Underwriters……………………………………………………………8
\n (e) Other Registrations…………………………………………………………………8
\n4. S-3 Registrations………………………………………………………………………8
\n5. Holdback Agreements…………………………………………………………………….8
\n6. Registration Procedures…………………………………………………………………9
\n7. Registration Expenses………………………………………………………………….12
\n8. Indemnification……………………………………………………………………….13
\n9. Participation in Underwritten Registrations………………………………………………15
\n10. Rule 144……………………………………………………………………………..15
\n11. Miscellaneous…………………………………………………………………………15
\n (a) Notices…………………………………………………………………………..15
\n (b) No Waivers………………………………………………………………………..16
\n (c) Successors and Assigns……………………………………………………………..16
\n (d) Governing Law……………………………………………………………………..16
\n (e) Jurisdiction………………………………………………………………………16
\n (f) Waiver of Jury Trial……………………………………………………………….17
\n (g) Counterparts; Effectiveness…………………………………………………………17
\n (h) Entire Agreement…………………………………………………………………..17
\n (i) Captions………………………………………………………………………….17
\n (j) Severability………………………………………………………………………17
\n (k) Amendments………………………………………………………………………..17
\n (l) Equitable Relief…………………………………………………………………..18
\n (m) Costs and Expenses. Except as otherwise expressly provided for herein, each party
\n to this Agreement shall bear its own costs and expenses, including but not limited to
\n attorneys’ fees and expenses, in connection with the closing of the transactions
\n contemplated hereby……………………………………………………………………18
\n<\/c><\/s><\/table>\n REGISTRATION RIGHTS AGREEMENT dated as of October 23, 2001, between
\neUniverse, Inc., a Nevada corporation (the “Company”), and 550 Digital Media
\nVentures Inc., a Delaware corporation (the “Stockholder”).<\/p>\n
In consideration of the mutual covenants and agreements herein
\ncontained and other good and valid consideration, the receipt and sufficiency of
\nwhich are hereby acknowledged, the parties to this Agreement hereby agree as
\nfollows:<\/p>\n
1. Certain Definitions.<\/p>\n
In addition to the terms defined elsewhere in this Agreement, the
\nfollowing terms shall have the following meanings:<\/p>\n
“Affiliate” of any Person means any other Person which directly or
\nindirectly through one or more intermediaries controls, or is controlled by, or
\nis under common control with such Person. The term “control” (including the
\nterms “controlled by” and “under common control with”) as used with respect to
\nany Person means the possession, directly or indirectly, of the power to direct
\nor cause the direction of the management and policies of such Person, whether
\nthrough the ownership of voting securities, by contract or otherwise.<\/p>\n
“Agreement” means this Registration Rights Agreement, including all
\namendments, modifications and supplements and any exhibits or schedules to any
\nof the foregoing, and shall refer to this Registration Rights Agreement as the
\nsame may be in effect at the time such reference becomes operative.<\/p>\n
“Business Day” means any day on which commercial banks are open for
\nbusiness in New York, New York.<\/p>\n
“Common Stock” means common stock, par value $.001 per share, of the
\nCompany.<\/p>\n
“Conversion Shares” means any of (x) the shares of Common Stock owned
\nby the Stockholder, (y) the shares of Common Stock issued or issuable upon
\nconversion of the Series B Preferred Stock or (z) any securities issued or
\nissuable with respect to the Common Stock or Series B Preferred Stock by way of
\nstock dividend or stock split or in connection with a combination of shares,
\nrecapitalization, merger, consolidation or other reorganization or otherwise.<\/p>\n
“Exchange Act” means the Securities Exchange Act of 1934, as amended.<\/p>\n
“Holder” means any holder of record of Registrable Common Stock (as
\ndefined below) and any transferees of such Registrable Common Stock from such
\nHolders (or in the case of a Holder of Series B Preferred Stock, the transferees
\nof such Holder). For purposes of this Agreement, the Company may deem and treat
\nthe registered holder of Registrable Common Stock as the Holder and absolute
\nowner thereof, and the Company shall not be affected by any notice to the
\ncontrary.<\/p>\n
“Person” means an individual, partnership, corporation, trust, limited
\nliability company, or unincorporated organization, or a government or agency or
\npolitical subdivision thereof.<\/p>\n
“Prospectus” means the prospectus or prospectuses included in any
\nRegistration Statement, as amended or supplemented by any prospectus supplement
\nwith respect to the terms of the offering of any portion of the Registrable
\nCommon Stock covered by such Registration Statement and by all other amendments
\nand supplements to the prospectus, including post-effective amendments and all
\nmaterial incorporated by reference in such prospectus or prospectuses.<\/p>\n
“Purchase Agreement” means the stock purchase agreement, dated as of
\nJuly 13, 2001, between the Company and the Stockholder.<\/p>\n
“Registrable Common Stock” means the Conversion Shares. All references
\nherein to a “Holder” or “Holder of Registrable Common Stock” shall include the
\nholder or holders of Series B Preferred Stock to the extent of the Conversion
\nShares then underlying such Series B Preferred Stock. For purposes of
\ndetermining the number of shares of Registrable Common Stock held by a Holder
\nand the number of shares of Registrable Common Stock outstanding, for purposes
\nof this Agreement (including the definition of “Holder”) but not for any other
\npurpose, any holder of record of Series B Preferred Stock shall be deemed to be
\na Holder of the number of Conversion Shares issuable upon conversion of such
\nSeries B Preferred Stock and all such Conversion Shares shall be deemed to be
\noutstanding shares of Registrable Common Stock.<\/p>\n
“Registration Statement” means any registration statement of the
\nCompany which covers any of the Registrable Common Stock pursuant to the
\nprovisions of this Agreement, including the Prospectus, amendments and
\nsupplements to such Registration Statement, including post-effective amendments,
\nall exhibits and all materials incorporated by reference in such Registration
\nStatement.<\/p>\n
“SEC” means the Securities and Exchange Commission.<\/p>\n
“Securities Act” means the Securities Act of 1933, as amended.<\/p>\n
“Series B Preferred Stock” means the Series B Convertible Preferred
\nStock, par value $0.10 per share, of the Company held by the Stockholder.<\/p>\n
“underwritten registration or underwritten offering” means a
\nregistration in which securities of the Company are sold to underwriters for
\nreoffering to the public.<\/p>\n
2. Demand Registrations.<\/p>\n
(a) Right to Request Registration. Beginning two and one-half (2 1\/2)
\nyears after the date of this Agreement, any Holder or Holders who together hold
\na majority of the then outstanding Registrable Common Stock (“Initiating
\nHolders”) may request registration under the Securities Act of all or part of
\nthe Registrable Common Stock (“Demand Registration”).<\/p>\n
4<\/p>\n
Within 10 days after receipt of any such request for Demand
\nRegistration, the Company shall give written notice of such request to all other
\nHolders of Registrable Common Stock and shall, subject to the provisions of
\nSection 2(d) hereof, include in such registration all such Registrable Common
\nStock with respect to which the Company has received written requests for
\ninclusion therein within 15 days after the receipt of the Company’s notice.<\/p>\n
(b) Number of Demand Registrations. Subject to the provisions of
\nSection 2(a), the Initiating Holders of Registrable Common Stock shall be
\nentitled to request an aggregate of five (5) Demand Registrations. A
\nregistration shall not count as one of the permitted Demand Registrations (i)
\nuntil it has become effective, (ii) if the Initiating Holder requesting such
\nregistration is not able to register and sell at least 50% of the Registrable
\nCommon Stock requested by such Initiating Holder to be included in such
\nregistration or (iii) in the case of a Demand Registration that would be the
\nlast permitted Demand Registration requested hereunder, if the Initiating Holder
\nrequesting such registration is not able to register and sell all of the
\nRegistrable Common Stock requested to be included by such Initiating Holder in
\nsuch registration.<\/p>\n
(c) Priority on Demand Registrations. Except as provided in Section
\n2(g), the Company shall not include in any Demand Registration any securities
\nwhich are not Registrable Common Stock without the written consent of the
\nHolders of a majority of the shares of Registrable Common Stock to be included
\nin such registration, or, if such Demand Registration is an underwritten
\noffering, without the written consent of the managing underwriters. If the
\nmanaging underwriters of the requested Demand Registration advise the Company in
\nwriting that in their opinion the number of shares of Registrable Common Stock
\nproposed to be included in any such registration exceeds the number of
\nsecurities which can be sold in such offering and\/or that the number of shares
\nof Registrable Common Stock proposed to be included in any such registration
\nwould adversely affect the price per share of the Company’s equity securities to
\nbe sold in such offering, the Company shall include in such registration only
\nthe number of shares of Registrable Common Stock which in the opinion of such
\nmanaging underwriters can be sold. If the number of shares which can be sold is
\nless than the number of shares of Registrable Common Stock proposed to be
\nregistered, the amount of Registrable Common Stock to be so sold shall be
\nallocated pro rata among the Holders of Registrable Common Stock desiring to
\nparticipate in such registration on the basis of the amount of such Registrable
\nCommon Stock initially proposed to be registered by such other Holders. If the
\nnumber of shares which can be sold exceeds the number of shares of Registrable
\nCommon Stock proposed to be sold, such excess shall be allocated pro rata among
\nthe other holders of securities, if any, desiring to participate in such
\nregistration based on the amount of such securities initially requested to be
\nregistered by such holders or as such holders may otherwise agree.<\/p>\n
(d) Restrictions on Demand Registrations. The Company shall not be
\nobligated to effect any Demand Registration within six months after the
\neffective date of a previous Demand Registration, a previous S-3 Registration
\n(as hereinafter defined) or a previous registration under which the Initiating
\nHolders had piggyback rights pursuant to Section 3 hereof wherein the Initiating
\nHolders were permitted to register, and sold, at<\/p>\n
5<\/p>\n
least 50% of the shares of Registrable Common Stock requested to be included
\ntherein. The Company may (i) postpone for up to ninety (90) days the filing or
\nthe effectiveness of a Registration Statement for a Demand Registration if,
\nbased on the good faith judgment of the Company’s board of directors, such
\npostponement or withdrawal is necessary in order to avoid premature disclosure
\nof a matter the board has determined would not be in the best interest of the
\nCompany to be disclosed at such time or (ii) postpone the filing of a Demand
\nRegistration in the event the Company shall be required to prepare audited
\nfinancial statements as of a date other than its fiscal year end (unless the
\nstockholders requesting such registration agree to pay the expenses of such an
\naudit); provided, however, that in no event shall the Company withdraw a
\nRegistration Statement under clause (i) above after such Registration Statement
\nhas been declared effective; and provided, further, however, that in any of the
\nevents described in clause (i) or (ii) above, the Initiating Holders requesting
\nsuch Demand Registration shall be entitled to withdraw such request and, if such
\nrequest is withdrawn, such Demand Registration shall not count as one of the
\npermitted Demand Registrations. The Company shall provide written notice to the
\nInitiating Holders requesting such Demand Registration of (x) any postponement
\nor withdrawal of the filing or effectiveness of a Registration Statement
\npursuant to this Section 2(d), (y) the Company’s decision to file or seek
\neffectiveness of such Registration Statement following such withdrawal or
\npostponement and (z) the effectiveness of such Registration Statement. The
\nCompany may defer the filing of a particular Registration Statement pursuant to
\nthis Section 2(d) only once every 12 months.<\/p>\n
(e) Selection of Underwriters. If any of the Registrable Common Stock
\ncovered by a Demand Registration or an S-3 Registration pursuant to Section 4
\nhereof is to be sold in an underwritten offering, the Initiating Holders shall
\nhave the right to select the managing underwriter(s) to administer the offering
\nsubject to the approval of the Company, which will not be unreasonably withheld.<\/p>\n
(f) Other Registration Rights. The Company shall not grant to any
\nPerson the right, other than as set forth herein and except to employees of the
\nCompany with respect to registrations on Form S-8 (or any successor forms
\nthereto), to request the Company to register any securities of the Company
\nexcept such rights as are not more favorable than or inconsistent with the
\nrights granted to the Holders herein. The stock transfer restriction imposed on
\nthe shares of the Company’s Capital Stock held by Brad Greenspan (the “Greenspan
\nRestrictions”) are not more favorable than or inconsistent with the stock
\ntransfer restrictions contained in this Agreement. In the event the Company
\ngrants rights which are more favorable or relaxes the Greenspan Restrictions,
\nthe Company will make such provisions available to the Holders and will enter
\ninto any amendments necessary to confer such rights on the Holders.<\/p>\n
(g) Effective Period of Demand Registrations. After any Demand
\nRegistration filed pursuant to this Agreement has become effective, the Company
\nshall use its best efforts to keep such Demand Registration effective for a
\nperiod equal to 180 days from the date on which the SEC declares such Demand
\nRegistration effective (or if such Demand Registration is not effective during
\nany period within such 180 days, such 180-day period shall be extended by the
\nnumber of days during such period when such<\/p>\n
6<\/p>\n
Demand Registration is not effective), or such shorter period which shall
\nterminate when all of the Registrable Common Stock covered by such Demand
\nRegistration has been sold pursuant to such Demand Registration. If the Company
\nshall withdraw any Demand Registration pursuant to subsection (d) of this
\nSection 2 (a “Withdrawn Demand Registration”), the Initiating Holders of the
\nRegistrable Common Stock remaining unsold and originally covered by such
\nWithdrawn Demand Registration shall be entitled to a replacement Demand
\nRegistration which (subject to the provisions of this Section 2) the Company
\nshall use its best efforts to keep effective for a period commencing on the
\neffective date of such Demand Registration and ending on the earlier to occur of
\nthe date (i) which is 180 days from the effective date of such Demand
\nRegistration and (ii) on which all of the Registrable Common Stock covered by
\nsuch Demand Registration has been sold. Such additional Demand Registration
\notherwise shall be subject to all of the provisions of this Agreement.<\/p>\n
3. Piggyback Registrations.<\/p>\n
(a) Right to Piggyback. Whenever the Company proposes to register any
\nof its common equity securities under the Securities Act (other than a
\nregistration statement on Form S-8 or on Form S-4 or any similar successor forms
\nthereto), whether for its own account or for the account of one or more
\nstockholders of the Company, and the registration form to be used may be used
\nfor any registration of Registrable Common Stock (a “Piggyback Registration”),
\nthe Company shall give prompt written notice (in any event within 10 business
\ndays after its receipt of notice of any exercise of other demand registration
\nrights) to all Holders of its intention to effect such a registration and,
\nsubject to Sections 3(b) and 3(c), shall include in such registration all
\nRegistrable Common Stock with respect to which the Company has received written
\nrequests for inclusion therein within 15 days after the receipt of the Company’s
\nnotice. The Company may postpone or withdraw the filing or the effectiveness of
\na Piggyback Registration at any time in its sole discretion.<\/p>\n
(b) Priority on Primary Registrations. If a Piggyback Registration is
\nan underwritten primary registration on behalf of the Company, and the managing
\nunderwriters advise the Company in writing that in their opinion the number of
\nsecurities requested to be included in such registration exceeds the number
\nwhich can be sold in such offering and\/or that the number of shares of
\nRegistrable Common Stock proposed to be included in any such registration would
\nadversely affect the price per share of the Company’s equity securities to be
\nsold in such offering, the Company shall include in such registration (i) first,
\nthe securities the Company proposes to sell, and (ii) second, the Registrable
\nCommon Stock requested to be included therein by the Holders and other
\nsecurities requested to be included in such registration pro rata among all the
\nholders of such securities on the basis of the number of shares requested to be
\nregistered by such holders or as such holders may otherwise agree.<\/p>\n
(c) Priority on Secondary Registrations. If a Piggyback Registration is
\nan underwritten secondary registration on behalf of a holder of the Company’s
\nsecurities other than Registrable Common Stock, and the managing underwriters
\nadvise the Company in writing that in their opinion the number of securities
\nrequested to be<\/p>\n
7<\/p>\n
included in such registration exceeds the number which can be sold in such
\noffering and\/or that the number of shares of Registrable Common Stock proposed
\nto be included in any such registration would adversely affect the price per
\nshare of the Company’s equity securities to be sold in such offering, the
\nCompany shall include in such registration (i) first, the securities the Company
\nproposes to sell, and (ii) second the Registrable Common Stock requested to be
\nincluded therein by the Holders and other securities requested to be included in
\nsuch registration pro rata among all the holders of such securities on the basis
\nof the number of shares requested to be registered by such holders or as such
\nholders may otherwise agree.<\/p>\n
(d) Selection of Underwriters. If any Piggyback Registration is an
\nunderwritten primary offering, the Company shall have the right to select the
\nmanaging underwriter or underwriters to administer any such offering.<\/p>\n
(e) Other Registrations. If the Company has previously filed a
\nRegistration Statement with respect to Registrable Common Stock pursuant to
\nSections 2 or 4 hereof or pursuant to this Section 3, and if such previous
\nregistration has not been withdrawn or abandoned, the Company shall not be
\nobligated to cause to become effective any other registration of any of its
\nsecurities under the Securities Act, whether on its own behalf or at the request
\nof any holder or holders of such securities, until a period of at least three
\nmonths has elapsed from the effective date of such previous registration.<\/p>\n
4. S-3 Registrations.<\/p>\n
If at any time that the Company is eligible to use Form S-3 or any
\nsuccessor thereto, any Holder or Holders requests that the Company file a
\nRegistration Statement on Form S-3 or any successor thereto for a public
\noffering of all or any portion of the Registrable Common Stock held by such
\nHolders, then the Company shall use its best efforts to register under the
\nSecurities Act on Form S-3 (an “S-3 Registration”) or any successor thereto, for
\npublic sale in accordance with the method of disposition specified in such
\nnotice, the number of shares of Registrable Common Stock specified in such
\nnotice; provided, however, that the Company shall have no obligation to register
\nsuch shares of Registrable Common Stock pursuant to this Section if (based on
\nthe current market prices) the number of shares of Registrable Common Stock
\nspecified in such notice would not yield gross proceeds to the selling
\nstockholders of at least $1,000,000. Whenever the Company is required by this
\nSection 4 to use its best efforts to effect the registration of Registrable
\nCommon Stock, each of the procedures and requirements of Section 2 (including
\nbut not limited to the requirement that the Company notify all Holders from whom
\nnotice has not been received and provide them with the opportunity to
\nparticipate in the offering) shall apply to such registration. There is no
\nlimitation on the number of registrations pursuant to this Section 4 that the
\nCompany is obligated to effect.<\/p>\n
5. Holdback Agreements.<\/p>\n
(a) The Company agrees not to effect any sale or distribution of any of
\nits equity securities during the 10 days prior to and during the 180 days
\nbeginning on the<\/p>\n
8<\/p>\n
effective date of any underwritten Demand Registration or any underwritten
\nPiggyback Registration or any underwritten S-3 Registration (except as part of
\nsuch underwritten registration or pursuant to registrations on Form S-8 or S-4
\nor any successor forms thereto) unless the underwriters managing the offering
\notherwise agree to a shorter period.<\/p>\n
(b) The Holders agree not to effect any sale or distribution of any
\nequity securities of the Company during the eighteen (18) month period following
\nthe date of this Agreement; provided, that such restriction shall not apply to
\n(i) transactions related to Common Stock acquired in open market transactions
\nafter the date of this Agreement, (ii) sales or distributions conducted pursuant
\nto Section 3 of this Agreement, or (iii) transfers to Affiliates, or other
\nprivate transactions which do not require registration under the Securities Act,
\nprovided that the transferee pursuant to this Section 5(b)(iii) agrees in
\nwriting to be subject to the terms hereof to the same extent as if the
\ntransferee were a Holder hereunder.<\/p>\n
6. Registration Procedures.<\/p>\n
Whenever the Holders request that any Registrable Common Stock be
\nregistered pursuant to this Agreement, the Company shall use its best efforts to
\neffect the registration and the sale of such Registrable Common Stock in
\naccordance with the intended methods of disposition thereof, and pursuant
\nthereto the Company shall as expeditiously as possible:<\/p>\n
(a) prepare and file with the SEC a Registration Statement with respect
\nto such Registrable Common Stock and use its best efforts to cause such
\nRegistration Statement to become effective as soon as practicable thereafter;
\nand before filing a Registration Statement or Prospectus or any amendments or
\nsupplements thereto, furnish to the Holders of Registrable Common Stock covered
\nby such Registration Statement and the underwriter or underwriters, if any,
\ncopies of all such documents proposed to be filed, including documents
\nincorporated by reference in the Prospectus and, if requested by such Holders,
\nthe exhibits incorporated by reference, and such Holders shall have the
\nopportunity to object to any information pertaining to such Holders that is
\ncontained therein and the Company will make the corrections reasonably requested
\nby such Holders with respect to such information prior to filing any
\nRegistration Statement or amendment thereto or any Prospectus or any supplement
\nthereto;<\/p>\n
(b) prepare and file with the SEC such amendments and supplements to
\nsuch Registration Statement and the Prospectus used in connection therewith as
\nmay be necessary to keep such Registration Statement effective for a period of
\nnot less than 180 days, in the case of a Demand Registration or an S-3
\nRegistration, or such shorter period as is necessary to complete the
\ndistribution of the securities covered by such Registration Statement and comply
\nwith the provisions of the Securities Act with respect to the disposition of all
\nsecurities covered by such Registration Statement during such period in
\naccordance with the intended methods of disposition by the sellers thereof set
\nforth in such Registration Statement;<\/p>\n
9<\/p>\n
(c) furnish to each seller of Registrable Common Stock such number of
\ncopies of such Registration Statement, each amendment and supplement thereto,
\nthe Prospectus included in such Registration Statement (including each
\npreliminary Prospectus) and such other documents as such seller may reasonably
\nrequest in order to facilitate the disposition of the Registrable Common Stock
\nowned by such seller;<\/p>\n
(d) use its best efforts to register or qualify such Registrable Common
\nStock under such other securities or blue sky laws of such jurisdictions as any
\nseller reasonably requests and do any and all other acts and things which may be
\nreasonably necessary or advisable to enable such seller to consummate the
\ndisposition in such jurisdictions of the Registrable Common Stock owned by such
\nseller (provided, that the Company will not be required to (i) qualify generally
\nto do business in any jurisdiction where it would not otherwise be required to
\nqualify but for this subparagraph (d), (ii) subject itself to taxation in any
\nsuch jurisdiction or (iii) consent to general service of process in any such
\njurisdiction);<\/p>\n
(e) notify each seller of such Registrable Common Stock, at any time
\nwhen a Prospectus relating thereto is required to be delivered under the
\nSecurities Act, of the occurrence of any event as a result of which the
\nProspectus included in such Registration Statement contains an untrue statement
\nof a material fact or omits any fact necessary to make the statements therein
\nnot misleading, and, at the request of any such seller, the Company shall
\nprepare a supplement or amendment to such Prospectus so that, as thereafter
\ndelivered to the purchasers of such Registrable Common Stock, such Prospectus
\nshall not contain an untrue statement of a material fact or omit to state any
\nmaterial fact necessary to make the statements therein not misleading;<\/p>\n
(f) in the case of an underwritten offering, enter into such customary
\nagreements (including underwriting agreements in customary form) and take all
\nsuch other actions as the Holders of a majority of number of shares of the
\nRegistrable Common Stock being sold or the underwriters, if any, reasonably
\nrequest in order to expedite or facilitate the disposition of such Registrable
\nCommon Stock (including, without limitation, making members of senior management
\nof the Company available to participate in, and cause them to cooperate with the
\nunderwriters in connection with, “road-show” and other customary marketing
\nactivities (including one-on-one meetings with prospective purchasers of the
\nRegistrable Common Stock)) and cause to be delivered to the underwriters and the
\nsellers, if any, opinions of counsel to the Company in customary form, covering
\nsuch matters as are customarily covered by opinions for an underwritten public
\noffering as the underwriters may request and addressed to the underwriters and
\nthe sellers;<\/p>\n
(g) make available, for inspection by any seller of Registrable Common
\nStock, any underwriter participating in any disposition pursuant to such
\nRegistration Statement, and any attorney, accountant or other agent retained by
\nany such seller or underwriter, all financial and other records, pertinent
\ncorporate documents and properties of the Company, and cause the Company’s
\nofficers, directors, employees and independent accountants to supply all
\ninformation reasonably requested by any such seller,<\/p>\n
10<\/p>\n
underwriter, attorney, accountant or agent in connection with such Registration
\nStatement;<\/p>\n
(h) use its best efforts to cause all such Registrable Common Stock to
\nbe listed on each securities exchange on which securities of the same class
\nissued by the Company are then listed or, if no such similar securities are then
\nlisted, on Nasdaq or a national securities exchange selected by the Company;<\/p>\n
(i) provide a transfer agent and registrar for all such Registrable
\nCommon Stock not later than the effective date of such Registration Statement;<\/p>\n
(j) if requested, cause to be delivered, immediately prior to the
\neffectiveness of the Registration Statement (and, in the case of an underwritten
\noffering, at the time of delivery of any Registrable Common Stock sold pursuant
\nthereto), letters from the Company’s independent certified public accountants
\naddressed to each selling Holder (unless such selling Holder does not provide to
\nsuch accountants the appropriate representation letter required by rules
\ngoverning the accounting profession) and each underwriter, if any, stating that
\nsuch accountants are independent public accountants within the meaning of the
\nSecurities Act and the applicable rules and regulations adopted by the SEC
\nthereunder, and otherwise in customary form and covering such financial and
\naccounting matters as are customarily covered by letters of the independent
\ncertified public accountants delivered in connection with primary or secondary
\nunderwritten public offerings, as the case may be;<\/p>\n
(k) make generally available to its stockholders a consolidated
\nearnings statement (which need not be audited) for the 12 months beginning after
\nthe effective date of a Registration Statement as soon as reasonably practicable
\nafter the end of such period, which earnings statement shall satisfy the
\nrequirements of an earning statement under Section 11(a) of the Securities Act;<\/p>\n
(l) promptly notify each seller of Registrable Common Stock and the
\nunderwriter or underwriters, if any:<\/p>\n
(i) when the Registration Statement, any
\n pre-effective amendment, the Prospectus or any Prospectus
\n supplement or post-effective amendment to the Registration
\n Statement has been filed and, with respect to the Registration
\n Statement or any post-effective amendment, when the same has
\n become effective;<\/p>\n
(ii) of any written request by the SEC for amendments
\n or supplements to the Registration Statement or Prospectus;<\/p>\n
(iii) of the notification to the Company by the SEC
\n of its initiation of any proceeding with respect to the
\n issuance by the SEC of any stop order suspending the
\n effectiveness of the Registration Statement; and<\/p>\n
11<\/p>\n
(iv) of the receipt by the Company of any
\n notification with respect to the suspension of the
\n qualification of any Registrable Common Stock for sale under
\n the applicable securities or blue sky laws of any
\n jurisdiction.<\/p>\n
At all times after the Company has filed a registration statement with
\nthe SEC pursuant to the requirements of either the Securities Act or the
\nExchange Act, the Company shall file all reports required to be filed by it
\nunder the Securities Act and the Exchange Act and the rules and regulations
\nadopted by the SEC thereunder, and take such further action as any Holders may
\nreasonably request, all to the extent required to enable such Holders to be
\neligible to sell Registrable Common Stock pursuant to Rule 144 (or any similar
\nrule then in effect).<\/p>\n
The Company may require each seller of Registrable Common Stock as to
\nwhich any registration is being effected to furnish to the Company any other
\ninformation regarding such seller and the distribution of such securities as the
\nCompany may from time to time reasonably request in writing.<\/p>\n
Each seller of Registrable Common Stock agrees by having its stock
\ntreated as Registrable Common Stock hereunder that, upon notice of the happening
\nof any event as a result of which the Prospectus included in such Registration
\nStatement contains an untrue statement of a material fact or omits any material
\nfact necessary to make the statements therein not misleading (a “Suspension
\nNotice”), such seller will forthwith discontinue disposition of Registrable
\nCommon Stock until such seller is advised in writing by the Company that the use
\nof the Prospectus may be resumed and is furnished with a supplemented or amended
\nProspectus as contemplated by Section 6(e) hereof, and, if so directed by the
\nCompany, such seller will deliver to the Company (at the Company’s expense) all
\ncopies, other than permanent file copies then in such seller’s possession, of
\nthe Prospectus covering such Registrable Common Stock current at the time of
\nreceipt of such notice; provided, however, that such postponement of sales of
\nRegistrable Common Stock by the Holders shall not exceed ninety (90) days in the
\naggregate in any one year. If the Company shall give any notice to suspend the
\ndisposition of Registrable Common Stock pursuant to a Prospectus, the Company
\nshall extend the period of time during which the Company is required to maintain
\nthe Registration Statement effective pursuant to this Agreement by the number of
\ndays during the period from and including the date of the giving of such notice
\nto and including the date such seller either is advised by the Company that the
\nuse of the Prospectus may be resumed or receives the copies of the supplemented
\nor amended Prospectus contemplated by Section 6(e). In any event, the Company
\nshall not be entitled to deliver more than three (3) Suspension Notices in any
\none year.<\/p>\n
7. Registration Expenses.<\/p>\n
All expenses incident to the Company’s performance of or compliance
\nwith this Agreement, including, without limitation, all registration and filing
\nfees, fees and expenses of compliance with securities or blue sky laws, listing
\napplication fees, printing expenses, transfer agent’s and registrar’s fees, cost
\nof distributing Prospectuses in preliminary and final form as well as any
\nsupplements thereto, and fees and<\/p>\n
12<\/p>\n
disbursements of counsel for the Company and all independent certified public
\naccountants and other Persons retained by the Company (all such expenses being
\nherein called “Registration Expenses”) (but not including any underwriting
\ndiscounts or commissions attributable to the sale of Registrable Common Stock or
\nfees and expenses of counsel representing the Holders of Registrable Common
\nStock), shall be borne by the Company. In addition, the Company shall pay its
\ninternal expenses (including, without limitation, all salaries and expenses of
\nits officers and employees performing legal or accounting duties), the expense
\nof any annual audit or quarterly review, the expense of any liability insurance
\nand the expenses and fees for listing the securities to be registered on each
\nsecurities exchange on which they are to be listed.<\/p>\n
8. Indemnification.<\/p>\n
(a) The Company agrees to indemnify, to the fullest extent permitted by
\nlaw, each Holder, its officers, directors and affiliates and each Person who
\ncontrols such Holder (within the meaning of the Securities Act) against all
\nlosses, claims, damages, liabilities and expenses arising out of or based upon
\nany untrue or alleged untrue statement of material fact contained in any
\nRegistration Statement, Prospectus or preliminary Prospectus or any amendment
\nthereof or supplement thereto or any omission or alleged omission of a material
\nfact required to be stated therein or necessary to make the statements therein
\nnot misleading or any violation or alleged violation by the Company of the
\nSecurities Act, the Exchange Act or applicable “blue sky” laws, except insofar
\nas the same are made in reliance and in conformity with information relating to
\nsuch Holder furnished in writing to the Company by such Holder expressly for use
\ntherein or caused by such Holder’s failure to deliver to such Holder’s immediate
\npurchaser a copy of the Registration Statement or Prospectus or any amendments
\nor supplements thereto (if the same was required by applicable law to be so
\ndelivered) after the Company has furnished such Holder with a sufficient number
\nof copies of the same. In connection with an underwritten offering, the Company
\nshall indemnify such underwriters, their officers and directors and each Person
\nwho controls such underwriters (within the meaning of the Securities Act) to the
\nsame extent as provided above with respect to the indemnification of the
\nHolders.<\/p>\n
(b) In connection with any Registration Statement in which a Holder of
\nRegistrable Common Stock is participating, each such Holder shall furnish to the
\nCompany in writing such information and affidavits as the Company reasonably
\nrequests for use in connection with any such Registration Statement or
\nProspectus and, to the extent permitted by law, shall indemnify the Company, its
\ndirectors and officers and each Person who controls the Company (within the
\nmeaning of the Securities Act) against any losses, claims, damages, liabilities
\nand expenses arising out of or based upon any untrue or alleged untrue statement
\nof material fact contained in the Registration Statement, Prospectus or
\npreliminary Prospectus or any amendment thereof or supplement thereto or any
\nomission or alleged omission of a material fact required to be stated therein or
\nnecessary to make the statements therein not misleading, but only to the extent
\nthat such untrue statement or omission is made in reliance on and in conformity
\nwith information or affidavit so furnished in writing by such Holder expressly
\nfor use in the Registration Statement; provided, however, that the obligation to
\nindemnify shall be several, not joint<\/p>\n
13<\/p>\n
and several, among such Holders and the liability of each such Holder shall be
\nin proportion to and limited to the net amount received by such Holder from the
\nsale of Registrable Common Stock pursuant to such Registration Statement.<\/p>\n
(c) Any Person entitled to indemnification hereunder shall (i) give
\nprompt written notice to the indemnifying party of any claim with respect to
\nwhich it seeks indemnification and (ii) unless in such indemnified party’s
\nreasonable judgment a conflict of interest between such indemnified and
\nindemnifying parties may exist with respect to such claim, permit such
\nindemnifying party to assume the defense of such claim with counsel reasonably
\nsatisfactory to the indemnified party. If such defense is assumed, the
\nindemnifying party shall not be subject to any liability for any settlement made
\nby the indemnified party without its consent (but such consent will not be
\nunreasonably withheld). An indemnifying party who is not entitled to, or elects
\nnot to, assume the defense of a claim shall not be obligated to pay the fees and
\nexpenses of more than one counsel for all parties indemnified by such
\nindemnifying party with respect to such claim, unless in the reasonable judgment
\nof any indemnified party there may be one or more legal or equitable defenses
\navailable to such indemnified party which are in addition to or may conflict
\nwith those available to another indemnified party with respect to such claim.
\nFailure to give prompt written notice shall not release the indemnifying party
\nfrom its obligations hereunder.<\/p>\n
(d) The indemnification provided for under this Agreement shall remain
\nin full force and effect regardless of any investigation made by or on behalf of
\nthe indemnified party or any officer, director or controlling Person of such
\nindemnified party and shall survive the transfer of securities.<\/p>\n
(e) If the indemnification provided for in or pursuant to this Section
\n8 is due in accordance with the terms hereof, but is held by a court to be
\nunavailable or unenforceable in respect of any losses, claims, damages,
\nliabilities or expenses referred to herein, then each applicable indemnifying
\nparty, in lieu of indemnifying such indemnified party, shall contribute to the
\namount paid or payable by such indemnified person as a result of such losses,
\nclaims, damages, liabilities or expenses in such proportion as is appropriate to
\nreflect the relative fault of the indemnifying party on the one hand and of the
\nindemnified party on the other in connection with the statements or omissions
\nwhich result in such losses, claims, damages, liabilities or expenses as well as
\nany other relevant equitable considerations. The relative fault of the
\nindemnifying party on the one hand and of the indemnified person on the other
\nshall be determined by reference to, among other things, whether the untrue or
\nalleged untrue statement of a material fact or the omission or alleged omission
\nto state a material fact relates to information supplied by the indemnifying
\nparty or by the indemnified party, and by such party’s relative intent,
\nknowledge, access to information and opportunity to correct or prevent such
\nstatement or omission. In no event shall the liability of any selling Holder be
\ngreater in amount than the amount of net proceeds received by such Holder upon
\nsuch sale or the amount for which such indemnifying party would have been
\nobligated to pay by way of indemnification if the indemnification provided for
\nunder Section 8(a) or 8(b) hereof had been available under the circumstances.<\/p>\n
14<\/p>\n
9. Participation in Underwritten Registrations.<\/p>\n
No Person may participate in any registration hereunder which is
\nunderwritten unless such Person (a) agrees to sell such Person’s securities on
\nthe basis provided in any underwriting arrangements approved by the Person or
\nPersons entitled hereunder to approve such arrangements and (b) completes and
\nexecutes all questionnaires, powers of attorney, indemnities, underwriting
\nagreements and other documents required under the terms of such underwriting
\narrangements.<\/p>\n
10. Rule 144.<\/p>\n
The Company covenants that it will file the reports required to be
\nfiled by it under the Securities Act and the Exchange Act and the rules and
\nregulations adopted by the SEC thereunder, and it will take such further action
\nas any Holder may reasonably request to make available adequate current public
\ninformation with respect to the Company meeting the current public information
\nrequirements of Rule 144(c) under the Securities Act, to the extent required to
\nenable such Holder to sell Registrable Common Stock without registration under
\nthe Securities Act within the limitation of the exemptions provided by (i) Rule
\n144 under the Securities Act, as such Rule may be amended from time to time, or
\n(ii) any similar rule or regulation hereafter adopted by the SEC. Upon the
\nrequest of any Holder, the Company will deliver to such Holder a written
\nstatement as to whether it has complied with such information and requirements.<\/p>\n
11. Miscellaneous.<\/p>\n
(a) Notices. All notices, requests and other communications to any
\nparty hereunder shall be in writing (including facsimile or similar writing) and
\nshall be given,<\/p>\n
If to the Company:<\/p>\n
eUniverse, Inc.
\n 6300 Wilshire Blvd., Suite 1700
\n Los Angeles, CA 90048
\n Facsimile No.: (323) 658-9089
\n Attn: President<\/p>\n
with a copy to:<\/p>\n
Martin, Lucas & Chioffi, LLP
\n 1177 Summer Street
\n Stamford, CT 06905
\n Attention: Christopher Martin, Esq.
\n Facsimile No.: (203) 324-8646<\/p>\n
If to the Stockholder:<\/p>\n
15<\/p>\n
550 Digital Media Ventures Inc.
\n c\/o Sony Music Entertainment, Inc.
\n 550 Madison Avenue
\n New York, NY 10022
\n Attention: Senior Vice President and
\n General Counsel of 550 Digital Media
\n Ventures, Inc; and Senior Vice President
\n and General Counsel – Sony Music
\n Facsimile No.: (212) 833-7844<\/p>\n
If to a transferee Holder, to the address of such Holder set forth in
\nthe transfer documentation provided to the Company;<\/p>\n
in each case with copies to:<\/p>\n
Skadden, Arps, Slate, Meagher & Flom LLP
\n Four Times Square
\n New York, New York 10036-6522
\n Attention: David J. Goldschmidt, Esq.
\n Facsimile No.: (212) 735-2000<\/p>\n
or such other address or facsimile number as such party (or transferee) may
\nhereafter specify for the purpose of providing notice to the other parties. Each
\nsuch notice, request or other communication shall be effective (a) if given by
\nfacsimile, when such facsimile is transmitted to the facsimile number specified
\nin this Section and the appropriate facsimile confirmation is received or (b) if
\ngiven by any other means, when delivered at the address specified in this
\nSection.<\/p>\n
(b) No Waivers. No failure or delay by any party in exercising any
\nright, power or privilege hereunder shall operate as a waiver thereof nor shall
\nany single or partial exercise thereof preclude any other or further exercise
\nthereof or the exercise of any other right, power or privilege. The rights and
\nremedies herein provided shall be cumulative and not exclusive of any rights or
\nremedies provided by law.<\/p>\n
(c) Successors and Assigns. The provisions of this Agreement shall be
\nbinding upon and inure to the benefit of the parties hereto and their respective
\nsuccessors and assigns, it being understood that subsequent Holders of the
\nRegistrable Common Stock are intended third party beneficiaries hereof.<\/p>\n
(d) Governing Law. This Agreement shall be construed in accordance with
\nand governed by the law of the State of New York, without regard to principles
\nof conflicts of law.<\/p>\n
(e) Jurisdiction. Any suit, action or proceeding seeking to enforce any
\nprovision of, or based on any matter arising out of or in connection with, this
\nAgreement or the transactions contemplated hereby may be brought in any federal
\nor state court located in the State of California, and each of the parties
\nhereby consents to the<\/p>\n
16<\/p>\n
jurisdiction of such courts (and of the appropriate appellate courts therefrom)
\nin any such suit, action or proceeding and irrevocably waives, to the fullest
\nextent permitted by law, any objection which it may now or hereafter have to the
\nlaying of the venue of any such suit, action or proceeding in any such court or
\nthat any such suit, action or proceeding which is brought in any such court has
\nbeen brought in an inconvenient forum. Process in any such suit, action or
\nproceeding may be served on any party anywhere in the world, whether within or
\nwithout the jurisdiction of any such court. Without limiting the foregoing, each
\nparty agrees that service of process on such party as provided in Section 10(a)
\nshall be deemed effective service of process on such party.<\/p>\n
(f) Waiver of Jury Trial.<\/p>\n
EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT
\nTO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS
\nAGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.<\/p>\n
(g) Counterparts; Effectiveness. This Agreement may be signed in any
\nnumber of counterparts, each of which shall be an original, with the same effect
\nas if the signatures thereto and hereto were upon the same instrument.<\/p>\n
(h) Entire Agreement. This Agreement constitutes the entire agreement
\nbetween the parties with respect to the subject matter of this Agreement and
\nsupersedes all prior agreements and understandings, both oral and written,
\nbetween the parties with respect to the transactions contemplated herein. No
\nprovision of this Agreement or any other agreement contemplated hereby is
\nintended to confer on any Person other than the parties hereto any rights or
\nremedies.<\/p>\n
(i) Captions. The captions herein are included for convenience of
\nreference only and shall be ignored in the construction or interpretation
\nhereof.<\/p>\n
(j) Severability. If any term, provision, covenant or restriction of
\nthis Agreement is held by a court of competent jurisdiction or other authority
\nto be invalid, void or unenforceable, the remainder of the terms, provisions,
\ncovenants and restrictions of this Agreement shall remain in full force and
\neffect and shall in no way be affected, impaired or invalidated so long as the
\neconomic or legal substance of the transactions contemplated hereby is not
\naffected in any manner materially adverse to any party. Upon such a
\ndetermination, the parties shall negotiate in good faith to modify this
\nAgreement so as to effect the original intent of the parties as closely as
\npossible in an acceptable manner in order that the transactions contemplated
\nhereby be consummated as originally contemplated to the fullest extent possible.<\/p>\n
(k) Amendments. The provisions of this Agreement, including the
\nprovisions of this sentence, may not be amended, modified or supplemented, and
\nwaivers or consents to departures from the provisions hereof may not be given
\nwithout the prior written consent of the holders of a majority of the Conversion
\nShares (as constituted on the date hereof); provided, however, that the consent
\nor agreement of the Company shall<\/p>\n
17<\/p>\n
be required with regard to any termination, amendment, modification or
\nsupplement of, or waivers or consents to departures from, the terms hereof,
\nwhich affect the Company’s obligations hereunder.<\/p>\n
(l) Equitable Relief. The parties hereto agree that legal remedies may
\nbe inadequate to enforce the provisions of this Agreement and that equitable
\nrelief, including specific performance and injunctive relief, may be used to
\nenforce the provisions of this Agreement.<\/p>\n
(m) Costs and Expenses. Except as otherwise expressly provided for
\nherein, each party to this Agreement shall bear its own costs and expenses,
\nincluding but not limited to attorneys’ fees and expenses, in connection with
\nthe closing of the transactions contemplated hereby.<\/p>\n
[Execution Page Follows]<\/p>\n
18<\/p>\n
IN WITNESS WHEREOF, this Registration Rights Agreement has been duly
\nexecuted by each of the parties hereto as of the date first written above.<\/p>\n
550 DIGITAL MEDIA VENTURES, INC.<\/p>\n
By: \/s\/ Mark Eisenberg
\n —————————————
\n Name: Mark Eisenberg
\n Title: Senior Vice President and General Counsel<\/p>\n
EUNIVERSE, INC.<\/p>\n
By: \/s\/ Brad D. Greenspan
\n —————————————
\n Name: Brad D. Greenspan
\n Title: Chairman and Chief Executive Officer<\/p>\n
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