Exhibit
10.8


 


WARRANT
HOLDER RIGHTS AGREEMENT


 


This Warrant Holder Rights Agreement (“Agreement”) is made as of the
13th day of August 2003, by and between YouthStream Media Networks, Inc.,
a Delaware corporation (“Company”) and Jonathan V. Diamond (“Holder”). The
parties hereby agree as follows:


 


1.                                       CERTAIN
DEFINITIONS.


 


As used in this Agreement, the following terms shall have the following
meanings:


 


“Commission” shall mean the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.


 


“Company’s Common Stock” or “Common Stock” shall mean the Common Stock,
par value $0.01 per share, of the Company.


 


A “Controlling Person” of a particular entity shall mean a person that
controls such entity within the meaning of Section 14 of the Securities
Act.


 


“Exchange Act” shall mean the Securities Exchange Act of 1934, as
amended.


 


“Holder” shall mean Holder and any other person holding Registrable
Securities to whom the rights under the Agreement have been transferred in
accordance with Section 9 hereof.


 


“Public Offering” means an underwritten public offering of the Company
pursuant to an effective registration statement under the Securities Act.


 


“Registrable Securities” shall mean (i) the Shares; (ii) any Common Stock
of the Company issued or issuable in respect of the Shares upon any stock
split, stock dividend, recapitalization, or similar event, or any Common Stock
otherwise issued or issuable with respect to the Shares; and (iii) any other
shares of Common Stock held by any Holder


 


The terms “Register,” “Registered” and “Registration” shall refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act, and the declaration or ordering of the
effectiveness of such registration statement.


 


“Registration Expenses” shall mean all expenses, except as otherwise
stated below, incurred by the Company including, without limitation all
registration, qualification and filing fees, printing expenses, escrow fees,
messenger and delivery expenses, fees and disbursements of counsel,
accountants, investment bankers and other person retained by the Company, blue
sky fees and expenses, and the expenses of any special audits incident to or
required by any such 


 

















 


registration (but excluding the compensation of regular employees of
the Company, which shall be paid in any event by the Company).


 


“Restricted Securities” shall mean the Warrants, the Shares and any
other securities issued in respect of the Shares upon any stock split, stock
dividend, recapitalization, merger, consolidation or similar event.


 


“Securities Act” means the Securities Act of 1933, as amended.


 


“Selling Expenses” shall mean all underwriting discounts, selling
commissions and stock transfer taxes applicable to the securities registered by
the Holders.


 


“Shares” shall mean the shares of the Company’s Common Stock issuable
to a Holder pursuant to the exercise by such Holder of the Warrants.


 


“Warrants” shall mean the warrants issued to Holder to purchase 400,000
Shares (subject to adjustment), by Warrant Certificate dated of even date
herewith.


 


2.                                       RESTRICTIONS
UPON TRANSFER.


 


Each certificate representing Restricted Securities shall be stamped or
otherwise imprinted with a legend in the form provided in Exhibit A attached
hereto (in addition to any legend required under applicable state securities
laws). Holder hereby consents to the Company making a notation on its records
and giving instructions to any transfer agent of the Company’s Common Stock in
order to implement the restrictions on transfer established in this Agreement.


 


3.                                       COMPANY
REGISTRATION.


 


3.1.                              Notice
of Registration. If at any time or from time to time the Company shall
determine to register any of its Common Stock, either for its own account or
the account of security holders, other than (i) a registration on Form S-8 or
otherwise relating solely to employee benefit plans, (ii) a registration on
Form S-4, or (iii) a registration on any other form which does not permit
secondary sales, the Company will:


 


(a) promptly give to each Holder written notice thereof; and


 


(b) except as set forth in Section 3.2 below, include in such
registration and any related qualification under blue sky laws or other
compliance), and in any underwriting involved therein, all Registrable
Securities as are specified in a written request or requests, actually received
by the Company within 15 days after receipt of such written notice from the
Company, by any Holder.


 


3.2.                              Underwriting.
If the registration of which the Company gives notice is for a registered
public offering involving an underwriting, the Company shall so advise the
Holders as a part of the written notice given pursuant to Section 3.1(a).
In such event the right of any Holder 


 


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to registration pursuant to Section 3.1 shall be conditioned upon
such Holder’s participation in such underwriting and the inclusion of such
Holder’s Registrable Securities in the underwriting to the extent provided
herein. All Holder’s proposing to distribute their securities through such
underwriting shall (together with the Company and the other holders
distributing their securities through such underwriting) enter into an
underwriting agreement in customary form with the managing underwriter selected
for such underwriting by the Company. The foregoing shall include, without
limitation, such powers of attorney and escrow agreements as the underwriters
may require. Notwithstanding any other provision of Section 3.1, if the
managing underwriter determines that marketing factors require a limitation of
the number of shares to be underwritten, the managing underwriter may limit the
Registrable Securities to be included in such registration. If any Holder
disapproves of the terms of any such underwriting, it may elect to withdraw
therefrom by written notice to the Company and the managing underwriter.


 


3.3.                              Company
Termination of Registration. The Company reserves the right to terminate
any such registration at anytime and for any reason without liability to any
Holder.


 


3.4.                              Expenses.
All Selling Expenses relating to securities registered on behalf of the Holders
in connection with a registration pursuant to this Agreement shall be borne by
the Holder of such securities pro rata on the basis of the number of shares so
registered and all Registration Expenses shall be borne by the Company.


 


4.                                       DELAY
OF REGISTRATION.


 


No Holder shall have any right to obtain or seek an injunction,
restraining or otherwise delaying any registration as the result of any
controversy that might arise under this Agreement.


 


5.                                       REGISTRATION
PROCEDURES.


 


5.1.                              In
the case of each registration, qualification or compliance effected by the
Company pursuant to this Agreement, the Company will keep each Holder advised in
writing as to the initiation of each registration, qualification and compliance
and as to the completion thereof. The Company will:


 


(a) Prepare and file with the Commission a registration statement with
respect to such securities and use its best efforts to cause such registration
statement to become effective; and


 


(b) Furnish to the Holders participating in such registration and to
the underwriters of the securities being registered such reasonable number of
copies of the registration statement, preliminary prospectus, final prospectus
and such other document as such Holders and underwriters may reasonably request
in order to facilitate the public offering of such securities.


 


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6.                                       INDEMNIFICATION.


 


6.1.                              Indemnification
by Company. To the extent permitted by law, the Company will indemnify each
Holder, each of the Holder’s officers, directors, shareholders, employees,
representatives and partners, if any, Controlling Person of such Holder, with
respect to which registration, qualification or compliance has been effected
pursuant to this Agreement, and each underwriter, if any, and each Controlling
Person of any underwriter, against all expenses, claims, losses, damages or
liabilities (or actions in respect thereof), including any of the foregoing
incurred in any investigation or inquiry or in any settlement of any litigation
commenced or threatened, arising out of or based on any untrue statement (or
alleged untrue statement) of a material fact contained in any registration
statement, prospectus, offering circular or other document, or any amendment or
supplement thereto, incident to any such registration, qualification or
compliance, or based on any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances in which they were made, not misleading,
or any violation by the Company of the Securities Act, the Exchange Act, or any
state securities law, or any rule or regulation promulgated under the
Securities Act, the Exchange Act or any state securities law applicable to the
Company in connection with any such registration, qualification or compliance,
and the Company will reimburse each such Holder, each of the Holder’s officers,
directors, shareholders, employees, representatives and partners, if any, and
each such Controlling Person, each such underwriter and each such Controlling
Person of any such underwriter, for any legal and any other expenses reasonably
incurred in connection with investigating, preparing or defending any such
claim, loss, damage, liability or action; provided, however, that the indemnity
agreement contained in this Section 6.1 shall not (i) apply to amounts
paid in settlement of any such loss, claim, damage, liability, or action if
such settlement is effected without the consent of the Company (which consent
shall not be unreasonably withheld); (ii) apply to any such case for any such
loss, claim, damage, liability, or action to the extent that it arises out of
or is based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in connection with such registration statement,
preliminary prospectus, final prospectus, or amendments to supplements thereto,
in reliance upon and in conformity with written information furnished expressly
for use in connection with such registration by and such Holder, underwriter,
or Controlling Person; or (iii) inure to the benefit of any underwriter from
whom the person asserting any such loss, claim, damage or liability purchased
the Registrable Securities which are the subject thereof (or to the benefit of
any person controlling such underwriter) with respect to a preliminary
prospectus or final prospectus if such underwriter (if required by the Act)
failed to send or give a copy of the most recent prospectus, if the most recent
prospectus furnished by the Company shall correct the untrue statement or
alleged untrue statement or omission or alleged omission which is the basis of
the loss, claim, damage, liability, or action for which indemnification is
sought, to such person at or prior to the written confirmation of the sale of
such Registrable Securities to such person. This indemnity will be in addition
to any liability which the Company may otherwise have.


 


6.2.                              Indemnification
by Holders. To the extent permitted by law, each Holder will, if
Registrable Securities held by such Holder are included in the securities as to
which such registration, qualification or compliance is being effected,
indemnify the Company, each of its directors, officers, shareholders,
employees, representatives, attorneys and partners, each Controlling Person of
the Company or such underwriter, and each other Holder, each of such 


 


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other Holder’s officers, directors, shareholders, employees,
representatives and partners and each Controlling Person of such other Holder,
against all claims, losses, damages and liabilities (or actions in respect thereof),
including any of the foregoing incurred in any investigation or inquiry or in
any settlement of any litigation, commenced or threatened, arising out of based
on any untrue statement (or alleged untrue statement) of a material fact
contained in any such registration statement, prospectus, offering circular or
other document, or any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or any violation by the Company of the Securities Act,
the Exchange Act or any state securities law, or any rule or regulation
promulgated under the Securities Act, the Exchange Act or any state securities
law applicable to the Company in connection with any such registration,
qualification or compliance, and each Holder will reimburse the Company, such
other Holders, such directors, officers, shareholders, employees,
representatives, attorneys, partners, such underwriters and such Controlling
Person for any legal or any other expenses actually incurred in connection with
investigating or defending any such claim, loss, damage, liability or action,
in each case to the extent, but only to the extent, that such untrue statement
(or alleged untrue statement), omission (or alleged omission) is made in such
registration statement, prospectus, offering circular or other document or such
violation (or alleged violation) is committed, in reliance upon and in
conformity with written information furnished to the Company by an instrument
duly executed by such Holder and stated to be specifically for use in any such
registration statement, prospectus, offering circular or other document;
provided, however, that the indemnity agreement contained in this
Section 8.2 shall not (i) apply to amounts paid in settlement of any such
loss, claim, damage, liability, or action if such settlement is effected
without the consent of such Holder (which consent shall not be unreasonably
withheld); or (ii) inure to the benefit of any underwriter from whom the person
asserting any such loss, claim damage or liability purchased the Registrable
Securities which are the subject thereof (or to the benefit of any person
controlling such underwriter) with respect to a preliminary prospectus or final
prospectus if such underwriter (if required by the Act) failed to send or give
a copy of the most recent prospectus, if the most recent prospectus furnished
by the Company shall correct the untrue statement or alleged untrue statement
or omission or alleged omission which is the basis of the loss, claim, damage,
liability, or action for which indemnification is sought, to such person at or
prior to the written confirmation of the sale of such Registrable Securities to
such person. This indemnity will be in addition to any liability which each
Holder may otherwise have.


 


6.3.                              Defense
of Claims. Each party entitled to indemnification under Section 6.1 or
6.2 (the “Indemnified Party”) shall give written notice to the party required
to provide indemnification (the “Indemnifying Party”) promptly after such
Indemnified Party has actual knowledge of any claim as to which indemnity may
be sought, and shall permit the Indemnifying Party to assume the defense of any
such claim or any litigation resulting therefrom, provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or litigation,
shall be approved by the Indemnified Party (whose approval shall not
unreasonably be withheld), and the Indemnified Party may participate in such
defense at such party’s expense, and provided further that the failure of any
Indemnified Party to give notice as provided herein shall not relieve the
Indemnified Party of its obligations under the Agreement unless the failure to
give such notice is materially prejudicial to an Indemnified Party’s ability to
defend such action. 


 


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Notwithstanding the foregoing, however, (i) if the Indemnified Party
reasonably determines that there may be a conflict between the position of the
Indemnified Party and of the Indemnified Party in connection with the defense
of such action, suit, investigation, inquiry or other proceeding or that there
may be legal defenses available to such Indemnified Party different from or in
addition to those available to the Indemnified Party, then counsel for the
Indemnified Party shall be entitled to conduct a defense to the extent
reasonably determined by such counsel to be necessary to protect the interest
of the Indemnified Party, and (ii) in any event, the Indemnified Party shall be
entitled to have counsel chosen by such Indemnified Party participate in, but
not to conduct, the defense. No Indemnified Party, in the defense of any such
claim or litigation, shall, except with the consent of each Indemnified Party,
consent to entry of any judgment or enter into any settlement that does not
include as a unconditional term thereof the giving by the claimant or plaintiff
to such Indemnified Party of a release from all liability in respect to such
claim or litigation.


 


6.4.                              Contribution.
If the indemnification provided in either Section 6.1 or Section 6.2
is held by a court of competent jurisdiction to be unavailable to an
Indemnified Party with respect to any loss, liability, claim, damage or expense
referred to therein, then the Indemnified Party thereunder shall contribute to
the amount paid or payable by such Indemnified Party as a result of such loss,
liability, claim, damage or expense in such proportion as is appropriate to
reflect the relative fault of the Indemnified Party on the one hand, and of the
Indemnified Party, on the other hand, in connection with the statements or
omissions which resulted in such loss, liability, claim, damage or expense as
well as any other relevant equitable considerations. The relative fault of the
Indemnified Party and of the Indemnified Party shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Indemnified Party or by the Indemnified
Party and the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission, provided,
however, that no person guilty of fraudulent misrepresentation (within the
meaning of Section 1.1(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. Each party entitled to contribution agrees that upon service
of a summons or other initial legal process upon such party in connection with
any action instituted against such party in respect of which contribution may
be sought, such party will promptly give written notice of such service to the
party or parties from whom contribution may be sought, but the omission to
notify such party or parties of any such service shall not relieve the party
from whom contribution may be sought from any obligation such party or parties
may have hereunder, or otherwise (except as specifically provided in
Section 6.3 above.)


 


7.                                       INFORMATION
FROM HOLDERS.


 


The Holder or Holders of Registrable Securities included in any
registration shall, as a condition precedent to the Company’s obligation to
register the securities of such Holder or Holders, furnish to the Company such
information regarding such Holder or Holders, the Registrable Securities held
by them and the distribution proposed by such Holder or Holders as the Company
may request in writing and as shall be required in connection with any
registration, qualification or compliance referred to in this Agreement. At the
request of the Company, each 


 


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Holder who is including any Registrable Securities in the registration
shall deposit in escrow with an escrow agent chosen by the Company those
Registrable Securities which such Holder proposes to sell, accompanied by an
irrevocable power of attorney authorizing the escrow agent to, without
limitation, sell such Registrable Securities to the underwriter upon the
effectiveness of the Registrable Securities.


 


8.                                       STANDOFF
AGREEMENT.


 


Each Holder agrees, in connection with any public offering of the
Company’s Common Stock, upon request of the Company or the underwriters
managing such public offering of the Company’s Common Stock, not to sell, make
any short sale of, loan, grant any option or right to purchase, or otherwise
dispose of in any public sale or distribution, any Registrable Securities or
any securities convertible into or exchangeable or exercisable for Common Stock
(other than those included in the registration) without the prior written
consent of the Company or such underwriters, as the case may be, for such
period of time before and after (not to exceed 60 days before and 180 days
after) the effective date of such registration as may be requested by the
underwriters; provided, that the officers and directors of the Company who own
Common Stock of the Company also agree to such restrictions on the shares held
by them.


 


9.                                       TRANSFER
OF RIGHTS.


 


The registration rights hereunder may be assigned only to any party who
acquires the Registrable Securities; provided, however that no party may be
assigned any of the foregoing rights unless the Company is given written notice
by the assigning party at the time of such assignment stating the name and
address of the assignee and identifying the securities of the Company as to
which the rights in question are being assigned; and provided further that any
such assignee shall receive such assigned rights subject to all the terms and
conditions of this Agreement.


 


10.                                 TERMINATION
OF REGISTRATION RIGHTS.


 


The right of any Holder to request registration or inclusion in any
Registration pursuant to Section 3 hereof shall terminate at such time as
such Holder may sell all Registrable Securities owned by him under Rule 144
during any 90-day period.


 


11.                                 MISCELLANEOUS.


 


11.1.                        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
Company has obtained the written consent of Holders of at least 66-2/3% of the
Registrable Securities.


 


11.2.                        Notices.
All notices and other communications provided for or permitted hereunder shall
be made in writing by hand-delivery, registered first-class mail, telecopier,
or air courier guaranteeing overnight delivery.


 


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(a) if a Holder of Registrable Securities, at the most current address
given by such Holder to the Company in accordance with the provisions of this
Section 11.2, which address initially is as follows:


 


Jonathan V. Diamond


374 West 11th Street #7


New York, NY 10014


Attn: President


 


and thereafter at such other address, notice of which is given in
accordance with the provisions of this Section 11.2.


 


(b) if to the Company, initially at:


 


YouthStream Media Networks, Inc.


244 Madison Avenue, PMB #358


New York, NY 10016


 


and thereafter at such other address, notice of which is given in
accordance with the provisions of this Section 11.2.


 


All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five business
days after being deposited in the mail, first class postage prepaid, if mailed;
when receipt acknowledged, if telecopied; and on the next business day if
timely delivered to an air courier guaranteeing overnight delivery.


 


11.3.                        Successors
and Assigns. Subject to the provisions of Section 9 hereof, this
Agreement shall inure to the benefit of and binding upon the successors and
assigns of each of the parties, including without limitation and without the
need for an express assignment, subsequent Holders of Registrable Securities.


 


11.4.                        Counterparts.
This Agreement may be executed in any number of counterparts and by the parties
hereto in separate 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 instrument.


 


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


 


11.6.                        Governing
Law. This Agreement is to be governed by and construed in accordance with
the laws of the State of Delaware.


 


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11.7.                        Attorneys’
Fees. If either the Company or any Holder shall bring an action against the
other by reason of the breach of any covenant, provision or condition hereof,
or otherwise arising out of this Agreement, the unsuccessful party shall pay to
the prevailing party its reasonable attorneys’ fees and costs in addition to
any other relief to which it may be entitled.


 


11.8.                        Severability.
In the event that any one or more of the provisions contained herein, or the
application thereof in any circumstance is held invalid, illegal or
unenforceable, the validity, legality and enforceability of any such provision
in every other respect and of the remaining provisions contained herein shall
not be affected or impaired thereby.


 


11.9.                        Entire
Agreement. This Agreement is intended by the parties as a final expression
of their agreement and intended to be a complete the exclusive statement of the
agreement and understanding of the parties hereto in respect of the subject
matter contained herein. There are no restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein with respect to
the registration rights granted by the Company with respect to the Registrable
Securities. This Agreement supersedes all prior agreements and understanding
between the parties with respect to such subject matter.


 


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


 


	
   

  	
  “COMPANY”

  
	
   

  	
   

  
	
   

  	
  YOUTHSTREAM MEDIA NETWORKS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Robert N. Weingarten

  	
   

  
	
   

  	
   

  	
  Robert N. Weingarten

  
	
   

  	
   

  	
  Its: Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  “HOLDER”

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
     /s/ Jonathan V. Diamond

  	
   

  
	
   

  	
   

  	
  Jonathan V. Diamond

  



 


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Exhibit
A


 


FORM OF STOCK CERTIFICATE LEGEND


 


“The securities evidenced by this certificate have been acquired for
investment purposes and have not been registered under the Securities Act of
1933, as amended. Such securities may not be sold, transferred, pledged or
hypothecated unless (i) effected in compliance with that certain Warrant Holder
Rights Agreement, dated as of August 13, 2003, between the Company and
Jonathan V. Diamond, and (iii) the registration provisions of said Act and any
applicable state securities or “blue sky” laws have been complied with or the
Company has received an opinion of counsel reasonably satisfactory to the
Company that such registration is not required.”


 


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