EXHIBIT B

                          REGISTRATION RIGHTS AGREEMENT

      This Registration  Rights Agreement (this "Agreement") is made and entered
into  as  of  October  ___,  2004  among  ON2  Technologies,  Inc.,  a  Delaware
corporation  (the  "Company"),  and the purchasers  signatory  hereto (each such
purchaser  is a  "Purchaser"  and all such  purchasers  are,  collectively,  the
"Purchasers").

      This  Agreement is made  pursuant to the  Securities  Purchase  Agreement,
dated as of the date hereof among the Company and the Purchasers  (the "Purchase
Agreement").

      The Company and the Purchasers hereby agree as follows:

      1. Definitions

      CAPITALIZED  TERMS USED AND NOT OTHERWISE  DEFINED HEREIN THAT ARE DEFINED
IN THE  PURCHASE  AGREEMENT  SHALL  HAVE THE  MEANINGS  GIVEN  SUCH TERMS IN THE
PURCHASE  AGREEMENT.  As used in this Agreement,  the following terms shall have
the following meanings:

            "Advice" shall have the meaning set forth in Section 6(d).

            "Effectiveness Date" means, with respect to the initial Registration
      Statement required to be filed hereunder, the 120th calendar day following
      the  date  hereof  and,  with  respect  to  any  additional   Registration
      Statements  which may be  required  pursuant  to  Section  3(c),  the120th
      calendar  day  following  the date on which the Company  first  knows,  or
      reasonably should have known, that such additional  Registration Statement
      is  required  hereunder;  provided,  however,  in the event the Company is
      notified by the Commission that one of the above  Registration  Statements
      will not be  reviewed  or is no  longer  subject  to  further  review  and
      comments,  the Effectiveness Date as to such Registration  Statement shall
      be the fifth  Trading  Day  following  the date on which the Company is so
      notified if such date precedes the dates required above.

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

            "Event" shall have the meaning set forth in Section 2(b).

            "Event Date" shall have the meaning set forth in Section 2(b).

            "Filing  Date"  means,  with  respect  to the  initial  Registration
      Statement  required  hereunder,  the 30th  calendar day following the date
      hereof and, with respect to any additional  Registration  Statements which
      may be required  pursuant to Section 3(c), the 15th day following the date
      on which the Company  first knows,  or  reasonably  should have known that
      such additional Registration Statement is required hereunder.
<PAGE>

            "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(c)
      hereof.

            "Indemnifying  Party"  shall have the  meaning  set forth in Section
      5(c) hereof.

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

            "Proceeding"  means  an  action,   claim,  suit,   investigation  or
      proceeding  (including,  without  limitation,  an investigation or partial
      proceeding, such as a deposition), whether commenced or threatened.

            "Prospectus"  means  the  prospectus   included  in  a  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 a 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, as of the date in question, (i) all
      of the shares of Common  Stock  issuable  upon  conversion  in full of the
      shares of Preferred  Stock,  (ii) all shares  issuable as dividends on the
      Preferred  Stock  assuming  all  dividend  payments  are made in shares of
      Common Stock and the Preferred  Stock is held for at least 3 years,  (iii)
      all Warrant Shares,  (iv) any securities issued or issuable upon any stock
      split,  dividend or other distribution  recapitalization  or similar event
      with respect to the foregoing and (v) any  additional  shares  issuable in
      connection with any anti-dilution provisions associated with the Preferred
      Stock and Warrants.

            "Registration  Statement" means the registration statements required
      to  be  filed  hereunder  and  any  additional   registration   statements
      contemplated  by Section 3(c),  including  (in each case) 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 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.


                                       2
<PAGE>

      2. Shelf Registration

            (a) On or prior to each Filing Date,  the Company  shall prepare and
file with the Commission a "Shelf" Registration Statement covering the resale of
130% of the  Registrable  Securities  on such  Filing Date for an offering to be
made on a  continuous  basis  pursuant to Rule 415. The  Registration  Statement
shall be on Form S-3 (except if the Company is not then eligible to register for
resale the Registrable  Securities on Form S-3, in which case such  registration
shall be on another  appropriate form in accordance  herewith) and shall contain
(unless  otherwise   directed  by  the  Holders)   substantially  the  "Plan  of
Distribution"  attached  hereto  as  Annex  A.  Subject  to the  terms  of  this
Agreement,  the  Company  shall use its best  efforts to cause the  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  applicable
Effectiveness  Date,  and shall use its best  efforts to keep such  Registration
Statement  continuously effective under the Securities Act until all Registrable
Securities covered by such Registration  Statement have been sold or may be sold
without volume restrictions pursuant to Rule 144(k) as determined by the counsel
to the Company  pursuant to a written  opinion letter to such effect,  addressed
and  acceptable to the Company's  transfer  agent and the affected  Holders (the
"Effectiveness  Period").  The Company shall immediately  notify the Holders via
facsimile of the  effectiveness  of the  Registration  Statement on the same day
that the Company receives notification of the effectiveness from the Commission.
Failure to so notify the Holder within 1 Trading Day of such notification  shall
be deemed an Event under Section 2(b).

            (b) If: (i) a Registration Statement is not filed on or prior to its
Filing Date or (ii) the Company fails to file with the  Commission a request for
acceleration in accordance  with Rule 461 promulgated  under the Securities Act,
within five Trading Days of the date that the Company is notified  (orally or in
writing,  whichever is earlier) by the Commission that a Registration  Statement
will not be "reviewed," or not subject to further review,  or (iii) prior to its
Effectiveness  Date,  the Company  fails to file a  pre-effective  amendment and
otherwise  respond in writing to comments  made by the  Commission in respect of
such  Registration  Statement  within 10  calendar  days  after the  receipt  of
comments by or notice from the  Commission  that such  amendment  is required in
order  for a  Registration  Statement  to  be  declared  effective,  or  (iv)  a
Registration  Statement  filed or required to be filed hereunder is not declared
effective  by the  Commission  by its  Effectiveness  Date,  or  (v)  after  the
Effectiveness  Date, a  Registration  Statement  ceases for any reason to remain
continuously effective as to all Registrable Securities for which it is required
to be  effective,  or the Holders are not  permitted  to utilize the  Prospectus
therein to resell such Registrable  Securities for 10 consecutive  calendar days
but no more than an  aggregate of 15 calendar  days during any  12-month  period
(which need not be  consecutive  Trading Days) (any such failure or breach being
referred  to as an "Event",  and for  purposes of clause (i) or (iv) the date on
which such Event  occurs,  or for purposes of clause (ii) the date on which such
five  Trading Day period is  exceeded,  or for purposes of clause (iii) the date
which such 10 calendar day period is exceeded, or for purposes of clause (v) the
date on which such 10 or 15 calendar  day  period,  as  applicable,  is exceeded
being  referred to as "Event  Date"),  then in addition to any other  rights the
Holders may have hereunder or under applicable law, on each such Event Date, the
Company  shall  pay to each  Holder an amount  in cash,  as  partial  liquidated
damages and not as a penalty, equal to 2.0% of the aggregate purchase price paid
by such Holder pursuant to the Purchase Agreement for any Registrable Securities
then held by such Holder,  and, on each monthly  anniversary  of each such Event
Date (if the applicable  Event shall not have been cured by such date) until the
applicable  Event is cured,  the  Company  shall pay to each Holder an amount in
cash, as partial liquidated  damages and not as a penalty,  equal to 1.0% of the
aggregate  purchase price paid by such Holder pursuant to the Purchase Agreement
for any Registrable Securities then held by such Holder. If the Company fails to
pay any partial 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
18% 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  partial
liquidated  damages are due until such amounts,  plus all such interest thereon,
are paid in full. The partial  liquidated  damages  pursuant to the terms hereof
shall  apply on a daily  pro-rata  basis for any portion of a month prior to the
cure of an Event.


                                       3
<PAGE>

      3. Registration Procedures

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

            (a) Not less  than five  Trading  Days  prior to the  filing of each
Registration  Statement or any related Prospectus or any amendment or supplement
thereto  (including  any  document  that would be  incorporated  or deemed to be
incorporated  therein by  reference),  the  Company  shall,  (i) furnish to each
Holder copies of all such documents proposed to be filed, which documents (other
than those  incorporated  or deemed to be  incorporated  by  reference)  will be
subject  to the  review  of such  Holders,  and  (ii)  cause  its  officers  and
directors,  counsel and independent  certified public  accountants to respond to
such inquiries as shall be necessary,  in the  reasonable  opinion of respective
counsel  to  conduct  a  reasonable  investigation  within  the  meaning  of the
Securities  Act. The Company  shall not file the  Registration  Statement or any
such Prospectus or any amendments or supplements thereto to which the Holders of
a majority of the Registrable  Securities shall reasonably object in good faith,
provided  that,  the Company is notified of such  objection  in writing no later
than 5 Trading  Days after the  Holders  have been so  furnished  copies of such
documents.   Each   Holder   agrees  to  furnish  to  the  Company  a  completed
Questionnaire  in the form  attached  to this  Agreement  as Annex B (a "Selling
Holder  Questionnaire")  not less than two Trading Days prior to the Filing Date
or by the end of the fourth  Trading Day following the date on which such Holder
receives draft materials in accordance with this Section.

            (b) (i)  Prepare  and file  with  the  Commission  such  amendments,
including  post-effective  amendments,  to  a  Registration  Statement  and  the
Prospectus  used  in  connection  therewith  as  may  be  necessary  to  keep  a
Registration  Statement  continuously effective as to the applicable Registrable
Securities for the Effectiveness Period and prepare and file with the Commission
such  additional  Registration  Statements in order to register for resale under
the Securities  Act all of the  Registrable  Securities;  (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 a  Registration
Statement  or any  amendment  thereto  and as promptly  as  reasonably  possible
provide the Holders true and complete copies of all  correspondence  from and to
the  Commission  relating to a  Registration  Statement;  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 a
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 such  Registration  Statement  as so amended or in
such Prospectus as so supplemented.


                                       4
<PAGE>

            (c) If during the  Effectiveness  Period,  the number of Registrable
Securities  at any time exceeds 85% of the number of shares of Common Stock then
registered in a Registration  Statement,  then the Company shall file as soon as
reasonably  practicable but in any case prior to the applicable  Filing Date, an
additional Registration Statement covering the resale by the Holders of not less
than 130% of the number of such Registrable Securities.

            (d) Notify the Holders of  Registrable  Securities to be sold (which
notice shall, pursuant to clauses (ii) through (vi) 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, in the case of (i)(A)
below,  not less than five Trading Days prior to such filing) 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 a  Registration  Statement is proposed to be filed;
(B) when the Commission notifies the Company whether there will be a "review" of
such Registration  Statement and whenever the Commission  comments in writing on
such Registration  Statement (the Company shall provide true and complete copies
thereof and all written responses thereto to each of the Holders);  and (C) with
respect to a 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 a
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 a  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;  (v) of the  occurrence  of any event or passage of time that makes the
financial  statements  included  in  a  Registration  Statement  ineligible  for
inclusion  therein  or  any  statement  made  in  a  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 a
Registration Statement,  Prospectus or other documents so that, in the case of a
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;  and
(vi) the  occurrence  or existence  of any pending  corporate  development  with
respect to the Company that the Company  believes  may be material and that,  in
the  determination  of the  Company,  makes it not in the best  interest  of the
Company  to  allow  continued  availability  of the  Registration  Statement  or
Prospectus;  provided  that  any  and  all  of  such  information  shall  remain
confidential  to each Holder until such  information  otherwise  becomes public,
unless  disclosure  by  a  Holder  is  required  by  law;   provided,   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.


                                       5
<PAGE>

            (e) Use its best  efforts to avoid the  issuance  of, or, if issued,
obtain  the  withdrawal  of (i) any  order  suspending  the  effectiveness  of a
Registration  Statement,  or  (ii)  any  suspension  of  the  qualification  (or
exemption from  qualification) of any of the Registrable  Securities for sale in
any jurisdiction, at the earliest practicable moment.

            (f) Furnish to each Holder,  without charge,  at least one conformed
copy of each such 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)  promptly  after the  filing of such
documents with the Commission.

            (g) Promptly deliver to each 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 on any notice pursuant to Section 3(d).

            (h) 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,  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.

            (i) 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  a
Registration  Statement,  which  certificates  shall  be  free,  to  the  extent
permitted by the Purchase Agreement,  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.

            (j) 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  stockholders  of the  premature  disclosure  of such  event,  prepare a
supplement or amendment, including a post-effective amendment, to a Registration
Statement or a supplement to the related Prospectus or any document incorporated
or deemed to be incorporated  therein by reference,  and file any other required
document so that, as thereafter delivered,  neither a 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(d) 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 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(j) to  suspend  the  availability  of a  Registration  Statement  and
Prospectus,  subject to the payment of partial  liquidated  damages  pursuant to
Section 2(b),  for a period not to exceed 60 days (which need not be consecutive
days) in any 12 month period.


                                       6
<PAGE>

            (k)  Comply  with  all  applicable  rules  and  regulations  of  the
Commission.

            (l) The Company may require  each  selling  Holder to furnish to the
Company a  certified  statement  as to the  number  of  shares  of Common  Stock
beneficially owned by such Holder and, if required by the Commission, the person
thereof  that has voting and  dispositive  control  over the Shares.  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  three  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 Event 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.

      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 is then
listed for trading,  and (B) in compliance with applicable  state  securities or
Blue Sky laws 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  if  the  printing  of
prospectuses  is  reasonably  requested  by the  holders  of a  majority  of the
Registrable Securities included in a Registration  Statement),  (iii) messenger,
telephone and delivery expenses,  (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 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.  In no event shall the Company be
responsible  for any  broker or  similar  commissions  or,  except to the extent
provided for in the Transaction Documents,  any legal fees or other costs of the
Holders.


                                       7
<PAGE>

      5. Indemnification

            (a)   Indemnification   by   the   Company.   The   Company   shall,
notwithstanding  any termination of this Agreement,  indemnify and hold harmless
each Holder,  the officers,  directors,  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 Common Stock), 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, 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,   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  a  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 (i) 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  expressly  approved in writing by such Holder
expressly for use in a Registration  Statement,  such Prospectus or such form of
Prospectus or in any amendment or supplement  thereto (it being  understood that
the Holder has approved  Annex A hereto for this purpose) or (ii) in the case of
an occurrence of an event of the type  specified in Section  3(d)(ii)-(vi),  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(d).
The Company  shall  notify the Holders  promptly of the  institution,  threat or
assertion of any Proceeding  arising from or in connection with the transactions
contemplated by this Agreement of which the Company is aware.

            (b) Indemnification by Holders. Each Holder shall, 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,  to the extent  arising out of or based solely upon: (x) such Holder's
failure to comply with the prospectus  delivery  requirements  of the Securities
Act or (y) 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 not
misleading (i) to the extent, but only to the extent, that such untrue statement
or omission is  contained  in any  information  so  furnished in writing by such
Holder to the Company specifically for inclusion in such Registration  Statement
or such  Prospectus  or (ii) to the extent  that (1) 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 expressly
approved  in  writing  by such  Holder  expressly  for  use in the  Registration
Statement (it being  understood  that the Holder has approved Annex A hereto for
this purpose), such Prospectus or such form of Prospectus or in any amendment or
supplement  thereto or (2) in the case of an  occurrence of an event of the type
specified  in Section  3(d)(ii)-(vi),  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(d). In no event shall the liability of
any selling Holder  hereunder be greater in amount than the dollar amount of the
net proceeds received by such Holder upon the sale of the Registrable Securities
giving rise to such indemnification obligation.


                                       8
<PAGE>

            (c) 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 fees
and expenses of such counsel shall be at the expense of such  Indemnified  Party
or Parties unless:  (1) the Indemnifying Party has agreed in writing to pay such
fees and  expenses;  (2) the  Indemnifying  Party shall have failed  promptly to
assume  the  defense  of  such  Proceeding  and  to  employ  counsel  reasonably
satisfactory to such Indemnified Party in any such Proceeding;  or (3) 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  Indemnifying  Party shall not have the
right to assume the defense  thereof and 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.


                                       9
<PAGE>

            Subject  to the terms of this  Agreement,  all  reasonable  fees and
expenses of the Indemnified Party (including reasonable fees and expenses to the
extent  incurred in connection  with  investigating  or preparing to defend such
Proceeding in a manner not inconsistent  with this Section) shall be paid to the
Indemnified  Party,  as  incurred,  within ten  Trading  Days of written  notice
thereof to the Indemnifying  Party;  provided,  that the Indemnified Party shall
promptly  reimburse  the  Indemnifying  Party for that  portion of such 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.

            (d) Contribution.  If a claim for indemnification under Section 5(a)
or 5(b) is unavailable  to an  Indemnified  Party (by reason of public policy or
otherwise),   then  each  Indemnifying  Party,  in  lieu  of  indemnifying  such
Indemnified  Party,  shall  contribute  to the  amount  paid or  payable by such
Indemnified  Party  as a  result  of  such  Losses,  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 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 this  Agreement,  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(d)  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.
Notwithstanding the provisions of this Section 5(d), no Holder shall be required
to contribute, in the aggregate, any amount in excess of the amount by which the
proceeds  actually  received  by such  Holder  from the sale of the  Registrable
Securities subject to the Proceeding exceeds the amount of any damages that such
Holder has  otherwise  been  required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission, except in the case of fraud by
such Holder.

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


                                       10
<PAGE>

      6. Miscellaneous

            (a)  Remedies.  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. 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) No Piggyback on  Registrations.  Except as set forth on Schedule
6(b) attached hereto, neither the Company nor any of its security holders (other
than the Holders in such capacity pursuant hereto) may include securities of the
Company in the Registration Statement other than the Registrable Securities. The
Company  shall  not file any other  registration  statements  until the  initial
Registration   Statement   required  hereunder  is  declared  effective  by  the
Commission,  provided that this Section 6(b) shall not prohibit the Company from
filing amendments to registration statements already filed.

            (c) 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.

            (d) 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(d),  such
Holder will forthwith  discontinue  disposition of such  Registrable  Securities
under a Registration  Statement until such Holder's receipt of the copies of the
supplemented  Prospectus and/or amended Registration  Statement,  or until it is
advised in writing (the  "Advice") by the Company that the use of the applicable
Prospectus  may be resumed,  and, in either  case,  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.  The
Company will use its best efforts to ensure that the use of the  Prospectus  may
be resumed as promptly as it  practicable.  The Company agrees and  acknowledges
that any  periods  during  which  the  Holder is  required  to  discontinue  the
disposition  of the  Registrable  Securities  hereunder  shall be subject to the
provisions of Section 2(b).

            (e)   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;  provided,  that,  the Company  shall not be
required to register any  Registrable  Securities  pursuant to this Section 6(e)
that are  eligible  for resale  pursuant  to Rule 144(k)  promulgated  under the
Securities  Act  or  that  are  the  subject  of a then  effective  Registration
Statement.


                                       11
<PAGE>

            (f)  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.

            (g)  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 Purchase Agreement.

            (h)  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 their respective rights hereunder in the manner and to the Persons as
permitted under the Purchase Agreement.

            (i) 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  or  otherwise
conflicts  with the  provisions  hereof.  Except as set forth on Schedule  6(i),
neither the Company nor any of its subsidiaries has previously  entered into any
agreement granting any registration rights with respect to any of its securities
to any Person that have not been satisfied in full.

            (j) 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,  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.

            (k)  Governing  Law.  All  questions  concerning  the  construction,
validity,  enforcement and  interpretation of this Agreement shall be determined
with the provisions of the Purchase Agreement.


                                       12
<PAGE>

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

            (m) 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.

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

            (o)  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.
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
<PAGE>

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


                                        ON2 TECHNOLOGIES, INC.


                                        By:_____________________________________
                                           Name:
                                           Title:


                       [SIGNATURE PAGE OF HOLDERS FOLLOWS]


                                       14
<PAGE>

                     [PURCHASER'S SIGNATURE PAGE TO ONT RRA]

Name of Investing Entity: __________________________
Signature of Authorized Signatory of Investing Entity: _________________________
Name of Authorized Signatory: _________________________
Title of Authorized Signatory: __________________________


                           [SIGNATURE PAGES CONTINUE]


                                       15
<PAGE>

                                     ANNEX A

                              Plan of Distribution

      Each Selling Stockholder (the "Selling  Stockholders") of the common stock
("Common  Stock")  of  ON2  Technologies,  Inc.,  a  Delaware  corporation  (the
"Company") and any of their pledgees,  assignees and successors-in-interest may,
from  time to time,  sell  any or all of their  shares  of  Common  Stock on the
Trading Market or any other stock exchange,  market or trading facility on which
the shares are traded or in private transactions. These sales may be at fixed or
negotiated  prices.  A  Selling  Stockholder  may  use  any  one or  more of the
following methods when selling shares:

            o     ordinary brokerage  transactions and transactions in which the
                  broker-dealer solicits purchasers;

            o     block trades in which the  broker-dealer  will attempt to sell
                  the shares as agent but may  position  and resell a portion of
                  the block as principal to facilitate the transaction;

            o     purchases by a  broker-dealer  as principal  and resale by the
                  broker-dealer for its account;

            o     an exchange  distribution  in accordance with the rules of the
                  applicable exchange;

            o     privately negotiated transactions;

            o     settlement  of short sales entered into after the date of this
                  prospectus;

            o     broker-dealers may agree with the Selling Stockholders to sell
                  a specified  number of such shares at a  stipulated  price per
                  share;

            o     a combination of any such methods of sale;

            o     through the writing or  settlement of options or other hedging
                  transactions,   whether   through  an  options   exchange   or
                  otherwise; or

            o     any other method permitted pursuant to applicable law.

      The Selling  Stockholders  may also sell  shares  under Rule 144 under the
Securities Act of 1933, as amended (the "Securities Act"), if available,  rather
than under this prospectus.

      Broker-dealers  engaged by the Selling  Stockholders may arrange for other
brokers-dealers to participate in sales.  Broker-dealers may receive commissions
or discounts from the Selling  Stockholders  (or, if any  broker-dealer  acts as
agent  for the  purchaser  of  shares,  from the  purchaser)  in  amounts  to be
negotiated.  Each  Selling  Stockholder  does not expect these  commissions  and
discounts  relating  to its sales of shares to exceed what is  customary  in the
types of transactions involved.


                                       16
<PAGE>

      In connection with the sale of our common stock or interests therein,  the
Selling  Stockholders may enter into hedging transactions with broker-dealers or
other  financial  institutions,  which may in turn  engage in short sales of the
common stock in the course of hedging the  positions  they  assume.  The Selling
Stockholders  may also sell shares of our common  stock short and deliver  these
securities  to close out their  short  positions,  or loan or pledge  the common
stock to  broker-dealers  that in turn may sell these  securities.  The  Selling
Stockholders   may  also  enter   into   option  or  other   transactions   with
broker-dealers  or other  financial  institutions or the creation of one or more
derivative  securities which require the delivery to such broker-dealer or other
financial  institution of shares offered by this  prospectus,  which shares such
broker-dealer  or  other  financial  institution  may  resell  pursuant  to this
prospectus (as supplemented or amended to reflect such transaction).

      The  Selling  Stockholders  and any  broker-dealers  or  agents  that  are
involved  in selling  the shares may be deemed to be  "underwriters"  within the
meaning of the Securities Act in connection with such sales. In such event,  any
commissions  received  by such  broker-dealers  or agents  and any profit on the
resale  of the  shares  purchased  by  them  may be  deemed  to be  underwriting
commissions or discounts under the Securities Act. Each Selling  Stockholder has
informed  the  Company  that it does not have any  agreement  or  understanding,
directly or indirectly, with any person to distribute the Common Stock.

      The Company is required to pay certain fees and  expenses  incurred by the
Company  incident to the  registration of the shares.  The Company has agreed to
indemnify the Selling Stockholders against certain losses,  claims,  damages and
liabilities, including liabilities under the Securities Act.

      Because Selling Stockholders may be deemed to be "underwriters" within the
meaning of the Securities  Act, they will be subject to the prospectus  delivery
requirements of the Securities Act. In addition,  any securities covered by this
prospectus  which qualify for sale pursuant to Rule 144 under the Securities Act
may be sold under Rule 144 rather  than  under  this  prospectus.  Each  Selling
Stockholder  has  advised  us that they have not  entered  into any  agreements,
understandings or arrangements  with any underwriter or broker-dealer  regarding
the sale of the resale shares.  There is no underwriter or  coordinating  broker
acting in connection  with the proposed sale of the resale shares by the Selling
Stockholders.

      We agreed to keep this  prospectus  effective until the earlier of (i) the
date on which  the  shares  may be resold by the  Selling  Stockholders  without
registration  and  without  regard to any volume  limitations  by reason of Rule
144(e) under the  Securities Act or any other rule of similar effect or (ii) all
of the shares have been sold  pursuant to the  prospectus  or Rule 144 under the
Securities  Act or any other rule of similar  effect.  The resale shares will be
sold only through  registered or licensed  brokers or dealers if required  under
applicable  state securities  laws. In addition,  in certain states,  the resale
shares may not be sold unless they have been registered or qualified for sale in
the applicable  state or an exemption  from the  registration  or  qualification
requirement is available and is complied with.


                                       17
<PAGE>

      Under applicable rules and regulations  under the Exchange Act, any person
engaged in the distribution of the resale shares may not  simultaneously  engage
in market making activities with respect to our common stock for a period of two
business days prior to the commencement of the  distribution.  In addition,  the
Selling  Stockholders  will be subject to applicable  provisions of the Exchange
Act and the rules and regulations thereunder,  including Regulation M, which may
limit the timing of  purchases  and sales of shares of our  common  stock by the
Selling Stockholders or any other person. We will make copies of this prospectus
available  to the Selling  Stockholders  and have  informed  them of the need to
deliver a copy of this  prospectus to each  purchaser at or prior to the time of
the sale.


                                       18
<PAGE>

                                                                         ANNEX B

                             ON2 TECHNOLOGIES, INC.

                 SELLING SECURITYHOLDER NOTICE AND QUESTIONNAIRE

      The  undersigned  beneficial  owner of common  stock,  par value $0.01 per
share (the "Common Stock"),  of ON2 Technologies,  Inc., a Delaware  corporation
(the "Company"), (the "Registrable Securities") understands that the Company has
filed or  intends  to file with the  Securities  and  Exchange  Commission  (the
"Commission")   a  registration   statement  on  Form  S-3  (the   "Registration
Statement") for the registration and resale under Rule 415 of the Securities Act
of 1933, as amended (the "Securities  Act"), of the Registrable  Securities,  in
accordance  with the terms of the  Registration  Rights  Agreement,  dated as of
October ___, 2004 (the "Registration  Rights Agreement"),  among the Company and
the Purchasers  named therein.  A copy of the  Registration  Rights Agreement is
available  from the Company  upon  request at the address set forth  below.  All
capitalized  terms not otherwise defined herein shall have the meanings ascribed
thereto in the Registration Rights Agreement.

      Certain   legal   consequences   arise  from  being  named  as  a  selling
securityholder  in  the  Registration  Statement  and  the  related  prospectus.
Accordingly, holders and beneficial owners of Registrable Securities are advised
to consult their own securities law counsel  regarding the consequences of being
named  or not  being  named  as a  selling  securityholder  in the  Registration
Statement and the related prospectus.

                                     NOTICE

      The  undersigned  beneficial  owner  (the  "Selling   Securityholder")  of
Registrable Securities hereby elects to include the Registrable Securities owned
by it and listed below in Item 3 (unless otherwise  specified under such Item 3)
in the Registration Statement.


                                       19
<PAGE>

The  undersigned  hereby  provides the following  information to the Company and
represents and warrants that such information is accurate:

                                  QUESTIONNAIRE

1.    NAME.

      (a)   Full Legal Name of Selling Securityholder

            ____________________________________________________________________

      (b)   Full Legal Name of Registered  Holder (if not the same as (a) above)
            through  which  Registrable  Securities  Listed  in Item 3 below are
            held:

            ____________________________________________________________________

      (c)   Full Legal Name of Natural  Control  Person  (which  means a natural
            person who directly you indirectly alone or with others has power to
            vote or dispose of the securities covered by the questionnaire):

            ____________________________________________________________________

2.  ADDRESS FOR NOTICES TO SELLING SECURITYHOLDER:


________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Telephone:______________________________________________________________________
Fax:____________________________________________________________________________
Contact Person:_________________________________________________________________

3.    BENEFICIAL OWNERSHIP OF REGISTRABLE SECURITIES:

      (a)   Type and Number of Registrable Securities beneficially owned:

            ____________________________________________________________________

            ____________________________________________________________________

            ____________________________________________________________________


                                       20
<PAGE>

4.    BROKER-DEALER STATUS:

      (a)   Are you a broker-dealer?

                            Yes |_|   No |_|

      Note: If yes,  the  Commission's  staff has  indicated  that you should be
            identified as an underwriter in the Registration Statement.

      (b)   Are you an affiliate of a broker-dealer?

                            Yes |_|   No |_|

      (c)   If you are an affiliate of a broker-dealer,  do you certify that you
            bought  the  Registrable   Securities  in  the  ordinary  course  of
            business,  and  at  the  time  of the  purchase  of the  Registrable
            Securities to be resold,  you had no  agreements or  understandings,
            directly  or   indirectly,   with  any  person  to  distribute   the
            Registrable Securities?

                            Yes |_|   No |_|

      Note: If no,  the  Commission's  staff has  indicated  that you  should be
            identified as an underwriter in the Registration Statement.

5.    BENEFICIAL  OWNERSHIP  OF OTHER  SECURITIES  OF THE  COMPANY  OWNED BY THE
      SELLING SECURITYHOLDER.

      Except  as set  forth  below in this  Item 5, the  undersigned  is not the
      beneficial or registered owner of any securities of the Company other than
      the Registrable Securities listed above in Item 3.

      (a)   Type  and  Amount  of  Other  Securities  beneficially  owned by the
            Selling Securityholder:

            ____________________________________________________________________

            ____________________________________________________________________


                                       21
<PAGE>

6.    RELATIONSHIPS WITH THE COMPANY:

      Except  as  set  forth  below,  neither  the  undersigned  nor  any of its
      affiliates,  officers, directors or principal equity holders (owners of 5%
      of more of the equity securities of the undersigned) has held any position
      or office or has had any other material  relationship with the Company (or
      its predecessors or affiliates) during the past three years.

      State any exceptions here:

            ____________________________________________________________________

            ____________________________________________________________________

      The undersigned  agrees to promptly notify the Company of any inaccuracies
or changes in the information  provided herein that may occur  subsequent to the
date hereof at any time while the Registration Statement remains effective.

      By signing  below,  the  undersigned  consents  to the  disclosure  of the
information  contained  herein  in its  answers  to  Items 1  through  6 and the
inclusion of such  information  in the  Registration  Statement  and the related
prospectus.  The undersigned  understands  that such  information will be relied
upon by the Company in  connection  with the  preparation  or  amendment  of the
Registration Statement and the related prospectus.

      IN WITNESS WHEREOF the  undersigned,  by authority duly given,  has caused
this Notice and  Questionnaire  to be executed and delivered either in person or
by its duly authorized agent.

Dated:______________________________       Beneficial Owner:____________________
                                           By:__________________________________
                                              Name:
                                              Title:

PLEASE FAX A COPY OF THE COMPLETED AND EXECUTED  NOTICE AND  QUESTIONNAIRE,  AND
RETURN THE ORIGINAL BY OVERNIGHT MAIL, TO:


                                       22