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

         REGISTRATION RIGHTS AGREEMENT (this "Agreement"),  dated as of May ___,
2002 by and between VIDEOLOCITY  INTERNATIONAL INC., a Nevada corporation,  with
its principal office located at 1762 - A Prospector Drive, Park City, Utah 84060
(the  "Company"),   and  CORNELL  CAPITAL  PARTNERS,   LP,  a  Delaware  limited
partnership (the "Investor").

         WHEREAS:

         A. In  connection  with the  Equity  Line of  Credit  Agreement  by and
between the parties  hereto of even date  herewith  (the  "Equity Line of Credit
Agreement"),  the  Company  has  agreed,  upon  the  terms  and  subject  to the
conditions  of the  Equity  Line of Credit  Agreement,  to issue and sell to the
Investor  that number of shares of the Company's  common stock,  par value $.001
per share (the "Common Stock"),  which can be purchased pursuant to the terms of
the Equity Line Credit Agreement for an aggregate purchase price of up to Twenty
Million Dollars  ($20,000,000) . Capitalized terms not defined herein shall have
the meaning ascribed to them in the Equity Line of Credit Agreement.

         B. To induce the  Investor  to execute  and  deliver the Equity Line of
Credit Agreement,  the Company has agreed to provide certain registration rights
under the  Securities  Act of 1933,  as amended,  and the rules and  regulations
there under, or any similar  successor statute  (collectively,  the "1933 Act"),
and applicable state securities laws.

         NOW,  THEREFORE,  in  consideration  of the  premises  and  the  mutual
covenants  contained  herein  and other  good and  valuable  consideration,  the
receipt and  sufficiency of which are hereby  acknowledged,  the Company and the
Investor hereby agree as follows:

1.       DEFINITIONS.
         ------------

         All  capitalized  terms used herein and not otherwise  defined  herein,
shall have the same  meaning  ascribed  to them as in the Equity  Line of Credit
Agreement. In addition as used in this Agreement, the following terms shall have
the following meanings:

         a.  "Person"  means a  corporation,  a limited  liability  company,  an
association,  a partnership,  an  organization,  a business,  an  individual,  a
governmental or political subdivision thereof or a governmental agency.

         b. "Register," "registered," and "registration" refer to a registration
effected by preparing and filing one or more Registration Statements (as defined
below) in  compliance  with the 1933 Act and pursuant to Rule 415 under the 1933
Act or any successor rule  providing for offering  securities on a continuous or
delayed basis ("Rule 415"),  and the declaration or ordering of effectiveness of
such  Registration  Statement(s)  by the United States  Securities  and Exchange
Commission (the "SEC").

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<PAGE>

         c.  "Registrable  Securities" means the shares of Common Stock issuable
to Investors pursuant to the Equity Line of Credit Agreement.

         d.  "Registration  Statement" means a registration  statement under the
1933 Act which covers the Registrable Securities.

2.       REGISTRATION.
         -------------

         a. Mandatory Registration.  The Company shall prepare and file with the
SEC a  Registration  Statement  on Form S-1,  SB-2 or on such  other  form as is
available.  The Company shall cause such  Registration  Statement to be declared
effective by the SEC prior to the first sale to Investor of the Company's Common
Stock pursuant to the Equity Line of Credit Agreement.

         b. Sufficient Number of Shares  Registered.  In the event the number of
shares  available under a Registration  Statement filed pursuant to Section 2(a)
is insufficient to cover all of the  Registrable  Securities  which the Investor
has purchased pursuant to the Equity Line of Credit Agreement, the Company shall
amend the Registration  Statement,  or file a new Registration Statement (on the
short form available therefore,  if applicable),  or both, so as to cover all of
such  Registrable  Securities  which the Investor has purchased  pursuant to the
Equity Line of Credit  Agreement  as soon as  practicable,  but in any event not
later than fifteen (15) days after the necessity  therefore arises.  The Company
shall use it best  efforts  to cause  such  amendment  and/or  new  Registration
Statement  to become  effective  as soon as  practicable  following  the  filing
thereof. For purposes of the foregoing provision, the number of shares available
under a Registration Statement shall be deemed "insufficient to cover all of the
Registrable  Securities"  if at any time the  number of  Registrable  Securities
issuable  on an  Advance  Notice  Date is  greater  than the  number  of  shares
available for resale under such Registration Statement.

3.       RELATED OBLIGATIONS.
         --------------------

         a. The Company shall keep the Registration Statement effective pursuant
to Rule 415 at all times  until the date on which the  Investor  shall have sold
all the  Registrable  Securities  covered by such  Registration  Statement  (the
"Registration  Period"),  which Registration Statement (including any amendments
or supplements thereto and prospectuses contained therein) shall not contain any
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 in which they were made, not misleading.

         b. The  Company  shall  prepare  and file with the SEC such  amendments
(including   post-effective   amendments)  and  supplements  to  a  Registration
Statement  and  the  prospectus  used  in  connection  with  such   Registration
Statement,  which  prospectus  is to be filed  pursuant to Rule 424  promulgated
under the 1933 Act,  as may be  necessary  to keep such  Registration  Statement
effective at all times during the Registration  Period, and, during such period,
comply with the  provisions of the 1933 Act with respect to the  disposition  of
all Registrable Securities of the Company covered by such Registration Statement
until such time as all of such  Registrable  Securities shall have been disposed
of in  accordance  with the  intended  methods of  disposition  by the seller or


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<PAGE>

sellers  thereof  as set forth in such  Registration  Statement.  In the case of
amendments and supplements to a Registration  Statement which are required to be
filed  pursuant to this Agreement  (including  pursuant to this Section 3(b)) by
reason of the Company's filing a report on Form 10-KSB,  Form 10-QSB or Form 8-K
or any analogous  report under the  Securities  Exchange Act of 1934, as amended
(the "1934 Act"), the Company shall have  incorporated  such report by reference
into the Registration Statement, if applicable, or shall file such amendments or
supplements  with the SEC on the same day on which the 1934 Act  report is filed
which  created  the  requirement  for the  Company  to amend or  supplement  the
Registration Statement.

         c. The Company shall  furnish to the Investor  without  charge,  (i) at
least one copy of such Registration  Statement as declared  effective by the SEC
and any amendment(s) thereto,  including financial statements and schedules, all
documents  incorporated therein by reference,  all exhibits and each preliminary
prospectus,  (ii) ten (10)  copies  of the  final  prospectus  included  in such
Registration Statement and all amendments and supplements thereto (or such other
number of copies as such Investor may  reasonably  request) and (iii) such other
documents as such Investor may reasonably  request from time to time in order to
facilitate the disposition of the Registrable Securities owned by such Investor.

         d. The Company  shall use its best  efforts to (i) register and qualify
the Registrable  Securities covered by a Registration  Statement under the "blue
sky" laws of the State of New  Jersey  and New York,  (ii)  prepare  and file in
those jurisdictions,  such amendments (including post-effective  amendments) and
supplements  to such  registrations  and  qualifications  as may be necessary to
maintain the effectiveness  thereof during the Registration  Period,  (iii) take
such other  actions as may be  necessary  to  maintain  such  registrations  and
qualifications in effect at all times during the Registration  Period,  and (iv)
take all  other  actions  reasonably  necessary  or  advisable  to  qualify  the
Registrable Securities for sale in such jurisdictions;  provided,  however, that
the  Company  shall not be required in  connection  therewith  or as a condition
thereto to (w) make any change to its certificate of  incorporation  or by-laws,
(x) qualify to do business in any  jurisdiction  where it would not otherwise be
required to qualify but for this  Section  3(d),  (y) subject  itself to general
taxation in any such  jurisdiction,  or (z) file a general consent to service of
process in any such jurisdiction. The Company shall promptly notify the Investor
of the receipt by the Company of any notification with respect to the suspension
of the registration or  qualification  of any of the Registrable  Securities for
sale under the securities or "blue sky" laws of any  jurisdiction  in the United
States or its  receipt  of  actual  notice  of the  initiation  or threat of any
proceeding for such purpose.

         e. As promptly as  practicable  after  becoming  aware of such event or
development,  the Company  shall notify the Investor in writing of the happening
of any event as a result  of which the  prospectus  included  in a  Registration
Statement, as then in effect, includes an untrue statement of a material fact or
omission 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  (provided that in no event shall such notice contain any
material, nonpublic information), and promptly prepare a supplement or amendment
to such Registration Statement to correct such untrue statement or omission, and
deliver ten (10) copies of such  supplement or amendment to each  Investor.  The
Company shall also promptly notify the Investor in writing (i) when a prospectus
or any prospectus  supplement or  post-effective  amendment has been filed,  and


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<PAGE>

when  a  Registration  Statement  or any  post-effective  amendment  has  become
effective (notification of such effectiveness shall be delivered to the Investor
by facsimile on the same day of such effectiveness),  (ii) of any request by the
SEC for  amendments  or  supplements  to a  Registration  Statement  or  related
prospectus  or  related  information,  and  (iii)  of the  Company's  reasonable
determination that a post-effective  amendment to a Registration Statement would
be appropriate.

         f. The Company  shall use its best  efforts to prevent the  issuance of
any stop order or other suspension of effectiveness of a Registration Statement,
or the suspension of the qualification of any of the Registrable  Securities for
sale in any  jurisdiction  within the United  States of America  and, if such an
order or  suspension  is  issued,  to obtain  the  withdrawal  of such  order or
suspension  at the  earliest  possible  moment and to notify the Investor of the
issuance  of such  order and the  resolution  thereof  or its  receipt of actual
notice of the initiation or threat of any proceeding for such purpose.

         g. At the reasonable request of the Investor, the Company shall furnish
to the Investor, on the date of the effectiveness of the Registration  Statement
and  thereafter  from time to time on such dates as the Investor may  reasonably
request (i) a letter, dated such date, from the Company's  independent certified
public  accountants in form and substance as is customarily given by independent
certified public accountants to underwriters in an underwritten public offering,
and (ii) an opinion,  dated as of such date, of counsel representing the Company
for purposes of such Registration  Statement, in form, scope and substance as is
customarily given in an underwritten public offering, addressed to the Investor.

         h. The Company shall make  available for inspection by (i) the Investor
and (ii) one  firm of  accountants  or other  agents  retained  by the  Investor
(collectively,  the "Inspectors") all pertinent financial and other records, and
pertinent corporate documents and properties of the Company  (collectively,  the
"Records"), as shall be reasonably deemed necessary by each Inspector, and cause
the Company's officers,  directors and employees to supply all information which
any Inspector may reasonably  request;  provided,  however,  that each Inspector
shall agree,  and the Investor hereby agrees,  to hold in strict  confidence and
shall not make any  disclosure  (except to an  Investor) or use of any Record or
other information which the Company determines in good faith to be confidential,
and of which  determination  the  Inspectors  are so  notified,  unless  (a) the
disclosure  of such Records is necessary to avoid or correct a  misstatement  or
omission in any Registration  Statement or is otherwise  required under the 1933
Act,  (b)  the  release  of  such  Records  is  ordered  pursuant  to  a  final,
non-appealable  subpoena or order from a court or  government  body of competent
jurisdiction,  or (c) the  information  in such Records has been made  generally
available  to the public  other than by  disclosure  in violation of this or any
other  agreement of which the  Inspector  and the Investor  has  knowledge.  The
Investor agrees that it shall,  upon learning that disclosure of such Records is
sought  in or by a court  or  governmental  body of  competent  jurisdiction  or
through other means, give prompt notice to the Company and allow the Company, at
its expense,  to undertake  appropriate  action to prevent  disclosure of, or to
obtain a protective order for, the Records deemed confidential.

         i. The Company shall hold in confidence  and not make any disclosure of
information   concerning  the  Investor  provided  to  the  Company  unless  (i)
disclosure of such information is necessary to comply with federal or state


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<PAGE>

securities  laws, (ii) the disclosure of such  information is necessary to avoid
or correct a misstatement or omission in any Registration  Statement,  (iii) the
release of such  information  is ordered  pursuant to a subpoena or other final,
non-appealable   order  from  a  court  or   governmental   body  of   competent
jurisdiction,  or (iv) such information has been made generally available to the
public other than by  disclosure  in  violation  of this  Agreement or any other
agreement.  The Company agrees that it shall,  upon learning that  disclosure of
such  information  concerning  the  Investor  is  sought  in  or by a  court  or
governmental body of competent  jurisdiction or through other means, give prompt
written  notice  to the  Investor  and  allow the  Investor,  at the  Investor's
expense, to undertake  appropriate action to prevent disclosure of, or to obtain
a protective order for, such information.

         j. The  Company  shall  use its best  efforts  either  to cause all the
Registrable  Securities covered by a Registration  Statement (i) to be listed on
each securities  exchange on which securities of the same class or series issued
by the Company  are then  listed,  if any,  if the  listing of such  Registrable
Securities is then  permitted  under the rules of such exchange or to secure the
inclusion for quotation on the National Association of Securities Dealers,  Inc.
OTC Bulletin Board for such  Registrable  Securities.  The Company shall pay all
fees and  expenses in  connection  with  satisfying  its  obligation  under this
Section 3(j).

         k.  The  Company  shall  cooperate  with  the  Investor  to the  extent
applicable,  to facilitate the timely  preparation  and delivery of certificates
(not bearing any restrictive legend) representing the Registrable  Securities to
be offered pursuant to a Registration  Statement and enable such certificates to
be in such  denominations  or amounts,  as the case may be, as the  Investor may
reasonably request and registered in such names as the Investor may request.

         l. The  Company  shall use its best  efforts  to cause the  Registrable
Securities  covered by the  applicable  Registration  Statement to be registered
with or approved by such other  governmental  agencies or  authorities as may be
necessary to consummate the disposition of such Registrable Securities.

         m. The Company shall make generally  available to its security  holders
as soon as practical, but not later than ninety (90) days after the close of the
period  covered  thereby,  an earnings  statement  (in form  complying  with the
provisions  of Rule 158 under  the 1933  Act)  covering  a  twelve-month  period
beginning  not later than the first day of the  Company's  fiscal  quarter  next
following the effective date of the Registration Statement.

         n. The Company shall  otherwise use its best efforts to comply with all
applicable  rules and regulations of the SEC in connection with any registration
hereunder.

         o. Within two (2) business days after a  Registration  Statement  which
covers Registrable Securities is ordered effective by the SEC, the Company shall
deliver,  and shall  cause legal  counsel  for the  Company to  deliver,  to the
transfer  agent for such  Registrable  Securities  (with copies to the Investor)
confirmation that such Registration Statement has been declared effective by the
SEC in the form attached hereto as Exhibit A.

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<PAGE>

         p. The Company  shall take all other  reasonable  actions  necessary to
expedite and facilitate  disposition by the Investors of Registrable  Securities
pursuant to a Registration Statement.

4.       OBLIGATIONS OF THE INVESTOR.
         ----------------------------

         The Investor  agrees that,  upon receipt of any notice from the Company
of the happening of any event of the kind described in Section 3(f) or the first
sentence of 3(e),  the Investor  will  immediately  discontinue  disposition  of
Registrable  Securities pursuant to any Registration  Statement(s) covering such
Registrable  Securities  until  the  Investor's  receipt  of the  copies  of the
supplemented  or amended  prospectus  contemplated by Section 3(e) or receipt of
notice that no supplement or amendment is required.  Notwithstanding anything to
the contrary,  the Company shall cause its transfer agent to deliver  unlegended
certificates  for shares of Common  Stock to a  transferee  of the  Investor  in
accordance  with the terms of the Equity Line of Credit  Agreement in connection
with any sale of Registrable  Securities  with respect to which the Investor has
entered  into a contract  for sale prior to the  Investor's  receipt of a notice
from the Company of the happening of any event of the kind  described in Section
3(f) or the  first  sentence  of 3(e) and for  which  the  Investor  has not yet
settled.

5.       EXPENSES OF REGISTRATION.
         -------------------------

         All expenses  incurred in  connection  with  registrations,  filings or
qualifications pursuant to Sections 2 and 3, including,  without limitation, all
registration,  listing and qualifications fees,  printers,  legal and accounting
fees shall be paid by the Company.  All other  expenses in  connection  with the
Equity Line of Credit  Agreement and those other agreements  referenced  therein
shall be paid in accordance with the terms of those respective agreements.

6.       INDEMNIFICATION.
         ----------------

         With  respect  to  Registrable  Securities  which  are  included  in  a
Registration Statement under this Agreement:

         a. To the fullest extent permitted by law, the Company will, and hereby
does, indemnify, hold harmless and defend the Investor, the directors, officers,
partners,  employees,  agents,  representatives of, and each Person, if any, who
controls the Investor  within the meaning of the 1933 Act or the 1934 Act (each,
an "Indemnified  Person"),  against any losses,  claims,  damages,  liabilities,
judgments, fines, penalties, charges, costs, reasonable attorneys' fees, amounts
paid in  settlement  or  expenses,  joint or  several  (collectively,  "Claims")
incurred in  investigating,  preparing or  defending  any action,  claim,  suit,
inquiry,  proceeding,  investigation  or appeal  taken from the  foregoing by or
before any court or governmental,  administrative  or other  regulatory  agency,
body or the SEC,  whether  pending or threatened,  whether or not an indemnified
party is or may be a party thereto ("Indemnified Damages"), to which any of them
may become subject  insofar as such Claims (or actions or  proceedings,  whether
commenced or threatened, in respect thereof) arise out of or are based upon: (i)
any  untrue  statement  or alleged  untrue  statement  of a  material  fact in a
Registration Statement or any post-effective  amendment thereto or in any filing
made in connection with the  qualification  of the offering under the securities
or other "blue sky" laws of any jurisdiction in which Registrable Securities are
offered  ("Blue Sky  Filing"),  or the  omission or alleged  omission to state a


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<PAGE>

material fact required to be stated  therein or necessary to make the statements
therein not misleading; (ii) any untrue statement or alleged untrue statement of
a material fact contained in any final  prospectus (as amended or  supplemented,
if the Company files any amendment  thereof or supplement  thereto with the SEC)
or the omission or alleged omission to state therein any material fact necessary
to make the statements made therein,  in light of the circumstances  under which
the  statements  therein were made,  not  misleading;  or (iii) any violation or
alleged  violation  by the Company of the 1933 Act, the 1934 Act, any other law,
including,  without  limitation,  any  state  securities  law,  or any  rule  or
regulation  there  under  relating  to the  offer  or  sale  of the  Registrable
Securities  pursuant to a  Registration  Statement (the matters in the foregoing
clauses (i) through (iii) being, collectively,  "Violations"). The Company shall
reimburse  the  Investor  and each  such  controlling  person  promptly  as such
expenses  are  incurred  and  are  due  and  payable,  for  any  legal  fees  or
disbursements or other reasonable  expenses  incurred by them in connection with
investigating  or  defending  any such  Claim.  Notwithstanding  anything to the
contrary  contained  herein,  the  indemnification  agreement  contained in this
Section 6(a):  (x) shall not apply to a Claim by an  Indemnified  Person arising
out of or based upon a Violation which occurs in reliance upon and in conformity
with information  furnished in writing to the Company by such Indemnified Person
expressly  for  use in  connection  with  the  preparation  of the  Registration
Statement or any such amendment thereof or supplement thereto;  (y) shall not be
available  to the extent  such Claim is based on a failure  of the  Investor  to
deliver  or to  cause to be  delivered  the  prospectus  made  available  by the
Company, if such prospectus was timely made available by the Company pursuant to
Section 3(e); and (z) shall not apply to amounts paid in settlement of any Claim
if such settlement is effected without the prior written consent of the Company,
which consent shall not be unreasonably withheld. Such indemnity shall remain in
full force and effect  regardless of any  investigation  made by or on behalf of
the Indemnified Person.

         b. In connection with a Registration Statement,  the Investor agrees to
indemnify,  hold harmless and defend,  to the same extent and in the same manner
as is set forth in Section 6(a), the Company, each of its directors, each of its
officers  who signs the  Registration  Statement  and each  Person,  if any, who
controls the Company within the meaning of the 1933 Act or the 1934 Act (each an
"Indemnified  Party"),  against any Claim or Indemnified Damages to which any of
them may become subject, under the 1933 Act, the 1934 Act or otherwise,  insofar
as  such  Claim  or  Indemnified  Damages  arise  out of or is  based  upon  any
Violation,  in each  case to the  extent,  and  only to the  extent,  that  such
Violation  occurs in reliance  upon and in conformity  with written  information
furnished to the Company by the Investor  expressly for use in  connection  with
such  Registration  Statement;  and,  subject to Section 6(d), the Investor will
reimburse any legal or other expenses  reasonably incurred by them in connection
with  investigating  or defending any such Claim;  provided,  however,  that the
indemnity  agreement  contained  in this  Section  6(b) and the  agreement  with
respect to  contribution  contained in Section 7 shall not apply to amounts paid
in  settlement  of any Claim if such  settlement  is effected  without the prior
written  consent  of the  Investor,  which  consent  shall  not be  unreasonably
withheld;  provided,  further,  however, that the Investor shall be liable under
this Section 6(b) for only that amount of a Claim or Indemnified Damages as does
not  exceed  the  net  proceeds  to the  Investor  as a  result  of the  sale of
Registrable Securities pursuant to such Registration  Statement.  Such indemnity
shall remain in full force and effect regardless of any investigation made by or
on behalf of such Indemnified  Party.  Notwithstanding  anything to the contrary
contained herein, the  indemnification  agreement contained in this Section 6(b)
with respect to any prospectus shall not inure to the benefit of any Indemnified


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<PAGE>

Party if the untrue  statement  or omission of material  fact  contained  in the
prospectus  was corrected and such new  prospectus was delivered to the Investor
prior to the Investor's use of the prospectus to which the Claim relates.

         c. Promptly after receipt by an Indemnified Person or Indemnified Party
under this Section 6 of notice of the  commencement  of any action or proceeding
(including  any  governmental  action or  proceeding)  involving  a Claim,  such
Indemnified  Person or Indemnified Party shall, if a Claim in respect thereof is
to be made against any  indemnifying  party under this Section 6, deliver to the
indemnifying  party  a  written  notice  of the  commencement  thereof,  and the
indemnifying  party shall have the right to  participate  in, and, to the extent
the indemnifying  party so desires,  jointly with any other  indemnifying  party
similarly  noticed,  to assume  control  of the  defense  thereof  with  counsel
mutually  satisfactory to the indemnifying  party and the Indemnified  Person or
the  Indemnified  Party,  as  the  case  may  be;  provided,  however,  that  an
Indemnified  Person or Indemnified  Party shall have the right to retain its own
counsel  with the fees  and  expenses  of not  more  than one  counsel  for such
Indemnified  Person or Indemnified  Party to be paid by the indemnifying  party,
if, in the reasonable opinion of counsel retained by the indemnifying party, the
representation  by such counsel of the Indemnified  Person or Indemnified  Party
and the  indemnifying  party would be  inappropriate  due to actual or potential
differing interests between such Indemnified Person or Indemnified Party and any
other party  represented  by such counsel in such  proceeding.  The  Indemnified
Party or Indemnified Person shall cooperate fully with the indemnifying party in
connection  with any  negotiation  or defense of any such action or claim by the
indemnifying  party and shall furnish to the indemnifying  party all information
reasonably  available  to the  Indemnified  Party or  Indemnified  Person  which
relates  to such  action  or  claim.  The  indemnifying  party  shall  keep  the
Indemnified  Party or  Indemnified  Person fully apprised at all times as to the
status of the defense or any settlement  negotiations  with respect thereto.  No
indemnifying  party shall be liable for any  settlement of any action,  claim or
proceeding effected without its prior written consent,  provided,  however, that
the indemnifying party shall not unreasonably  withhold,  delay or condition its
consent.  No indemnifying party shall,  without the prior written consent of the
Indemnified  Party or  Indemnified  Person,  consent to entry of any judgment or
enter into any  settlement  or other  compromise  which  does not  include as an
unconditional  term  thereof  the giving by the  claimant or  plaintiff  to such
Indemnified  Party or  Indemnified  Person of a release  from all  liability  in
respect to such claim or litigation.  Following  indemnification as provided for
hereunder,  the  indemnifying  party  shall be  subrogated  to all rights of the
Indemnified Party or Indemnified Person with respect to all third parties, firms
or corporations  relating to the matter for which indemnification has been made.
The  failure  to  deliver  written  notice to the  indemnifying  party  within a
reasonable  time of the  commencement  of any such action shall not relieve such
indemnifying  party of any liability to the  Indemnified  Person or  Indemnified
Party under this Section 6, except to the extent that the indemnifying  party is
prejudiced in its ability to defend such action.

         d. The  indemnification  required  by this  Section  6 shall be made by
periodic  payments of the amount thereof during the course of the  investigation
or defense, as and when bills are received or Indemnified Damages are incurred.

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<PAGE>

         e. The indemnity  agreements  contained  herein shall be in addition to
(i) any cause of action or similar right of the Indemnified Party or Indemnified
Person against the  indemnifying  party or others,  and (ii) any liabilities the
indemnifying party may be subject to pursuant to the law.

7.       CONTRIBUTION.
         -------------

         To  the  extent  any   indemnification  by  an  indemnifying  party  is
prohibited or limited by law, the indemnifying  party agrees to make the maximum
contribution  with respect to any amounts for which it would otherwise be liable
under Section 6 to the fullest extent permitted by law; provided, however, that:
(i) no seller of Registrable  Securities guilty of fraudulent  misrepresentation
(within  the  meaning of Section  11(f) of the 1933 Act)  shall be  entitled  to
contribution  from any seller of  Registrable  Securities  who was not guilty of
fraudulent misrepresentation; and (ii) contribution by any seller of Registrable
Securities shall be limited in amount to the net amount of proceeds  received by
such seller from the sale of such Registrable Securities.

8.       REPORTS UNDER THE 1934 ACT.
         ---------------------------

         With a view to making  available  to the  Investor the benefits of Rule
144 promulgated  under the 1933 Act or any similar rule or regulation of the SEC
that may at any time permit the  Investors to sell  securities of the Company to
the public without registration ("Rule 144") the Company agrees to:

         a.  make and keep  public  information  available,  as those  terms are
understood and defined in Rule 144;

         b. file with the SEC in a timely manner all reports and other documents
required  of the  Company  under  the  1933  Act and the 1934 Act so long as the
Company remains subject to such  requirements  (it being understood that nothing
herein shall limit the  Company's  obligations  under  Section 6.3 of the Equity
Line of Credit  Agreement) and the filing of such reports and other documents is
required for the applicable provisions of Rule 144; and

         c.  furnish to the Investor so long as the  Investor  owns  Registrable
Securities,  promptly upon request,  (i) a written statement by the Company that
it has complied  with the reporting  requirements  of Rule 144, the 1933 Act and
the 1934 Act, (ii) a copy of the most recent  annual or quarterly  report of the
Company and such other reports and documents so filed by the Company,  and (iii)
such other information as may be reasonably  requested to permit the Investor to
sell such securities pursuant to Rule 144 without registration.


9.       AMENDMENT OF REGISTRATION RIGHTS.
         ---------------------------------

         Provisions of this Agreement may be amended and the observance  thereof
may  be  waived  (either  generally  or  in a  particular  instance  and  either
retroactively  or  prospectively),  only with the written consent of the Company
and the  Investor.  Any  amendment or waiver  effected in  accordance  with this
Section 9 shall be binding upon the Investor and the Company.  No  consideration
shall be  offered  or paid to any  Person  to amend or  consent  to a waiver  or


                                       9
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modification  of  any  provision  of any  of  this  Agreement  unless  the  same
consideration also is offered to all of the parties to this Agreement.

10.      MISCELLANEOUS.
         --------------

         a. A Person is deemed to be a holder of Registrable Securities whenever
such Person owns or is deemed to own of record such Registrable  Securities.  If
the Company receives conflicting instructions,  notices or elections from two or
more Persons with respect to the same Registrable Securities,  the Company shall
act upon  the  basis of  instructions,  notice  or  election  received  from the
registered owner of such Registrable Securities.

         b. Any notices,  consents,  waivers or other communications required or
permitted to be given under the terms of this  Agreement  must be in writing and
will be  deemed  to have  been  delivered:  (i)  upon  receipt,  when  delivered
personally;  (ii) upon receipt, when sent by facsimile (provided confirmation of
transmission is mechanically or electronically generated and kept on file by the
sending  party);  or (iii) one  business  day after  deposit  with a  nationally
recognized  overnight  delivery service,  in each case properly addressed to the
party to  receive  the  same.  The  addresses  and  facsimile  numbers  for such
communications shall be:

If to the Company, to:             Videolocity International Inc..
                                   1762 - A Prospector Drive
                                   Park City, Utah 84060
                                   Attention:  Robert E. Holt
                                               President and C.E.O.
                                   Telephone:  (619) 890-8186 or (801) 521-2807
                                   Facsimile:  (801) 521-2844

With a copy to:                    Leonard E. Neilson, Esq.
                                   8160 South Highland Drive - Suite 209
                                   Sandy, Utah 84093
                                   Telephone:  (801) 733-0800
                                   Facsimile:  (801) 733-0808


If to the Investor, to:            Cornell Capital Partners, LP
                                   101 Hudson Street - Suite 3606
                                   Jersey City, NJ 07302
                                   Attention:   Mark Angelo
                                                Portfolio Manager
                                   Telephone:   (201) 985-8300
                                   Facsimile:   (201) 985-8266

With copy to:                      Butler Gonzalez LLP
                                   1000 Stuyvesant Avenue - Suite 6
                                   Union, NJ 07083
                                   Attention:   David Gonzalez, Esq.
                                   Telephone:   (908) 810-8588
                                   Facsimile:   (908) 810-0973

                                       10
<PAGE>

Any party may  change  its  address  by  providing  written  notice to the other
parties  hereto at least five days prior to the  effectiveness  of such  change.
Written  confirmation  of receipt  (A) given by the  recipient  of such  notice,
consent,  waiver or other  communication,  (B)  mechanically  or  electronically
generated by the sender's facsimile machine containing the time, date, recipient
facsimile  number  and an image of the first  page of such  transmission  or (C)
provided by a courier or overnight courier service shall be rebuttable  evidence
of  personal  service,  receipt  by  facsimile  or  receipt  from  a  nationally
recognized  overnight  delivery  service in accordance  with clause (i), (ii) or
(iii) above, respectively.

         c.  Failure  of any party to  exercise  any right or remedy  under this
Agreement or otherwise,  or delay by a party in exercising such right or remedy,
shall not operate as a waiver thereof.

         d. The  corporate  laws of the State of Nevada  shall govern all issues
concerning the relative rights of the Company and the Investor.

         e. This Agreement,  the Equity Line of Credit  Agreement and the Escrow
Agreement  constitute the entire agreement among the parties hereto with respect
to the subject matter hereof and thereof.  There are no restrictions,  promises,
warranties or undertakings, other than those set forth or referred to herein and
therein.  This  Agreement,  the Equity Line of Credit  Agreement  and the Escrow
Agreement  supersede all prior agreements and  understandings  among the parties
hereto with respect to the subject matter hereof and thereof.

         f. This Agreement shall inure to the benefit of and be binding upon the
permitted successors and assigns of each of the parties hereto.

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

         h. This  Agreement may be executed in identical  counterparts,  each of
which shall be deemed an original but all of which shall  constitute one and the
same agreement.  This Agreement,  once executed by a party,  may be delivered to
the other party hereto by  facsimile  transmission  of a copy of this  Agreement
bearing the signature of the party so delivering this Agreement.

         i. Each party shall do and perform,  or cause to be done and performed,
all such further acts and things,  and shall  execute and deliver all such other
agreements,  certificates,  instruments  and  documents,  as the other party may
reasonably  request in order to carry out the intent and accomplish the purposes
of this Agreement and the consummation of the transactions contemplated hereby.

         j.  The  language  used in this  Agreement  will  be  deemed  to be the
language  chosen by the parties to express  their mutual  intent and no rules of
strict construction will be applied against any party.

                                       11
<PAGE>

         k. This Agreement is intended for the benefit of the parties hereto and
their respective  permitted  successors and assigns,  and is not for the benefit
of, nor may any provision hereof be enforced by, any other Person.



                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]



                                       12
<PAGE>




         IN WITNESS WHEREOF,  the parties have caused this  Registration  Rights
Agreement to be duly executed as of day and year first above written.


                   COMPANY:
                                       VIDEOLOCITY INTERNATIONAL INC.

                                       By:
                                               -----------------------
                                       Name:       Robert E. Holt
                                       Title:      President and C.E.O.


                   INVESTOR:
                                       CORNELL CAPITAL PARTNERS, LP

                                       By:     Yorkville Advisors, LLC
                                       Its:    General Partner

                                       By:
                                               -----------------------
                                       Name:        Mark Angelo
                                       Title:       Portfolio Manager




                                       13
<PAGE>

                                    EXHIBIT A


                         FORM OF NOTICE OF EFFECTIVENESS
                            OF REGISTRATION STATEMENT



[TRANSFER AGENT]
Attn:____________________________

                  Re:      VIDEOLOCITY INTERNATIONAL INC.
                           ------------------------------

Ladies and Gentlemen:

         We are counsel to Videolocity  International Inc., a Nevada corporation
(the  "Company"),  and have  represented  the  Company in  connection  with that
certain Equity Line of Credit Agreement (the "Equity Line of Credit  Agreement")
entered into by and between the Company and Cornell  Capital  Partners,  LP (the
"Investor")  pursuant to which the Company issued to the Investor  shares of its
Common Stock,  par value $.001 per share (the "Common  Stock").  Pursuant to the
Equity  Line  of  Credit  Agreement,   the  Company  also  has  entered  into  a
Registration  Rights  Agreement  with the  Investor  (the  "Registration  Rights
Agreement")  pursuant  to which the  Company  agreed,  among  other  things,  to
register  the  Registrable  Securities  (as defined in the  Registration  Rights
Agreement)  under the  Securities  Act of 1933, as amended (the "1933 Act").  In
connection  with  the  Company's   obligations  under  the  Registration  Rights
Agreement,  on ____________ ____, the Company filed a Registration  Statement on
Form ________ (File No.  333-_____________) (the "Registration  Statement") with
the Securities and Exchange  Commission  (the "SEC") relating to the Registrable
Securities which names the Investor as a selling stockholder thereunder.

         In connection  with the  foregoing,  we advise you that a member of the
SEC's  staff has  advised  us by  telephone  that the SEC has  entered  an order
declaring the Registration Statement effective under the 1933 Act at [ENTER TIME
OF  EFFECTIVENESS]  on [ENTER DATE OF  EFFECTIVENESS]  and we have no knowledge,
after  telephonic  inquiry of a member of the SEC's  staff,  that any stop order
suspending its  effectiveness  has been issued or that any  proceedings for that
purpose  are  pending  before,  or  threatened  by, the SEC and the  Registrable
Securities  are  available  for  resale  under  the  1933  Act  pursuant  to the
Registration Statement.

                                             Very truly yours,

                                             [ISSUER'S COUNSEL]


                                             By: _______________________________
cc:      Cornell Capital Partners, LP


                                       14
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