September 24 2004 Exhibit 10.65





EXHIBIT 10.65



 

DIGITAL VIDEO SYSTEMS, INC.





REGISTRATION RIGHTS AGREEMENT























DIGITAL VIDEO
SYSTEMS, INC

REGISTRATION RIGHTS AGREEMENT

THIS AGREEMENT is made as of September 20, 2004, among
Digital Video Systems, Inc., a Delaware corporation (the "Company") and the
purchasers of the Company's 8% Series C Convertible Preferred Stock (the "Series
C Preferred Stock") and accompanying Class A warrants (the "Warrants") listed on
Exhibit A hereto (each an "Investor," and collectively, the
"Investors"). Capitalized terms not defined herein shall have the meanings
defined for them in the 8% Series C Convertible Preferred Stock Purchase
Agreement by and between the Company and the Purchasers listed on Exhibit A
thereto, of even date herewith (the "SPA").

RECITALS

WHEREAS, the Investors desire to obtain certain rights
regarding registration of the Company's securities under the Securities Act
of 1933, as amended ("Registration Rights"). 

WHEREAS, the Company, to induce the Investors to invest,
desires to grant the Investors such rights.

NOW, THEREFORE, the parties agree as follows:


1.REGISTRATION UNDER THE SECURITIES ACT OF 1933


1.1Definitions. For purposes of this
Agreement:


(a)The term "Act" means the Securities Act of
1933, as amended.

(b)The term "Offering" refers to the non-
registered private placement of 8% Series C Convertible Preferred Stock, Class A
Warrants and (potentially) Class B Warrants pursuant to the SPA.

(c)The terms "register," "registered" and
"registration" refer to a registration effected by preparing and filing a
registration statement in compliance with the Act and the declaration or
ordering of effectiveness of such registration statement.

(d)The term "Registrable Securities" means: (i)
the Common Stock, $0.0001 par value of the Company (the "Common Stock) issuable
upon conversion of the Series C Preferred Stock sold in the Offering, including
any Series C Preferred Stock issuable upon exercise of the Green Shoe Warrant;
(ii) any Common Stock of the Company issuable upon exercise of the Class A
Warrants issued in connection with the Offering; and (iii) any Common Stock of
the Company issued or issuable with respect to such shares of Common Stock upon
any stock split, stock dividend, recapitalization, or similar event, or any
Common Stock otherwise issued or issuable with respect to such Common Stock;
provided, however, that such securities shall only be treated as
Registrable Securities if and so long as they have not been (A) sold to or
through a broker or dealer or underwriter in a public distribution or a public
securities transaction, or (B) sold in a transaction exempt from the
registration and prospectus delivery requirements of the Act under Section 4(1)
thereof so that all transfer restrictions and restrictive legends with respect
thereto are removed upon the consummation of such sale; the Common Stock
issuable upon exercise of the Class B Warrants, if issued in the future pursuant
to the terms of the Offering as described in the SPA, are not "Registrable
Securities" for purposes of Section 1.2 below, but shall be considered
"Registrable Securities for purposes of Section 1.3 hereof.

(e)The term "Holder" means the person or entity
holding Registrable Securities, who is also a party to this Agreement;




1.2Registration of Registrable Securities.
Within 30 days following the final Closing of the Offering (not including the
Green Shoe Closing, which by its terms will not occur until after the effective
date of the registration statement contemplated by this Section 1.2), the
Company shall use its reasonable efforts to file a registration under the Act of
all of the Registrable Securities and to use its best efforts to effect the
registration thereunder as promptly as possible thereafter, but in no event
later than 90 days following the final Closing of the Offering. In the event the
Company has not filed the registration statement within such 30-day period or
the Registrable Securities have not been registered pursuant to an effective
registration statement by such 90-day period, the Company agrees to pay a
penalty as liquidated damages at a rate of 1% of the aggregate purchase price
paid by each investor, payable in cash or in kind, for each 30-day period after
the deadline. The Company is obligated to effect only one registration pursuant
to this Section 1.2 unless the Company fails to effect the registration of all
Registrable Securities for which registration is required and have such
registration declared or ordered effective. The foregoing notwithstanding, there
can be no assurance that the registration statement, once filed by the Company,
will be declared effective by the Securities and Exchange Commission (the
"Commission").

1.3Company Registration. 


(a)If the Company shall determine to register any
of its securities either for its own account or the account of a security holder
or holders exercising their respective demand registration rights (other than
pursuant to Section 1.2 hereof), other than a registration relating solely to
employee benefit plans, or a registration relating to a corporate reorganization
or other transaction under Rule 145, or a registration on any registration form
that does not permit secondary sales, the Company will:


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

(ii)use its best efforts to include in such
registration (and any related qualification under blue sky laws or other
compliance), except as section forth in Section 1.3(b) below, and in any
underwriting involved therein, all the Registrable Securities (including for
this purpose, any Common Stock issuable upon exercise of Class B Warrants, if
such warrants have been issued at the time of the notice contemplated by Section
1.3(a)(i)) specified in a written request or requests, made by any Holder and
received by the Company within ten days after the written notice from the
Company described in clause (i) above is mailed or delivered by the Company.
Such written request may specify all or a part of the Holder's Registrable
Securities.




(b)If the registration of which the Company gives
notice is for a registered public offering involving an underwriting, the
Company shall so advise the Holders as a part of the written notice given
pursuant to Section 1.3(a)(i). In such event, the right of any Holder to
registration pursuant to this Section 1.3 shall be conditioned upon such
Holder's participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting to the extent provided herein. All
Holders proposing to distribute their securities through such underwriting shall
(together with the Company and other holders of securities of the Company with
registration rights to participate therein distributing their securities through
such underwriting) enter into an underwriting agreement in customary form with
the representative of the underwriter or underwriters selected by the
Company.

(c)Notwithstanding any other provision of this
Section 1.3, if the representative of the underwriters advises the Company in
writing that marketing factors require a limitation on the number of shares to
be underwritten, the representative may (subject to the limitations set forth
below) exclude all Registrable Securities from, or limit the number of
Registrable Securities to be included in, the registration and underwriting. The
Company shall so advise all holders of securities requesting registration, and
the number of shares of securities that are entitled to be included in the
registration and underwriting shall be allocated first to the Company for
securities being sold for its own account and thereafter as set forth in Section
1.3(d). If any person does not agree to the terms of any such underwriting, he
shall be excluded therefrom by written notice from the Company or the
underwriter. Any Registrable Securities or other securities excluded or
withdrawn from such underwriting shall be withdrawn from such registration. 

If shares are so withdrawn from the registration or if
the number of shares of Registrable Securities to be included in such
registration was previously reduced as a result of marketing factors, the
Company shall then offer to all persons who have retained the right to include
securities in the registration the right to include additional securities in the
registration in an aggregate amount equal to the number of shares so withdrawn,
with such shares to allocated among the persons requesting additional inclusion
in accordance with Section 1.3(d).

(d)If any circumstance in which all of the
Registrable Securities and other shares of Common Stock of the Company
(including shares of Common Stock issued or issuable upon conversion of shares
of any currently unissued series of Preferred Stock of the Company) with
registration rights (the "Other Shares") requested to be included in a
registration on behalf of the holders or other selling stockholders cannot be so
included as a result of limitations of the aggregate number of shares of
Registrable Securities and Other Shares that may be so included, the number of
shares of Registrable Securities and Other Shares that may be so included shall
be allocated among the Holders and the other selling stockholders requesting
inclusion of shares pro rata on the basis of the number of shares of
Registrable Securities and Other Shares that would be held by such Holders and
other selling stockholders, assuming conversion; provided, however, that
such allocation shall not operate to reduce the aggregate number of Registrable
Securities and Other Shares to be included in such registration, if any Holder
or other selling stockholder does not request inclusion of the maximum number of
shares of Registrable Securities and Other Shares allocated to him pursuant to
the above-described procedure, the remaining portion of his allocation shall be
reallocated among those requesting Holders and other selling stockholders whose
allocations did not satisfy their requests pro rata on the basis of the
number of shares of Registrable Securities and Other Shares that would be held
by such Holders and other selling stockholders, assuming conversion, and this
procedure shall be repeated until all of the shares of Registrable Securities
and Other Shares that may be included in the registration on behalf of the
Holders and other selling stockholders have been so allocated. The Company shall
not limit the number of Registrable Securities to be included in a registration
pursuant to this Agreement in order to include shares held by stockholders with
no registration rights or any shares of stock issued to employees, officers,
directors or consultants pursuant to the Company's stock options plans, in order
to include such registration securities registered for the Company's own
account.




1.4Obligations of the Company. Whenever
required under Section 1.2 or 1.3 to use its reasonable efforts to effect the
registration of any Registrable Securities, the Company shall, as expeditiously
as reasonably possible:


(a)Prepare and file with the Commission a
registration statement with respect to such Registrable Securities and use its
reasonable efforts to cause such registration statement to be declared or
ordered effective;

(b)Prepare and file with the Commission such
amendments or supplements to such registration statement and the prospectus used
in connection with such registration statement as may be necessary to keep such
registration statement effective for a period ending the earlier of (i) the
completion of the distribution of the Registrable Securities included in the
registration statement of (ii) one year from the effective date of such
registration statement;

(c)Furnish to the Holder such numbers of copies
of a prospectus, including a preliminary prospectus, in conformity with the
requirements of the Act, and such other documents as they may reasonably request
in order to facilitate the disposition of Registrable Securities owned by them;
and

(d)Use its reasonable efforts to register and
qualify the securities covered by such registration statement under such other
securities or Blue Sky laws of such jurisdictions as shall be reasonably
appropriate for the distribution of the securities covered by the registration
statement, provided that the Company shall not be required in connection
therewith or as a condition thereto to qualify to do business or to file a
general consent to service of process in any such states or jurisdictions, and
further provided that (anything in this Agreement to the contrary
notwithstanding with respect to the bearing of expenses) if any jurisdiction in
which the securities shall be qualified shall require that expenses incurred in
connection with the qualification of the securities in that jurisdiction be
borne by selling stockholders, then such expenses shall be payable to selling
stockholders pro rata, to the extent required by such jurisdiction;




1.5Furnish Information. It shall be a
condition precedent to the obligations of the Company to take any action
pursuant to this Agreement as to any Holder that such Holder shall furnish to
the Company such information regarding him or it, the Registrable Securities
held by him or it, and the intended method of disposition of such securities as
the Company shall reasonably request and as shall be requested or required by
the SEC or otherwise in connection with the action to be taken by the
Company.

1.6Expenses of Registration. All expenses
incurred in connection with the registration, qualification or compliance
pursuant to Sections 1.2 or 1.3 (excluding underwriters' discounts and
commissions), including, without limitation, all registration and qualification
fees, printers' and accounting fees and fees and disbursements of counsel for
the Company, shall be borne by the Company. The foregoing notwithstanding, to
the extent any applicable state securities statutes or regulations require
selling stockholders to bear the costs of registration of their securities, the
Holders shall be responsible for such costs to the extent required by applicable
state law.

1.7Delay of Registration. Notwithstanding any
other provision of this Agreement, no Holder shall have any right to take any
action to restrain, enjoin or otherwise delay any registration as the result of
any controversy that might arise with respect to the interpretation or
implementation of this Agreement.


1.8Indemnification. In the event any
Registrable Securities are included in a registration statement under this
Agreement:


(a)To the extent permitted by law, the Company
will indemnify each Holder, each of its officers and directors and partners, and
each person controlling such Holder within the meaning of Section 15 of the Act,
with respect to which registration, qualification or compliance has been
effected pursuant to this Agreement, and each underwriter, if any, and each
person who controls any underwriter within the meaning of Section 15 of the Act,
against all expenses, claims, losses, damages and liabilities (or actions in
respect thereof), including any of the foregoing incurred in settlement of any
litigation, commenced or threatened, arising out of or based on any untrue
statement (or alleged untrue statement) of a material fact contained in any
registration statement, prospectus, offering circular or other document, or any
amendment or supplement thereto, incident to any such registration,
qualification or compliance, or any omission (or alleged omission) to state
therein a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they were made, not
misleading, or any violation by the Company of the Act or any rule or regulation
promulgated under the Act applicable to the Company in connection with any such
registration, qualification or compliance, and the Company will reimburse each
such Holder, each of its officers and directors and partners, and each person
controlling such Holder, each such underwriter and each person who controls any
such underwriter, for any legal and any other expenses reasonably incurred in
connection with investigating, preparing or defending any such claim, loss,
damage, liability or action, provided that the Company will not be liable in any
such case to the extent that any such claim, loss, damage, liability or expense
arises out of or is based on any untrue statement or omission or alleged untrue
statement or alleged omission, made in reliance upon and in conformity with
written information furnished to the Company by such Holder, officer, director,
partner, controlling person or underwriter and stated to be specifically for use
therein.

(b)Each Holder will, if Registrable Securities
held by such Holder are included in the securities as to which such
registration, qualification or compliance is being effected, indemnify the
Company, each of its officers and directors, each underwriter of the Company's
securities covered by such a registration statement, each person who controls
the Company or such underwriting within the meaning of Section 15 of the Act,
and each other such Holder, each of its officers and directors and partners and
each person controlling such Holder within the meaning of Section 15 of the Act,
against all expenses, claims, losses, damages and liabilities (or actions in
respect thereof), including any of the foregoing incurred in settlement of any
litigation, commenced or threatened, arising out of or based on any untrue
statement (or alleged untrue statement) of a material fact contained in any
registration statement, prospectus, offering circular or other document, or any
amendment or supplement thereto, incident to such registration, qualification or
compliance, or any omission (or alleged omission) to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading, and will reimburse the Company, such Holders, such directors,
officers, partners, persons, underwriters or control persons for any legal or
any other expenses reasonably incurred in connection with investigating,
preparing or defending any such claim, loss, damage, liability or action, in
each case to the extent, but only to the extent, that such untrue statement (or
alleged untrue statement) or omission (or allege omission) is made in such
registration statement, prospectus, offering circular or other document in
reliance upon and in conformity with written information furnished to the
Company by any instrument duly executed by such Holder and stated to be
specifically for use therein. Notwithstanding the foregoing, the liability of
each Holder under this subsection (b) shall be limited in an amount equal to the
initial public offering price of the shares sold by such Holder, unless such
liability arises out of or is based on willful conduct by such Holder.

(c)Each party entitled to indemnification under
this Section 1.8 (the "Indemnified Party") shall give notice to the party
required to provide indemnification (the "Indemnifying Party") promptly after
such Indemnified Party has actual knowledge of any claim as to which indemnity
may be sought, and shall permit the Indemnifying Party to assume the defense of
any such claim or any litigation resulting therefrom; provided that counsel for
the Indemnifying Party, who shall conduct the defense of such claim or
litigation, shall be approved by the Indemnified Party (whose approval shall not
unreasonably be withheld), and the Indemnified Party may participate in such
defense at such party's expense; and provided further that the failure of any
Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its obligations under this Agreement unless the failure to
give such notice is materially prejudicial to an Indemnified Party's ability to
defend such action; and provided further that the Indemnifying Party shall not
assume the defense for matters as to which there is a conflict of interest or
separate and different defenses. No Indemnifying Party, in the defense of any
such claim or litigation, shall, except with the consent of each Indemnified
Party, consent to entry of any judgment or enter into any settlement which does
not include as an unconditional term thereof the giving by the claimant or
plaintiff to such Indemnified Party of a release from all liability in respect
to such claim or litigation.




1.9Proposed Transfers of Registrable
Securities. The Holder of each certificate representing Registrable
Securities by accepting those securities, agrees to comply in all respects with
the following provisions:


(a)Prior to any proposed transfer of any
Registrable Securities (other than under the circumstances described in Section
1.2 above), the Holder of those Registrable Securities shall give written notice
to the Company of such Holder's intention to effect the transfer;

(b)Each such notice shall describe the manner
and circumstances of the proposed transfer, shall be accompanied by such
information as is necessary in order to establish that such transfer may be made
without registration under the Act and except with respect to transactions not
involving a change in beneficial ownership or transactions involving the
distribution without consideration of Registrable Securities by any of the
Holders to any of their partners, retired partners, or any estate of their
partners or retired partners, or to any affiliated venture capital partnership,
or to any members of the immediate family of the Holders, shall also be
accompanied by either (i) a written opinion of legal counsel who shall be
reasonably satisfactory to the Company and its counsel stating that the proposed
transfer of the Registrable Securities may be effected without registration
under the Act and without qualification under the state securities or Blue Sky
laws; or (ii) a "no action" letter from the Commission; or (iii) an appropriate
registration statement with respect to such Registrable Securities filed by the
Company with the Commission and declared effective by the Commission.

(c)Having satisfied Section 1.9(b), above,
the Holder of such Registrable Securities shall be entitled to transfer the
Registrable Securities in accordance with the terms of the notice delivered by
the Holder to the Company.

(d)Each certificate evidencing the
Registrable Securities transferred shall bear the appropriate restrictive
legends as set forth on the Registrable Securities themselves prior to transfer.
However, the Company shall remove such restrictive legend upon the request of
the Holder if (i) the Company has received from or on behalf of the investor an
opinion of counsel who is reasonably acceptable to the Company and its counsel
to the effect that registration of any and all future transfers is not required;
or (ii) an appropriate registration statement with respect to such Registrable
Securities has been filed by the Company with the Commission and declared
effected by the Commission.




1.10Transfer of Registration Rights. The
registration rights of the Holders under this Agreement may be transferred to
any transferee who acquires Registrable Securities; provided, however,
that such transfer of rights shall be effective only where the Company is given
written notice by the Holder stating the name and address of the transferee and
identifying the securities with respect to which the rights under this Agreement
are being assigned.




2.MISCELLANEOUS


2.1Additional Investors. Additional
Investors will be added to this Agreement; such Investors may become party to
this Agreement, upon execution and delivery to the Company of signature pages
hereto.

2.2Waivers and Amendments. With the written
consent of the record or beneficial holders of at least 60% of the Registrable
Securities, the rights and obligations of the Company and the holders of
Registrable Securities under this Agreement may be waived (either generally or
in a particular instance, either retroactively or prospectively, and either for
a specified period of time or indefinitely), and with the same consent, the
Company, when authorized by resolution of its Board of Directors, may enter into
a supplementary agreement for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement;
provided, however, that any proposed waiver or amendment which would adversely
affect the rights or obligations of the holders of the Series C Preferred Stock
relative to, or disproportionately with, the rights or obligations of the
holders of the other Preferred Stock, must be approved by the holders of at
least a majority of the Series C Preferred Stock; further provided, however,
that no such consent shall be required for the purpose of adding to this
Agreement an Investor pursuant to Section 2.1, and further, that no such
modification, amendment or waiver shall reduce the aforesaid percentage of
Registrable Securities without the consent of all of the Purchasers of the
Registrable Securities. Upon the effectuation of each such waiver, consent,
agreement of amendment or modification, the Company shall promptly give written
notice thereof to the record holders of the Registrable Securities who have not
previously consented thereto in writing. This Agreement or any provision hereof
may be changed, waived, discharged or terminated only by a statement in writing
signed by the party against which enforcement of the change, waiver, discharge
or termination is sought, except to the extent provided in this Section 2.2
(Waivers and Amendments).

2.3Notices. All notices and other
communications required or permitted hereunder shall be in writing and, except
as otherwise noted herein, shall be deemed effectively given upon personal
delivery, delivery by nationally recognized courier or forty-eight (48) hours
after being deposited with the United States Post Office, (by registered mail,
postage prepaid) addressed: 

	if to the Company, at:

Digital Video Systems, Inc.

   430 Cambridge Avenue, Suite 110

   Palo Alto, CA 94306

   Attn.: Chief Executive Officer

   Tel: (650) 322-8108

   Fax: (650) 322-8109

	if to a Holder, at the latest address of such person shown on the Company's
records.

2.4Descriptive Headings. The descriptive
headings herein have been inserted for convenience only and shall not be deemed
to limit or otherwise affect the construction of any provisions hereof.

2.5Governing Law. This Agreement shall be
governed by and interpreted under the laws of the State of California, without
regard to conflict of law provisions.

2.6Counterparts. This Agreement may be
executed in one or more counterparts, each of which shall for all purposes be
deemed to be an original and all of which shall constitute the same instrument,
but only one of which need be produced.

2.7Expenses. If any action at law or in
equity is necessary to enforce or interpret the terms of this Agreement, the
prevailing party shall be entitled to reasonable attorney's fees, costs and
necessary disbursements in addition to any other relief to which such party may
be entitled. 

2.8Successors and Assigns. Except as
otherwise expressly provided in this Agreement, this Agreement shall benefit and
bind the successors, assigns, heirs, executors and administrators of the parties
to this Agreement.

2.9Entire Agreement. This Agreement
constitutes the full and entire understanding and agreement between the parties
with regard to the subject matter of this Agreement.

2.10Separability; Severability. Unless
expressly provided in this Agreement, the rights of each Investor under this
Agreement are several rights, not rights jointly held with any other Investors.
Any invalidity, illegality or limitation on the enforceability of this Agreement
with respect to any Investor shall not affect the validity, legality or
enforceability of this Agreement with respect to the other Investors. If any
provision of this Agreement is judicially determined to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not be affected or impaired.

2.11Stock Splits. All references to numbers
of shares in this Agreement shall be appropriately adjusted to reflect any stock
dividend, split, combination or other recapitalization of shares by the Company
occurring after the date of this Agreement.

2.12Aggregation of Stock. All shares of
Preferred Stock held or acquired by affiliated entities or persons shall be
aggregated together for the purpose of determining the availability of any
rights under this Agreement.

2.13Facsimile
Signatures. Any signature page delivered by fax machine or telecopy
machine shall be binding to the same extent as an original signature page, with
regard to any agreement subject to the terms hereof or any amendment thereto.
Any party who delivers such a signature page agrees to later deliver an original
counterpart to any party which requests it.




IN WITNESS WHEREOF, the parties have executed this
Registration Rights' Agreement on the day and year first set forth above.





	
THE COMPANY:
	
DIGITAL VIDEO SYSTEMS, INC.,

   a Delaware corporation

By: /s/ Thomas A. Spanier

   Name: Thomas A. Spanier

   Title: Chief Executive Officer 





	
THE INVESTORS:
	
(If an entity):

______________________

Name: /s/________________

   Title: ______________________

(If an individual):

/s/______________

       Name: ___________________

                



 

 [Signature Page to Registration Rights
Agreement]

















Schedule of Investors

First Closing



	

Stockholder
	
Series C Preferred Converted

                  Common Stock
	
Warrant Shares

	
	
	

	
Empire Capital Partners, LP
	
334,052
	
167,026

	
Empire Capital Partners, Ltd.
	
622,865
	
311,432

	
Empire Capital Partners II, Ltd.
	
116,031
	
58,015

	
Charter Oak Partners, LP
	
61,945
	
30,972

	
Charter Oak Partners II, LP
	
12,647
	
6,323

	
Glenbrook Capital, LP
	
409,836
	
204,918

	
Sanctus Spiritus Antilles, NV
	
327,868
	
163,934

	
Maria Molinsky
	
81,967
	
40,983

	
Edmund Y. Sun
	
81,967
	
40,983

	
Ychien Chang
	
32,786
	
16,393





 

Subsequent Closing


	

Stockholder
	
Series C Preferred Converted

                  Common Stock
	

Warrant Shares