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EXHIBIT 10.27    
  

 
 

LICENSE AND CONTENT AGREEMENT    
  

    This License and Content Agreement ("Agreement") is entered into on this 18th day of May, 2001 ("Effective Date") by and between ODS Technologies, L.P., a
limited partnership organized and existing under the laws of the State of Delaware, and ODS Properties, Inc., a corporation organized and existing under the laws of the State of Delaware, each
with a place of business at 12421 West Olympic Boulevard, Los Angeles, CA 90064 (collectively, the "TVG Parties"), and Youbet.com, Inc. ("UBET"), a corporation organized and existing under the
laws of the State of Delaware, with a place of business at 5901 DeSoto Avenue, Woodland Hills, CA 91367 (collectively, the "Parties"). 

    WHEREAS,
the TVG Parties are engaged in the research, design and development of interactive wagering systems; 

    WHEREAS,
the TVG Parties own certain intellectual property rights relating to interactive wagering systems, and have certain rights with respect to horse race simulcast audio and
video content and pari-mutuel wagering on horse races; and 

    WHEREAS,
the TVG Parties desire to grant and UBET desires to accept non-exclusive licenses and rights with respect to such intellectual property rights, simulcast audio
and video content and pari-mutuel wagering on horse races in accordance with the terms, covenants and conditions herein specified and all applicable laws and regulations. 

    NOW,
THEREFORE, in consideration of the terms, covenants and conditions contained in this Agreement, the Parties agree as follows: 

 
 

SECTION 1—DEFINITIONS    
  

    As used herein, the following terms shall have the meanings set forth below: 

    1.1 "Affiliate"
means, with respect to any person or entity, any other person or entity that, directly or indirectly through one or more intermediaries, controls, is
controlled by or is under common control with such person or entity, whether through ownership of voting securities or otherwise. For purposes hereof, control shall mean with respect to any person or
entity, any other person or entity that has the ability to elect a majority of such person's or entity's board of directors or similar governing body or the ability (by contract, share ownership or
otherwise) to direct the policies and management of such person or entity. Notwithstanding the foregoing, in no event shall the TVG Parties be considered an Affiliate of UBET for purposes of this
Agreement. 

    1.2 "Business
Day" means any day other than a day which is a Saturday, Sunday or United States federal legal holiday or federal bank holiday. 

    1.3 "Host
Track Fee" means the fee payable to the racing association sponsoring the race on which an account wager is accepted, generally 1.5% to 3.0% of handle. The
Host Track Fees currently in effect are listed in Schedule 1.3 attached hereto. The TVG Parties may amend Schedule 1.3 from time to time through written notice to UBET; provided,
however, that, with the exception of Breeders Cup races, the Host Track Fee, when added to the amount payable hereunder to TVG Parties, shall not exceed 8.5% of the handle. 

    1.4 "Interactive
Television User Interfaces" means interactive wagering user interfaces implemented using systems, networks or equipment that provide television
programming (either alone or in combination with other services) to viewers, including cable television systems, satellite television systems, cable set-top boxes, satellite integrated
receiver-decoders, televisions and television program recording devices. 

    1.5 "IVR
User Interfaces" means interactive voice response systems through which users communicate with a Wagering Transaction Management System using conventional
telephones over the public switched telephone network to interactively place account wagers on horse races. 

 

    1.6 "Ladbroke" means, collectively, Ladbroke USA, Ladbroke Racing Corp., Ladbroke Pennsylvania, Inc., Mountain Laurel Racing, Inc., Washington Trotting
Association, Inc., and their respective Affiliates, successors and assigns, including, without limitation, Magna Entertainment Corp. and its Affiliates. 

    1.7 "Licensed
Interactive Wagering Systems" means: (i) IVR User Interfaces operated by and for the benefit of UBET; (ii) Personal Computer User Interfaces
operated by and for the benefit of UBET; and (iii) Operator Assisted User Interfaces operated by and for the benefit of UBET. Expressly excluded from the definition of Licensed Interactive
Wagering Systems are (i) Interactive Television User Interfaces, and (ii) systems that use wireless communications technology in connection with wagering, unless otherwise agreed in
writing by the TVG Parties. 

    1.8 "Licensed
Territory" means the United States, its territories, and its possessions. 

    1.9 "NTRA"
means the National Thoroughbred Racing Association and any of its Affiliates. 

    1.10 "Operator
Assisted User Interfaces" means systems through which users communicate with a live telephone operator to place account wagers on horse races using a
Wagering Transaction Management System. 

    1.11 "Personal
Computer User Interfaces" means interactive wagering user interfaces running on desk-top or lap-top personal computers that
communicate with a Wagering Transaction Management System via the Internet (including virtual private networks) to effectuate interactive account wagers on horse races. 

    1.12 "Positive
Cash Flow" means, for any period, the positive difference between (i) the gross cash receipts of UBET and its consolidated subsidiaries for such
period from all sources; minus, (ii) the gross cash expenditures of UBET for operational purposes for such period, which shall specifically
exclude, without limitation, (A) all capital expenditures, (B) all tax and interest expenses, (C) all depreciation, amortization and other non-cash charges, and
(D) expenditures made from previously established reserves, determined in accordance with generally accepted accounting principles consistently applied. 

    1.13 "Source
Market Fee" means the fee payable to the various participants of the horse racing industry (e.g., racing associations, horse owners, etc.) in the state
where the account holder resides, generally the remainder of the takeout or commission on a wager less the Host Track Fee and the fee payable to the TVG Parties set forth in Section 4.1(d). 

    1.14 "TVG
Designated Non-exclusive Tracks" means the four horse race tracks listed in Schedule 1.14 attached hereto with which the TVG Parties have a
non-exclusive relationship with respect to account wagering. Except as provided in the last sentence of this Section 1.14, Schedule 1.14 may be modified by the TVG Parties
through written notice provided to UBET once each calendar year (including once in the calendar year 2001). Each such modification shall be effective for the calendar year following the calendar year
in which such modification was made. In the event that in any given year the TVG Parties' non-exclusive relationship with a race track now or in the future listed in Schedule 1.14
terminates, the TVG Parties may immediately modify Schedule 1.14 to replace that race track with another non-exclusive race track, which modification shall be effective upon written
notice to UBET. 

    1.15 "TVG
Exclusive Tracks" means the race tracks listed on Schedule 1.15 attached hereto. In addition, all race tracks owned, controlled or operated by Magna
Entertainment, Inc. or any of its Affiliates shall be deemed TVG Exclusive Tracks if the TVG Parties reach an agreement with Magna Entertainment, Inc. or any of its Affiliates that
allows the TVG Parties to simulcast and take account wagers on races conducted at such race tracks, regardless of whether such agreement is exclusive or non-exclusive, effective as of the
date such agreement becomes effective. 

2

 

    1.16 "TVG Patent Rights" means the U.S. patents owned by the TVG Parties that are listed in Schedule 1.16 attached hereto, and any U.S. patents issued to the TVG
Parties during the Term of this Agreement that include claims in the field of use of the Licensed Interactive Wagering Systems. 

    1.17 "UBET
Patent Rights" means any and all patents, utility models and other patent rights of any kind under the laws of all countries in the world, including reissues
and reexaminations thereof, and applications and provisional applications for any of the foregoing, including any divisions, continuations and continuations in part, now owned or acquired during the
Term of this Agreement by UBET or its Affiliates, or any and all patented intellectual property under which UBET or its Affiliates has or will have the right to grant licenses. 

    1.18 "Wagering
Transaction Management System" means a system for managing and processing interactive horse race wagering transactions and/or maintaining
end-user horse race wagering accounts. 

    1.19 Terms
Generally. The definitions in this Section 1 shall apply equally to both the singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words "include", "includes" and "including" shall be deemed to be followed by the phrase "without
limitation". All references herein to Articles, Sections, Attachments and Schedules shall be deemed references to the Articles of, Sections of, and Attachments and Schedules to, this Agreement unless
the context shall otherwise require. Any reference in this Agreement to a "day" or number of "days" (without the explicit qualification of "Business") shall be interpreted as a reference to a calendar
day or number of calendar days. If any action or notice is to be taken or given on or by a particular calendar day, and such calendar day is not a Business Day, then such action or notice shall be
deferred until, or may be taken or given on, the next Business Day. 

 
 

SECTION 2—PATENT LICENSES AND RELEASE    
  

    2.1 The
TVG Parties hereby grant to UBET a non-exclusive license under the TVG Patent Rights, without the right to grant sublicenses, to make and use within
the Licensed Territory during the Term of this Agreement, Licensed Interactive Wagering Systems to accept and process account wagers through a Wagering Transaction Management System operated by and
for the benefit of UBET within the State of Oregon or such other state(s) approved in writing by the TVG Parties (which approval shall not be unreasonably withheld); provided, however, that no right
or license is granted to UBET in this Section 2.1 with respect to account wagering activities conducted through or in connection with Ladbroke (including its successor(s) in interest). 

    2.2 The
TVG Parties hereby grant to UBET a non-exclusive license under the TVG Patent Rights, without the right to grant sublicenses, to make and use within
the Licensed Territory during the Term of this Agreement, Licensed Interactive Wagering Systems to accept and process account wagers through a Wagering Transaction Management System operated by any
entity other than UBET; provided, however, that the license granted in this Section 2.2 shall be subject to the TVG Parties' prior written approval of any entity operating a Wagering
Transaction Management System, which approval may be granted or withheld in the TVG Parties' sole discretion. 

    2.3 UBET
hereby grants to the TVG Parties under the UBET Patent Rights a perpetual, irrevocable, world-wide, royalty-free,
non-exclusive license, with the right to grant sublicenses, to make, have made, use, sell, offer to sell, import, and otherwise dispose of the inventions disclosed and claimed therein. 

    2.4 The
TVG Parties hereby release UBET and its current Affiliates from all claims, demands and rights of action that the TVG Parties may have on account of any
infringement or alleged infringement of any of the TVG Patent Rights based on the manufacture and use of Licensed Wagering Systems by UBET or its current Affiliates prior to the Effective Date. 

3

 
 
 

SECTION 3—SIMULCAST RIGHTS    
  

    3.1 The
TVG Parties hereby grant to UBET a non-exclusive right to: (i) provide within the Licensed Territory during the Term of this Agreement, live
streaming online simulcast audio and video content of live horse races conducted at the TVG Exclusive Tracks through Personal Computer User Interfaces licensed hereunder through which
end-users may place account wagers on such live horse races conducted at the TVG Exclusive Tracks, which account wagers are accepted or processed through a Wagering Transaction Management
System operated by and for the benefit of UBET in the State of Oregon or such other state(s) approved in writing by the TVG Parties (which approval shall not be unreasonably withheld), to the extent
that the TVG Parties have the right to grant such simulcast audio and video content rights; and (ii) accept and process account wagers on live horse races conducted at the TVG Exclusive Tracks
placed using Licensed Interactive Wagering Systems through a Wagering Transaction Management System operated by and for the benefit of UBET in the State of Oregon or such other state(s) approved in
writing by the TVG Parties (which approval shall not be unreasonably withheld), to the extent that the TVG Parties have the right to grant such account wagering rights; provided, however, that no
right or license is granted to UBET in this Section 3.1 with respect to account wagering activities conducted through or in connection with Ladbroke. Expressly excluded from this Agreement is
any grant of rights with respect to programming on the TVG Network or any other programming produced by or for the TVG Parties or their Affiliates. 

    3.2 To
the extent the TVG Parties have the right to grant the simulcast audio and video content rights granted in Section 3.1, such simulcast audio and video
content provided to UBET (if provided by the TVG Parties) shall be: (i) the same as that provided to the TVG Parties pursuant to the applicable agreement between the TVG Parties and the
applicable racing association or other participant of the horse racing industry; and (ii) made available to UBET at substantially the same time such simulcast audio and video content is made
available to the TVG Parties. 

    3.3 The
TVG Parties shall make available to UBET such racing information, including odds, scratches, changes, racecards and post times as the TVG Parties receive from
the TVG Exclusive Tracks, at substantially the same time such information is made available to the TVG Parties, to the extent that the TVG Parties have the right to make such information available to
UBET. 

    3.4 If
UBET shall be unable to receive streaming online simulcast audio and video content from any TVG Exclusive Track as contemplated by Section 3.1 hereof
because of a breach by a third party of any agreement between any TVG Party and any third party, then the TVG Parties shall use their commercially reasonable efforts, in the TVG Parties' reasonable
judgment after taking into account the business interests of the TVG Parties, and in consultation with UBET, to restore UBET's ability to provide streaming online simulcast audio and video content and
accept and process account wagers as contemplated by Section 3.1 hereof. 

    3.5 The
TVG Parties shall use commercially reasonable efforts to assist UBET to obtain the simulcast audio and video content (as set forth in Sections 3.1 and 3.2) and
the information (as set forth in Section 3.3) directly from the TVG Exclusive Tracks and to interact directly with the TVG Exclusive Tracks to accept and process wagers (solely in accordance
with the terms and conditions of this Agreement). UBET shall be solely responsible for all costs associated with implementing any of the systems contemplated by this Agreement, including any equipment
used to receive and process such simulcast audio and video content and information, and to accept and process wagers. 

4

 
 
 

SECTION 4—CONSIDERATION    
  

    4.1 In
consideration for the rights and licenses granted by the TVG Parties to UBET herein, UBET shall: 

    (a) provide
to the TVG Parties upon signing of this Agreement, the Initial Warrant as defined in, and in accordance with the terms and conditions of, the Warrant
Issuance Agreement dated on the Effective Date (the "Warrant Issuance Agreement"); 

    (b) provide
to the TVG Parties, the Additional Warrant as defined in, and in accordance with the terms and conditions of, the Warrant Issuance Agreement; 

    (c) pay
to the TVG Parties transaction fees as follows: (i) with respect to account wagers accepted or processed through a Wagering Transaction Management System
operated by a party other than Ladbroke, commencing at such time as UBET shall commence accepting or processing account wagers using a Licensed Interactive Wagering System operated by UBET, UBET shall
charge each wagering account subscriber on such a system a transaction fee of $.25 per wager transaction, of which the first $3.00 received from each subscriber per month shall be retained by UBET,
the next $3.00 shall be paid to the TVG Parties, and any remaining amounts shall be split equally between UBET and the TVG Parties; (ii) with respect to account wagers accepted or processed
through a Wagering Transaction Management System operated by Ladbroke, commencing upon the earlier of (i) such time as UBET shall commence accepting or processing account wagers using a
Licensed Interactive Wagering System operated by UBET or (ii) September 1, 2001, UBET shall, at its election, charge each UBET wagering account subscriber on such a system either a
transaction fee per wager transaction of not less than $.25 or a monthly subscription fee of not less than $5.95, and shall pay to the TVG Parties with respect to wagers made by such subscribers
either 50% of such per wager transaction fee or 50% of such monthly subscription fee, as the case may be. In the event that UBET shall commence accepting or processing account wagers using a Licensed
Interactive Wagering System operated by UBET prior to September 1, 2001, amounts payable to the TVG Parties pursuant to this Section 4.1(c)(ii) shall accrue and shall not be paid
to the TVG Parties until the first day following the first quarterly period that UBET achieves Positive Cash Flow, and then and thereafter only to the extent of Positive Cash Flow. In the event that
UBET shall not have commenced accepting or processing account wagers using a Licensed Interactive Wagering System operated by UBET by September 1, 2001, all amounts payable pursuant to this
Section 4.1(c)(ii) shall be paid to the TVG Parties commencing with the next quarterly payment hereunder. Notwithstanding the foregoing, in the case of both clauses (i) and (ii),
UBET shall be permitted to waive wager transaction and subscription fees for any subscriber wagering at least $2,500 in any month, provided that UBET shall pay to the TVG Parties 50% of the total
wager transaction and subscription fees received from any such subscriber. 

    (d) pay
to the TVG Parties, (i) with respect to account wagers accepted or processed through a Wagering Transaction Management System operated by UBET or any
other entity approved by the TVG Parties other than Ladbroke, 5.5% of all account wagers accepted or processed using Licensed Interactive Wagering Systems, and (ii) with respect to account
wagers accepted or processed through a Wagering Transaction Management System operated by Ladbroke, the entire commission or other consideration paid to UBET with respect to account wagers accepted or
processed using Licensed Interactive Wagering Systems; provided, however, that all amounts payable by UBET to the TVG Parties pursuant to this Section 4.1(d)(ii) for the period
commencing on the Effective Date and ending on July 31, 2001 shall accrue and shall not be paid to the TVG Parties until the first day following the first quarterly period that UBET achieves
Positive Cash Flow, and then and thereafter such accrued amount shall only be payable to the extent of Positive Cash Flow; and 

5

 

    (e) pay to the TVG Parties, commencing with the first calendar quarter in which UBET achieves Positive Cash Flow and then and thereafter only to the extent of Positive
Cash Flow, the following amounts based on revenues derived from or through the use of Licensed Interactive Wagering Systems: (i) 50% of gross advertising revenues, and (ii) 50% of the
amount by which the gross operating margin (i.e., revenues less direct costs) from monthly e-commerce revenues exceeds the gross operating margin from e-commerce revenues for
the calendar month preceding the date of this Agreement. 

    4.2 In
addition to the consideration set forth in Section 4.1 above, with respect to account wagers accepted or processed on races conducted at TVG Exclusive
Tracks from wagering account subscribers with account addresses located in the states of NY, CA, TX, KY, MD, FL, OR, IL, IN, IA, AZ, WA, NM and MA, UBET shall: 

    (a) pay
Source Market Fees and Host Track Fees to the TVG Parties in accordance with the agreements between the TVG Parties and the applicable racing association(s) or
other participant(s) of the horse racing industry; and 

    (b) pay
all applicable state taxes and NTRA fees where Wagering Transaction Management Systems are located (currently 0.25% of handle to the State of Oregon and 0.75%
of handle to the NTRA) and any other applicable taxes and fees in effect from time to time provided that the aggregate of all such taxes and fees do not exceed 1% of handle. To the extent that the
amounts payable under this Section 4.2(b) exceed 1% of handle, the excess amount due under Section 4.2(b) shall be deducted from the Source Market Fee payable under
Section 4.2(a); provided that such amounts do not exceed the Source Market Fee. 

    4.3 In
addition to the consideration set forth in Section 4.1 above, with respect to account wagers accepted or processed on races conducted at TVG Exclusive
Tracks from account subscribers with account addresses located in states other than those listed in Section 4.2 above, UBET shall: 

    (a) pay
Host Track Fees to the TVG Parties in accordance with the agreements between the TVG Parties and the applicable racing association(s) or other participant(s) of
the horse racing industry; 

    (b) be
responsible for its own Source Market Fee arrangements with racing interests in such other states; and 

    (c) pay
all applicable state taxes where Wagering Transaction Management Systems are located (currently 0.25% of handle to the State of Oregon) and any other applicable
taxes and fees in effect from time to time. 

    4.3.1 In
addition to the consideration set forth in Sections 4.1, 4.2 and 4.3 above, with respect to account wagers accepted or processed using License
Interactive Wagering Systems from subscribers with an account address located within a twenty-five (25) mile radius of any TVG Excusive Track (and provided such address is within
the same state of such TVG Exclusive Track) on races conducted at any track that is not a TVG Exclusive Track, UBET shall pay TVG 10% of all such account wagers. TVG shall retain 50% of such amount
and the remaining 50% shall be divided among and paid to the TVG Exclusive Tracks and UBET's other partner tracks located within the twenty-five (25) mile radius,  provided, that such remaining 50%
shall be held in escrow by TVG until such time as the applicable TVG Exclusive Tracks and UBET partner tracks entitled
to such payment hereunder shall have agreed on its division. 

6

 

    4.4 If UBET obtains shareholder approval for the issuance of the Additional Warrant in accordance with the terms and conditions of the Warrant Issuance Agreement on or
before October 1, 2001, then the consideration payable by UBET to the TVG Parties pursuant to Section 4.1(d) above shall be modified to the following: UBET shall pay to the TVG Parties: 

    (a) 5.5%
of all account wagers accepted or processed using Licensed Interactive Wagering Systems (other than wagers accepted or processed through a Wagering Transaction
Management System operated by Ladbroke) on races conducted at the TVG Exclusive Tracks; 

    (b) the
entire commission or other consideration paid to UBET with respect to account wagers accepted or processed through a Wagering Transaction Management System
operated by Ladbroke on races conducted at the TVG Exclusive Tracks; and 

    (c) 3.0%
of all account wagers accepted or processed using Licensed Interactive Wagering Systems on races conducted at the TVG Designated Non-exclusive
Tracks (including wagers accepted or processed through Wagering Transaction Management Systems operated by Ladbroke). 

    4.5 During
the period from the Effective Date until the earlier of (x) the date on which UBET obtains shareholder approval for the issuance of the Additional
Warrant in accordance with the terms and conditions of the Warrant Issuance Agreement, or (y) October 1, 2001 and subject to the proviso of Section 4.1(d)(ii), UBET may pay into
an interest-bearing escrow account, (i) the difference between the 5.5% payable with respect to account wagers accepted or processed on the TVG Designated Non-exclusive Tracks
pursuant to Section 4.1(d), and the 3.0% payable on such account wagers pursuant to Section 4.4(b) (the remaining 3.0% shall be paid directly to the TVG Parties during such period in
accordance with the provisions of Section 5); and (ii) the 5.5% payable with respect to account wagers accepted or processed on tracks other than the TVG Exclusive Tracks and the TVG
Designated Non-exclusive Tracks pursuant to Section 4.1(d). If UBET obtains such shareholder approval on or before October 1, 2001, the escrowed amount, together with any
interest thereon, shall be returned to UBET. Otherwise, the escrowed amount, together with any interest thereon, shall be paid to the TVG Parties. 

    4.6 The
Parties acknowledge that the consideration payable by UBET under this Agreement was jointly negotiated and agreed to by the Parties, and that the amounts
payable constitute fair, combined, undivided consideration for the patent license, the TVG Exclusive Track simulcast audio and video content rights, the TVG Exclusive Track account wagering rights,
the TVG Exclusive Track racing information rights, and the release for past infringement of the TVG Patent Rights by UBET. The Parties acknowledge and agree that the undivided consideration payable
under this Agreement was negotiated for purposes of administrative convenience of both parties, and to avoid future disputes between the Parties as to whether or not particular wagering systems and
methods used by UBET use the TVG Patent Rights, and whether or not UBET is using or will use the TVG Exclusive Track simulcast audio and video content, account wagering rights or racing information
rights. Accordingly, in consideration for such administrative convenience and avoidance of future disputes, UBET agrees that it shall pay the full amount of the consideration set forth in this
Section 4, in the manner set forth in this Agreement, irrespective of whether or not UBET is using or uses any particular right or license granted herein. 

    4.7 If
a TVG Party or one or more of their Affiliates shall acquire an interest in the entity that acquires the assets of the New York City Off-Track
Betting Corporation ("New OTB"), UBET shall not at any time during which a TVG Party or its Affiliate owns outstanding equity of New OTB, process or accept account wagers from residents of New York
City; provided that UBET may continue to process and accept account wagers from residents of New York City who were subscribers of UBET as of the date that a TVG Party or its Affiliate or Affiliates,
as the case may be, are notified that New OTB is the successful bidder for the assets of such New York City Off-Track Betting Corporation. 

7

  

 
 

SECTION 5—AUDIT PROVISIONS    
  

    5.1 Not
later than the last day of each January, April, July and October, UBET shall furnish to the TVG Parties a written report of all amounts due pursuant to
Section 4 for the quarterly periods ended the last day of the preceding December, March, June and September, respectively, and shall pay to the TVG Parties all amounts due to the TVG Parties.
Such report shall contain appropriate line items and other information as the TVG Parties shall reasonably request through written notice provided to UBET. If no amount is accrued during any quarterly
period, a written statement to that effect shall be furnished. 

    5.2 Payments
provided for in this Agreement, when overdue, shall bear interest at a rate per annum equal to five percent (5%) in excess of the "Prime Rate" published by
The Wall Street Journal on the date such payment is due, and for the time period until payment is received by the TVG Parties. 

    5.3 Each
royalty report shall be certified by the Chief Financial Officer (or equivalent) of UBET to be correct to the best of UBET's knowledge and information. 

    5.4 If
this Agreement is for any reason terminated before all of the payments herein provided for have been made, UBET shall within thirty (30) days after the
termination of this Agreement, submit a terminal report and pay to the TVG Parties any remaining unpaid balance even though the due date as set forth above provided has not been reached. 

    5.5 UBET
shall keep records in sufficient detail to permit the determination of royalties and other payments payable hereunder. Such records shall be maintained for at
least thirty-six (36) months. At the reasonable request of the TVG Parties, UBET will permit an independent auditor to examine during ordinary business hours such records and other
documents as may be necessary to verify or determine royalties and other payments paid or payable under this Agreement (in no event shall requests made by the TVG Parties on a semi-annual
basis pursuant to this Section 5.5 be deemed unreasonable). Such auditor shall be instructed to report to both Parties only the amount of any payments which are due and payable. With respect to
any particular accounting period, if no request for examination of records for such period is made by the TVG Parties within thirty-six (36) months after the end of such period, the
right to examine such records for such period shall terminate. 

    5.6 The
fees and expenses of the independent auditor performing any examination of records relative to payments due under this Agreement shall be borne by the TVG
Parties. However, if an error resulting in an underpayment of more than ten percent (10%) of the total payments thereof respectively due is discovered for any period examined, then the total fees and
expenses of the independent auditor for such period shall be borne by UBET. In any case, any underpayment or overpayment, uncovered as a result of any such examination of records, together with
interest computed based on the "Prime Rate" published by the Wall Street Journal on the date the underpayment or overpayment is reported to the Parties shall be paid by the applicable party. 

    5.7 Any
payments due under this Agreement, other than amounts subject to a bona fide dispute for which one party has notified the other in writing prior to the date any
such payment is due, not received within thirty (30) Business Days of the date when due shall be considered delinquent. Acceptance of any delinquent payment hereunder shall not be deemed a
waiver of any rights or remedies the accepting party has or may have at law or otherwise, including, without limitation, the right to dispute the accuracy or completeness of any payment, report or
other information supplied by the other party. 

8

 

    5.8 Accounting reports, as described in this Section 5, shall be (i) faxed and then mailed, or (ii) sent by overnight courier, to the following
address: 

TVG

12421 West Olympic Blvd.

Los Angeles, CA 90064

Attention: Chief Financial Officer

Copy to: General Counsel

Telecopy Number: (310) 689-2501 

The
TVG Parties may change their address and contact information by providing written notice to UBET. 

    5.9 All
payments and other sums of money due under this Agreement shall be paid in United States dollars and made from and to bank accounts located within the United
States. Payments shall be paid via automated clearing house payment, check sent by overnight delivery or bank wire transfer as specified by the payee through written notice. 

 
 

SECTION 6—TERM AND TERMINATION    
  

    6.1 This
Agreement shall come into effect as of the Effective Date; however, the rights and licenses granted to UBET under Sections 2.1 and 3 shall not come into effect
until UBET has established a Wagering Transaction Management System in the State of Oregon or such other state(s) approved in writing by the TVG Parties (which approval shall not be unreasonably
withheld), and has received all of the necessary state licenses to operate such Wagering Transaction Management System. This Agreement shall remain effective until terminated pursuant to Sections 6.2
or 6.3, 6.4 or 6.5 (the "Term"). 

    6.2 The
Term of this Agreement shall remain in effect until the later of (x) 10 years from the Effective Date, (y) the date of expiration of the
last to expire of the TVG Patent Rights, or (z) the date on which the last of the TVG Parties' agreements with their track partners terminates, subject to the early termination provisions
provided for in Sections 6.3, 6.4 and 6.5. 

    6.3 The
TVG Parties may terminate this Agreement, and the rights and licenses granted hereunder, and shall have no further obligation to UBET in the event that:
(i) UBET has not obtained the necessary state licenses and has not opened a Wagering Transaction Management System in the State of Oregon or such other state(s) approved in writing by the TVG
Parties (which approval shall not be unreasonably withheld) by the date that is one hundred eighty (180) days following the Effective Date, or thereafter ceases to operate a Wagering
Transaction Management System in the State of Oregon or such other approved state(s) for its own benefit; or (ii) UBET brings any legal action against the TVG Parties or any of their
Affiliates, including their parent, Gemstar-TV Guide International, Inc. If, however, in connection with any such legal action, it is finally determined that the TVG Parties (or the
applicable Affiliate of the TVG Parties) had acted in bad faith with respect to any claims that are subject of such action, then this Agreement shall be reinstated. 

9

 

    6.4 Either Party may terminate this Agreement upon written notice to the other party in the event that the other Party breaches a material obligation hereunder, and
fails to cure such breach within thirty (30) days after written notice by the non-breaching party. Without limiting the generality of the foregoing, (i) the failure of UBET
to comply with any of the provisions of Section 4 shall be deemed a material breach of this Agreement, (ii) UBET shall not be deemed to have breached this Agreement if it shall cease
accepting and/or processing account wagers from residents of any state, provided that UBET shall use its commercially reasonable efforts, in the exercise of its reasonable judgment after taking into
account its business interests, to contest any pending or threatened state or local action alleging that it is or making it unlawful for UBET to accept and/or process account wagers in such state, and
(iii) the failure of the TVG Parties to provide to UBET the simulcast audio and video content rights, account wagering rights or racing information rights described in Section 3 with
respect to any TVG Exclusive Track as a result of such TVG Exclusive Track not having granted to the TVG Parties its consent therefore shall not be deemed a breach of this Agreement nor shall it
effect UBET's payment obligations pursuant to Section 4 with respect to any such TVG Exclusive Track. 

    6.5 This
Agreement may be terminated at any time during the Term by the mutual written agreement of the Parties. 

    6.6 The
provisions of Sections 2.3, 4 and 5, and any other provision which by its nature is intended to survive termination of this Agreement, shall survive any
termination of this Agreement. 

 
 

SECTION 7—REPRESENTATIONS AND WARRANTIES    
  

    7.1 THE
TVG PARTIES MAKE NO REPRESENTATIONS, EXPRESS OR IMPLIED, AND MAKE NO WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE AS TO THE SIMULCAST AUDIO
AND VIDEO CONTENT, RACING INFORMATION OR THE TVG PATENT RIGHTS LICENSED HEREUNDER OR ANY WARRANTY AS TO INTELLECTUAL PROPERTY VALIDITY, ENFORCEABILITY, NON-INFRINGEMENT, SCOPE OR OTHER
WARRANTY. WITHOUT LIMITING THE FOREGOING SENTENCE, THE TVG PARTIES MAKE NO WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, THAT THE SIMULCAST AUDIO AND VIDEO CONTENT, RACING INFORMATION OR LICENSED
INTERACTIVE WAGERING SYSTEMS DO NOT DIRECTLY OR CONTRIBUTORILY INFRINGE ANY THIRD PARTY PATENT, COPYRIGHT, MASK WORK, TRADE SECRET, TRADEMARK, OR OTHER PROPRIETARY RIGHT, AND THE PARTIES AGREE WITHOUT
LIMITATION THAT THE TVG PARTIES DO NOT WARRANT AGAINST INFRINGEMENT SPECIFIED IN THE UNIFORM COMMERCIAL CODE. 

    7.2 THE
TVG PARTIES SHALL NOT BE LIABLE TO UBET, ITS CUSTOMERS OR ANY OTHER ENTITY CLAIMING THROUGH OR UNDER UBET FOR ANY LOSS OF PROFITS OR INCOME, LOSS OF DATA OR
OTHER TANGIBLE BUSINESS LOSS OR OTHER CONSEQUENTIAL, INCIDENTAL, PUNITIVE OR SPECIAL DAMAGES, EVEN IF THE TVG PARTIES HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, ARISING OUT OF OR IN
CONNECTION WITH THIS AGREEMENT. 

    7.3 UBET
MAKE NO REPRESENTATIONS, EXPRESS OR IMPLIED, AND MAKES NO WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE AS TO THE UBET PATENT RIGHTS
LICENSED HEREUNDER OR ANY WARRANTY AS TO INTELLECTUAL PROPERTY VALIDITY, ENFORCEABILITY, NON-INFRINGEMENT, SCOPE OR OTHER WARRANTY. 

10

 

    7.4 THE PARTIES ACKNOWLEDGE THAT THE LIMITS ON WARRANTIES AND LIABILITIES CONTAINED IN THIS AGREEMENT ARE A FUNDAMENTAL PART OF THE BASIS OF THIS AGREEMENT AND THE
BARGAIN NEGOTIATED BY THE PARTIES AND SET FORTH HEREIN AND THAT THIS AGREEMENT WOULD NOT HAVE BEEN CONSUMMATED WITHOUT SUCH LIMITS. 

    7.5 The
rights and licenses provided for under this Agreement are limited to those expressly stated. Neither Party nor any third party shall have any implied rights or
licenses under or arising from this Agreement. 

 
 

SECTION 8—MISCELLANEOUS TERMS    
  

    8.1 Except
as set forth in Section 4.1(c) above, UBET shall have the exclusive right to determine the fees it will charge its subscribers. 

    8.2 This
Agreement is personal to UBET and shall not be assignable by UBET without the prior written consent of the TVG Parties. Further, it may not be transferred,
including in bankruptcy or insolvency proceedings, either in whole or in part and whether by operation of law or otherwise, without the prior written consent of the TVG Parties. Any consent, which may
be withheld at the TVG Parties' sole discretion, to an assignment or transfer shall be conditioned, in part, on the recipient undertaking in writing to assume all of the obligations of this Agreement
that it would have been required to undertake had it been an original party to this Agreement. 

    8.3 This
Agreement and the legal relations between the Parties shall be governed by and construed in accordance with the laws of the State of Delaware, without regard
to the conflict of laws rules thereof. The Parties agree that the exclusive jurisdiction and venue for any action brought between the Parties under this Agreement not subject to Section 8.15
hereof shall be the state and federal courts in Delaware, and each of the Parties agrees and submits itself to the exclusive jurisdiction and venue of such courts for such purpose. 

    8.4 Except
as otherwise expressly set forth in this Agreement, no waiver, consent, amendment, modification or change of terms of this Agreement shall bind any Party
unless in writing signed by the Parties, and then such waiver, consent, modification or change shall be effective only in the specific instance and for the specific purpose given. Either of the
Parties to this Agreement may by written instrument (i) waive any inaccuracies in any of the representations or warranties made to it by the other Party contained in this Agreement or in any
instruments and documents delivered to it pursuant to this Agreement, (ii) waive compliance by the other Party with the covenants or agreements made to it by the other Party contained in this
Agreement, or (iii) waive performance of any of the obligations or other acts of the other Party hereto. The delay or failure on the part of either Party to insist, in any one instance or more,
upon strict performance of any of the terms or conditions to this Agreement, or to exercise any right or privilege herein conferred shall not be construed as a waiver of any such terms, conditions,
rights or privileges but the same shall continue and remain in full force and effect. All rights and remedies are cumulative to, and not exclusive of, any rights or remedies that may be otherwise
available unless explicitly provided otherwise. 

    8.5 UBET
agrees to mark Licensed Interactive Wagering Systems with the numbers of the patents included in the TVG Patent Rights in accordance with the reasonable
requirements of the TVG Parties as provided to UBET from time to time through written notice. UBET further agrees to use its reasonable efforts to obtain from each of its account wagering subscribers
the name of the cable or satellite operator providing multi-channel television service to such account wagering subscriber and to provide such information, together with the account wagering activity
of such subscriber, to the TVG Parties. 

11

 

    8.6 The TVG Parties agree to mark any products sold by the TVG Parties that use the UBET Patent Rights with the numbers of the patents included in the UBET Patent
Rights in accordance with the reasonable requirements of UBET as provided to the TVG Parties from time to time through written notice. 

    8.7 All
notices, requests, demands, waivers and other communications required or permitted to be given under this Agreement shall be in writing and shall be deemed to
have been duly given on (i) the day on which delivered personally or by telecopy (with prompt confirmation by mail) during a Business Day to the appropriate location listed as the address
below, (ii) three business days after the posting thereof by United States registered or certified first class mail, return receipt requested, with postage and fees prepaid or (iii) one
business day after deposit thereof for overnight delivery. Such notices, requests, demands, waivers or other communications shall be addressed as follows: 

	(a)
	if
to the TVG Parties, to: 

TVG

12421 West Olympic Boulevard

Los Angeles, California 90064

Attn: Mark Wilson, President and CEO

Telecopy No.: (310) 689-2501 

with
copies to: 

Lee
D. Charles, Esq.

Baker Botts L.L.P.

599 Lexington Avenue

New York, New York 10022

Telecopy No.: (212) 705-5125 

Joseph
M. Guiliano, Esq.

Fish & Neave

1251 Avenue of the Americas

New York, New York 10020

Telecopy No.: (212) 596-9090 

	(b)
	if
to UBET, to: 

Youbet.com, Inc.

5901 DeSoto Avenue

Woodland Hills, California 90367

Attn: Chief Executive Officer

Telecopy No.: (818) 668-2101 

with
a copy to: 

Christensen,
Miller, Fink, Jacobs,

Glaser, Weil & Shapiro, LLP

2121 Avenue of the Stars

Los Angeles, California 90067

Attn: Stephen D. Silbert, Esq.

Telecopy No.: (310) 556-2920 

or
to such other person or address as any party shall specify by notice in writing to the other party. 

12

 

    8.8 This Agreement, the Warrant Issuance Agreement (including the Exhibits, Schedules and other documents referred to herein and therein) and the Warrants constitute
the entire agreements between the Parties and, except as expressly provided herein, supersede all prior agreements and understandings, oral and written, between the Parties with respect to the subject
matter hereof. 

    8.9 This
Agreement has been jointly negotiated and drafted by the Parties and, in construing and interpreting this Agreement, no provision shall be construed or
interpreted for or against any of the Parties because such provision, or any other provision, or the Agreement as a whole, was purportedly drafted by a particular Party. 

    8.10 Nothing
in this Agreement shall be deemed to create any joint venture, partnership or principal-agent relationship between UBET and the TVG Parties, and neither
shall hold itself out in its advertising or in any other manner which would indicate any such relationship with the other. 

    8.11 This
Agreement may be executed in counterparts, each of which shall be deemed to be an original, and all of which together shall be deemed to be one and the same
instrument. 

    8.12 If
any term or provision of this Agreement shall be found by a court of competent jurisdiction to be invalid, illegal or otherwise unenforceable in any
jurisdiction in which this Agreement is being performed or enforced, the remainder of this Agreement shall be valid and enforceable, and the Parties shall use their best efforts to negotiate a
substitute valid and enforceable provision while preserving to the fullest extent possible the intent and agreements of the Parties set forth herein. 

    8.13 This
Agreement shall be binding upon and inure to the benefit of each Party, and nothing in this Agreement, unless expressly otherwise provided, is intended to
confer upon any other person any rights or remedies of any nature whatsoever under or by reason of this Agreement. Nothing in this Agreement is intended to relieve or discharge the obligation of any
third person to any Party to this Agreement. 

    8.14 Captions
and headings contained in this Agreement have been included for ease of reference and convenience and do not form a part of this Agreement and
shall not be considered in interpreting or construing this Agreement. 

    8.15 Any
dispute or controversy arising out of or relating to this Agreement, other than infringement, validity or enforceability of the TVG Patent Rights, shall be
settled by an expedited arbitration proceeding before a single arbitrator with experience in arbitrations involving patent licenses, to be held in the City of Wilmington, Delaware in accordance with
the rules then in effect of the American Arbitration Association or any successor thereto. The arbitrator may grant injunctions or other relief in such dispute or controversy. The decision of an
arbitrator shall be final, conclusive, and binding on the Parties to the arbitration. Judgment may be entered on the arbitrator's decision in any court having jurisdiction. The losing Party in such
arbitration shall pay all costs and expenses of such arbitration and all the reasonable attorney's fees and expenses of the other Party thereof. 

    8.16 From
and after the Effective Date, each of the TVG Parties and UBET shall, at any time and from time to time, make, execute and deliver, or cause to be made,
executed and delivered, such instruments, agreements, consents and assurances, and take or cause to be taken all such actions as may reasonably be requested by the other party for the effectual
consummation of this Agreement and the transactions contemplated thereby. 

    8.17 Except
as otherwise provided herein, all costs and expenses, including fees and disbursements of counsel, financial advisors and accountants, incurred in
connection with this Agreement and the transactions contemplated hereby, shall be paid by the party incurring such costs and expenses. 

    8.18 UBET
and TVG shall discuss in good faith UBET having the right to lease any unused capacity at the TVG/NTRA Oregon hub at the cost to TVG. TVG shall have the right
to lease any unused facilities and/or bandwith at UBET's facility at UBET's cost. 

13

 

    Intending to be bound thereby, the Parties have caused their duly authorized representatives to execute this Agreement as of the Effective Date. 

	OVERLAND EXPRESS, INC.	 	ODS TECHNOLOGIES, L.P. YOUBET.COM, INC.
	

By:	

 	
 	

By:	

 
	 	
	 	 	

	

Name:	

 	
 	

Name:	

 
	 	
	 	 	

	

Title:	

 	
 	

Title:	

 
	 	
	 	 	

	
ODS PROPERTIES, INC.	
 	

 	

 
	

By:	

 	
 	

 	

 
	 	
	 	 	 
	

Name:	

 	
 	

 	

 
	 	
	 	 	 
	

Title:	

 	
 	

 	

 
	 	
	 	 	 

14

QuickLinks

EXHIBIT 10.27

LICENSE AND CONTENT AGREEMENT

SECTION 1—DEFINITIONS

SECTION 2—PATENT LICENSES AND RELEASE

SECTION 3—SIMULCAST RIGHTS

SECTION 4—CONSIDERATION

SECTION 5—AUDIT PROVISIONS

SECTION 6—TERM AND TERMINATION

SECTION 7—REPRESENTATIONS AND WARRANTIES

SECTION 8—MISCELLANEOUS TERMSPrepared by MERRILL CORPORATION

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EXHIBIT 10.28    
  

 
 

WARRANT ISSUANCE AGREEMENT    
  

    WARRANT ISSUANCE AGREEMENT (this "Agreement"), dated as of May 18, 2001, by and between
YOUBET.COM, INC., a Delaware corporation ("UBET") and ODS TECHNOLOGIES, L.P., a Delaware limited partnership
("TVG"). 

 
 

RECITALS    
  

    WHEREAS,
UBET and TVG are parties to a License and Content Agreement (the "License Agreement"), dated as of the date hereof, relating
to the grant by TVG to UBET of a non-exclusive license to use, subject to the terms thereof, (i) TVG's patented systems, platforms, methods and technologies for the making of
pari-mutuel wagers on horse races using telephones and online using personal computers and other devices approved by the TVG in its business judgment, and (ii) certain horsetrack
simulcast audio, video and data content for the purpose of streaming such content online and the agreement of each track to accept wagers based on such content; 

    WHEREAS,
UBET and TVG have made the execution and delivery of this Agreement a condition to the execution and delivery of the License Agreement; and 

    WHEREAS,
UBET intends, subject to the terms and conditions set forth in this Agreement, to issue to TVG certain warrants representing the right to purchase shares of common stock, par
value $.001 per share, of UBET ("UBET Common Stock"). 

    NOW,
THEREFORE, in consideration of the premises and the respective representations, warranties, covenants and agreements set forth herein, the parties hereto agree as follows: 

 
 

ARTICLE I
  
    ISSUANCE OF WARRANTS    
  

    SECTION
1.01.  Issuance of Initial Warrant. UBET, for good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, shall issue to TVG a
warrant (the "Initial Warrant") to purchase an aggregate of 3,884,650 shares of UBET Common Stock (as the same may be adjusted pursuant to the terms of the Initial Warrant, the "Initial Warrant
Shares"). The Initial Warrant shall be evidenced by, and have the terms (including adjustment terms) set forth in, the Warrant Certificate attached hereto as Exhibit A. 

    SECTION
1.02.  Issuance of Additional Warrant. Subject only to (i) the approval of UBET's stockholders of the Warrant Proposal as provided in
Section 4.01, and (ii) the License Agreement not having been terminated according to its terms, immediately following the UBET Stockholders Meeting (as hereinafter defined), UBET, for
good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, shall issue to TVG a warrant (the "Additional Warrant") to purchase a number of shares of UBET Common Stock
which, when aggregated with the number of Initial Warrant Shares, shall equal 51.0% of the sum of (i) the total number of shares of UBET Common Stock outstanding on the date the Additional
Warrant is exercised (the "Additional Warrant Exercise Date"), (ii) the total number of shares of UBET Common Stock issuable upon exercise of the Additional Warrant, and (iii) the total
number of Initial Warrant Shares then issuable upon exercise of the Initial Warrant (as the same may be adjusted pursuant to the terms of the Additional Warrant, the "Additional Warrant Shares"). The
Additional Warrant shall be evidenced by, and have terms (including adjustment terms) set forth in, the Warrant Certificate attached hereto as Exhibit B. 

 
 
 

ARTICLE II
  
    REPRESENTATIONS AND WARRANTIES OF UBET    
  

    UBET hereby represents and warrants to TVG as follows: 

    SECTION
2.01.  Organization and Qualification. UBET (i) is a corporation duly incorporated, validly existing and in good standing under the laws of the State of
Delaware, (ii) has all requisite corporate power and authority to own, lease and operate its properties and to carry on its business as it is now being conducted and (iii) is duly
qualified or licensed and in good standing to do business in each jurisdiction in which the properties owned, leased or operated by it or the nature of the business conducted by it makes such
qualification or license necessary, except in such jurisdictions where the failure to be so duly qualified or licensed or in good standing has not had, either individually or in the aggregate, a
material adverse effect on the business, assets, results of operations or financial condition of UBET. UBET has delivered to TVG true and complete copies of its Certificate of Incorporation and
By-laws, each as amended through and in effect on the date hereof. UBET has no Subsidiaries. 

    SECTION
2.02.  Authorization and Validity. Except as set forth on Schedule 2.02, UBET has all requisite corporate power and authority to enter into this
Agreement and the License Agreement, to perform its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby, provided however, that the issuance of the
Additional Warrant pursuant to Section 1.02 shall require the adoption of the Warrant Proposal by UBET's stockholders as provided in Section 4.01. The execution, delivery and performance
by UBET of this Agreement and the License Agreement and the consummation of the transactions contemplated hereby and thereby have been duly authorized by the Board of Directors of UBET (the "UBET
Board") and by all other necessary corporate action on the part of UBET, subject, in the case of the issuance of the Additional Warrant pursuant to Section 1.02, to the adoption of the Warrant
Proposal by UBET's stockholders as provided as in Section 4.01. This Agreement and the License Agreement have been duly executed and delivered by UBET and each is a valid and binding obligation
of UBET, enforceable against UBET in accordance with its terms (except insofar as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors' rights generally, or by principles governing the availability of equitable remedies). 

2

 

    SECTION 2.03.  Capitalization. 

    (a) At
the date hereof, the authorized capital stock of UBET consists of (i) 50,000,000 shares of UBET Common Stock and (ii) 1,000,000 shares of Preferred
Stock, par value $.001 per share (the "UBET Preferred Stock"). As of the close of business on May 18, 2001: (i) 19,520,850 shares of UBET
Common Stock were issued and outstanding, 10,951,416 shares were reserved for issuance upon exercise of outstanding stock options and warrants and no shares were held by UBET in its treasury; and
(ii) no shares of UBET Preferred Stock were issued or outstanding or held by UBET in its treasury. All issued and outstanding shares of UBET Common Stock have been validly issued and are fully
paid and nonassessable, are not subject to and have not been issued in violation of any preemptive rights and have not been issued in violation of any Federal or state securities laws. Except as set
forth in the UBET Commission Filings (as hereinafter defined) or on Schedule 2.03, there are no issued or outstanding bonds, debentures, notes or other indebtedness of UBET which have the right
to vote (or which are convertible into other securities having the right to vote) on any matters on which stockholders of UBET may vote ("Voting Debt").
Except as set forth in the UBET Commission Filings or on Schedule 2.03, there are not as of the date hereof any outstanding or authorized subscriptions, options, warrants, calls, rights,
commitments or any other agreements of any character to or by which UBET is a party or is bound which, directly or indirectly, obligate UBET to issue, deliver or sell or cause to be issued, delivered
or sold any shares of UBET Common Stock or UBET Preferred Stock or any other capital stock, equity interest or Voting Debt of UBET or any securities convertible into, or exercisable or exchangeable
for, or evidencing the right to subscribe for any such shares, interests or Voting Debt or obligating UBET to grant, extend or enter into any such subscription, option, warrant, call or right. Except
as set forth in the UBET Commission Filings or on Schedule 2.03, UBET has not adopted, authorized or assumed any plans, arrangements or practices for the benefit of its officers, employees or
directors which require or permit the issuance, sale, purchase or grant of any capital stock, other equity interests or Voting Debt of UBET or any other securities convertible into, or exercisable or
exchangeable for, any such stock, interests or Voting Debt or any phantom shares, phantom equity interests or stock or equity appreciation rights. Except as set forth in the UBET Commission Filings or
on Schedule 2.03, there are not as of the date hereof any outstanding or authorized subscriptions, options, warrants, calls, rights, commitments or other agreements of any character that,
directly or indirectly, (x) call for or relate to the sale, pledge, transfer or other disposition by UBET of any shares of capital stock or other equity interests or any Voting Debt of UBET or
(y) relate to the voting or control of such capital stock or other equity interests or Voting Debt. 

    (b) The
Initial Warrant Shares, as of the date hereof, constitute at least 19.9% of the issued and outstanding shares of UBET Common Stock. The Initial Warrant Shares,
upon issuance and delivery against payment of the exercise price therefor in accordance with the terms of the Initial Warrant, will be duly authorized, validly issued, fully paid and
non-assessable, will be free of any liens, claims, charges, security interests, pledges, voting or shareholder agreements, encumbrances or equities of any kind whatsoever (except as
expressly contemplated hereby or to the extent created by TVG) and will not be issued in violation of any preemptive rights. 

3

 

    (c) Upon exercise of the Additional Warrant, the Additional Warrant Shares shall equal not less than 51% of the sum of (x) the total number of shares of UBET
Common Stock outstanding on the Additional Warrant Exercise Date, (y) the total number of shares of UBET Common Stock issuable upon exercise of the Additional Warrant, and (z) the
Initial Warrant Shares then issuable upon exercise of the Initial Warrant. Subject to approval of the Warrant Proposal, the Additional Warrant Shares, upon issuance and delivery against payment of the
exercise price therefor in accordance with the terms of the Additional Warrant, will be duly authorized, validly issued, fully paid and non-assessable, will be free of any liens, claims,
charges, security interests, pledges, voting or shareholder agreements, encumbrances or equities of any kind whatsoever (except as expressly contemplated hereby or to the extent created by TVG) and
will not be issued in violation of any preemptive rights. 

    SECTION
2.04.  Reports and Financial Statements. UBET has heretofore made available to TVG true and complete copies of all reports, registration statements, definitive
proxy statements and other documents (in each case together with all amendments and supplements thereto) filed by UBET with the Securities and Exchange Commission (the "Commission") since
March 30, 2000 (such reports, registration statements, definitive proxy statements and other documents, together with any amendments and supplements thereto, are sometimes collectively referred
to as the "UBET Commission Filings"). The UBET Commission Filings constitute all of the documents (other than preliminary material) that UBET was required to file with the Commission since such date.
As of their respective dates, each of the UBET Commission Filings complied in all material respects with the applicable requirements of the Securities Act of 1933, as amended (the "Securities Act"),
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the rules and regulations under each such Act, and none of the UBET Commission Filings contained as of such date any untrue
statement of a material fact or omitted 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. When filed with the Commission, the financial statements included in the UBET Commission Filings complied as to form in all material respects with the applicable rules and regulations
of the Commission and were prepared in accordance with generally accepted accounting principles (as in effect from time to time) applied on a consistent basis (except as may be indicated therein or in
the notes or schedules thereto), and such financial statements fairly present the financial position of UBET as at the dates thereof and the results of its operations and its cash flows for the
periods then ended, subject, in the case of the unaudited interim financial statements, to year-end audit adjustments, none of which are expected to be material in nature or amount. Since
December 31, 2000, except in the ordinary course of business or as disclosed in the UBET Commission Filings filed with the Commission prior to the date hereof, as of the date hereof, UBET has
not incurred any liability or obligation of any kind which, in any case or in the aggregate, would have a material adverse effect on the business, assets, results of operations or financial condition
of UBET. 

    SECTION
2.05.  No Approvals or Notices Required; No Conflict with Instruments. Except as set forth on Schedule 2.05, the execution and delivery by UBET of this
Agreement and the License Agreement do not, and the performance by UBET of its obligations hereunder and thereunder and the consummation of the transactions contemplated hereby and thereby will not: 

    (i)  conflict
with or violate the Certificate of Incorporation, as amended, or By-laws, as amended, of UBET; 

4

 

    (ii) require any consent, approval, order or authorization of or other action by any Governmental Entity (as defined in clause (v) of this Section 2.05)
(a "Government Consent") or any registration, qualification, declaration or filing with or notice to any Governmental Entity (a
"Governmental Filing"), in each case on the part of or with respect to UBET, the absence or omission of which would, either individually or in the
aggregate, have a material adverse effect on the transactions contemplated by this Agreement or the License Agreement or on the business, assets, results of operations or financial condition of UBET; 

    (iii) require,
on the part of UBET, any consent by or approval of (a "Contract Consent") or notice to (a
"Contract Notice") any other person or entity (other than a Governmental Entity), the absence or omission of which would, either individually or in the
aggregate, have a material adverse effect on the transactions contemplated by this Agreement or the License Agreement or on the business, assets, results of operations or financial condition of UBET; 

    (iv) assuming
that the Contract Consents and Contract Notices described on Schedule 2.05 are obtained and given, conflict with, result in any violation or breach
of or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of any obligation or the loss of any material benefit under
or the creation of any lien, security interest, pledge, charge, claim, option, right to acquire, restriction on transfer, voting restriction or agreement, or any other restriction or encumbrance of
any nature whatsoever on any assets pursuant to (any such conflict, violation, breach, default, right of termination, cancellation or acceleration, loss or creation, a
"Violation") any contract (which term shall mean and include any note, bond, indenture, mortgage, deed of trust, lease, franchise, permit,
authorization, license, contract, instrument, employee benefit plan or practice, or other agreement, obligation, commitment or concession of any nature) to which UBET is a party, by which UBET or its
assets or properties is bound or affected or pursuant to which UBET is entitled to any rights or benefits, except for such Violations which would not, either individually or in the aggregate, have a
material adverse effect on the transactions contemplated hereby or on the business, assets, results of operations or financial condition of UBET; or 

    (v) assuming
that the Government Consents and Governmental Filings specified in clause (ii) of this Section 2.05 are obtained, made and given, result in a
Violation of, under or pursuant to, any law, rule, regulation, order, judgment or decree applicable to UBET or by which any of its properties or assets is bound or affected, except for such Violations
which would not, either individually or in the aggregate, have a material adverse effect on the transactions contemplated by this Agreement or the License Agreement or on the business, assets, results
of operations or financial condition of UBET. As used herein, the term "Governmental Entity" means and includes any court, administrative agency or
commission or other governmental authority or instrumentality, domestic or foreign. 

    SECTION
2.06.  Absence of Certain Changes or Events. Except as otherwise disclosed in the UBET Commission Filings filed with the Commission prior to the date hereof or
as set forth on Schedule 2.06, during the period commencing on January 1, 2001 and ending on the date of this Agreement, there has not been any material adverse change in, and no event
has occurred and no condition exists which,
individually or together with other events or conditions (excepting therefrom general market and economic conditions), has had a material adverse effect on, the business, assets, results of operations
or financial condition of UBET. 

    SECTION
2.07.  Legal Proceedings. Except as set forth in the UBET Commission Filings filed with the Commission prior to the date hereof or as set forth on
Schedule 2.07, there is no suit, action or proceeding pending or, to the knowledge of UBET, any investigation pending or any suit, action, proceeding or investigation threatened, against,
involving or affecting UBET or its properties or rights, 

5

 

nor is there any judgment, decree, injunction, rule or order of any court, governmental department, commission, agency, instrumentality or arbitrator outstanding against UBET, which does or will
(i) result in the modification, termination, suspension, impairment or reformation of any material contract to which UBET is a party; (ii) materially adversely affect the manner in which
UBET conducts its business; (iii) materially adversely affect the ability of UBET or TVG to consummate any of the transactions contemplated by this Agreement or the License Agreement; or
(iv) have a material adverse effect on the business, assets, results of operations or financial condition of UBET. 

    SECTION
2.08.  Compliance With Regulatory Requirements. Except as set forth in the UBET Commission Filings filed with the Commission prior to the date hereof or as set
forth on Schedule 2.08, UBET is in compliance with, and has conducted its business so as to comply with, all applicable laws, rules, regulations, ordinances and codes, domestic or foreign,
including laws, rules, regulations, ordinances and codes relating to the protection of the environment, except where the failure so to comply has not had, and may reasonably be expected not to have,
either individually or in the aggregate, a material adverse effect on the business, assets, results of operations or financial condition of UBET. The UBET Common Stock is registered pursuant to
Section 12(g) of the Exchange Act and is listed on the Nasdaq National Market, and, except as set forth on Schedule 2.08, UBET has taken no action designed to, or which is likely to have
the effect of, terminating the registration of the UBET Common Stock under the Exchange Act or delisting the UBET Common Stock from the Nasdaq National Market. Provided that any shares of UBET Common
Stock are then listed on the Nasdaq National Market, the Initial Warrant Shares, upon exercise of the Initial Warrant, and the Additional Warrant Shares, upon exercise of the Additional Warrant, will
be approved for listing on the Nasdaq National Market. 

    SECTION
2.09.  Brokers or Finders. No agent, broker, investment banker, financial advisor or other person or entity is or will be entitled, by reason of any agreement,
act or statement by UBET or any of its directors, officers, employees or affiliates, to any financial advisory, broker's, finder's or similar fee or commission, to reimbursement of expenses or to
indemnification or contribution in connection with any of the transactions contemplated by this Agreement or the License Agreement, and UBET agrees to indemnify and hold TVG harmless from and against
any and all claims, liabilities or obligations with respect to any such fees, commissions, expenses or claims for indemnification or contribution asserted by any person on the basis of any act or
statement made by UBET or any of its directors, officers, employees or affiliates. 

    SECTION
2.10.  Intellectual Property. 

    (a) UBET
owns, or has the defensible right to use, all Intellectual Property used in UBET's business, except where the failure to own or have the right to use such
Intellectual Property would not, individually or in the aggregate, have a material adverse effect on the business, assets, results of operations or financial condition of UBET. 

    (b) Except
as disclosed in the UBET Commission Filings filed with the Commission prior to the date hereof and except as set forth on Schedule 2.10, no claims
have been asserted or, to the knowledge of UBET, threatened by any person or entity (i) challenging the ownership, validity or effectiveness of any Intellectual Property owned or used by UBET,
(ii) to the effect that any activity of UBET infringes on any patent or (iii) against the use by UBET of any Intellectual Property necessary for the conduct of its business, except where
such claims would not, individually or in the aggregate, have a material adverse effect on the business, assets, results of operations or financial condition of UBET. 

6

 

    (c) As used in this Section 2.10, "Intellectual Property" means all industrial and intellectual property rights
including Proprietary Technology, patents, patent applications, trademarks, trademark applications and registrations, service marks, service mark applications and registrations, copyrights,
know-how, licenses relating to any of the foregoing, trade secrets, proprietary processes and formulae. "Proprietary Technology" means all
proprietary processes, formulae, inventions, trade secrets, know-how, development tools and other proprietary rights used by UBET pertaining to any product, software or service
manufactured, marketed, licensed or sold by UBET in the conduct of its business or used, employed or exploited in the development, license, sale, marketing, distribution or maintenance thereof, and
all documentation and media constituting, describing or relating to the above, including manuals, memoranda, know-how, notebooks, software, records and disclosures. 

    SECTION
2.11.  Compliance with Charter and Contracts. 

    (a) UBET
is not in violation of any term of its charter or by-laws. 

    (b) UBET
has filed with the Commission copies of all agreements, leases, license agreements and other contracts to which UBET is a party or may be bound that, after
consultation with its legal counsel, UBET reasonably believes are required to be filed under the Securities Act and the Exchange Act. Except as set forth on Schedule 2.11, each of such
agreements, leases, license agreements and contracts is in full force and effect (other than those which have expired or terminated pursuant to their terms or by mutual agreement of UBET and each
other party thereto since the filing thereof), and (i) neither UBET nor, to UBET's knowledge, any other party thereto, has breached or is in default thereunder, (ii) to UBET's knowledge,
no event has occurred which, with the passage of time or the giving of notice, would constitute such a breach or default, (iii) no claim of material default thereunder has, to UBET's knowledge,
been asserted or threatened and (iv) neither UBET nor, to UBET's knowledge, any other party thereto is seeking the renegotiation thereof or substitute performance thereunder, except where such
breach or default, or attempted renegotiation or substitute performance, individually or in the aggregate, would not have a material adverse effect on the business, assets, results of operations or
financial condition of UBET. 

    SECTION
2.12.  Disclosure. Neither this Agreement, nor any other agreement, document, certificate or other written instrument delivered pursuant hereto, contains or
will contain any untrue statement of a material fact or omits or will omit to state a material fact necessary to make the statements herein and therein, when taken together, not misleading. 

    SECTION
2.13.  Section 203 of the DGCL. Prior to the execution of this Agreement, the UBET Board has approved the transactions contemplated by this Agreement and
the License Agreement, including the acquisition by TVG of the Initial Warrant Shares and the Additional Warrant Shares upon exercise of the Initial Warrant and the Additional Warrant, respectively,
for all purposes, including Section 203 of the Delaware General Corporation Law ("DGCL"), and none of TVG or any "affiliate" or "associate" (as such terms are defined in
Section 203 of the DGCL) shall as a result of the execution of this Agreement, the exercise of the Initial Warrant or the Additional Warrant or consummation of the transactions contemplated by
this Agreement or the License Agreement, be subject to any restrictions of Section 203 of the DGCL. 

 
 

ARTICLE III
  
    REPRESENTATIONS AND WARRANTIES OF TVG    
  

    TVG hereby represents and warrants to UBET as follows: 

    SECTION
3.01.  Organization and Qualification. TVG (i) is a limited partnership duly organized, validly existing and in good standing under the laws of the State
of Delaware, (ii) has all requisite partnership power and authority to own, lease and operate its properties and to carry on its business as 

7

 

it is now being conducted and (iii) is duly qualified or licensed and in good standing to do business in each jurisdiction in which the properties owned, leased or operated by it or the nature
of the business conducted by it makes such qualification or license necessary, except in such jurisdictions where the failure to be so duly qualified or licensed or in good standing has not had,
either individually or in the aggregate, a material adverse effect on the business, assets, results of operations or financial condition of TVG. 

    SECTION
3.02.  Authorization and Validity of Agreement. TVG has all requisite partnership power and authority to enter into this Agreement and the License Agreement and
to perform its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance by TVG of this Agreement and the License
Agreement and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all necessary partnership action on the part of TVG. This Agreement and the License
Agreement have been duly executed and delivered by TVG and each is a valid and binding obligation of TVG, enforceable against TVG in accordance with its terms (except insofar as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors' rights generally, or by principles governing the availability of equitable remedies). 

    SECTION
3.03.  No Approvals or Notices Required; No Conflict with Instruments. Except as set forth on Schedule 3.03, the execution and delivery by TVG of this
Agreement and the License Agreement do not, and the performance by TVG of its obligations hereunder and thereunder and the consummation of the transactions contemplated hereby and thereby will not: 

    (i)  conflict
with or violate the Agreement of Limited Partnership of TVG; 

    (ii) require
any Government Consent or Governmental Filing, in each case on the part of or with respect to TVG, the absence or omission of which would, either
individually or in the aggregate, have a material adverse effect on the ability of TVG to perform its obligations under this Agreement or the License Agreement, except for the filing with the
Commission of such reports under Section 13(d) of the Exchange Act as may be required in connection with the transactions contemplated by this Agreement; 

    (iii) require,
on the part of TVG, any Contract Consent or Contract Notice, the absence or omission of which would, either individually or in the aggregate, have a
material adverse effect on the ability of TVG to perform its obligations under this Agreement or the License Agreement; 

    (iv) conflict
with or result in any Violation of any contract to which TVG is a party, by which TVG or any of its assets or properties is bound or affected or pursuant
to which TVG is entitled to any rights or benefits, except for such Violations which would not, either individually or in the aggregate, have a material adverse effect on the ability of TVG to perform
its obligations under this Agreement or the License Agreement; or 

    (v) assuming
that the Government Consents and Governmental Filings specified in clause (ii) of this Section 3.03 are obtained, made and given, result in a
Violation of, under or pursuant to, any law, rule, regulation, order, judgment or decree applicable to TVG or by which any of its properties or assets are bound or affected, except for such Violations
which would not, either individually or in the aggregate, have a material adverse effect on the ability of TVG to perform its obligations under this Agreement or the License Agreement. 

    SECTION
3.04.  Legal Proceedings. There is no suit, action or proceeding pending or, to the knowledge of TVG, any investigation pending or any suit, action, proceeding
or investigation threatened, against or involving TVG or any of its properties or rights, nor is there any judgment, decree, injunction, rule or order of any court, governmental department,
commission, agency, instrumentality or arbitrator outstanding against TVG, which does or will materially adversely affect the 

8

 

ability of TVG to consummate the transactions contemplated by this Agreement or the License Agreement. 

    SECTION
3.05.  Compliance With Regulatory Requirements. TVG is in compliance with, and has conducted its business so as to comply with, all applicable laws, rules,
regulations, ordinances and codes, domestic or foreign, except where the failure so to comply has not had, and may reasonably be expected not to have, either individually or in the aggregate, a
material adverse effect on the ability of TVG to perform its obligations under this Agreement or the License Agreement. 

    SECTION
3.06.  Brokers or Finders. No agent, broker, investment banker, financial advisor or other person or entity is or will be entitled, by reason of any agreement,
act or statement by TVG or any of its directors, officers, employees or affiliates, to any financial advisory, broker's, finder's or similar fee or commission, to reimbursement of expenses or to
indemnification or contribution in connection with any of the transactions contemplated by this Agreement or the License Agreement, and TVG agrees to indemnify and hold UBET harmless from and against
any and all claims, liabilities or obligations with respect to any such fees, commissions, expenses or claims for indemnification or contribution asserted by any person on the basis of any act or
statement made by TVG or any of its directors, officers, employees or affiliates. 

9

 

    SECTION 3.07.  Intellectual Property. 

    (a) TVG
owns, or has the defensible right to use, all Intellectual Property used in TVG's business, except where the failure to own or have the right to use such
Intellectual Property would not, individually or in the aggregate, have a material adverse effect on the ability of TVG to perform its obligations under this Agreement or the License Agreement. 

    (b) No
claims which, individually or in the aggregate, are reasonably expected to have a material adverse effect on the ability of TVG to consummate the transactions
contemplated by this Agreement or the License Agreement, or to perform its obligations hereunder or thereunder, have been asserted or, to the knowledge of TVG, threatened by any person or entity
(i) to the effect that any of the Intellectual Property licensed by TVG to UBET pursuant to the License Agreement infringes on any patent, (ii) against the use by TVG of any Intellectual
Property necessary for TVG to perform its obligations under the License Agreement, or (iii) challenging the ability of TVG to provide the simulcast audio and visual signals and
pari-mutuel wagering as provided in the License Agreement. 

    (c) As
used in this Section 3.07, "Intellectual Property" means all industrial and intellectual property rights
including Proprietary Technology, patents, patent applications, trademarks, trademark applications and registrations, service marks, service mark applications and registrations, copyrights,
know-how, licenses relating to any of the foregoing, trade secrets, proprietary processes and formulae. "Proprietary Technology" means all
proprietary processes, formulae, inventions, trade secrets, know-how, development tools and other proprietary rights used by TVG pertaining to any product, software or service
manufactured, marketed, licensed or sold by TVG in the conduct of its business or used, employed or exploited in the development, license, sale, marketing, distribution or maintenance thereof, and all
documentation and media constituting, describing or relating to the above, including manuals, memoranda, know-how, notebooks, software, records and disclosures. 

    SECTION
3.08.  Compliance with Charter. TVG is not in violation of any terms of its certificate of limited partnership or partnership agreement except where such
violation would not have a material adverse effect on the ability of TVG to perform its obligations under this Agreement or the License Agreement. 

    SECTION
3.09.  Investment Purpose. TVG is acquiring the Initial Warrant and, provided the Warrant Proposal is adopted by UBET's Stockholders as provided in
Section 4.01, the Additional Warrant, solely for the purpose of investment and not with a view to, or for offer or sale in connection with, any distribution thereof in any transaction which
would be in violation of the securities laws of the United States of America or any state thereof. TVG understands that the certificate representing the Initial Warrant Shares and the Additional
Warrant Shares will contain a legend stating in substance: 

"The
shares represented by this certificate have not been registered under the Securities Act of 1933 and such shares may not be sold or transferred unless such sale or transfer will be effected in
accordance with the registration requirements of the Securities Act of 1933, as at that time amended, or in accordance with any exemption from the registration requirements of such Act, which may then
be available thereto." 

    TVG
understands and acknowledges that UBET will deliver unlegended certificates in exchange for the certificate bearing such legend only in the event that (i) TVG transfers
shares represented by such certificate pursuant to and in the manner provided for in an effective registration statement covering the transfer or sale of such shares or (ii) TVG shall have
delivered to UBET a letter from the staff of the Commission, or an opinion of counsel in form reasonably satisfactory to UBET to the effect that such legend is not required for the purposes of the
Securities Act. 

10

  

 
 

ARTICLE IV
  
    CERTAIN COVENANTS    
  

    SECTION
4.01. UBET Stockholder Meeting.  

    (a) UBET
will, either at its 2001 annual meeting of stockholders or, at its option, at a special meeting of its stockholders, in either case to be held on or before
October 1, 2001, propose for approval by UBET's stockholders the issuance to TVG of the Additional Warrant (the "Warrant Proposal") and such
increases in the authorized number of shares of Common Stock as UBET determines is prudent in light of the number of Additional Warrant Shares. Subject to the fiduciary duties of UBET's directors
under applicable law as determined by a majority of such directors with the advice of legal counsel, the UBET Board will recommend that UBET's stockholders vote in favor of approval of the Warrant
Proposal at such meeting (the "UBET Stockholders Meeting"), and UBET will use its best efforts to solicit from its stockholders proxies in favor of such
approval. To the extent that the Initial Warrant has been exercised on or prior to the record date for the UBET Stockholders Meeting, TVG agrees that any stock received by it as a result of such
exercise will not be counted in determining whether the requisite percentage of UBET's stockholders vote in favor of the Warrant Proposal. 

    (b) UBET
shall (i) as soon as reasonably practicable in light of the anticipated date of the UBET Stockholders Meeting file with the Commission a preliminary
form (the "UBET Preliminary Proxy Statement") of the definitive proxy statement to be mailed to UBET's stockholders in connection with the UBET
Stockholders Meeting (the "UBET Proxy Statement"), (ii) use its best efforts to promptly respond to the comments of the Commission thereon, and
(iii) use its best efforts to cause the UBET Proxy Statement to be filed with the Commission as soon as reasonably practicable after the UBET Preliminary Proxy Statement, as it may be amended,
is cleared by the Commission. To the extent that the UBET Preliminary Proxy Statement or any amendment thereto includes a description of TVG and/or this Agreement or the License Agreement, UBET will
provide TVG with the opportunity to review and comment on such description prior to the filing of the UBET Preliminary Proxy Statement or such amendment, as the case may be, and will consider in good
faith such comments as TVG may have with respect thereto. 

    (c) UBET
shall notify TVG promptly after the receipt by UBET of any comments of the Commission on, or of any request by the Commission for amendments or supplements to,
the UBET Preliminary Proxy Statement or UBET Proxy Statement and shall provide TVG with copies of all correspondence between UBET or any of its representatives and the Commission with respect to
either of the foregoing filings. 

    SECTION
4.02. Reservation of Shares.  UBET will at all times during the period that the Initial Warrant or the Additional Warrant may be exercised reserve and keep
available, free from preemptive rights, out of the aggregate of its authorized but unissued UBET Common Stock, or its authorized and issued UBET Common Stock held in treasury, for the purpose of
enabling it to satisfy any obligation to issue Initial Warrant Shares upon exercise of the Initial Warrant and Additional Warrant Shares upon exercise of the Additional Warrant, the full number of
Initial Warrant Shares and Additional Warrant Shares deliverable upon the exercise of the Initial Warrant and Additional Warrant, respectively. UBET covenants and agrees that for so long as the
Initial Warrant or the Additional Warrant is outstanding and is exercisable, it will not take any action to increase the par value of the UBET Common Stock or issue any shares of UBET Preferred Stock
which grants the holders thereof the right to vote on any matters on which the holders of UBET Common Stock may vote. 

11

 

    SECTION 4.03. Obtaining of Certain Governmental Approvals.  

    (a) UBET
from time to time will use reasonable efforts to obtain and keep effective any and all permits, consents and approvals of Governmental Entities and to make
securities law filings under federal and state laws, or with any securities exchange or association on which the UBET Common Stock is listed, that may be required in connection with the issuance and
delivery of the Additional Warrant, the exercise of the Initial Warrant and the Additional Warrant and the issuance and delivery of Initial Warrant Shares and the Additional Warrant Shares. 

    (b) Without
limiting the generality of the foregoing, in the event that TVG reasonably believes that exercise of the Initial Warrant or the Additional Warrant and
issuance of Initial Warrant Shares or Additional Warrant Shares acquirable upon such exercise requires prior compliance with the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and
the rules and regulations thereunder (the "HSR Act and Rules"), then any such exercise shall be contingent upon such prior compliance. To effect such
compliance, UBET and TVG will, promptly following receipt by UBET of TVG's notice of exercise, use their respective commercially reasonable efforts to make all filings necessary to cause the
expiration or termination of any applicable waiting period under the HSR Act and Rules. Each of UBET and TVG shall bear and pay its respective costs or expenses that it incurs in complying with this
Section 4.03(b), except that each of UBET and TVG shall each pay one half of any fee payable to the Federal Trade Commission (the "FTC") or the
Antitrust Division of the Department of Justice (the "DOJ") or any other governmental body then having jurisdiction with respect to the HSR Act and
Rules in connection with the filing of any reports under the HSR Act and Rules. Notwithstanding anything to the contrary contained herein, in the event that any filing under the HSR Act and Rules made
by TVG and UBET pursuant to this Section 4.03(b) results in either the FTC or DOJ issuing a written "request for additional information or documentary material" pursuant to
Section 7A(e)(i) of the HSR Act and Rules 16 C.F.R. §803.20, then TVG shall have the absolute right to withdraw such filing and its notice of exercise of the Initial
Warrant and/or the Additional Warrant, as the case may be. 

    SECTION
4.04. Reasonable Efforts.  Subject to the terms and conditions of this Agreement and applicable law, each of the parties shall use its reasonable efforts to
take, or cause to be taken, all actions, and do, or cause to be done, all things reasonably necessary, proper or advisable to consummate and make effective the transactions contemplated by this
Agreement as soon as reasonably practicable. 

    SECTION
4.05. UBET Board Representation.  Following the exercise of the Initial Warrant and/or the Additional Warrant and for so long as TVG beneficially owns at least
5% of the outstanding shares of UBET common stock (the "Director Designation Period"), UBET agrees to use its best efforts to enable TVG to designate a number of directors to the UBET Board in a ratio
based on TVG's overall ownership of UBET Common Stock according to the following formula:

	Percentage of Outstanding

Common Stock Owned by TVG
 
	 	Ratio of TVG's Board Designees

to Total Number of Directors

	5% to 30%	 	1/5
	more than 30% up to 49.9%	 	2/5
	more than 49.9% up to 60%	 	3/5
	more than 60% up to 79.9%	 	4/5
	more than 79.9%	 	5/5

12

 

In
furtherance of the foregoing, during the Director Designation Period, at each annual or special meeting of the stockholders of UBET at which members of the UBET Board are to be elected, UBET agrees
to use its best efforts to cause the UBET Board (or any authorized committee thereof) to nominate and recommend the election to the UBET Board of a number of directors designated by TVG in the ratio
to the fully constituted UBET Board set forth above, based on the percentage of the outstanding shares of UBET Common Stock owned by TVG as of the record date for such meeting of UBET stockholders.
During the Director Designation Period, UBET agrees (i) to use its best efforts to fill any vacancy created by the resignation, withdrawal or removal of any director designated by TVG with a
new director designated by TVG, and (ii) to not take any action to increase the number of directors constituting the full UBET Board if, as a result of such increase and the filling of
vacancies created thereby, the ratio of directors of the UBET Board designated by TVG to the total number of directors shall be a fraction less than the ratio of TVG-designated directors
to the total number of directors immediately prior to such increase. 

    SECTION
4.06. Registration Rights.  

    (a) Demand Registration Rights.

     (i) At
any time and from time to time after the date hereof, TVG and any transferee of Registrable Securities (as defined in clause (viii) of this
Section 4.06(a)) who becomes a party to this Agreement (each such transferee and TVG, a "Holder, and collectively, the "Holders") shall have the right to request UBET to effect the registration
under the Securities Act of all or part of their Registrable
Securities. Holders shall exercise such right by giving of a notice stating (A) the number of Registrable Securities to be included in such registration statement and (B) the Holder's
intended method of distribution (which may include an underwritten offering). Upon receipt by UBET of any such request, UBET shall promptly give notice of such proposed registration to all Holders who
hold Registrable Securities and thereupon shall, as expeditiously as possible, use reasonable efforts to effect the registration under the Securities Act of: 

    (A) all
Registrable Securities that UBET has been requested to register pursuant to clause (i) of this Section 4.06(a); and 

    (B) all
other Registrable Securities that Holders have, within 20 days after UBET has given such notice, requested UBET to register; 

all
to the extent requisite to permit the sale or other disposition by the Holders of the Registrable Securities so to be registered. 

    (ii) If
the managing underwriter, selected pursuant to Section 4.06(g)(i), of the public offering to be effected pursuant to a registration statement filed
pursuant to clause (i) of this Section 4.06(a) of any Registrable Securities shall advise UBET in writing (with a copy to each holder of Registrable Securities requesting registration)
that, in its opinion, the number of securities requested to be included in such registration (including securities of UBET that are not Registrable Securities) exceeds the number that can be sold in
such offering without having an adverse effect on such offering, UBET will include in such registration to the extent of the number that UBET is so advised can be sold in such offering: 

    (A) first, Registrable Securities requested to be included in such registration by TVG; 

    (B) second, Registrable Securities requested to be included in such
registration by Holders other than TVG pro rata based on the number of such shares to be included; and 

13

 

    (C) third, other securities of UBET proposed to be included pursuant to Section 4.06(a)(vii) in such
registration, in accordance with the priorities, if any, then existing among UBET and the holders of such other securities. 

    (iii) The
Holders requesting inclusion in a registration statement under this Section 4.06(a) may withdraw from
any requested registration pursuant to this Section 4.06(a) by giving written notice to UBET prior to the date an underwriting agreement is executed or such registration statement becomes
effective; provided, however, that for a period of six months after such withdrawal, such Holders may not request any registration pursuant to this Section 4.06(a) unless (A) such
Holders pay UBET for its out-of-pocket expenses relating to such registration, (B) the registration statement had not been filed within 60 days of the initial
request for registration pursuant to Section 4.06(a)(i) or had not become effective within 75 days of its filing or (C) UBET otherwise failed to comply with its obligations
under this Section 4.06 with respect to such registration. 

    (iv) UBET
shall not be required to effect more than a total of five effective registrations under this Section 4.06(a). If UBET shall have filed a registration
statement and all of the Holders requesting registration thereunder shall have withdrawn from the registration under Section 4.06(a)(iii) prior to such registration statement becoming
effective, such registration shall be deemed to have been effective unless (A) such Holders pay UBET for its out-of-pocket expenses relating to such registration,
(B) the registration statement had not been filed within 60 days of the initial request for registration pursuant to Section 4.06(a)(i) or had not become effective within
75 days of its filing or (C) UBET otherwise failed to comply with its obligations under this Section 4.06 with respect to such registration. Notwithstanding the foregoing, if the
Holders withdraw from an offering after the registration statement for the shares to be offered thereby has become effective due to the occurrence of any of the events set forth in Sections
4.06(c)(vi), (vii) or (viii), in each case unless cured prior to the Holders' withdrawal, then such registration shall not be counted as an effective registration for purposes of this
Section 4.06(a)(iv). 

    (v) UBET
shall not be required to effect a registration pursuant to this Section 4.06(a) unless the offering includes Registrable Securities having a fair market
value of at least $2 million in the aggregate. 

    (vi) UBET
shall not be required to effect any registration within six (6) months of the effective date of any other registration under this
Section 4.06(a). 

   (vii) If
the managing underwriter in an underwritten offering has not limited the number of Registrable Securities to be underwritten, then UBET may include securities
for its own account or for the account of others in such registration statement and underwriting if the managing underwriter so agrees and if the number of Registrable Securities held by Holders which
would otherwise have been included in such registration statement and underwriting will not thereby be limited. The inclusion of such shares shall be on the same terms as the registration of
Registrable Securities held by the Holders. In the event that the managing underwriter excludes some of the securities to be registered, the securities to be sold for the account of UBET and any other
holders shall be excluded in their entirety prior to the exclusion of any Registrable Securities of the Holders. 

   (viii) For
purposes of this Agreement, the term "Registrable Securities" shall mean any Initial Warrant Shares or
Additional Warrant Shares. As to any particular Registrable Securities once issued, such securities shall cease to be Registrable Securities when (i) a registration statement with respect to
the sale of such securities shall have become effective under the Securities Act and such securities shall
have been disposed of in accordance with such registration statement, (ii) such securities shall be freely saleable by the applicable 

14

 

Holder without limits as to volume under Rule 144 (or any successor provision) under the Securities Act, (iii) such securities shall have been otherwise transferred, new certificates for
them not bearing a legend restricting further transfer shall have been delivered by UBET and subsequent disposition of them shall not require registration or qualification of them under the Securities
Act, or (iv) such securities shall have ceased to be outstanding. 

    (b) "Piggyback" Registrations. If UBET at any time proposes to register any of its securities under the Securities Act
(other than pursuant to Section 4.06(a)) on a registration statement on Form S-1, S-2 or S-3 or on any other form upon which may be registered
securities similar to the Registrable Securities for sale to the general public except Form S-4 and Form S-8, UBET will at each such time give prompt notice to
the Holders of its intention to do so setting forth the date on which UBET proposes to file such registration statement, which date shall be no earlier than 20 days from the date of such
notice, and advising the Holders of their right to have Registrable Securities included therein. Upon the written request of the Holders given to UBET not less than 5 days prior to the proposed
filing date of such registration statement set forth in such notice, UBET will use reasonable best efforts to cause each of the Registrable Securities that UBET has been requested to register by the
Holders to be registered under the Securities Act. If the securities to be so registered for sale include securities to be sold for the account of UBET and to be distributed by or through a firm of
underwriters of recognized standing, then the Registrable Securities shall also be included in such underwriting, provided that if the underwriter shall
advise UBET in writing (with a copy to each holder of Registrable Securities requesting registration) that, in its opinion, the number of securities requested to be included in such registration
exceeds the number that can be sold in such offering without having an adverse effect on such offering, UBET will include in such registration to the extent of the number that UBET is so advised can
be sold in such offering securities determined as follows: 

     (i) if
such registration as initially proposed by UBET was solely a primary registration of its securities: 

    (A) first, the securities proposed by UBET to be sold for its own account, 

    (B) second, any Registrable Securities requested to be included in such
registration pro rata among the Holders of such Registrable Securities and the holders of such other shares of UBET Common Stock on the basis of the number of Registrable Securities and other shares
of UBET Common Stock requested to be included by each such holder, and 

    (C) third, any other securities of UBET proposed to be included in such
registration statement in accordance with the provisions, if any, then existing among the holders of such securities, and 

    (ii) if
such registration as initially proposed by UBET was in whole or in part requested by holders of securities of UBET, other than Holders of Registrable
Securities, pursuant to demand registration rights, 

    (A) first, such securities held by the holders initiating such registration, pro rata among the holders thereof, on the
basis agreed upon by such holders and UBET, 

    (B) second, Registrable Securities requested to be included in such registration pro rata among the Holders of such
Registrable Securities and the holders of such other shares of UBET Common Stock on the basis of the number of Registrable Securities and other shares of UBET Common Stock requested to be included by
each such holder, and 

    (C) third, any securities of UBET proposed to be included in such registration statement in accordance with the
priorities, if any, then existing among the holders of such securities. 

15

 

The Holders requesting inclusion in a registration statement under this Section 4.06(b) may withdraw from any such requested registration by giving written notice to UBET prior to the date an
underwriting agreement is executed or such registration statement becomes effective. 

    (c) UBET's Obligations in Registration. If and whenever UBET is obligated by the provisions of this Section 4.06
to use reasonable best efforts to effect the registration of any Registrable Securities under the Securities Act, UBET will: 

     (i) prepare
and file with the Commission, as expeditiously as possible but in no event later than 60 days after the initial request from holders to register such
Registrable Securities, a registration statement with respect to such Registrable Securities and use reasonable best efforts to cause such registration statement to become effective within
75 days after its filing and to remain effective; provided, however, that UBET shall not be required to keep such registration statement
effective, or to prepare and file any amendments or supplements thereto, later than the earlier of (x) such time as all Registrable Securities have been sold and (y) 5:00 P.M.,
New York City time, on the 120th business day following the date on which such registration statement becomes effective under the Securities Act; 

    (ii) prepare
and file with the Commission such amendments and supplements to such registration statement and the prospectus used in connection therewith as may be
necessary to keep such registration statement effective and to comply with provisions of the Securities Act with respect to the disposition of all Registrable Securities covered by such registration
statement whenever the Holders for whom such Registrable Securities are registered or are to be registered shall desire to dispose of the same, subject, however, to the proviso contained in the
immediately preceding clause (i); 

    (iii) furnish
each Holder for whom such Registrable Securities are registered or are to be registered such numbers of copies of each registration statement and printed
prospectus, including a preliminary prospectus and any amendments or supplements thereto, in conformity with the requirements of the Securities Act, and such other documents and information as such
Holder may reasonably request in order to facilitate the disposition of such Registrable Securities; 

    (iv) use
reasonable best efforts to register or qualify the Registrable Securities covered by such registration statement under such other securities or blue sky laws
of such United States jurisdictions as each Holder shall reasonably request, and do any and all other acts and things that may be necessary or advisable to enable such Holder to consummate the
disposition in such jurisdictions of such Registrable Securities, except that UBET shall not be required to (A) qualify generally to do business as a foreign corporation in any jurisdiction
wherein it would not but for the requirements of this clause (iv) be obligated to be so qualified, (B) subject itself to taxation in any such jurisdiction or (C) consent to
general service of process in any such jurisdiction unless UBET is already subject to general service of process in such jurisdiction; 

    (v) furnish
to the Holders for whom such Registrable Securities are registered or are to be registered at the time of the disposition of such Registrable Securities by
such Holders a signed copy of an opinion of counsel for UBET reasonably acceptable to such holders as to such matters as such holders may reasonably request and substantially to the effect that, a
registration statement covering such Registrable Securities has been filed with the Commission under the Securities Act and has been made effective by order of the Commission; said registration
statement and the prospectus contained therein comply as to form in all material respects with the requirements of the Securities Act (except that counsel need not express any opinion as to financial
statements contained therein) and, although counsel has not 

16

 

independently verified and is not passing upon the accuracy, completeness or fairness of the statements contained in the registration statement and prospectus included therein, nothing has come to
said counsel's attention that would cause it to believe that either said registration statement or said prospectus contains an untrue statement of a material fact or omits to state a material fact
required to be stated therein or necessary to make the statements therein (in the case of said prospectus, in the light of the circumstances under which they were made) not misleading; said counsel
knows of no legal or governmental proceedings required to be described in said prospectus that are not described as required, or of any contract or documents of a character required to be described in
said registration statement or said prospectus or to be filed as an exhibit to said registration statement or to be incorporated by reference therein that is not described and filed as required; to
the best of counsel's
knowledge, no stop order has been issued by the Commission suspending the effectiveness of such registration statement and no proceedings for the issuance of such a stop order are threatened or
contemplated; it being understood that said counsel may rely, as to all factual matters and financial data treated therein, on certificates of UBET (copies of which shall be delivered to such
Holders). 

    (vi) immediately
notify each Holder of Registrable Securities covered by such registration statement, at any time when a prospectus relating thereto is required to be
delivered under the Securities Act, of the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a
material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances under which they were made,
and at the request of any such Holder promptly prepare and furnish to such Holder a reasonable number of copies of a supplement to or an amendment of such prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such securities, such prospectus shall not include 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 not misleading in the light of the circumstances under which they were made; 

   (vii) advise
each Holder of Registrable Securities covered by such registration statement, promptly after it shall receive notice or obtain knowledge thereof, of the
issuance of any stop order by the Commission suspending the effectiveness of such Registration Statement or the initiation or threatening of any proceeding for that purpose; and use its reasonable
best efforts to comply with all applicable rules and regulations of the Commission, and make generally available to its securities holders as promptly as practicable an earnings statement covering a
period of twelve (12) months beginning after the effective date of such registration statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities
Act and Rule 158 promulgated thereunder; 

   (viii) permit
any holder holding Registrable Securities covered by such registration statement or prospectus to withdraw their Registrable Securities from such
registration statement or prospectus if such Holder has informed UBET that it reasonably believes that such amendment or supplement does not comply in all material respects with the requirements of
the Securities Act or the rules and regulations thereunder; 

    (ix) enter
into such customary agreements (including an underwriting agreement in customary form, if applicable) and take all such other actions as holders of a
majority of the Registrable Securities being sold or the underwriters retained by such Holders, if any, reasonably request in order to expedite or facilitate the disposition of such Registrable
Securities, including customary opinions and indemnification and lock-up agreements; 

17

 

    (x) if requested by the managing underwriters or a Holder of Registrable Securities being sold in connection with an underwritten offering, promptly incorporate in a
prospectus supplement or post-effective amendment such information as the managing underwriters and the holders of a majority of the Registrable Securities being sold agree should be
included therein relating to the plan of distribution with respect to such Registrable Securities including, without limitation, information with respect to the securities being sold to such
underwriters, the purchase price being paid therefor by such underwriters and with respect to any other terms of the underwritten offering of the Registrable Securities to be sold in such offering;
and make all required filings of such prospectus supplement or post-effective amendment as soon as notified of the matters to be incorporated in such prospectus supplement or
post-effective amendment; and 

    (xi) list
such Registrable Securities on any securities exchange on which the UBET Common Stock is then listed, if such Registrable Securities are not already so listed
and if such listing is then permitted under the rules of such exchange. 

    The
period of time that UBET is obligated to keep any registration statement effective, or to prepare and file any amendments or supplements thereto, pursuant to
Section 4.06(c)(i) shall be extended by the number of days that any such Holder is unable to sell Registrable Securities due to the matters discussed in
Section 4.06(c)(vi) and (vii) above. 

    (d) Payment of Registration Expenses. In connection with each registration pursuant to this Section 4.06, UBET
shall pay all expenses incident to performance of or compliance with this Section 4.06, including without limitation, (i) all Commission and stock exchange or National Association of
Securities Dealers, Inc. registration, filing fees and listing expenses, (ii) all fees and expenses of complying with securities or blue sky laws (including reasonable fees and
disbursements of counsel for any underwriters in connection with blue sky qualification of any Registrable Securities), (iii) all printing, messenger and delivery expenses, (iv) the fees
and disbursements of counsel for UBET and of its independent public accountants, including the expenses of any special audits and/or "cold comfort" letters required by or incident to such performance
and compliance, (v) the reasonable fees and disbursements of one counsel retained in connection with such registration by Holders of a majority of the Initial Warrant Shares and Additional
Warrant Shares being registered, not to exceed $35,000, and (vi) any fees and disbursements of underwriters customarily paid by issuers or sellers of securities, including the fees and expenses
of any special experts retained in connection with the requested registration, but excluding underwriting discounts and sales commissions applicable to the sale of the Registrable Securities. 

    (e) Indemnification. 

     (i) Indemnification by UBET. In the event of any registration under the Securities Act of any Registrable Securities
pursuant to this Section 4.06, UBET hereby agrees to indemnify and hold harmless the Holders, their respective agents, directors and officers, each other person, if any, who controls (within
the meaning of the Securities Act) the Holders and each other person (including underwriters) who participates in the offering of such Registrable Securities, against any losses, claims, damages or
liabilities, to the extent that such losses, claims, damages or liabilities (or proceedings in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in any registration statement, under which such Registrable Securities were registered under the Securities Act, in any preliminary prospectus or final prospectus contained
therein or in any amendment or supplement to any preliminary prospectus or final prospectus (if used during the period UBET is required to keep such registration statement current in any such case),
or arise out of or are based upon the omission or alleged omission to state therein a material 

18

 

fact required to be stated therein or necessary to make the statements therein not misleading, or any violation by UBET of the Securities Act or state securities or blue sky laws and relating to
action or inaction required of UBET in connection with the registration or qualification of securities under such laws and will reimburse such Holders, such agents, directors and officers and each
such controlling person or participating person (including underwriters) for any legal or any other expenses reasonably incurred by such Holders, such agents, directors and officers or such
controlling person or participating person (including underwriters) in connection with investigating or defending any such loss, claim, damage, liability or proceeding,  provided, that UBET will not be
liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission made in such registration statement, any preliminary or final prospectus or any amendment or supplement thereto in reliance
upon and in conformity with written information furnished to UBET by such Holder specifically for use in the preparation of such registration statement; and provided,
further, that, with respect to any untrue statement or omission or alleged untrue statement or omission made in any preliminary prospectus, UBET will not be liable to any
holder to the extent that any loss, claim, damage, liability or expense results from the fact that a current copy of the final prospectus (including any amendment or supplement thereto) was not sent
or given to the person asserting any such loss, claim, damage, liability or expense at or prior to the written confirmation of the sale of the Registrable Securities concerned to such person if it is
determined that it was the responsibility of such Holder to provide such person with a current copy of the final prospectus (or amendment or supplement thereto) and such current copy of the final
prospectus, amendment or supplement was provided to such Holders and would have cured the defect giving rise to such loss, claim, damage, liability or expense. 

    (ii) Indemnification by the Holders. Each Holder, individually and not jointly, hereby agrees to indemnify and hold
harmless UBET, its respective agents, directors and officers, each other person, if any, who controls (within the meaning of the Securities Act) UBET and each other person (including underwriters) who
participates in the offering of such Registrable Securities, against all losses, claims, damages and liabilities to which UBET, may become subject under the Securities Act or otherwise, insofar as
such losses, claims, damages or liabilities (or proceedings in respect thereof) arise out of or are based upon any untrue statement of any material fact contained in any such registration statement
under which such Registrable Securities were registered under the Securities Act, in any preliminary prospectus or final prospectus contained therein or in any amendment or supplement to any
preliminary prospectus or final prospectus (if used during the period UBET is required to keep such registration statement current in any such case), or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, but only if and to the extent that any such loss, claim,
damage or liability arises out of or is based upon any such statement or omission made in such registration statement, any preliminary or final prospectus or any amendment or supplement in reliance
upon and in conformity with written information furnished to UBET by such Holder or such underwriter, as the case may be, specifically for use in the preparation of such registration statement. 

    (iii) Notices of Claims, Etc. Each party entitled to be indemnified pursuant to Section 4.06(e)(i) or
(ii) above, promptly but not later than 10 days after its receipt of notice of the commencement of any action against it in respect of which indemnity may be sought from any indemnifying
party pursuant to this Section 4.06(e), shall notify such indemnifying party in writing of the commencement thereof. In case any such action shall be brought against any indemnified party and
it shall notify such indemnifying party of the commencement thereof, such indemnifying party will be entitled to participate therein and, to 

19

 

the extent that it may wish, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party, and such indemnified party may participate in such defense, which
participation by the indemnified party shall be at its expense unless (i) the employment of counsel by such indemnified party has been authorized by the indemnifying party, (ii) the
indemnified party shall have been advised by its counsel in writing that there is a conflict of interest between the indemnifying party and the indemnified party in the conduct of the defense of such
action (in which case the indemnifying party shall not have the right to direct the defense of such action on behalf of the indemnified party) or (iii) the indemnifying party shall not in fact
have employed counsel to assume the defense of such action, in each of which cases the fees and expenses of the indemnified party's counsel shall be at the expense of the indemnifying party; provided,
that the indemnifying party shall not be responsible for the expense of more than one counsel for all indemnified parties in any action. The failure of any such indemnified party to give notice as
provided herein shall not relieve such indemnifying party of its obligations under this Section 4.06(e) unless such failure to give notice shall materially adversely affect such indemnifying
party in the defense of any such claim or any such litigation. With respect to any claim or litigation the defense of which is being conducted by such indemnifying party, no indemnified party shall,
except with the consent of such indemnifying party, consent to entry of any judgment or enter into any settlement of any claim as to which indemnity may be sought. 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. 

    (iv) Contribution. To the extent that the undertaking to indemnify, pay and hold harmless set forth in paragraphs
(i) and (ii) of this Section 4.06(e) may be unenforceable because it is violative of any law or public policy, each party that would have been required to provide the indemnity
shall contribute the maximum portion which it is permitted to pay and satisfy under applicable law, to the payment and satisfaction of all indemnified liabilities incurred by each party entitled to
indemnification under this Section 4.06(e); provided that in no event shall a Holder of Registrable Securities be required to contribute an amount greater than the dollar amount of net proceeds
received by such Holder upon the sale of such Registrable Securities. 

    (f)  Obligations of the Holders. The Holders agree: 

     (i) that
upon receipt of any notice from UBET of the happening of any event of the kind described in Section 4.06(c)(vi), the Holders will forthwith discontinue
its disposition of Registrable Securities pursuant to the registration statement relating to such Registrable Securities until its receipt of the copies of the supplemented or amended prospectus
contemplated by Section 4.06(c)(vi) and, if so directed by UBET, will use its reasonable best efforts to deliver to UBET (at UBET's expense) all copies, other than permanent file copies,
then in such Holder's possession of the prospectus relating to such Registrable Securities current at the time of receipt of such notice, and 

    (ii) that
they will immediately notify UBET at any time when a prospectus relating to the registration of such Registrable Securities is required to be delivered under
the Securities Act, of the happening of any event as a result of which information previously furnished by such Holder to UBET in writing specifically for inclusion in such prospectus contains an
untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances under
which they were made. 

    (g) Underwritten Registration. 

20

 

     (i) If
any of the Registrable Securities covered by a registration pursuant to Section 4.06(a) are to be sold in an underwritten offering, the investment banker
or investment bankers and manager or managers that will administer the offering, which shall be of recognized standing, will be selected by the Holders of a majority in fair market value of such
Registrable Securities included in such offering, subject to UBET's approval, which shall not be unreasonably withheld. No person may participate in any such underwritten registration hereunder unless
such person (a) agrees to sell its Registrable Securities, UBET Common Stock or other securities of UBET on the basis provided in an underwriting agreement provided by the Holders of a majority
in fair market value of the Registrable Securities to be sold in such underwritten offering and (b) completes and executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents required under the terms of such underwriting arrangements. 

    (ii) If
any of the Registrable Securities covered by a registration pursuant to Section 4.06(b) are to be sold in an underwritten offering, the investment banker
or investment bankers and manager or managers that will administer the offering will be selected by (x) UBET, if the registration as initially proposed by UBET included a primary offering of
its securities, or (y) the holders of a majority in fair market value of securities being registered, if the registration as initially proposed was requested by such holders. No Holder may
participate in any such underwritten registration hereunder unless such Holder (a) agrees to sell its Registrable Securities on the basis provided in an underwriting agreement approved by UBET
or the holders of a majority in fair market value of the securities being registered and (b) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements
and other documents required under the terms of such underwriting arrangements. 

    (h) Exchange Act Compliance. UBET shall comply in all material respects with all of the reporting requirements of the
Exchange Act and shall comply in all material respects with all other public information reporting requirements of the Commission which are conditions to the availability of Rule 144
promulgated under the Securities Act (or any successor rule of the Commission) for the sale of Registrable Securities. UBET shall cooperate with each Holder in supplying such information as may be
necessary for such Holder to complete and file any information reporting forms presently or hereafter required by the Commission as a condition to the availability of Rule 144. 

    SECTION
4.07. Rights to Additional Shares.  

    (a) On
the Additional Warrant Exercise Date, UBET shall deliver to TVG a schedule, certified by an executive officer of UBET, (i) listing all rights to subscribe
for, purchase or otherwise acquire any share or shares of UBET Common Stock which are outstanding on the Additional Warrant Exercise Date ("Qualifying
Rights"), and (ii) indicating the number of shares of UBET Common Stock and other securities or property issuable upon payment, exercise, conversion, surrender or
exchange of all such Qualifying Rights. 

21

 

    (b) If at any time after the Additional Warrant Exercise Date, UBET issues any shares of UBET Common Stock or other securities upon conversion, exercise or exchange of
any Qualifying Rights, UBET shall, concurrently with the issuance thereof, issue to TVG an equivalent number of shares of UBET Common Stock or other securities (collectively, "Make-Whole
Shares") for no additional consideration (it being understood and agreed that the exercise price of the Additional Warrant shall constitute the aggregate consideration for the Additional Warrant
Shares and the Make-Whole Shares). All such Make-Whole Shares issued to TVG pursuant to this Section 4.07 shall, upon issuance, be duly authorized, validly issued, fully
paid and non-assessable, will be free of any liens, claims charges, security interests, pledges, voting or shareholder agreements, encumbrances or equities of any kind whatsoever (except
as expressly contemplated hereby or to the extent created by TVG) and will not be issued in violation of any preemptive rights. 

    SECTION
4.08. Restrictions on Purchases of UBET Common Stock Other than Pursuant to the Warrants.  During the period commencing on the date hereof and ending on the
earliest to occur of (i) the date of the UBET Stockholders Meeting, provided that the Warrant Proposal is not approved at such meeting, (ii) the date upon which UBET issues for cash any
shares of UBET Common Stock, UBET Preferred Stock, or securities exercisable or exchangeable for, or convertible into (with or without consideration) UBET Common Stock or UBET Preferred Stock (other
than (a) shares issuable upon exercise of options or warrants outstanding on the date hereof and (b) options granted to employees and shares issuable upon exercise of such options), or
(iii) the Additional Warrant Exercise Date, TVG will not, and will use its best efforts to cause Gemstar-TV Guide International, Inc. ("Gemstar-TV Guide") and
each Controlled Affiliate of Gemstar-TV Guide to not, purchase any shares of UBET Common Stock other than pursuant to the exercise of the Initial Warrant or the Additional
Warrant. As used in this Section 4.08, a Controlled Affiliate of Gemstar-TV Guide shall mean any corporation, partnership, limited liability company, trust or individual that
Gemstar-TV Guide has the power to direct, or cause the direction of, the management and policies of, whether through the ownership of voting securities, by contract, or by membership or
involvement in the board of directors, management committee or other management structure of such entity. 

    SECTION
4.09 Ladbroke Agreement.  For so long as the License Agreement is in effect, UBET agrees that it shall not amend that certain Telecommunications Facilitation
System Agreement, dated as of June 23, 1997, with Mount Laurel Racing, Inc. and Washington Trotting Association, Inc., in a manner that would reduce the percentage rate payable to
UBET with respect to commissions on account wagers under such agreement. 

22

  

 
 

ARTICLE V
  
    MISCELLANEOUS    
  

    SECTION
5.01.  Further Assurances.  From and after the date hereof, each of TVG and UBET shall, at any
time and from time to time, make, execute and deliver, or cause to be made, executed and delivered, such instruments, agreements, consents and assurances and take or cause to be taken all such actions
as may reasonably be requested by the other party hereto for the effectual consummation and confirmation of this Agreement and the transactions contemplated hereby. 

    SECTION
5.02.  Expenses.  Except as otherwise provided herein, all costs and expenses, including, without
limitation, fees and disbursements of counsel, financial advisors and accountants, incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party
incurring such costs and expenses. 

    SECTION
5.03.  Notices.  All notices, requests, demands, waivers and other communications required or
permitted to be given under this Agreement shall be in writing and shall be deemed to have been duly given on (i) the day on which delivered personally or by telecopy (with prompt confirmation
by mail) during a business day to the appropriate location listed as the address below, (ii) three business days after the posting thereof by United States registered or certified first class
mail, return receipt requested, with postage and fees prepaid or (iii) one business day after deposit thereof for overnight delivery via Federal Express or other nationally recognized overnight
delivery service. Such notices, requests, demands, waivers or other communications shall be addressed as follows: 

	(a)
	if
to TVG, to: 

TVG

12421 West Olympic Boulevard

Los Angeles, California 90064

Attn: Mark Wilson, President and CEO

Telecopy No.: (310) 689-2501 

with
a copy to: 

Lee
D. Charles, Esq.

Baker Botts L.L.P.

599 Lexington Avenue

New York, New York 10022

Telecopy No.: (212) 705-5125 

	(b)
	if
to UBET, to: 

Youbet.com, Inc.

5901 De Soto Avenue

Woodland Hills, California 91367

Attn: Robert Fell, Chairman and CEO

Telecopy No.: (818) 668-2101 

23

 

with a copy to: 

Christensten,
Miller, Fink, Jacobs,

Glaser, Weil & Shapiro, LLP

2121 Avenue of the Stars

Los Angeles, California 90067

Attn: Stephen D. Silbert, Esq.

Telecopy No.: (310) 556-2920 

or
to such other person or address as any party shall specify by notice in writing to the other party. 

    SECTION
5.04.  Entire Agreement.  This Agreement and the License Agreement (including the Exhibits,
Schedules and other documents referred to herein and therein) constitute the entire agreements between the parties and, except as expressly provided herein, supersede all prior agreements and
understandings, oral and written, between the parties with respect to the subject matter hereof. 

    SECTION
5.05.  Assignment; Binding Effect; Benefit.  Neither this Agreement nor any of the rights,
benefits or obligations hereunder may be assigned by any party without the prior written consent of the other party; provided, however, that the rights granted to TVG under Section 4.06 may be
assigned in connection with any transfer or assignment of the Initial Warrant, the Additional Warrant, the Initial Warrant Shares or the Additional Warrant Shares, provided such transferee
(i) is a permitted transferee under the Initial Warrant or Additional Warrant, as applicable, and (ii) executes a written agreement, in form and substance reasonably satisfactory to
UBET, pursuant to which such transferee agrees to be bound by all of the provisions of Section 4.06, as applicable, as if such transferee were a "Holder" thereunder. Subject to the preceding
sentence, this Agreement will be binding upon, inure to the benefit of and be enforceable by the parties and their respective successors and assigns. Nothing in this Agreement, expressed or implied,
is intended to confer on any person other than the parties or their respective successors and assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement. 

    SECTION
5.06.  Amendment.  This Agreement may not be amended except by an instrument in writing signed on
behalf of each of the parties. 

    SECTION
5.07.  Extension; Waiver.  TVG or UBET may, to the extent legally allowed, (i) extend the
time specified herein for the performance of any of the obligations of the other party, (ii) waive any inaccuracies in the representations and warranties of the other party contained herein or
in any document delivered pursuant hereto, or (iii) waive compliance by the other party with any of the agreements or covenants of such other party contained herein. Any agreement on the part
of a party hereto to any such extension or waiver shall be valid only if set forth in a written instrument signed on behalf of such party. No such waiver shall constitute a waiver of, or estoppel with
respect to, any subsequent or other breach or failure to comply strictly with the provisions of this Agreement. The failure of any party to insist on strict compliance with this Agreement or to assert
any of its rights or remedies hereunder or with respect hereto shall not constitute a waiver of such rights or remedies. Whenever this Agreement requires or permits consent or approval by any party,
such consent or approval shall be effective if given in writing in a manner consistent with the requirements for a waiver of compliance as set forth in this Section 5.07. 

    SECTION
5.08.  Survival.  The representations and warranties made by UBET in Article II shall
survive for a period of two years from the date of this Agreement, except for the representations and warranties contained in Section 2.03(b) and Section 2.03(c) which shall survive for
a period of one year following the expiration date of the Additional Warrant. All covenants and agreements of the parties contained in this Agreement shall survive indefinitely (except as may
otherwise be expressly provided for by their terms). 

24

 

    SECTION 5.09.  Arbitration.  Any dispute or controversy arising out of or relating to this Agreement, the
Initial Warrant or the Additional Warrant shall be settled by an expedited arbitration proceeding to be held in the City of Wilmington, Delaware in accordance with the rules then in effect of the
American Arbitration Association or any successor thereto. The arbitrator may grant injunctions or other relief in such dispute or controversy. The decision of the arbitrator shall be final,
conclusive and binding on the parties to the arbitration. Judgment may be entered on the arbitrator's decision in any court having jurisdiction. The losing party in such arbitration shall pay all the
costs and expenses of such arbitration and all the reasonable attorneys' fees and expenses of the other party thereto. 

    SECTION
5.10.  Interpretation.  When a reference is made in this Agreement to Sections, Articles,
Exhibits or Schedules, such reference shall be to a Section, Article, Exhibit or Schedule (as the case may be) of this Agreement unless otherwise indicated. When a reference is made in this Agreement
to a "party" or "parties", such reference shall be to a party or parties to this Agreement unless otherwise indicated. The table of contents and headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the words "include", "includes" or "including" are used in this Agreement, they shall be deemed
to be followed by the words "without limitation". The use of any gender herein shall be deemed to be or include the other genders and the use of the singular herein shall be deemed to be or include
the plural (and vice versa), wherever appropriate. The use of the words "hereof", "herein", "hereunder" and words of similar import shall refer to this entire Agreement, and not to any particular
article, section, subsection, clause, paragraph or other subdivision of this Agreement, unless the context clearly indicates otherwise. 

    SECTION
5.11.  Counterparts.  This Agreement may be executed in counterparts, each of which shall be
deemed to be an original, and all of which together shall be deemed to be one and the same instrument. 

    SECTION
5.12.    

    SECTION
5.13.  Applicable Law.  This Agreement and the legal relations between the parties shall be
governed by and construed in accordance with the laws of the State of Delaware, without regard to the conflict of laws rules thereof. 

25

 

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

	 	 	YOUBET.COM, INC.
	

 	
 	

By:	

/s/ PHILLIP HERMANN   
 Phillip Hermann
	 	 	 	Name: Phillip Hermann
	 	 	 	Title:  Executive Vice President and Chief Financial Officer
	

 	
 	
ODS TECHNOLOGIES, L.P.
	

 	
 	

By:	

TV GUIDE, INC., a General Partner
	

 	
 	

By:	

/s/ MARK D. WILSON   
 Phillip Hermann
	 	 	 	Name: Mark D. Wilson
	 	 	 	Title:  Chief Executive Officer—TVG

26

  

 
 

TABLE OF CONTENTS    
  

	 
	 	 
	 	Page

	

 	
 	
Article I. Issuance of Warrants	
 	

 
	

Section 1.01.	
 	

Issuance Of Initial Warrant	
 	

1
	Section 1.02.	 	Issuance Of Additional Warrant	 	1
	

 	
 	
Article II. Representations and Warranties of UBET	
 	

 
	

Section 2.01.	
 	

Organization And Qualification	
 	

2
	Section 2.02.	 	Authorization And Validity	 	2
	Section 2.03.	 	Capitalization	 	3
	Section 2.04.	 	Reports And Financial Statements	 	4
	Section 2.05.	 	No Approvals Or Notices Required; No Conflict With Instruments	 	4
	Section 2.06.	 	Absence Of Certain Changes Or Events	 	5
	Section 2.07.	 	Legal Proceedings	 	5
	Section 2.08.	 	Compliance With Regulatory Requirements	 	6
	Section 2.09.	 	Brokers Or Finders	 	6
	Section 2.10.	 	Intellectual Property	 	6
	Section 2.11.	 	Compliance With Charter And Contracts	 	7
	Section 2.12.	 	Disclosure	 	7
	Section 2.13.	 	Section 203 Of The DGCL	 	7
	

 	
 	
Article III. Representations and Warranties of TVG	
 	

 
	

Section 3.01.	
 	

Organization And Qualification	
 	

7
	Section 3.02.	 	Authorization And Validity Of Agreement	 	8
	Section 3.03.	 	No Approvals Or Notices Required; No Conflict With Instruments	 	8
	Section 3.04.	 	Legal Proceedings	 	8
	Section 3.05.	 	Compliance With Regulatory Requirements	 	9
	Section 3.06.	 	Brokers Or Finders	 	9
	Section 3.07.	 	Intellectual Property	 	10
	Section 3.08	 	Compliance with Charter	 	10
	Section 3.09.	 	Investment Purpose	 	10
	

 	
 	
Article IV. Certain Covenants	
 	

 
	

Section 4.01.	
 	

UBET Stockholder Meeting	
 	

11
	Section 4.02.	 	Reservation Of Shares	 	11
	Section 4.03.	 	Obtaining Of Certain Governmental Approvals	 	12
	Section 4.04.	 	Reasonable Efforts	 	12
	Section 4.05.	 	UBET Board Representation	 	12
	Section 4.06.	 	Registration Rights.	 	13
	Section 4.07.	 	Rights To Additional Shares	 	21
	Section 4.08.	 	Restrictions On Purchases Of UBET Common Stock Other Than Pursuant To The Warrants	 	22
	Section 4.09.	 	Ladbroke Agreement	 	22
	

 	
 	
Article V. Miscellaneous	
 	

 
	

Section 5.01.	
 	

Further Assurances	
 	

24
	Section 5.02.	 	Expenses	 	24
	Section 5.03.	 	Notices	 	24

27

 

	Section 5.04.	 	Entire Agreement	 	25
	Section 5.05.	 	Assignment; Binding Effect; Benefit	 	25
	Section 5.06.	 	Amendment	 	25
	Section 5.07.	 	Extension; Waiver	 	25
	Section 5.08.	 	Survival	 	25
	Section 5.09.	 	Arbitration	 	26
	Section 5.10.	 	Interpretation	 	26
	Section 5.11.	 	Counterparts	 	26
	Section 5.12.	 	Applicable Law	 	26

28

WARRANT ISSUANCE AGREEMENT  

 Between  

 YOUBET.COM, INC.  

 and  

 ODS TECHNOLOGIES, L.P.  

 Dated as of May 18, 2001  

QuickLinks

EXHIBIT 10.28

WARRANT ISSUANCE AGREEMENT

RECITALS

ARTICLE I ISSUANCE OF WARRANTS

ARTICLE II REPRESENTATIONS AND WARRANTIES OF UBET

ARTICLE III REPRESENTATIONS AND WARRANTIES OF TVG

ARTICLE IV CERTAIN COVENANTS

ARTICLE V MISCELLANEOUS

TABLE OF CONTENTS

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