Document:

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                                                                 Exhibit 10.14.2

                       AMENDMENT TO SPLIT-DOLLAR AGREEMENT

         THIS Amendment is made and entered into this 28th day of January, 2002,
by and among Martha Stewart Living Omnimedia, Inc., a Delaware corporation,
having an address of 11 West 42nd Street, New York, New York, 10036
("Corporation"), Martha Stewart, an individual residing in the state of
Connecticut ("Employee"), and The Martha Stewart Family Limited Partnership, a
Connecticut limited partnership ("Owner").

         WITNESSETH THAT:

         WHEREAS, the Corporation, the Employee and the Owner (collectively the
"parties") executed an agreement on February 28, 2001 known as the "Split Dollar
Agreement" (the "Agreement"); and

         WHEREAS, the Agreement terminates upon the second day of the sixteenth
year of the Policies; and

         WHEREAS, the parties now wish to amend the Agreement in certain
respects;

         NOW, THEREFORE, in consideration of the mutual promises contained in
this Agreement, the parties agree as follows:

1.       The second sentence of Section 2.b. is amended to read as follows:

         "Specifically, but without limitation, the Corporation shall neither
have nor exercise any right as collateral assignee of any of the Policies which
could in any way defeat or impair the Owner's right to receive the cash
surrender values or the death proceeds of the Policies in excess of the amount
due the Corporation under this Agreement."

2.       Section 4 is amended to read as follows:

         "4.      PAYMENT OF PREMIUMS.

                  a. This paragraph 4.a. shall apply only for premiums due on a
Policy prior to the Original Termination Date. Thirty (30) days prior to the due
date of a premium on a Policy, the Corporation shall notify the Owner of the
exact amount due from the Owner under this Agreement with respect to that
Policy. For each Policy, the amount due from the Owner shall equal the annual
cost of current life insurance protection on the life of the Employee provided
under that Policy. Either the Owner, or the Employee on behalf of the Owner,
shall pay the required contribution to the Corporation prior to a premium due
date. If neither the Employee nor the Owner timely pays a contribution, the
Corporation, in its sole discretion, may elect to pay the Owner's portion of a
premium, which shall be recovered by the Corporation as provided in this
Agreement. On or before the due date of each Policy premium, or within the grace
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period provided therein, the Corporation shall pay, subject to the contribution
provided above, the full amount of the premium to the Insurer, and shall, upon
request, promptly furnish the Owner evidence of timely payment of that premium.
Any contribution towards a premium payment actually paid by the Owner, or the
Employee on behalf of the Owner, under this paragraph shall be considered to be
a payment by the Owner or the Employee of a portion (equal to that contribution)
of that premium for purposes of calculating the amount to be repaid the
Corporation under Sections 6, 7 and 9 of this Agreement.

                  b. This paragraph 4.b. shall apply only for premiums due on a
Policy after the Original Termination Date. Thirty (30) days prior to the due
date of a premium on a Policy, the Corporation shall have notified the Owner of
the upcoming premium and the exact amount due from the Owner under this
Agreement with respect to that Policy. For each Policy, the amount due from the
Owner shall equal the annual cost of current life insurance protection on the
life of the Employee provided under that Policy. Either the Owner, or the
Employee on behalf of the Owner, shall have provided evidence to the Corporation
of payment of the premium, or shall pay the required amount prior to a due date
to the Corporation, which upon receipt shall forward that amount to the Insurer.
Any payment actually made by the Owner, or the Employee on behalf of the Owner,
under this paragraph shall be considered to be a payment by the Owner or the
Employee for purposes of calculating the amount to be repaid the Corporation
under Sections 6, 7 and 9 of this Agreement.

                  c. Prior to the Original Termination Date, the premiums on
both Policies shall total ONE MILLION ONE HUNDRED SEVENTY-FOUR THOUSAND
SIXTY-NINE DOLLARS ($1,174,069) annually. For purposes of this Section 4, the
"annual cost of current life insurance protection" under a Policy on the life of
the Employee provided under that Policy, shall be calculated using the lower of
(1) the Table 2001 rate, set forth in Internal Revenue Service Notice 2002-8 (or
the corresponding applicable provision of any future Internal Revenue Service
authority), or (2) the Insurer's current published premium rate for annually
renewable term insurance for standard risks. The Corporation shall annually
furnish the Employee a statement of the amount of income reportable by the
Employee, if any, for federal and state income tax purposes as a result of the
insurance protection provided the Owner as the policy beneficiary.

3.       A new sentence is added to the end of Section 5 as follows:

         "This paragraph shall not preclude the corporation from seeking, under
other provisions of this Agreement, from the Owner any amounts still due (after
taking into consideration amounts actually repaid as noted above) the
Corporation under Sections 6.c., 7.b. and 9.a. of this Agreement."

4.       Sections 6.a. and 6.b. are amended to read as follows:

         "a. While this Agreement is in effect, the Owner shall take no action

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regarding any Policy subject to this Agreement that would in any way compromise
or jeopardize the Corporation's right to be repaid the amounts it has paid
toward premiums on, plus any other amounts owed the Corporation under this
Agreement with respect to, those Policies.

         b. Subject to the terms of this Agreement, the Owner may pledge or
assign a Policy to secure a loan from the Insurer or from a third party, or make
withdrawals from a Policy, in an amount not to exceed (1) the cash surrender
value of that Policy as of the date to which premiums have been paid less (2)
the aggregate amounts paid toward premiums on that Policy by the Corporation
plus any unpaid Interest Amount for that Policy plus any unpaid Remaining Amount
for any other policy that has been previously surrendered or cancelled. Interest
charges on such a loan shall be the responsibility of and be paid by the Owner."

5.       The first two sentences of Section 6.c. are amended to read as
follows:

         "c. The Owner shall have the sole right to surrender or cancel a
Policy, and to receive the cash surrender value of that Policy from the Insurer
after the Corporation has been paid as follows: upon the surrender or
cancellation of that Policy, the Corporation shall have the unqualified right to
receive directly from the Insurer a portion of the cash surrender value of that
Policy equal to the Original Termination Amount for that Policy, plus any unpaid
Interest Amount for that Policy calculated as of the surrender or cancellation,
plus any unpaid Remaining Amounts for any other Policy that has been previously
surrendered or cancelled."

6.       Section 7.b. is amended to read as follows:

         "b. Upon the death of the Employee, the Corporation shall have the
unqualified right to receive directly from the Insurer a portion of the death
benefits of a Policy that remains subject to this Agreement equal to the
aggregate amount of the premiums paid by the Corporation with respect to that
Policy, plus any unpaid Interest Amount with respect to that Policy, plus any
unpaid Remaining Amounts for any other policy that has been previously
surrendered or cancelled (all determined as of the date of death). The balance
of the death benefit, if any, shall be paid directly to the Owner, in the manner
and in the amount or amounts provided in the beneficiary designation provision
of that Policy. No amount shall be paid from a Policy's death benefit to the
Owner until the full amount due the Corporation with respect to that Policy has
been paid. The parties agree that the beneficiary designation provision of each
Policy shall conform to the provisions of this Agreement, and that the Parties
shall take any actions necessary to effect that conformity."

7.       Section 8.a.(1) is amended to read "(1) January 27, 2017 (the `Original
Termination Date');", and the following paragraph c. is added to Section 8 of
the Agreement:

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         "c. Notwithstanding paragraph a. of this Section 8, the Owner, by
notice to the Corporation given at any time prior to the Original Termination
Date of the Policies, may elect to postpone the termination of this Agreement."

9.       The first two sentences of Section 9.a. of the Agreement are amended
to read as follows:

         "a. For sixty (60) days after the date of the termination of this
Agreement during the Employee's lifetime, the Owner shall have the option of
obtaining the release of the collateral assignment of a Policy to the
Corporation. To obtain the release of a Policy, the Owner shall repay to the
Corporation the Original Termination Amount with respect to that Policy and any
unpaid Interest Amount with respect to that Policy, plus any unpaid Remaining
Amounts for any other policy that has been previously surrendered or cancelled,
(all as determined as of the date of termination)."

10.      The second sentence of Section 9.b. of the Agreement is amended to
read as follows:

         "Alternatively the Corporation may enforce, pursuant to the collateral
assignment of that Policy, the Corporation's right to be repaid, out of that
Policy's cash surrender value, the amount which the Corporation would otherwise
be paid under Section 9.a. if the Owner had obtained the appropriate release;
provided that if the cash surrender value of that Policy exceeds the amount due
the Corporation, that excess shall be paid to the Owner."

11.      A new Section 16 is added as follows:

"16.     PAYMENT OF INTEREST AMOUNT. If the Owner has made the election
described in Section 8 c. of this Agreement, the Interest Amount shall accrue
from the Original Termination Date, and shall be payable by the Owner to the
Corporation on each anniversary of that date, except that the Corporation may
elect to allow the Interest Amount accrued for the prior year to be added to
"Principal," as described under Section 19."

12.      A new Section 17 is added as follows:

"17.     DEFICIENCIES AND OTHER SECURITY.

         a. Upon (1) the earlier of the termination of this Agreement (whether
or not extended by the Owner as set forth above) or the surrender or
cancellation of all Policies subject to this Agreement, or (2) the death of the
Insured, if earlier than (1), the Owner shall pay the Corporation (3) the total
amount the Corporation would have received under Section 9. (or Section 6. as
the case may be) if the cash surrender values of the Policies

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had been sufficient or under Section 7 if the death benefits had been
sufficient, less (4) amounts paid or payable to the Corporation from the
Policies.

         b. From time to time after the Original Termination Date, the Owner
shall promptly execute and deliver all instruments and documents and take all
action that the Corporation may reasonably request to grant, perfect or protect
one or more security interests in the Owner's assets (other than the Policies)
to the extent that the Corporation reasonably considers itself insecure with
respect to the amounts owed to it under this Agreement, taking into
consideration, however, the unencumbered cash surrender value of the Policies.

         c. During any time that the Employee does not have the right to vote
shares of stock of the Corporation having more than 50% of the total combined
voting power of all classes of stock of the Corporation, and is not a
controlling stockholder of the Corporation within the meaning of the regulations
issued by the Treasury under Section 2042 of the Internal Revenue Code of 1986,
as amended (or any successor provision), the Corporation shall have the power to
direct the Owner as to the exercise of the investment powers with respect to the
Policies. For purposes of this provision, the Employee shall be deemed to have
the right to vote all shares of stock of the Corporation owned by the Owner and
the shares of stock of the Corporation owned by any other entity which she
controls directly or indirectly."

13.      A new Section 18 is added as follows:

"18.     DEFAULT.

If, within 90 days after the Owner has been notified by the Corporation of a
default, that default has not been cured, this Agreement shall terminate. A
default shall be considered to have occurred only if (1) the Owner fails to pay
interest when due, as set forth in Section 16 above or (2) there is a breach of
Section 17.b."

14.      A new Section 19 is added as follows:

"19.     MISCELLANEOUS AND DEFINITIONS.

         a. For purposes of this Agreement in the event that both Policies are
in fact surrendered or cancelled on the same date, the Policy whose surrender or
cancellation would result in the largest "Remaining Amount" shall be deemed to
have been surrendered or cancelled prior to the other Policy. Moreover, if the
Owner surrenders or cancels one but not both Policies, and if surrender or
cancellation of either Policy would result in a "Remaining Amount," the Owner
may surrender or cancel only that Policy whose surrender or cancellation would
result in the largest "Remaining Amount."

         b.       As used in this Agreement:

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         "Original Termination Amount" means, with respect to a Policy, the
lesser of (1) the aggregate amount of premiums paid by the Corporation with
respect to that Policy; and (2) the cash surrender value of that Policy plus the
amount of the aggregate unreturned withdrawals from that Policy. For purposes of
this provision, the use of some or all of a Policy's cash surrender value to pay
any part of a loan secured by that Policy shall be treated as a withdrawal from
that Policy. The Original Termination Amount of a Policy shall be calculated
upon the earliest to occur of: the Original Termination Date, the date a Policy
is surrendered or cancelled, and the date this Agreement is terminated.

         "Remaining Amount" means, with respect to a Policy, the Original
Termination Amount less the cash surrender value, but not below zero.

         "Interest Amount" means, at the time the term is being applied with
respect to a Policy, an amount equal to the interest that would have accrued at
the Rate on a loan assuming the principal (the "Principal") of the loan equaled
(1) the Original Termination Amount for that Policy, plus (2) the unpaid
Remaining Amount for a Policy that has been surrendered or cancelled prior to
the Original Termination Date, plus (3) any Interest Amount for which the
Corporation makes an election under Section 16. When and to the extent payments
are made under this Agreement reducing any items used above in calculating the
"Principal" for a Policy, the Principal shall be reduced in accordance with
customary commercial terms.

         "Rate" means for each twelve month period after the Original
Termination Date, the minimum rate necessary in the Corporation's reasonable and
good faith judgment to avoid, for securities laws purposes, reporting
compensation to the Employee due to the payment or accrual of interest under
this Agreement; however, "Rate" shall not be less than the rate at which the
Corporation may borrow from its customary lender(s) at the time the term is
being applied.

15.      In all other respects, the parties ratify the terms of the Agreement.

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         The parties have executed this Agreement as of the day and year first
above written

                                    MARTHA STEWART LIVING OMNIMEDIA, INC.

                                    By: /s/ James Follo
                                       -----------------------------------------
                                       James Follo, Chief Financial Officer

                                        /s/ Martha Stewart
                                       -----------------------------------------
                                       Martha Stewart

                                    MARTHA STEWART FAMILY LIMITED PARTNERSHIP

                                    --------------------------------------------

                                    By: /s/ Martha Stewart
                                       -----------------------------------------
                                       Martha Stewart, General Partner

                                       7<PAGE>
                                                                   EXHIBIT 10.15

                              INVESTMENT AGREEMENT

                  INVESTMENT AGREEMENT, dated as of January 8, 2002 (this
"Agreement"), by and among Martha Stewart Living Omnimedia, Inc., a Delaware
corporation (the "Corporation"), ValueAct Capital Partners, L.P. a Delaware
limited partnership, ValueAct Capital Partners II, L.P. a Delaware limited
partnership and ValueAct Capital International, Ltd. a British Virgin Islands
corporation (collectively, "ValueAct"), and, for the purposes of Article I,
Section 2.3 and Article V hereof only, The Martha Stewart Family Limited
Partnership, L.P., a Connecticut limited partnership ("Stewart").

                                    RECITALS:

                  WHEREAS, pursuant to the terms of a Stock Purchase Agreement,
dated as of the date hereof (the "Stock Purchase Agreement"), Stewart has agreed
to sell to ValueAct, and ValueAct has agreed to purchase from Stewart, an
aggregate of 3,000,000 shares of Class A Stock (the "Stock Purchase");

                  WHEREAS, in connection with the consummation of the Stock
Purchase, the parties hereto desire to enter into certain arrangements relating
to ValueAct's ownership of the Class A Stock.

                  NOW, THEREFORE, in consideration of the premises and mutual
covenants and obligations hereinafter set forth, the parties hereto agree as
follows:

                                    ARTICLE I

                                  DEFINED TERMS

                  Section 1.1. Definitions. Unless the context otherwise
requires, the terms defined in this Article I shall, for the purposes of this
Agreement, have the meanings herein specified.

                  "1933 Act" means the Securities Act of 1933, as amended.

                  "1934 Act" means the Securities Exchange Act of 1934, as
amended.

                  "Affiliate" means with respect to a specified Person, any
Person that directly or indirectly controls, is controlled by, or is under
common control with, the specified Person, and that Person's spouse, estate,
personal representative or lineal descendants or any trust for the benefit of
such Person and/or such Person's spouse and/or such Person's lineal descendants
or any entities controlled by such Person. As used in this definition, the term
"control" means the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of a Person, whether
through ownership of voting securities, by contract or otherwise.

                  "2002 Annual Meeting" shall have the meaning set forth in
Section 2.3 hereof.

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                  "Agreement" means this Investment Agreement, as amended,
modified, supplemented or restated in accordance with the terms hereof from
time to time.

                  "Assign" and "Assignment" have the meanings set forth in
Section 2.1 hereof.

                  "Board" shall mean the Board of Directors of the Corporation.

                  "Class A Stock" shall mean Class A Common Stock, par value
$0.01 per share, of the Corporation.

                  "Class B Stock" shall mean the Class B Common Stock, par value
$0.01 per share, of the Corporation.

                  "Corporation" shall have the meaning set forth in the preamble
hereto.

                  "Delaware Act" shall mean the Delaware General Corporation
Law, as amended.

                  "Directors" shall mean those individuals elected as members of
the Board.

                  "NYSE" shall mean the New York Stock Exchange, Inc.

                  "Person" includes any individual, corporation, association,
partnership (general or limited), joint venture, trust, estate, limited
liability company, or other legal entity or organization.

                  "Registration Request" shall have the meaning set forth in
Section 3.1 hereof.

                  "Stewart" shall have the meaning set forth in the preamble
hereto.

                  "Stockholders Agreement " means the Stockholders Agreement,
dated as of October 19, 1999, by and among the Corporation and certain of its
stockholders.

                  "Stock Purchase" shall have the meaning set forth in the
recitals hereof.

                  "Ubben" shall have the meaning set forth in Section 2.3
hereof.

                  "ValueAct" shall have the meaning set forth in the preamble
hereto.

                  Section 1.2. Headings. The headings and subheadings in this
Agreement are included for convenience and identification only and are in no way
intended to describe, interpret, define or limit the scope, extent or intent
of this Agreement or any provision hereof.

                                   ARTICLE II

                         COVENANTS AND ACKNOWLEDGEMENTS

                  Section 2.1. Investment Intent. ValueAct represents and
warrants to the Corporation that it is acquiring the Class A Stock in the Stock
Purchase for investment for its own account and not with the view to, or for
resale in connection with, any distribution thereof.

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                  Section 2.2. Transfers and Assignments. Prior to the first
anniversary hereof, ValueAct shall not sell, assign, transfer, pledge,
hypothecate, mortgage or dispose of, by gift or otherwise, or in any way
encumber ("Assign," and such act, an "Assignment") all or any part of the shares
of Class A Stock owned by ValueAct; provided, however, that following the six-
month anniversary hereof, ValueAct may distribute up to 50% of the shares
acquired in the Stock Purchase to limited partners or other fund participants in
the relevant ValueAct fund. The foregoing restriction shall not apply to any
Assignment approved by the Board. ValueAct acknowledges that the Stock Purchase
has not been registered under the 1933 Act, and that the Class A Stock acquired
in the Stock Purchase may not be offered or Assigned except pursuant to an
effective registration statement under the 1933 Act or an applicable exemption
therefrom.

                  Section 2.3. Board of Directors. Effective as of the date
hereof, Jeffrey Ubben ("Ubben") has been appointed by the Board to the Board as
a Director to fill an existing vacancy thereon, to serve until the 2002 annual
meeting of the stockholders of the Corporation (the "2002 Annual Meeting"),
unless earlier removed for cause (as such term is used in Section 141(k) of the
Delaware General Corporation Law). The Corporation and Stewart agree that,
subject to the Board's fiduciary duties under applicable law (after consultation
in good faith with outside legal counsel) and unless earlier removed from the
Board in accordance with the preceding sentence, Ubben shall be included in the
slate of nominees recommended for election to the Board as Directors at the
2002 Annual Meeting by the Board. Stewart agrees to vote all of shares of Class
A Common Stock and Class B Common Stock beneficially held by it in favor of
Ubben's election to the Board as a Director at the 2002 Annual Meeting if Ubben
is nominated therefor in accordance with the preceding sentence, and agrees
that, if Stewart should seek to transfer shares of Class A Common Stock or Class
B Common Stock such that, following such transfer, Stewart would have less than
a majority of the outstanding voting power of the Corporation, Stewart shall
require the transferees thereof to be bound by this sentence.

                                   ARTICLE III

                               REGISTRATION RIGHTS

                  Section 3.1.     Form S-3 Registration.

         (a) If Form S-3, or any successor form thereto, is available for such
offering, ValueAct may request in writing that the Corporation effect a
registration on Form S-3 and any related qualification or compliance (a
"Registration Request"), and the Corporation shall use its best efforts to
effect, as soon as practicable, such registration, qualification or compliance
as may be so requested and as would permit or facilitate the sale and
distribution of all Class A Stock specified in such Registration Request and to
maintain the registration on Form S-3 for 180 days following the effectiveness
thereof; provided, that such 180-day period may be suspended if, in the good
faith judgment of the Board, a corporate event requires such suspension, the
Corporation shall use its best efforts to reinstate the effectiveness thereof
for the remaining number of days. The Corporation shall not be obligated to
effect more than three registrations on Form S-3 for ValueAct pursuant to this
Section 3.1(a), or be obligated to effect more than one registration on Form S-3
during any six-month period; provided, however, that in no event shall the
Corporation be obligated to effect a registration statement under this Section
3.1(a) within 120 days of the end of the effective period of any prior
registration statement effected by the Corporation pursuant to a Registration
Request. The anticipated net offering price of the shares of Class A Stock
specified in the Registration Request shall be at least $10,000,000. Any
registration

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<PAGE>
statement filed pursuant to this Section 3.1(a) may include other shares of
Class A Stock that the Corporation is required to include in such registration
statement by virtue of the Stockholders Agreement; provided, that in no event
shall the number of shares of Class A Stock to be registered pursuant to the
Registration Request be reduced in order to comply with any provision of the
Stockholders Agreement

         (b) The Corporation shall not be obligated to effect the filing of a
registration statement pursuant to Section 3.1(a) hereof (i) if the
Corporation has furnished to ValueAct, within 30 days after receipt of a
Registration Request an opinion of counsel (in form and substance reasonably
satisfactory to ValueAct) to the Corporation to the effect that ValueAct may
effect the sale and distribution of shares of Class A Stock held by ValueAct
included in the Registration Request in accordance with its intended method of
distribution without the registration of such securities under the 1933 Act; or
(ii) if the Corporation has furnished to ValueAct within 30 days after receipt
of a Registration Request a certificate signed by an executive officer of the
Corporation stating that, in the good faith judgment of the Board such
registration would require premature disclosure of material information
relating to a pending corporate development or a special audit of the
Corporation, in which event the Corporation shall have the right to defer the
obligations contained in this Section 3.1 for a period of not more than 165
days (including the time period used for filing the applicable registration
statement) after receipt of the Registration Request, and provided that the
Corporation has not, in any twelve-month period, utilized the right in this
clause (ii) more than once.

                  Section 3.2.     Corporation Registration.

         (a) If the Corporation proposes to register any of its capital stock or
other equity securities (including any securities convertible into or
exchangeable for equity securities) under the 1933 Act in connection with the
public offering of such securities solely for cash (other than a registration on
Form S-8 or any successor form relating solely to the sale of securities to
participants in a Corporation Class A Stock plan, or a registration on Form
S-4 or any successor form), the Corporation shall, at such time, promptly give
ValueAct written notice of such registration. Upon the written request of
ValueAct given within 20 days after the receipt of such notice by the
Corporation, the Corporation shall, subject to the provisions of Section 3.2(b),
use commercially reasonable efforts to cause a registration statement covering
all of the shares of Class A Stock that ValueAct has requested to be registered
to become effective under the 1933 Act. The Corporation shall have no
obligation under this Section 3.2 to make any offering of its securities or to
complete any offering of its securities that it proposes to make, and shall
incur no liability to ValueAct for its failure to do so.

                  (b) In connection with any offering involving an underwriting
of securities being issued by the Corporation, the Corporation shall not be
required under this Section 3.2 to include any of the securities of the
Corporation owned by ValueAct in such underwriting unless it accepts the terms
of the underwriting as agreed upon between the Corporation and the underwriters
selected by it, and then only in such quantity, if any, as will not, in the
reasonable opinion of the underwriters, jeopardize the success of the offering
by the Corporation. If the managing underwriter for the offering shall advise
the Corporation in writing that marketing factors require a limitation of the
number of shares to be underwritten, then the Corporation shall so advise
ValueAct, and the number of shares that may be included in the underwriting
shall be allocated in priority as follows: (i) all shares of Class A Stock
proposed to be underwritten on behalf of the Corporation, and then (ii) all
shares of Class A Stock required to be registered on behalf of other

                                       -4-
<PAGE>
stockholders of the Corporation pursuant to the Stockholders Agreement, and then
(iii) all shares of Class A Stock proposed to be underwritten on behalf of
ValueAct.

                  Section 3.3. Expenses of Registration. The Corporation shall
bear and pay all expenses other than underwriting fees, discounts and
commissions relating to shares of Class A Stock incurred in connection with each
registration, filing or qualification pursuant to this Article III, including
(without limitation) all registration, blue sky, securities exchange or listing
fees (including NYSE, NASD and similar fees), filing and qualification fees,
printing and accounting fees (including for audits and comfort letters), fees
and disbursements of counsel for the Corporation; provided, however, that the
Corporation shall not be required to pay for any expenses of any registration
proceeding begun at the request of ValueAct if the registration request is
subsequently withdrawn at any time at the request of ValueAct, in which case
ValueAct shall bear such expenses (including all out-of-pocket expenses and fees
incurred by the Corporation), unless ValueAct agrees to forfeit one Form S-3
registration. If ValueAct withdraws a registration request after the filing of
the applicable registration statement, ValueAct, shall reimburse all such
expenses and fees and shall also forfeit such applicable registration right,
provided, however, that if such withdrawal is due primarily to (i) the
Corporation's failure to comply in all material respects with its obligations
under Sections 3.1 through 3.5, or (ii) the failure of the Corporation at a
reasonable time, in light of the circumstances, prior to the filing of such
registration statement to advise ValueAct, of its knowledge of the existence of
an event relating to the Corporation that would reasonably be expected to have a
material effect on the business, financial condition or market valuation of the
Corporation, such registration right shall not be forfeited. Underwriting
discounts and commissions relating to the shares of Class A Stock included in a
registration pursuant Section 3.2 shall be borne and paid ratably by ValueAct
in proportion to its participation in such registration.

                  Section 3.4. Furnishing of Information. It shall be a
condition precedent to the obligations of the Corporation to take any action
pursuant to this Article III that ValueAct shall have furnished to the
Corporation such information as the Corporation shall request regarding
ValueAct, the shares of Class A Stock held by ValueAct, and the intended method
of disposition of such shares of Class A Stock as shall be required to effect
the requested registration, and that ValueAct shall have provided the
Corporation with such representations and warranties, covenants and opinions as
are customary for a selling Class A Stockholder in connection with the
registration of a selling Class A Stockholder's securities. The Corporation
shall provide ValueAct with copies of all correspondence with the Securities and
Exchange Commission related to any registration statement filed pursuant to this
Article III and in which ValueAct is participating on a reasonably prompt basis.

                  Section 3.5. Indemnification. In the event that any Class A
Stock of ValueAct is included in a registration statement under this Article
III, ValueAct and the Corporation shall agree to customary indemnification
provisions (which may include indemnification of any underwriter of such
registration) in connection therewith relating to compliance with the 1933 Act,
the 1934 Act, any state securities law or any rule or regulation promulgated
under the 1933 Act, the 1934 Act or any state securities law in connection with
any matter relating to such registration statement.

                  Section 3.6. Additional Registration Rights. In the event that
the Corporation shall grant to any stockholder of the Corporation registration
rights (other than those contained in

                                       -5-
<PAGE>
the Stockholders' Agreement), the Corporation shall provide written notice of
such grant to ValueAct.

                                   ARTICLE IV

                                   ARBITRATION

                  Section 4.1. Dispute Resolution. To the fullest extent
permitted by the Delaware Act and other applicable law, any controversy or
claim arising out of or relating to this Agreement, or any breach thereof, shall
be settled by arbitration in accordance and to the extent permitted by the
Uniform Arbitration Act (10 Del. C. Section 5701, et seq.) and, to the extent
not inconsistent therewith, the then-prevailing Rules for Non-Administered
Arbitration of Business Disputes of the CPR Center for Dispute Resolution. Each
party to the arbitration shall select one (1) arbitrator. The arbitrators'
ruling shall be binding and conclusive upon the parties hereto to the fullest
extent permitted by law. Any arbitration shall occur in Wilmington, Delaware,
and judgment upon the award rendered may be entered in any court having
jurisdiction thereof. The arbitrators shall be governed by and shall apply the
substantive law of the State of Delaware in making their award. The expenses of
the arbitration shall be borne equally by the parties to the arbitration,
provided that each party shall pay for and bear the cost of its own experts,
evidence and legal counsel.

                                    ARTICLE V

                                  MISCELLANEOUS

                  Section 5.1. Notices. All notices provided for in this
Agreement shall be in writing, duly signed by the party giving such notice, and
shall be delivered, or mailed by registered or certified mail, as follows:

                  (a)      if given to the Corporation, at the following
                           address:

                           Martha Stewart Living Omnimedia, Inc.
                           20 West 43rd Street
                           New York, New York 10036
                           Attention: General Counsel

                           with a copy to:

                           Wachtell, Lipton, Rosen & Katz
                           51 West 52nd Street
                           New York, New York 10019
                           Attention:  Andrew J. Nussbaum, Esq.

                  (b) if given to Stewart or ValueAct, at the address on file
with the Corporation, or at such other address as Stewart or ValueAct may
hereafter designate by written notice to the Corporation.

All such notices shall be deemed to have been given when received.

                                       -6-
<PAGE>
                  Section 5.2. Amendments. Except as otherwise provided herein,
no modification, amendment or waiver of any provision of this Agreement shall be
effective against any party hereto unless such modification, amendment or waiver
is approved in writing by each party hereto. The failure of any party to enforce
any of the provisions of this Agreement shall in no way be construed as a waiver
of such provisions and shall not affect the right of such party there- after to
enforce each and every provision of this Agreement in accordance with its terms.

                  Section 5.3. Failure to Pursue Remedies. The failure of any
party to seek redress for violation of, or to insist upon the strict performance
of, any provision of this Agreement shall not prevent a subsequent act, which
would have originally constituted a violation, from having the effect of an
original violation.

                  Section 5.4. Specific Performance. The parties hereto
acknowledge that there would be no adequate remedy at law if any party fails to
perform any of its obligations hereunder, and accordingly agree that each party,
in addition to any other remedy to which it may be entitled at law or in equity,
shall be entitled to compel specific performance of the obligations of any other
party under this Agreement in accordance with the terms and conditions of this
Agreement. Any remedy under this Section 5.4 is subject to certain equitable
defenses and to the discretion of the court before which any proceedings
therefor may be brought.

                  Section 5.5. Cumulative Remedies. The rights and remedies
provided by this Agreement are cumulative and the use of any one right or remedy
by any party shall not preclude or waive its right to use any or all other
remedies. Said rights and remedies are given in addition to any other rights the
parties may have by law, statute, ordinance or otherwise.

                  Section 5.6. Binding Effect. This Agreement shall be binding
upon and inure to the benefit of all of the parties and, to the extent permitted
by this Agreement, their successors, legal representatives and assigns.

                  Section 5.7. Interpretation. Throughout this Agreement, nouns,
pronouns and verbs shall be construed as masculine, feminine, neuter, singular
or plural, whichever shall be applicable. All references herein to "Articles,"
"Sections" and "Paragraphs" shall refer to corresponding provisions of this
Agreement.

                  Section 5.8. Severability. The invalidity or unenforceability
of any particular provision of this Agreement shall not affect the other
provisions hereof, and this Agreement shall be construed in all respects as if
such invalid or unenforceable provision were omitted.

                  Section 5.9. Counterparts. This Agreement may be executed in
any number of counterparts with the same effect as if all parties hereto had
signed the same document. All counterparts shall be construed together and shall
constitute one instrument

                  Section 5.10. Integration. This Agreement constitutes the
entire agreement among the parties hereto pertaining to the subject matter
hereof and, except as otherwise provided herein, supersedes all prior agreements
and understandings pertaining thereto.

                  Section 5.11. Governing Law. This Agreement and the rights of
the parties hereunder shall be interpreted in accordance with the laws of the
State of Delaware, and all rights and remedies shall be governed by such laws
without regard to principles of conflict of laws.

                                       -7-
<PAGE>
                  Section 5.12. Term. Except as otherwise provided herein, the
registration rights provided for in this Agreement shall terminate at such time
as ValueAct is able to sell all of its shares of Class A Stock beneficially
owned by it in one transaction pursuant to Rule 144 under the 1933 Act.

                                       -8-
<PAGE>
                  IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above stated.

                                        MARTHA STEWART LIVING OMNIMEDIA, INC.

                                        By: /s/ Greg Blatt
                                        Name: Greg Blatt
                                        Title: Executive Vice President &
                                               General Counsel

                                        VALUEACT CAPITAL PARTNERS, L.P.

                                        By: /s/ Jeffrey W. Ubben
                                        Name: Jeffrey W. Ubben
                                        Title: Managing Partner

                                        VALUEACT CAPITAL PARTNERS II, L.P.

                                        By: /s/ Jeffrey W. Ubben
                                        Name: Jeffrey W. Ubben
                                        Title: Managing Partner

                                        VALUEACT CAPITAL INTERNATIONAL, LTD.

                                        By: /s/ Jeffrey W. Ubben
                                        Name: Jeffrey W. Ubben
                                        Title: Managing Partner

                                        For purposes of Article I, Section 2.3
                                        and Article V hereof only.

                                        THE MARTHA STEWART FAMILY LIMITED
                                        PARTNERSHIP, L.P.

                                        By: /s/ Martha Stewart
                                        Name: Martha Stewart
                                        Title: General Partner

                                      -9-

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