Document:

Exhibit 10.6

 

Execution Copy

 

HSW INTERNATIONAL, INC.

 

REGISTRATION RIGHTS AGREEMENT

 

THIS REGISTRATION RIGHTS
AGREEMENT (this “Agreement”), dated as of October 2, 2007, is entered
into by and among HSW International, Inc., a Delaware corporation (the “Company”),
Wei Zhou, a citizen of Germany (“Zhou”), and HowStuffWorks, Inc., a
Delaware corporation (“HSW”, each of Zhou and HSW, an “Investor”,
and collectively, the “Investors”).

 

R  E
C  I  T  A  L  S

 

WHEREAS, pursuant to the
terms of the Agreement and Plan of Merger dated as of April 20, 2006, as
amended on January 29, 2007 and further amended on August 23, 2007 (the “Merger
Agreement”), by and among the Company, HSW, INTAC International, Inc., a
Nevada corporation (“INTAC”), and HSW International Merger Corporation,
a Nevada corporation and wholly-owned subsidiary of the Company (“Merger Sub”),
(i) HSW will contribute a license and sublicense of certain content to the
Company in exchange for shares of the Common Stock of the Company, and (ii)
Merger Sub will merge with and into INTAC (the “Merger”) and the
shareholders of INTAC will receive shares of the Common Stock of the Company.

 

WHEREAS, Zhou is a Rule 145
Affiliate as such term is defined in the Merger Agreement;

 

WHEREAS, the Company has
agreed, as a condition precedent to HSW’s obligations under the Merger
Agreement, to grant each Investor certain registration rights with respect to
the shares of Common Stock issued to each Investor pursuant to the Merger on
the terms and conditions set forth herein; and

 

WHEREAS, the Company and
each Investor desire to define the registration rights of each Investor on the
terms and subject to the conditions herein set forth.

 

NOW, THEREFORE, in
consideration of the foregoing premises and for other good and valuable consideration,
the parties hereby agree as follows:

 

SECTION 1.  DEFINITIONS

 

As used in this Agreement,
the following terms shall have the respective meanings set forth below:

 

“Closing”   shall
mean the closing of the Merger pursuant to the Merger Agreement;

 

“Commission”   shall
mean the Securities and Exchange Commission and any successor agency;

 

“Exchange Act”   shall
mean the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder;

 

 

“Person”   shall
any individual, firm, corporation, partnership, limited partnership, limited
liability company, association, trust, unincorporated organization or other
entity, as well as any syndicate or group that would be deemed to be a person
under Section 13(d)(3) of the Exchange Act;

 

“Register”, “Registered”
and “Registration” shall refer to a registration effected by preparing
and filing a registration statement or similar document with the Commission in
compliance with the Securities Act and the declaration or ordering by the
Commission of effectiveness of such registration statement or document;

 

“Registrable Securities”   shall
mean, as applicable: (a) the shares of Common Stock owned by each Investor,
whether owned or acquired by virtue of the Merger Agreement on the date hereof
or acquired hereafter by way of stock dividend or stock split or in connection
with a combination of shares, recapitalization, reorganization, merger or
consolidation of the Company; and (b) shares of Common Stock held by Persons
who, by virtue of agreements with the Company, are entitled to be included in a
Registration made by a Demanding Investor hereunder. For purposes of this
Agreement, (i) Registrable Securities shall cease to be Registrable Securities
when a registration statement covering such Registrable Securities has been
declared effective under the Securities Act by the Commission and such
Registrable Securities have been disposed of pursuant to such effective
registration statement, and (ii) Registrable Securities shall cease to be Registrable
Securities, if in the opinion of the Company, such Registrable Securities may
be distributed to the public pursuant to Rule 144(k) (or any successor
provision then in effect) under the Securities Act or any such Registrable
Securities have been sold in a sale made pursuant to Rule 144 of the Securities
Act;

 

“Registration Expenses”   shall
mean any and all expenses incurred by the Company incident to the performance
of or compliance with any registration or marketing of securities pursuant to Section
2(a), (b) and (c) hereof, including (a) the fees,
disbursements and expenses of Company’s counsel and accountants in connection
with this Agreement and the performance of Company’s obligations hereunder
(including the expenses of any annual audit letters and “cold comfort”
letters required or incidental to the performance of such obligations); (b) all
expenses, including filing fees, in connection with the preparation, printing
and filing of any registration statement, any preliminary prospectus or final prospectus,
any other offering document and amendments and supplements thereto and the
mailing and delivering of copies thereof to any underwriters and dealers; (c)
the cost of printing and producing any agreements among underwriters,
underwriting agreements, selling group agreements and any other customary
documents in connection with the marketing of securities pursuant to Section
2(a), (b) and (c) hereof; (d) all expenses in connection with
the qualification of the securities to be disposed of for offering and sale
under state securities laws, including the reasonable fees and disbursements of
counsel for the underwriters or an Investor in connection with such
qualification and in connection with any “blue sky” and legal investment
surveys, including the cost of printing and producing any such “blue sky”
or legal investment surveys; (e) the filing fees incident to securing any
required review by the National Association of Securities Dealers, Inc. of the
terms of the securities being registered pursuant to Section 2(a), (b)
and (c) hereof; (f) transfer agents’ and registrars’ fees and expenses
and the fees and expenses of any other agent or trustee appointed in connection
with such offering; (g) all security engraving and security printing expenses;
(h) all fees and expenses payable in connection with the listing of the 

 

2

 

securities on any securities
exchange or automated interdealer quotation system; and (i) the costs and
expenses of Company and its officers relating to analyst or investor
presentations, if any, or any “road show” undertaken in connection with
the registration and/or marketing of any shares of Registrable Stock other than
as provided in any underwriting agreement entered into in connection with such
offering. In no event shall Registration Expenses be deemed to include Selling
Expenses;

 

“Securities”   shall
have the meaning set forth in Section 2(1) of the Securities Act;

 

“Securities Act”   shall
mean the Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder; and

 

“Selling Expenses”   shall
mean all underwriting discounts, selling commissions, brokerage fees and
transfer taxes applicable to the sale of Registrable Securities and all fees
and disbursements of counsel for each Investor.

 

SECTION 2.  REGISTRATION
RIGHTS

 

(a)                                  Requested Registration.

 

(i)                                     Request for Registration.   After the receipt of a
written request from either Investor (such Investor, the “Demanding Investor”)
at any time after 180 days following the Closing requesting that the Company
effect any Registration under the Securities Act covering all or part of the
Registrable Securities held by such Investor, the Company shall, (i) as
expeditiously as is possible, but in any event no later than forty-five (45)
days after receipt of a written request from a Demanding Investor, file a
registration statement with the SEC for such Registration relating to all
shares of Registrable Securities which the Company has been so requested to
register by such Investor for sale, and (ii) use its commercially reasonable
efforts to cause such registration statement to be declared effective by the
SEC as soon as is practicable; provided that the Company shall not be
obligated to effect, or take any action to effect, any such Registration
pursuant to this Section 2(a):

 

(1)                                  After the Company has effected three (3) such
Registrations requested by each Investor pursuant to this Section 2(a)
and the registration statements for such Registrations have been declared or
ordered effective;

 

(2)                                  If the Registrable Securities requested by
such Investor to be Registered pursuant to such request do not have an
anticipated aggregate public offering price (before any underwriting discounts
and commissions) of at least $5,000,000; or

 

(3)                                  During the period starting with the date
thirty (30) days prior to the Company’s good faith estimate of the date of
filing of, and ending on the date ninety (90) days immediately following the
effective date of, any registration statement pertaining to securities of the
Company (other than a Registration of securities in a Rule 145 transaction or,
with respect to an employee benefit plan), provided that the Company is
actively employing in good faith all commercially 

 

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reasonable efforts to cause
such registration statement to become effective; provided, further,
however, that the Company may only delay an offering pursuant to this Section
2(a)(i)(3) for a period of not more than ninety (90) days, if a filing of
any other registration statement is not made within that period and the Company
may only exercise this right once in any twelve (12) month period.

 

(ii)                                  Other Stockholders.   The registration statement
filed pursuant to any such request of any Demanding Investor may, subject to
the provisions of Section 2(a)(iv) below, include Registrable Securities
of the other Investor, and other securities of the Company which are held by
Persons who, by virtue of agreements with the Company, are entitled to include
their Registrable Securities in any such Registration (“Other Stockholders”).

 

(iii)                               Assignment.   The registration rights set forth in this Section
2 may be assigned, in whole or in part, to any transferee of Registrable
Securities (who shall be entitled to all rights and bound by all obligations of
this Agreement).

 

(iv)                              Underwriting.

 

(1)                                  If the Investor intends to distribute the
Registrable Securities covered by its request for Registration by means of an
underwriting, it shall so advise the Company in its request made pursuant to Section
2(a).

 

(2)                                  If the other Investor or Other Stockholders
request inclusion in any such Registration, the Demanding Investor shall offer
to include the Registrable Securities of the other Investor and such Other
Stockholders in the underwriting but may condition such offer on their
acceptance of the further applicable provisions of this Section 2(a)(iv).
The Demanding Investor and the Company shall (together with the other Investor
and all Other Stockholders proposing to distribute their Registrable Securities
through such underwriting) enter into an underwriting agreement in customary
form with the representative of the underwriter or underwriters selected for
such underwriting by the Company and acceptable to the Demanding Investor. Notwithstanding
any other provision of this Section 2(a), if the representative of such
underwriter or underwriters advise the Company and/or the Demanding Investor in
writing that marketing factors require a limitation on the number of shares to
be underwritten, the Registrable Securities held by the other Investor and
Other Stockholders shall be excluded from such Registration to the extent so
required by such limitation pro rata in accordance with the number of shares of
Registrable Securities requested by such parties to be included in such
Registration, by such minimum number of shares as is necessary to comply with
such limitation. No Registrable Securities excluded from the underwriting by
reason of the underwriter’s marketing limitation shall be included in such
Registration. If the other Investor or any Other Stockholder who has requested
inclusion in such Registration as provided above disapproves of the terms of
the underwriting, such person may elect to withdraw therefrom by written notice
to the Company, the underwriter and the Demanding Investor. If the Demanding
Investor elects to withdraw from such Registration, the initiation

 

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of such Registration shall
not count as a demand by such Investor for purposes hereof (including without
limitation, Section 2(a)(i)(1)). The Registrable Securities so withdrawn
shall also be withdrawn from Registration. If the underwriter has not limited
the number of Registrable Securities to be underwritten, the Company and
officers and directors of the Company may include its or their securities for
its or their own account in such Registration if the representative of such
underwriter or underwriters so agrees and if the number of Registrable Securities
which would otherwise have been included in such Registration and underwriting
will not thereby be limited.

 

(b)                                 Company Registration.

 

(i)                                     If the Company determines to Register any of
its equity securities either for its own account or for the account of Other
Stockholders, other than a Registration relating solely to employee benefit
plans, or a Registration relating solely to a Commission Rule 145 transaction,
or a Registration on any registration form which does not permit secondary
sales or does not include substantially the same information as would be
required to be included in a registration statement covering the sale of
Registrable Securities, the Company shall:

 

(1)                                  promptly give to each Investor a written
notice thereof (which shall include a list of the jurisdictions in which the
Company intends to attempt to qualify such securities under the applicable blue
sky or other state securities laws); and

 

(2)                                  include in such Registration (and any related
qualification under blue sky laws or other compliance), and in any underwriting
involved therein, all the Registrable Securities held by an Investor specified
in a written request made by such Investor within fifteen (15) days after
receipt of the written notice from the Company described in clause (1) above,
except as set forth in Section 2(b)(ii) below. Such written request may
cover Registration of all or a part of such Investor’s Registrable Securities.

 

(ii)                                  Underwriting.   If the Registration of
which the Company gives notice is for a Registered public offering involving an
underwriting, the Company shall so advise each Investor in the written notice
given pursuant to Section 2(b)(i)(1). In such event, the right of an
Investor to Registration pursuant to this Section 2(b) shall be conditioned
upon such Investor’s participation in such underwriting and the inclusion of
such Investor’s Registrable Securities in the underwriting to the extent
provided herein. In such case, each such Investor shall (together with the
Company and the Other Stockholders distributing their Registrable Securities
through such underwriting) enter into an underwriting agreement in customary
form with the representative of the underwriter or underwriters selected for
underwriting by the Company. Notwithstanding any other provision of this Section
2(b), if such representative determines that marketing factors require a
limitation on the number of shares to be underwritten, such representative may
(subject to the allocation priority set forth below) limit the number of Registrable
Securities to be included in the Registration and underwriting. The Company
shall so 

 

5

 

advise each such Investor
and any other holder of Registrable Securities requesting Registration, and the
number of shares of Registrable Securities that are entitled to be included in
the Registration and underwriting shall be allocated in the following
manner:  the Registrable Securities held
by such Investor and by Other Stockholders (other than Registrable Securities
held by any such persons who by contractual right demanded such Registration)
shall be excluded from such Registration and underwriting to the extent
required by such limitation pro rata in accordance with the number of shares of
Registrable Securities requested by such parties to be included in such
Registration, by such minimum number of shares as is necessary to comply with
such limitation. If any such holder of Registrable Securities disapproves of
the terms of any such underwriting, such holder may elect to withdraw therefrom
by written notice to the Company and the underwriter. Any Registrable
Securities or other securities excluded or withdrawn from such underwriting
shall be withdrawn from such Registration.

 

(c)                                  Form S-3.   Following the Closing, the Company shall use all
commercially reasonable efforts to qualify for Registration on Form S-3 for
secondary sales. After the Company has qualified for the use of Form S-3, each
Investor shall have the right to request three (3) Registrations on Form S-3
with respect to all or a part of the Registrable Securities held by such
Investor (all such requests shall be in writing and shall state the number of
shares of Registrable Securities to be disposed of and the intended method of
disposition of shares by the Investor), provided that the Company shall
not be obligated to effect, or take any action to effect, any such Registration
pursuant to this Section 2(c):

 

(i)                                     Unless such Investor proposes to dispose of
shares of Registrable Securities having an aggregate price to the public
(before deduction of underwriting discounts and expenses of sale) of more than
$5,000,000;

 

(ii)                                  Within 180 days of the effective date of the
registration statement for the most recent Registration pursuant to this Section
2(c) in which securities held by the Investor could have been included for
sale or distribution; or

 

(iii)                               During the period starting with the date
thirty (30) days prior to the Company’s good faith estimate of the date of
filing of, and ending on the date ninety (90) days immediately following the
effective date of, any registration statement pertaining to securities of the
Company (other than a Registration of securities in a Rule 145 transaction or
with respect to an employee benefit plan), provided that the Company is
actively employing in good faith all commercially reasonable efforts to cause
such registration statement to become effective; provided, however,
that the Company may only delay an offering pursuant to this Section
2(c)(iii) for a period of not more than sixty (60) days, if a filing of any
other registration statement is not made within that period and the Company may
only exercise this right once in any twelve (12) month period.

 

The Company shall give
written notice to the other Investor and all Other Stockholders of the receipt
of a request for Registration pursuant to this Section 2(c) and shall
provide a reasonable opportunity for the other Investor and such Other
Stockholders to participate in the Registration, provided that if the Registration
is for an underwritten offering, the terms of Section 2(a)(ii) shall
apply to all participants in such offering. Subject to the foregoing, the
Company will use all 

 

6

 

commercially reasonable
efforts to effect promptly the Registration of all shares of Registrable
Securities on Form S-3 to the extent requested by the holders thereof for
purposes of disposition.

 

(d)                                 Expenses of Registration.   All Registration Expenses
shall be borne by the Company, and all Selling Expenses shall be borne by the
holders of the Registrable Securities so Registered pro rata on the basis of
the number of their shares of Registrable Securities so Registered.

 

(e)                                  Registration Procedures.   If and when the Company
effects a Registration of Registrable Securities under the Securities Act
pursuant to this Section 2, the Company shall keep each Investor advised
in writing as to the initiation of each Registration and as to the completion
thereof. At its expense, the Company shall:

 

(i)                                     prepare and file with the Commission a
registration statement on any appropriate form under the Securities Act with
respect to such Registrable Securities and thereafter use its commercially
reasonable efforts to cause such registration statement promptly to become and
remain effective for a period of one hundred twenty (120) days or until each
Investor has completed the distribution described in the registration statement
relating thereto, whichever first occurs; provided, however, that
(A) such one hundred twenty (120) day period shall be extended for a period of
time equal to the period during which an Investor refrains from selling any
Registrable Securities included in such Registration in accordance with
provisions in Section 2(k) or 2(l) hereof; and (B) in the case of any
Registration of Registrable Securities on Form S-3 which are intended to be
offered on a continuous or delayed basis, such one hundred twenty (120) day
period shall be extended until all such Registrable Securities are sold, provided
that Rule 415, or any successor rule under the Securities Act, permits an
offering on a continuous or delayed basis, and provided  further
that applicable rules under the Securities Act governing the obligation to file
a post-effective amendment permit, in lieu of filing a post-effective amendment
which (y) includes any prospectus required by Section 10(a) of the Securities
Act or (z) reflects facts or events representing a material or fundamental
change in the information set forth in the registration statement, the
incorporation by reference of information required to be included in (y) and
(z) above to be contained in periodic reports filed pursuant to Section 12 or
15(d) of the Exchange Act in the registration statement;

 

(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 the provisions of the Securities Act with
respect to the disposition of all Securities covered by such registration
statement until the earlier of such time as all of such Securities have been
disposed of in a public offering or the expiration of [30] days;

 

(iii)                               furnish to each Demanding Investor and to the
other Investor, if the other Investor has shares of Registrable Securities
covered by such Registration (a “Selling Investor”) such number of copies of
such registration statement, each amendment and supplement thereto, the
prospectus included in such registration statement (including each preliminary
prospectus), any documents incorporated by reference therein and such 

 

7

 

other documents as such
Investor may reasonably request in order to facilitate the disposition of the
shares of Registrable Securities owned by such Investor (it being understood
that, subject to the requirements of the Securities Act and applicable state
securities laws, Company consents to the use of the prospectus and any amendment
or supplement thereto by each Demanding Investor and Selling Investor in
connection with the offering and sale of the shares of Registrable Securities
covered by the registration statement of which such prospectus, amendment or
supplement is a part);

 

(iv)                              furnish, on the date that such Registrable
Securities are delivered to the underwriters for sale, if such securities are
being sold through underwriters or, if such securities are not being sold
through underwriters, on the date that the registration statement with respect
to such securities becomes effective, (1) an opinion, dated as of such date, of
the counsel representing the Company for the purposes of such Registration, in
form and substance as is customarily given to underwriters in an underwritten
public offering and reasonably satisfactory to each Demanding Investor and
Selling Investor, addressed to the underwriters, if any, and to the holders of
Registrable Securities participating in such Registration and (2) a letter,
dated as of such date, from the independent certified public accountants of the
Company, in form and substance as is customarily given by independent certified
public accountants to underwriters in an underwritten public offering and
reasonably satisfactory to each Demanding Investor and Selling Investor,
addressed to the underwriters, if any, and if permitted by applicable
accounting standards, to the holders of Registrable Securities participating in
such Registration.

 

(v)                                 use its commercially reasonable efforts to
register or qualify such Registrable Securities under such other securities or
blue sky laws of such jurisdictions within the United States of America as each
Demanding Investor and Selling Investor may reasonably request; use its
commercially reasonable efforts to keep each such registration or qualification
(or exemption therefrom) effective during the period in which such registration
statement is required to be kept effective and take any other action which may
be reasonably necessary or advisable to enable each Demanding Investor and
Selling Investor to consummate the disposition in such jurisdictions of the
Registrable Securities being disposed of by such Demanding Investor and Selling
Investor, provided, however, that Company will not be required to (A)
qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this subparagraph or (B) subject
itself to taxation in or consent to general service of process in any such
jurisdiction, and provided, further, that Company shall not be required
to qualify such Registrable Securities in any jurisdiction in which the
securities regulatory authority requires that any Investor submits any shares
of its Registrable Securities to the terms, provisions and restrictions of any
escrow, lockup or similar agreement(s) for consent to sell Registrable
Securities in such jurisdiction;

 

(vi)                              promptly notify each Demanding Investor and
Selling Investor (A) when the registration statement, any prospectus or any
prospectus supplement or post-effective amendment has been filed and, with
respect to a registration statement or any post-effective amendment, when the
same has become effective, (B) of the issuance by any state securities or other
regulatory authority of any order suspending the qualification or 

 

8

 

exemption from qualification
of any of the Registrable Securities under state securities or “blue sky”
laws or the initiation of any proceedings for that purpose and (C) of the happening
of any event which makes any statement made in a registration statement or
related prospectus untrue or which requires the making of any changes in such
registration statement, prospectus or documents so that they will not contain
any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading (or with respect to the prospectus, in light of the circumstance
under which such statements were made), and, subject to Section 2(l), as
promptly as reasonably practicable thereafter, prepare and file with the
Commission and furnish a supplement or amendment to such prospectus so that, as
thereafter deliverable to the purchasers of such Registrable Securities, such
prospectus will not contain any untrue statement of a material fact or omit a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;

 

(vii)                           if requested by any Demanding Investor or
Selling Investor, promptly incorporate in a prospectus supplement or
post-effective amendment such information as such Demanding Investor or Selling
Investor reasonably requests to be included therein and promptly make all
required filings of such prospectus supplement or post-effective amendment;

 

(viii)                        as promptly as reasonably practicable after
the filing with the Commission of any document which is incorporated by
reference into a registration statement (in the form in which it was
incorporated), deliver copies of each such document to each Demanding Investor
and Selling Investor;

 

(ix)                                cooperate with each Demanding Investor and
Selling Investor to facilitate the timely preparation and delivery of
certificates (which shall not bear any restrictive legends unless required
under applicable law) representing securities sold under any registration
statement, and enable such securities to be in such denominations and
registered in such names as such Demanding Investor or Selling Investor may
request and keep available and make available to Company’s transfer agent prior
to the effectiveness of such registration statement a supply of such
certificates;

 

(x)                                   cause the Registrable Securities included in
any registration statement to be listed on each United States securities
exchange, if any, on which the Company Common Stock is then listed;

 

(xi)                                provide a transfer agent and registrar for
all shares of Registrable Securities registered hereunder and provide a CUSIP
number for the shares of Registrable Securities included in any registration
statement not later than the effective date of such                                                registration statement;

 

(xii)                             cooperate with each Demanding Investor,
Selling Investor and their counsel in connection with any filings required to
be made with the NASD;

 

9

 

(xiii)                          during the period when the prospectus is
required to be delivered under the Securities Act, promptly file all documents
required to be filed with the Commission pursuant to Sections 13(a), 13(c), 14
or 15(d) of the Exchange Act;

 

(xiv)                         notify each Demanding Investor and Selling
Investor promptly of any request by the Commission for the amending or
supplementing of such registration statement or prospectus or for additional
information;

 

(xv)                            prepare and file with the Commission as
promptly as reasonably practicable any amendments or supplements to such
registration statement or prospectus which, in the opinion of counsel for
Company, is required in connection with the distribution of the Registrable
Securities;

 

(xvi)                         advise each Demanding Investor and Selling
Investor, 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 such purpose and promptly use its commercially reasonable
efforts to prevent the issuance of any stop order or to obtain its withdrawal
at the earliest possible moment if such stop order should be issued; and

 

(xvii)                      in the event of an underwritten public
offering, enter into and perform its obligations under an underwriting
agreement, in usual and customary form, with the managing underwriter(s) of
such offering.

 

(f)                                    Indemnification.

 

(i)                                     The Company shall indemnify and hold harmless
each Demanding Investor, Selling Investor, each of their officers, directors,
partners and members, and each person controlling such Investor, with respect
to each Registration which has been effected pursuant to this Section 2,
and each underwriter, if any, and each person who controls any underwriter,
against all claims, losses, damages and liabilities (or actions in respect
thereof), to which they may become subject under the Securities Act or
otherwise, insofar as such claims, losses, damages and liabilities (or actions
in respect thereof) arise out of or are based on any untrue (or alleged untrue)
statement of any material fact contained in any registration statement on the
effective date thereof (including any prospectus, offering circular or other
documents) incident to any such Registration, qualification or compliance, or
arise out of or are based on any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, or any violation by the Company of the
Securities Act or the Exchange Act or any rule or regulation thereunder
applicable to the Company and relating to action or inaction required of the
Company in connection with any such Registration, qualification or compliance,
and shall reimburse each Demanding Investor, Selling Investor, each of their
officers, directors, partners and members, and each person controlling such
Investor, each such underwriter and each person who controls any such
underwriter, for any legal and any other expenses reasonably incurred by them
in connection with investigating and defending any such claims, losses,
damages, liabilities or actions; provided, that the Company shall not be
liable to such Investor, its officers, 

 

10

 

directors, partners and
members, each person controlling such Investor, each such underwriter and each
person who controls any such underwriter in any such case to the extent that any
such claims, losses, damages, liabilities or expenses arise out of or are based
on any untrue statement or omission made in connection with such registration
statement, or amendments or supplements thereto, in reliance upon and in
conformity with written information furnished to the Company by such Investor
or underwriter expressly for use in connection with such registration statement
by such Investor, its officers, directors, partners and members, each person
controlling such Investor, each such underwriter and each person who controls
any such underwriter.

 

(ii)                                  Each Demanding Investor and Selling Investor
shall, if Registrable Securities held by it are included in the securities as
to which such Registration, qualification or compliance is being effected,
severally and not jointly, indemnify and hold harmless the Company, each of its
directors and officers and each underwriter for the Company within the meaning
of the Securities Act (if any), and each person who controls the Company or
such underwriter against all claims, losses, damages and liabilities, joint or
several (or actions in respect thereof), to which the Company or any such
director, officer, controlling person, or underwriter may become subject, under
the Securities Act or otherwise, insofar as such claims, losses, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue (or alleged untrue) statement of any material fact contained in any
registration statement on the effective date thereof (including any prospectus,
offering circular or other documents) made by such Investor, or arise out of or
are based upon any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements by such
Investor therein not misleading, shall reimburse any legal or any other
expenses reasonably incurred by the Company or any such directors, officers,
controlling persons or underwriters in connection with investigating or
defending any such claims, losses, damages, liabilities or actions, in each
case to the extent, but only to the extent, that such untrue statement (or
alleged untrue statement) or omission (or alleged omission) was made in such
registration statement or amendments or supplements thereto, in reliance upon
and in conformity with written information furnished to the Company by such
Investor expressly for use in connection with such registration statement; provided,
however, that the obligations of such Investor hereunder shall be
limited to an amount equal to the net proceeds to such Investor of the
Registrable Securities sold as contemplated herein.

 

(iii)                               Each party entitled to indemnification under
this Section 2(f) (the “Indemnified Party”) shall give written
notice to the party required to provide indemnification (the “Indemnifying
Party”) and to the other parties hereto promptly after the receipt by such
Indemnified Party of any written notice of the commencement of any claim,
action, proceeding or investigation or threat thereof made in writing for which
the Indemnified Party intends to claim indemnification pursuant to this
Agreement, and shall permit the Indemnifying Party to assume the defense of any
such claim, action, proceeding or investigation; provided that counsel
for the Indemnifying Party, who shall conduct the defense of such claim,
action, proceeding or investigation, shall be approved by the Indemnified Party
(whose approval shall not unreasonably be withheld) and the Indemnified Party
may participate in such defense at such party’s expense (unless the

 

11

 

Indemnified Party shall have
reasonably concluded that there may be a conflict of interest between the
Indemnifying Party and the Indemnified Party in such claim, action, proceeding
or investigation, in which case the fees and expenses of counsel shall be at
the expense of the Indemnifying Party), and provided further that the
failure of any Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party of its obligations under this Section 2
unless the Indemnifying Party is materially prejudiced thereby. No Indemnifying
Party, in the defense of any such claim, action, proceeding or investigation
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,
action, proceeding or investigation. Each Indemnified Party shall furnish such
information regarding itself or the claim in question as an Indemnifying Party
may reasonably request in writing and as shall be reasonably required in
connection with the defense of such claim, action, proceeding or investigation.

 

(iv)                              If the indemnification provided for in this Section
2(f) is held by a court of competent jurisdiction to be unavailable to an
Indemnified Party with respect to any losses, liabilities, claims, damages or
expenses referred to herein, then the Indemnifying Party, in lieu of
indemnifying such Indemnified Party hereunder, shall contribute to the amount
paid or payable by such Indemnified Party as a result of such losses,
liabilities, claims, damages or expenses in such proportion as is appropriate
to reflect the relative fault of the Indemnifying Party on the one hand and of
the Indemnified Party on the other in connection with the statements or
omissions which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations. The relative
fault of the Indemnifying Party and of the Indemnified Party shall be
determined by reference to, among other things, whether the untrue (or alleged
untrue) statement of a material fact or the omission (or alleged omission) to
state a material fact relates to information supplied by the Indemnifying Party
or by the Indemnified Party and the parties’ relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or
omission.

 

(v)                                 Notwithstanding the foregoing, to the extent
that the provisions on indemnification and contribution contained in the
underwriting agreement entered into in connection with any underwritten public
offering contemplated by this Agreement are in conflict with the foregoing
provisions, the provisions in such underwriting agreement shall be controlling.

 

(vi)                              The foregoing indemnity agreement of the
Company and each Investor is subject to the condition that, insofar as they
relate to any losses, claims, liabilities or damages arising out of a statement
made in or omitted from a preliminary prospectus but eliminated or remedied in
the amended prospectus on file with the Commission at the time the registration
statement in question becomes effective or the amended prospectus filed with
the Commission pursuant to Commission Rule 424(b) (the “Final Prospectus”),
such indemnity or contribution agreement shall not inure to the benefit of any
underwriter if a copy of the Final Prospectus was furnished to the underwriter
and was not furnished 

 

12

 

to the person asserting the
losses, liabilities, claims or damages at or prior to the time such action is
required by the Securities Act.

 

(g)                                 Information by the Investors.   To the extent the
Registrable Securities held by an Investor are included in any Registration,
such Investor shall furnish to the Company such information regarding such
Investor and the distribution proposed by such Investor as the Company may
reasonably request in writing and as shall be reasonably required in connection
with any Registration, qualification or compliance referred to in this Section
2.

 

(h)                                 Rule 144 Reporting.   With a view to making
available the benefits of certain rules and regulations of the Commission which
may at any time permit the sale of Registrable Securities to the public without
Registration, at all times from and after ninety (90) days following the
effective date of the registration statement for the first Registration
demanded by any Investor under the Securities Act filed by the Company for an
offering of securities of the Company to the general public, the Company agrees
to:

 

(i)                                     make and keep public information available as
those terms are understood and defined in Rule 144 under the Securities Act (“Rule
144”);

 

(ii)                                  use all commercially reasonable efforts to
file with the Commission in a timely manner all reports and other documents
required of the Company under the Securities Act and the Exchange Act at any
time after it has become subject to such reporting requirements; and

 

(iii)                               so long as any Investor owns any Registrable
Securities, furnish to such Investor, upon request, a written statement by the
Company as to its compliance with the reporting requirements of Rule 144 and of
the Securities Act and the Exchange Act (at any time after it has become
subject to such reporting requirements), a copy of the most recent annual or
quarterly report of the Company, and such other reports and documents so filed
as such Investor may reasonably request in availing itself of any rule or
regulation of the Commission allowing such Investor to sell any such securities
without Registration.

 

(i)                                     Reserved.

 

(j)                                     Limitation on Subsequent Registration Rights.   The Company shall not,
without the prior written consent of each Investor, enter into any agreement
with any other holder or prospective holder of any securities of the Company
that would allow such other holder or prospective holder to include securities
of the Company in any registration statement on terms more favorable than the
terms on which the Investor may include shares of Registrable Securities in
such Registration.

 

(k)                                  Holdback Agreements.

 

(i)                                     If and whenever the Company effects a
Registration pursuant to Section 2, each Investor that holds Registrable
Securities included in such Registration agrees not to effect any public sale
or distribution, including any sale pursuant to Rule 144 under the Securities
Act, of any Registrable Securities within seven days prior to and 90 days 

 

13

 

(unless advised in writing
by the managing underwriter that a longer period, not to exceed 180 days, is
required) after the effective date of the registration statement relating to
such Registration, except as part of such Registration; provided,
however, that each such Investor only agrees to such restriction if and to the
extent that all other holders of Registrable Securities included in such
Registration (including without limitation, officers and directors of the
Company) similarly agree not to effect any such sales or distributions during
such periods.

 

(ii)                                  The Company agrees not to effect any public
sale or distribution of its equity securities or securities convertible into or
exchangeable or exercisable for any of such securities within seven days prior
to and 90 days (unless advised in writing by the managing underwriter that a
longer period, not to exceed 180 days, is required) after the effective date of
any such registration statement as described in Section 2(k)(i) (except
as part of such Registration or pursuant to a Registration on Form S-4 or
S-8 or any successor form). In addition, if requested by the managing
underwriter, the Company shall use its commercially reasonable best efforts to
cause each holder of Registrable Securities, to agree not to effect any such
public sale or distribution of such Registrable Securities during such period,
except as part of any such Registration if permitted, and to use its
commercially reasonable efforts to cause each such holder to enter into a
similar agreement to such effect with the Company.

 

(l)                                     Blockage
Period.       If
(i) there has been or there is pending a development or change in the business,
affairs or prospects of Company or any of its subsidiaries; (ii) Company’s
counsel advised Company in writing that such development or change should be
disclosed in the registration statement, the prospectus included therein, or an
amendment or supplement thereto in order to ensure that the registration
statement and such prospectus, as amended or supplemented, will not contain any
misstatement 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 (or
with respect to the prospectus, in light of the circumstance under which such
statements were made); and (iii) in the good faith judgment of the officers or
directors of Company, disclosure of such development or change would either (x)
have an adverse effect on the business or operations of Company or (y) if the
disclosure otherwise relates to a material financing or acquisition of assets
which has not yet been disclosed and such disclosure would have an adverse
effect on the likelihood of consummating such transaction, then Company may
deliver written notification to the Investors that Registrable Securities may
not be sold pursuant to the registration statement (a “Blockage Notice”). Company
shall have no obligation to include in any such notice any reference to or
description of the facts based upon which the Company is delivering such notice.
Company shall delay during such Blockage Period the filing or effectiveness of
any registration statement required pursuant this Agreement. No Investor shall
sell any Registrable Securities pursuant to the registration statement for the
period (the “Blockage Period”) beginning on the date such Blockage Notice was
received by such Investor and ending on the date on which Company notifies the
Investors that the Blockage Period has ended, which Blockage Period shall not
exceed an aggregate of ninety (90) days in any calendar year, provided,
that such Blockage Period shall be extended for any period, not to exceed
forty-five (45) days in any calendar year, during which the Commission is
reviewing any proposed amendment to the registration (and Company agrees
promptly to notify the Investors if the circumstances giving rise to such
Blockage Period no longer apply). Company shall promptly prepare and file any
amendment or 

 

14

 

supplement
to the registration statement or the prospectus included therein necessary so
that at the conclusion of the Blockage Period, the registration statement and
the prospectus included therein do not contain any misstatements 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 (or with respect to the
prospectus, in light of the circumstance under which such statements were made)
and notify the Investors of such amendment or supplement and of the conclusion
of the Blockage Period.

 

SECTION 3.  TERMINATION

 

(a)                                  Termination.                             The provisions of this Agreement shall
terminate as to a particular Investor at such time as such Investor has sold
all of his or its Registrable Securities in a Registration pursuant to the
Securities Act or pursuant to Rule 144. Section 2(f) shall survive any
termination of this Agreement.

 

SECTION 4.  MISCELLANEOUS

 

(a)                                  Governing Law.   This Agreement and all
actions arising out of or in connection with this Agreement shall be governed
by and construed in accordance with the laws of the State of New York,
applicable to contracts executed in and to be performed entirely within that
State, without regard to the conflicts of law provisions of the State of New
York.

 

(b)                                 Submission to Jurisdiction.   All actions and
proceedings arising out of or relating to this agreement shall be heard and
determined exclusively in any New York state or federal court sitting in the
Borough of Manhattan of the City of New York. The parties hereto hereby (a)
submit to the exclusive jurisdiction of any state or federal court sitting in
the Borough of Manhattan of the City of New York for the purpose of any action
arising out of or relating to this agreement brought by any party hereto, and
(b) irrevocably waive, and agree not to assert by way of motion, defense, or
otherwise, in any such action, any claim that it is not subject personally to
the jurisdiction of the above-named courts, that its property is exempt or
immune from attachment or execution, that the action is brought in an
inconvenient forum, that the venue of the action is improper, or that this
agreement or the transaction may not be enforced in or by any of the
above-named courts. Each of the parties hereto hereby waives to the fullest
extent permitted by applicable law any right it may have to a trial by jury
with respect to any litigation directly or indirectly arising out of, under or
in connection with this agreement. Each of the parties hereto (a) certifies that
no representative, agent or attorney of any other party has represented,
expressly or otherwise, that such other party would not, in the event of
litigation, seek to enforce that foregoing waiver and (b) acknowledges that it
and the others hereto have been induced to enter into this agreement, as
applicable, by, among other things, the mutual waivers and certifications in
this Section 3(c)

 

(c)                                  Notices.    All notices and other communications under
this Agreement shall be in writing and shall be deemed given (i) when delivered
personally by hand (with written confirmation of receipt), (ii) when sent by
facsimile (with written confirmation of transmission) or (iii) one Business Day
following the day sent by overnight courier (with written confirmation of receipt),
in each case at the following addresses and facsimile numbers (or to such other
address or facsimile number as a party may have specified by notice given to
the other party pursuant to this provision):

 

15

 

(i)         If
to the Company, to:

 

One Capital City Plaza

3350
Peachtree Road

Suite 1500

Atlanta, Georgia  30326

Attn: Chief Executive Officer

Fax:      (404)
760-3458

 

with a copy (which shall not constitute
notice) to:

 

Greenberg
Traurig, LLP

3290 Northside Parkway, N.W., Suite 400

Atlanta,
GA  30327

Attn:     James
S. Altenbach, Esq.

Fax:      (678)
553-2188

 

(ii)         If to HowStuffWorks, Inc., to:

 

One
Capital City Plaza

3350
Peachtree Road

Suite 1500

Atlanta, Georgia  30326

Attn:
Legal Department

Fax:      (404)
760-3458

 

with a copy (which shall not constitute
notice) to:

 

Greenberg
Traurig, LLP

3290 Northside Parkway, N.W., Suite 400

Atlanta,
GA  30327

Attn:     James
S. Altenbach, Esq.

Fax:      (678)
553-2188

 

(iii)        If
to Zhou, to:

 

Room
512, East Wing, Beijing Capital Times Square

88
West Chan’An Avenue

Beijing
100031, China

Attention:
Wei Zhou

Fax:      +
8610 8391 3145

 

with
a copy (which shall not constitute notice) to:

 

Shearman
& Sterling LLP

2318
China World Tower Two

16

 

1
Jianguomenwai Dajie

Beijing
100004, China

Attention:  Lee Edwards

Facsimile:  +(8610) 6505-1818]

 

 

(d)                                 Reproduction of Documents.   This Agreement and all
documents relating thereto, including, without limitation, any consents,
waivers and modifications which may hereafter be executed may be reproduced by
the Investors by any photographic, photostatic, microfilm, microcard, miniature
photographic or other similar process and the Investors may destroy any original
document so reproduced. The parties hereto agree and stipulate that any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by the Investors in the
regular course of business) and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.

 

(e)                                  Successors and Assigns.   Subject to the restrictions
on transfer described in clauses (i) and (ii) below, the rights and
obligations of the Company and each Investor hereunder shall be binding upon
and benefit the successors, assigns, heirs, administrators and transferees of
such parties.

 

(i)                                     The rights, interests or obligations
hereunder may not be assigned, by operation of law or otherwise, in whole or in
part, by an Investor without the prior written consent of the Company; provided,
however, an Investor may assign its interest to its partners, limited
partners, affiliates or heirs without the consent of the Company.

 

(ii)                                  The rights, interests or obligations
hereunder may not be assigned, by operation of law or otherwise, in whole or in
part, by the Company without the prior written consent of each Investor.

 

(f)                                    Amendment and Waivers.   No failure or delay on the
part of Company or any Investor in exercising any right, power or remedy
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right, power or remedy preclude any other or further
exercise thereof or the exercise of any other right, power or remedy. The
remedies provided for herein are cumulative and are not exclusive of any
remedies that may be available to Company or an Investor at law or in equity or
otherwise. Any provision of this Agreement may be amended, supplemented,
modified or waived if, but only if, such amendment, supplement, modification or
waiver is in writing and is signed by all the parties hereto.

 

(g)                                 Severability.   If any term or other
provision of this Agreement is invalid, illegal, or incapable of being enforced
by any law or public policy, all other terms or provisions of this Agreement
shall nevertheless remain in full force and effect so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner materially adverse to any party. Upon such determination that any term
or other provision is invalid, illegal, or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the parties as closely as possible in an 

 

17

 

acceptable manner in order that the transactions contemplated hereby
are consummated as originally contemplated to the greatest extent possible.

 

(h)                                 Counterparts.   This Agreement may be
executed in one or more counterparts, each of which will be deemed to be an
original copy of this Agreement and all of which, when taken together, will be
deemed to constitute one and the same agreement. This Agreement may be executed
by facsimile or other electronic means.

 

(i)                                     Entire Agreement.   This Agreement constitutes
the entire agreement, and supersedes all other prior agreements and
understandings, both written and oral, among the parties, or any of them, with
respect to the subject matter hereof and thereof and, except as provided in
Section 2(f) hereof, is not intended to and shall not confer upon any Person
other than the parties any rights or remedies hereunder. The parties agree that
time is of the essence with respect to the performance of all obligations
provided in this Agreement and effectuation of the transactions contemplated
thereby.

 

(j)                                     Specific Enforcement.   The parties agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that the parties shall be entitled
to an injunction or injunctions to prevent breaches of this Agreement and to
enforce specifically the terms and provisions of this Agreement in any New York
State Court sitting in the borough of Manhattan in the city of New York or any
Federal Court sitting in the borough of Manhattan in the city of New York, this
being in addition to any other remedy to which they are entitled at law or in
equity.

 

(k)                                  Rules of Construction.   Unless the context
otherwise requires, the singular shall include the plural and vice-versa, each
pronoun in any gender shall include all other genders, and provisions apply to
successive events and transactions. The words “hereof”, “hereby”, “herein” and “hereunder”
and words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this Agreement. The
word “including” or any variation thereof means “including, without limitation”
and shall not be construed to limit any general statement that it follows to
the specific or similar items or matters immediately following it. The titles
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.
Where any provision in this Agreement refers to action to be taken by any
Person, or which such Person is prohibited from taking, such provision shall be
applicable whether such action is taken directly or indirectly by such Person.

 

[Remainder of page
intentionally left blank]

 

18

Execution Copy

 

 

IN
WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first set forth above.

 

 

	
   

  	
  HSW
  INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Bradley Zimmer

  	
   

  
	
   

  	
  Name: Bradley Zimmer

  
	
   

  	
  Title: Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HOWSTUFFWORKS,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Jeffrey Arnold

  	
   

  
	
   

  	
  Name: Jeffrey Arnold

  
	
   

  	
  Title: Chief
  Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WEI ZHOU

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/
  Wei ZhouExhibit 10.7

 

Execution Version

 

HSW INTERNATIONAL, INC.

 

AFFILIATE REGISTRATION RIGHTS AGREEMENT

 

THIS AFFILIATE REGISTRATION
RIGHTS AGREEMENT (this “Agreement”) dated as of October 2, 2007 is
entered into by and among HSW International, Inc., a Delaware corporation (the “Company”),
and Kevin Jones, a resident of the State of                ;
Theodore P. Botts, a resident of the State of Connecticut; J. David Darnell, a
resident of the State of Texas; Dr. Heinz-Gerd Stein, a resident of the State
of                ;
and Larrie A. Weil, a resident of the State of                ;
(each an “Affiliate,” and collectively, the “Affiliates”).

 

R  E
C  I  T  A  L  S

 

WHEREAS, pursuant to the
terms of the Agreement and Plan of Merger dated as of April 20, 2006, as amended
on January 29, 2007 and further amended on August 23, 2007, (the “Merger
Agreement”), by and among the Company, HowStuffWorks, Inc., a Delaware
corporation (“HSW”), INTAC International, Inc., a Nevada corporation (“INTAC”),
and HSW International Merger Corporation, a Nevada corporation and wholly-owned
subsidiary of the Company (“Merger Sub”), (i) HSW will contribute a
license and sublicense of certain content to the Company in exchange for shares
of the common stock, par value $0.001 per share, of the Company (“Common
Stock”), and (ii) Merger Sub will merge with and into INTAC (the “Merger”)
and the shareholders of INTAC will receive shares of the Common Stock of the
Company.

 

WHEREAS, each Affiliate is a
Rule 145 Affiliate as such term is defined in the Merger Agreement;

 

WHEREAS, the Company has
agreed to grant each Affiliate certain registration rights with respect to the
shares of Common Stock issued to each Affiliate pursuant to the Merger on the
terms and conditions set forth herein; and

 

WHEREAS, the Company and
each Affiliate desire to define the registration rights of each Affiliate on
the terms and subject to the conditions herein set forth.

 

NOW, THEREFORE, in
consideration of the foregoing premises and for other good and valuable
consideration, the parties hereby agree as follows:

 

SECTION 1.  DEFINITIONS

 

As used in this Agreement,
the following terms shall have the respective meanings set forth below:

 

“Closing” shall mean
the closing of the Merger pursuant to the Merger Agreement;

 

“Commission” shall
mean the Securities and Exchange Commission and any successor agency;

 

 

“Exchange Act” shall
mean the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder;

 

“Person” shall any
individual, firm, corporation, partnership, limited partnership, limited
liability company, association, trust, unincorporated organization or other
entity, as well as any syndicate or group that would be deemed to be a person
under Section 13(d)(3) of the Exchange Act;

 

“Register”, “Registered”
and “Registration” shall refer to a registration effected by preparing
and filing a registration statement or similar document with the Commission in
compliance with the Securities Act and the declaration or ordering by the
Commission of effectiveness of such registration statement or document;

 

“Registrable Securities”
shall mean, as applicable: (a) the shares of Common Stock owned by each
Affiliate, whether owned or acquired by virtue of the Merger Agreement on the
date hereof or acquired hereafter by way of stock dividend or stock split or in
connection with a combination of shares, recapitalization, reorganization,
merger or consolidation of the Company; and (b) shares of Common Stock held by
Persons who, by virtue of agreements with the Company, are entitled to be
included in a Registration made by a Demanding Affiliate hereunder. For
purposes of this Agreement, (i) Registrable Securities shall cease to be
Registrable Securities when a registration statement covering such Registrable
Securities has been declared effective under the Securities Act by the
Commission and such Registrable Securities have been disposed of pursuant to
such effective registration statement, and (ii) Registrable Securities shall
cease to be Registrable Securities, if in the opinion of the Company, such
Registrable Securities may be distributed to the public pursuant to Rule 144(k)
(or any successor provision then in effect) under the Securities Act or any
such Registrable Securities have been sold in a sale made pursuant to Rule 144
of the Securities Act;

 

“Registration Expenses”
shall mean any and all expenses incurred by the Company incident to the
performance of or compliance with any registration or marketing of securities
pursuant to Section 2(a), (b) and (c) hereof, including
(a) the fees, disbursements and expenses of Company’s counsel and accountants
in connection with this Agreement and the performance of Company’s obligations
hereunder (including the expenses of any annual audit letters and “cold
comfort” letters required or incidental to the performance of such
obligations); (b) all expenses, including filing fees, in connection with the
preparation, printing and filing of any registration statement, any preliminary
prospectus or final prospectus, any other offering document and amendments and
supplements thereto and the mailing and delivering of copies thereof to any
underwriters and dealers; (c) the cost of printing and producing any agreements
among underwriters, underwriting agreements, selling group agreements and any
other customary documents in connection with the marketing of securities
pursuant to Section 2(a), (b) and (c) hereof; (d) all
expenses in connection with the qualification of the securities to be disposed
of for offering and sale under state securities laws, including the reasonable
fees and disbursements of counsel for the underwriters or an Affiliate in
connection with such qualification and in connection with any “blue sky”
and legal investment surveys, including the cost of printing and producing any
such “blue sky” or legal investment surveys; (e) the filing fees
incident to securing any required review by the National Association of
Securities Dealers, Inc. of the terms of the securities being registered
pursuant to Section 2(a), (b) and (c) hereof;

 

2

 

(f) transfer agents’ and
registrars’ fees and expenses and the fees and expenses of any other agent or
trustee appointed in connection with such offering; (g) all security engraving
and security printing expenses; (h) all fees and expenses payable in connection
with the listing of the securities on any securities exchange or automated
interdealer quotation system; and (i) the costs and expenses of Company and its
officers relating to analyst or investor presentations, if any, or any “road
show” undertaken in connection with the registration and/or marketing of
any shares of Registrable Stock other than as provided in any underwriting
agreement entered into in connection with such offering. In no event shall
Registration Expenses be deemed to include Selling Expenses;

 

“Securities” shall
have the meaning set forth in Section 2(1) of the Securities Act;

 

“Securities Act”
shall mean the Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder; and

 

“Selling Expenses”
shall mean all underwriting discounts, selling commissions, brokerage fees and
transfer taxes applicable to the sale of Registrable Securities and all fees
and disbursements of counsel for each Affiliate.

 

SECTION 2.  REGISTRATION
RIGHTS

 

(a)                                  Requested Registration.

 

(i)                                     Request for Registration. After the receipt of a written request from
any Affiliate (such Affiliate, the “Demanding Affiliate”) at any time
after 180 days following the Closing requesting that the Company effect any
Registration under the Securities Act covering all or part of the Registrable
Securities held by such Affiliate, the Company shall, (i) as expeditiously as
is possible, but in any event no later than forty-five (45) days after receipt
of a written request from a Demanding Affiliate, file a registration statement
with the SEC for such Registration relating to all shares of Registrable
Securities which the Company has been so requested to register by such
Affiliate for sale, and (ii) use its commercially reasonable efforts to cause
such registration statement to be declared effective by the SEC as soon as is
practicable; provided that the Company shall not be obligated to effect,
or take any action to effect, any such Registration pursuant to this Section
2(a):

 

(1)                                  After the Company has effected three (3) such
Registrations requested by each Affiliate pursuant to this Section 2(a)
and the registration statements for such Registrations have been declared or
ordered effective;

 

(2)                                  If the Registrable Securities requested by
such Affiliate to be Registered pursuant to such request do not have an
anticipated aggregate public offering price (before any underwriting discounts
and commissions) of at least $5,000,000; or

 

(3)                                  During the period starting with the date
thirty (30) days prior to the Company’s good faith estimate of the date of
filing of, and ending on the date ninety (90) days immediately following the
effective date of, any registration

 

3

 

statement
pertaining to securities of the Company (other than a Registration of
securities in a Rule 145 transaction or, with respect to an employee benefit
plan), provided that the Company is actively employing in good faith all
commercially reasonable efforts to cause such registration statement to become
effective; provided, further, however, that the Company
may only delay an offering pursuant to this Section 2(a)(i)(3) for a
period of not more than ninety (90) days, if a filing of any other registration
statement is not made within that period and the Company may only exercise this
right once in any twelve (12) month period.

 

(ii)                                  Other Stockholders. The registration statement filed pursuant
to any such request of any Demanding Affiliate may, subject to the provisions
of Section 2(a)(iv) below, include Registrable Securities of the other
Affiliate, and other securities of the Company which are held by Persons who,
by virtue of agreements with the Company, are entitled to include their Registrable
Securities in any such Registration (“Other Stockholders”).

 

(iii)                               Assignment. The registration rights set forth in this Section 2 may be
assigned, in whole or in part, to any transferee of Registrable Securities (who
shall be entitled to all rights and bound by all obligations of this
Agreement).

 

(iv)                              Underwriting.

 

(1)                                  If the Affiliate intends to distribute the
Registrable Securities covered by its request for Registration by means of an
underwriting, it shall so advise the Company in its request made pursuant to Section
2(a).

 

(2)                                  If the other Affiliate or Other Stockholders
request inclusion in any such Registration, the Demanding Affiliate shall offer
to include the Registrable Securities of the other Affiliate and such Other
Stockholders in the underwriting but may condition such offer on their
acceptance of the further applicable provisions of this Section 2(a)(iv).
The Demanding Affiliate and the Company shall (together with the other
Affiliate and all Other Stockholders proposing to distribute their Registrable
Securities through such underwriting) enter into an underwriting agreement in
customary form with the representative of the underwriter or underwriters
selected for such underwriting by the Company and acceptable to the Demanding
Affiliate. Notwithstanding any other provision of this Section 2(a), if
the representative of such underwriter or underwriters advise the Company
and/or the Demanding Affiliate in writing that marketing factors require a
limitation on the number of shares to be underwritten, the Registrable
Securities held by the other Affiliate and Other Stockholders shall be excluded
from such Registration to the extent so required by such limitation pro rata in
accordance with the number of shares of Registrable Securities requested by
such parties to be included in such Registration, by such minimum number of
shares as is necessary to comply with such limitation. No Registrable
Securities excluded from the underwriting by reason of the underwriter’s
marketing limitation shall be included in such Registration. If the other
Affiliate or any Other Stockholder who has requested inclusion in such
Registration as provided above disapproves of the

 

4

 

terms
of the underwriting, such person may elect to withdraw therefrom by written
notice to the Company, the underwriter and the Demanding Affiliate. If the
Demanding Affiliate elects to withdraw from such Registration, the initiation
of such Registration shall not count as a demand by such Affiliate for purposes
hereof (including without limitation, Section 2(a)(i)(1)). The
Registrable Securities so withdrawn shall also be withdrawn from Registration. If
the underwriter has not limited the number of Registrable Securities to be
underwritten, the Company and officers and directors of the Company may include
its or their securities for its or their own account in such Registration if
the representative of such underwriter or underwriters so agrees and if the
number of Registrable Securities which would otherwise have been included in
such Registration and underwriting will not thereby be limited.

 

(b)                                 Company Registration.

 

(i)                                     If the Company determines to Register any of
its equity securities either for its own account or for the account of Other
Stockholders, other than a Registration relating solely to employee benefit
plans, or a Registration relating solely to a Commission Rule 145 transaction,
or a Registration on any registration form which does not permit secondary
sales or does not include substantially the same information as would be
required to be included in a registration statement covering the sale of
Registrable Securities, the Company shall:

 

(1)                                  promptly give to each Affiliate a written
notice thereof (which shall include a list of the jurisdictions in which the
Company intends to attempt to qualify such securities under the applicable blue
sky or other state securities laws); and

 

(2)                                  include in such Registration (and any related
qualification under blue sky laws or other compliance), and in any underwriting
involved therein, all the Registrable Securities held by an Affiliate specified
in a written request made by such Affiliate within fifteen (15) days after
receipt of the written notice from the Company described in clause (1) above,
except as set forth in Section 2(b)(ii) below. Such written request may
cover Registration of all or a part of such Affiliate’s Registrable Securities.

 

(ii)                                  Underwriting. If the Registration of which the Company
gives notice is for a Registered public offering involving an underwriting, the
Company shall so advise each Affiliate in the written notice given pursuant to Section
2(b)(i)(1). In such event, the right of an Affiliate to Registration
pursuant to this Section 2(b) shall be conditioned upon such Affiliate’s
participation in such underwriting and the inclusion of such Affiliate’s
Registrable Securities in the underwriting to the extent provided herein. In
such case, each such Affiliate shall (together with the Company and the Other
Stockholders distributing their Registrable Securities through such
underwriting) enter into an underwriting agreement in customary form with the
representative of the underwriter or underwriters selected for underwriting by
the Company. Notwithstanding any other provision of this Section 2(b),
if such representative determines that marketing

 

5

 

factors
require a limitation on the number of shares to be underwritten, such
representative may (subject to the allocation priority set forth below) limit
the number of Registrable Securities to be included in the Registration and
underwriting. The Company shall so advise each such Affiliate and any other
holder of Registrable Securities requesting Registration, and the number of
shares of Registrable Securities that are entitled to be included in the
Registration and underwriting shall be allocated in the following manner:  the Registrable Securities held by such
Affiliate and by Other Stockholders (other than Registrable Securities held by
any such persons who by contractual right demanded such Registration) shall be
excluded from such Registration and underwriting to the extent required by such
limitation pro rata in accordance with the number of shares of Registrable
Securities requested by such parties to be included in such Registration, by
such minimum number of shares as is necessary to comply with such limitation. If
any such holder of Registrable Securities disapproves of the terms of any such
underwriting, such holder may elect to withdraw therefrom by written notice to
the Company and the underwriter. Any Registrable Securities or other securities
excluded or withdrawn from such underwriting shall be withdrawn from such
Registration.

 

(c)                                  Form S-3. Following the Closing, the Company shall use all commercially
reasonable efforts to qualify for Registration on Form S-3 for secondary sales.
After the Company has qualified for the use of Form S-3, each Affiliate shall
have the right to request three (3) Registrations on Form S-3 with respect to
all or a part of the Registrable Securities held by such Affiliate (all such
requests shall be in writing and shall state the number of shares of
Registrable Securities to be disposed of and the intended method of disposition
of shares by the Affiliate), provided that the Company shall not be
obligated to effect, or take any action to effect, any such Registration
pursuant to this Section 2(c):

 

(i)                                     Unless such Affiliate proposes to dispose of
shares of Registrable Securities having an aggregate price to the public
(before deduction of underwriting discounts and expenses of sale) of more than
$5,000,000;

 

(ii)                                  Within 180 days of the effective date of the
registration statement for the most recent Registration pursuant to this Section
2(c) in which securities held by the Affiliate could have been included for
sale or distribution; or

 

(iii)                               During the period starting with the date thirty (30) days prior to the
Company’s good faith estimate of the date of filing of, and ending on the date
ninety (90) days immediately following the effective date of, any registration
statement pertaining to securities of the Company (other than a Registration of
securities in a Rule 145 transaction or with respect to an employee benefit
plan), provided that the Company is actively employing in good faith all
commercially reasonable efforts to cause such registration statement to become
effective; provided, however, that the Company may only delay an
offering pursuant to this Section 2(c)(iii) for a period of not more
than sixty (60) days, if a filing of any other registration statement is not
made within that period and the Company may only exercise this right once in
any twelve (12) month period.

 

6

 

The Company shall give
written notice to the other Affiliate and all Other Stockholders of the receipt
of a request for Registration pursuant to this Section 2(c) and shall
provide a reasonable opportunity for the other Affiliate and such Other
Stockholders to participate in the Registration, provided that if the
Registration is for an underwritten offering, the terms of Section 2(a)(ii)
shall apply to all participants in such offering. Subject to the foregoing, the
Company will use all commercially reasonable efforts to effect promptly the
Registration of all shares of Registrable Securities on Form S-3 to the extent
requested by the holders thereof for purposes of disposition.

 

(d)                                 Expenses of Registration. All Registration Expenses shall be borne by
the Company, and all Selling Expenses shall be borne by the holders of the
Registrable Securities so Registered pro rata on the basis of the number of
their shares of Registrable Securities so Registered.

 

(e)                                  Registration Procedures. If and when the Company effects a Registration
of Registrable Securities under the Securities Act pursuant to this Section
2, the Company shall keep each Affiliate advised in writing as to the
initiation of each Registration and as to the completion thereof. At its
expense, the Company shall:

 

(i)                                     prepare and file with the Commission a
registration statement on any appropriate form under the Securities Act with
respect to such Registrable Securities and thereafter use its commercially
reasonable efforts to cause such registration statement promptly to become and
remain effective for a period of one hundred twenty (120) days or until each
Affiliate has completed the distribution described in the registration
statement relating thereto, whichever first occurs; provided, however,
that (A) such one hundred twenty (120) day period shall be extended for a
period of time equal to the period during which an Affiliate refrains from
selling any Registrable Securities included in such Registration in accordance
with provisions in Section 2(k) or 2(l) hereof; and (B) in the case of
any Registration of Registrable Securities on Form S-3 which are intended to be
offered on a continuous or delayed basis, such one hundred twenty (120) day
period shall be extended until all such Registrable Securities are sold, provided
that Rule 415, or any successor rule under the Securities Act, permits an
offering on a continuous or delayed basis, and provided  further
that applicable rules under the Securities Act governing the obligation to file
a post-effective amendment permit, in lieu of filing a post-effective amendment
which (y) includes any prospectus required by Section 10(a) of the Securities
Act or (z) reflects facts or events representing a material or fundamental
change in the information set forth in the registration statement, the
incorporation by reference of information required to be included in (y) and
(z) above to be contained in periodic reports filed pursuant to Section 12 or
15(d) of the Exchange Act in the registration statement;

 

(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 the provisions of the Securities Act
with respect to the disposition of all Securities covered by such registration
statement until the earlier of such time as all of such Securities have been
disposed of in a public offering or the expiration of 30 days;

 

7

 

(iii)                               furnish to each Demanding Affiliate and to the other Affiliate, if the
other Affiliate has shares of Registrable Securities covered by such
Registration (a “Selling  Affiliate”) such number of copies of
such registration statement, each amendment and supplement thereto, the
prospectus included in such registration statement (including each preliminary
prospectus), any documents incorporated by reference therein and such other
documents as such Affiliate may reasonably request in order to facilitate the
disposition of the shares of Registrable Securities owned by such Affiliate (it
being understood that, subject to the requirements of the Securities Act and
applicable state securities laws, Company consents to the use of the prospectus
and any amendment or supplement thereto by each Demanding Affiliate and Selling
Affiliate in connection with the offering and sale of the shares of Registrable
Securities covered by the registration statement of which such prospectus,
amendment or supplement is a part);

 

(iv)                              furnish, on the date that such Registrable Securities are delivered to
the underwriters for sale, if such securities are being sold through
underwriters or, if such securities are not being sold through underwriters, on
the date that the registration statement with respect to such securities
becomes effective, (1) an opinion, dated as of such date, of the counsel
representing the Company for the purposes of such Registration, in form and
substance as is customarily given to underwriters in an underwritten public
offering and reasonably satisfactory to each Demanding Affiliate and Selling
Affiliate, addressed to the underwriters, if any, and to the holders of
Registrable Securities participating in such Registration and (2) a letter,
dated as of such date, from the independent certified public accountants of the
Company, in form and substance as is customarily given by independent certified
public accountants to underwriters in an underwritten public offering and
reasonably satisfactory to each Demanding Affiliate and Selling Affiliate,
addressed to the underwriters, if any, and if permitted by applicable
accounting standards, to the holders of Registrable Securities participating in
such Registration.

 

(v)                                 use its commercially reasonable efforts to register
or qualify such Registrable Securities under such other securities or blue sky
laws of such jurisdictions within the United States of America as each
Demanding Affiliate and Selling Affiliate may reasonably request; use its
commercially reasonable efforts to keep each such registration or qualification
(or exemption therefrom) effective during the period in which such registration
statement is required to be kept effective and take any other action which may
be reasonably necessary or advisable to enable each Demanding Affiliate and
Selling Affiliate to consummate the disposition in such jurisdictions of the
Registrable Securities being disposed of by such Demanding Affiliate and
Selling Affiliate, provided, however, that Company will not be required
to (A) qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this subparagraph or (B) subject
itself to taxation in or consent to general service of process in any such
jurisdiction, and provided, further, that Company shall not be required
to qualify such Registrable Securities in any jurisdiction in which the
securities regulatory authority requires that any Affiliate submits any shares
of its Registrable Securities to the terms, provisions and restrictions of any
escrow, lockup or similar agreement(s) for consent to sell Registrable
Securities in such jurisdiction;

 

8

 

(vi)                              promptly notify each Demanding Affiliate and
Selling Affiliate (A) when the registration statement, any prospectus or any
prospectus supplement or post-effective amendment has been filed and, with
respect to a registration statement or any post-effective amendment, when the
same has become effective, (B) of the issuance by any state securities or other
regulatory authority of any order suspending the qualification or exemption
from qualification of any of the Registrable Securities under state securities
or “blue sky” laws or the initiation of any proceedings for that purpose
and (C) of the happening of any event which makes any statement made in a
registration statement or related prospectus untrue or which requires the
making of any changes in such registration statement, prospectus or documents
so that they will not contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein not misleading (or with respect to the prospectus, in
light of the circumstance under which such statements were made), and, subject
to Section 2(l), as promptly as reasonably practicable thereafter,
prepare and file with the Commission and furnish a supplement or amendment to
such prospectus so that, as thereafter deliverable to the purchasers of such
Registrable Securities, such prospectus will not contain any untrue statement
of a material fact or omit a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading;

 

(vii)                           if requested by any Demanding Affiliate or
Selling Affiliate, promptly incorporate in a prospectus supplement or
post-effective amendment such information as such Demanding Affiliate or
Selling Affiliate reasonably requests to be included therein and promptly make
all required filings of such prospectus supplement or post-effective amendment;

 

(viii)                        as promptly as reasonably practicable after
the filing with the Commission of any document which is incorporated by
reference into a registration statement (in the form in which it was
incorporated), deliver copies of each such document to each Demanding Affiliate
and Selling Affiliate;

 

(ix)                                cooperate with each Demanding Affiliate and
Selling Affiliate to facilitate the timely preparation and delivery of
certificates (which shall not bear any restrictive legends unless required
under applicable law) representing securities sold under any registration
statement, and enable such securities to be in such denominations and
registered in such names as such Demanding Affiliate or Selling Affiliate may
request and keep available and make available to Company’s transfer agent prior
to the effectiveness of such registration statement a supply of such
certificates;

 

(x)                                   cause the Registrable Securities included in
any registration statement to be listed on each United States securities
exchange, if any, on which the Company Common Stock is then listed;

 

(xi)                                provide a transfer agent and registrar for
all shares of Registrable Securities registered hereunder and provide a CUSIP
number for the shares of Registrable Securities included in any registration
statement not later than the effective date of such registration statement;

 

9

 

(xii)                             cooperate with each Demanding Affiliate,
Selling Affiliate and their counsel in connection    with any
filings required to be made with the NASD;

 

(xiii)                          during the period when the prospectus is
required to be delivered under the Securities Act, promptly file all documents
required to be filed with the Commission pursuant to Sections 13(a), 13(c), 14
or 15(d) of the Exchange Act;

 

(xiv)                         notify each Demanding Affiliate and Selling
Affiliate promptly of any request by the Commission for the amending or
supplementing of such registration statement or prospectus or for additional
information;

 

(xv)                            prepare and file with the Commission as
promptly as reasonably practicable any amendments or supplements to such
registration statement or prospectus which, in the opinion of counsel for
Company, is required in connection with the distribution of the Registrable
Securities;

 

(xvi)                         advise each Demanding Affiliate and Selling
Affiliate, 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 such purpose and promptly use its commercially reasonable
efforts to prevent the issuance of any stop order or to obtain its withdrawal
at the earliest possible moment if such stop order should be issued; and

 

(xvii)                      in the event of an underwritten public
offering, enter into and perform its obligations under an underwriting
agreement, in usual and customary form, with the managing underwriter(s) of
such offering.

 

(f)                                    Indemnification.

 

(i)                                     The Company shall indemnify and hold harmless
each Demanding Affiliate, Selling Affiliate, each of their officers, directors,
partners and members, and each person controlling such Affiliate, with respect
to each Registration which has been effected pursuant to this Section 2,
and each underwriter, if any, and each person who controls any underwriter,
against all claims, losses, damages and liabilities (or actions in respect
thereof), to which they may become subject under the Securities Act or
otherwise, insofar as such claims, losses, damages and liabilities (or actions
in respect thereof) arise out of or are based on any untrue (or alleged untrue)
statement of any material fact contained in any registration statement on the
effective date thereof (including any prospectus, offering circular or other
documents) incident to any such Registration, qualification or compliance, or
arise out of or are based on any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, or any violation by the Company of the
Securities Act or the Exchange Act or any rule or regulation thereunder
applicable to the Company and relating to action or inaction required of the Company
in connection with any such Registration, qualification or compliance, and
shall reimburse each Demanding Affiliate, Selling Affiliate, each of their
officers, directors, partners and members, and each person controlling such
Affiliate, each such underwriter and each person who controls any such

 

10

 

underwriter,
for any legal and any other expenses reasonably incurred by them in connection
with investigating and defending any such claims, losses, damages, liabilities
or actions; provided, that the Company shall not be liable to such
Affiliate, its officers, directors, partners and members, each person
controlling such Affiliate, each such underwriter and each person who controls
any such underwriter in any such case to the extent that any such claims,
losses, damages, liabilities or expenses arise out of or are based on any
untrue statement or omission made in connection with such registration
statement, or amendments or supplements thereto, in reliance upon and in
conformity with written information furnished to the Company by such Affiliate
or underwriter expressly for use in connection with such registration statement
by such Affiliate, its officers, directors, partners and members, each person
controlling such Affiliate, each such underwriter and each person who controls
any such underwriter.

 

(ii)                                  Each Demanding Affiliate and Selling
Affiliate shall, if Registrable Securities held by it are included in the
securities as to which such Registration, qualification or compliance is being
effected, severally and not jointly, indemnify and hold harmless the Company,
each of its directors and officers and each underwriter for the Company within
the meaning of the Securities Act (if any), and each person who controls the
Company or such underwriter against all claims, losses, damages and
liabilities, joint or several (or actions in respect thereof), to which the
Company or any such director, officer, controlling person, or underwriter may
become subject, under the Securities Act or otherwise, insofar as such claims,
losses, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue (or alleged untrue) statement of any material fact
contained in any registration statement on the effective date thereof
(including any prospectus, offering circular or other documents) made by such
Affiliate, or arise out of or are based upon any omission or alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statements by such Affiliate therein not misleading, shall reimburse
any legal or any other expenses reasonably incurred by the Company or any such
directors, officers, controlling persons or underwriters in connection with
investigating or defending any such claims, losses, damages, liabilities or
actions, in each case to the extent, but only to the extent, that such untrue
statement (or alleged untrue statement) or omission (or alleged omission) was
made in such registration statement or amendments or supplements thereto, in
reliance upon and in conformity with written information furnished to the
Company by such Affiliate expressly for use in connection with such
registration statement; provided, however, that the obligations
of such Affiliate hereunder shall be limited to an amount equal to the net
proceeds to such Affiliate of the Registrable Securities sold as contemplated
herein.

 

(iii)                               Each party entitled to indemnification under this Section 2(f)
(the “Indemnified Party”) shall give written notice to the party
required to provide indemnification (the “Indemnifying Party”) and to
the other parties hereto promptly after the receipt by such Indemnified Party
of any written notice of the commencement of any claim, action, proceeding or
investigation or threat thereof made in writing for which the Indemnified Party
intends to claim indemnification pursuant to this Agreement, and shall permit
the Indemnifying Party to assume the defense of any such claim, action,
proceeding or investigation; provided that counsel for the Indemnifying
Party, who shall

 

11

 

conduct
the defense of such claim, action, proceeding or investigation, shall be
approved by the Indemnified Party (whose approval shall not unreasonably be
withheld) and the Indemnified Party may participate in such defense at such
party’s expense (unless the Indemnified Party shall have reasonably concluded
that there may be a conflict of interest between the Indemnifying Party and the
Indemnified Party in such claim, action, proceeding or investigation, in which
case the fees and expenses of counsel shall be at the expense of the
Indemnifying Party), and provided further that the failure of any
Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its obligations under this Section 2 unless the
Indemnifying Party is materially prejudiced thereby. No Indemnifying Party, in
the defense of any such claim, action, proceeding or investigation 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,
action, proceeding or investigation. Each Indemnified Party shall furnish such
information regarding itself or the claim in question as an Indemnifying Party
may reasonably request in writing and as shall be reasonably required in
connection with the defense of such claim, action, proceeding or investigation.

 

(iv)                              If the indemnification provided for in this Section 2(f) is held
by a court of competent jurisdiction to be unavailable to an Indemnified Party
with respect to any losses, liabilities, claims, damages or expenses referred
to herein, then the Indemnifying Party, in lieu of indemnifying such
Indemnified Party hereunder, shall contribute to the amount paid or payable by
such Indemnified Party as a result of such losses, liabilities, claims, damages
or expenses in such proportion as is appropriate to reflect the relative fault
of the Indemnifying Party on the one hand and of the Indemnified Party on the
other in connection with the statements or omissions which resulted in such
losses, liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations. The relative fault of the Indemnifying Party and of
the Indemnified Party shall be determined by reference to, among other things,
whether the untrue (or alleged untrue) statement of a material fact or the
omission (or alleged omission) to state a material fact relates to information
supplied by the Indemnifying Party or by the Indemnified Party and the parties’
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.

 

(v)                                 Notwithstanding the foregoing, to the extent
that the provisions on indemnification and contribution contained in the
underwriting agreement entered into in connection with any underwritten public
offering contemplated by this Agreement are in conflict with the foregoing
provisions, the provisions in such underwriting agreement shall be controlling.

 

(vi)                              The foregoing indemnity agreement of the Company and each Affiliate is
subject to the condition that, insofar as they relate to any losses, claims,
liabilities or damages arising out of a statement made in or omitted from a
preliminary prospectus but eliminated or remedied in the amended prospectus on
file with the Commission at the time the registration statement in question
becomes effective or the amended prospectus filed with the Commission pursuant
to Commission Rule 424(b) (the “Final Prospectus”),

 

12

 

such
indemnity or contribution agreement shall not inure to the benefit of any
underwriter if a copy of the Final Prospectus was furnished to the underwriter
and was not furnished to the person asserting the losses, liabilities, claims
or damages at or prior to the time such action is required by the Securities
Act.

 

(g)                                 Information by the Affiliates. To the extent the Registrable Securities
held by an Affiliate are included in any Registration, such Affiliate shall
furnish to the Company such information regarding such Affiliate and the
distribution proposed by such Affiliate as the Company may reasonably request
in writing and as shall be reasonably required in connection with any
Registration, qualification or compliance referred to in this Section 2.

 

(h)                                 Rule 144 Reporting. With a view to making available the
benefits of certain rules and regulations of the Commission which may at any
time permit the sale of Registrable Securities to the public without
Registration, at all times from and after ninety (90) days following the
effective date of the registration statement for the first Registration
demanded by any Affiliate under the Securities Act filed by the Company for an
offering of securities of the Company to the general public, the Company agrees
to:

 

(i)                                     make and keep public information available as
those terms are understood and defined in Rule 144 under the Securities Act (“Rule
144”);

 

(ii)                                  use all commercially reasonable efforts to
file with the Commission in a timely manner all reports and other documents
required of the Company under the Securities Act and the Exchange Act at any
time after it has become subject to such reporting requirements; and

 

(iii)                               so long as any Affiliate owns any Registrable Securities, furnish to
such Affiliate, upon request, a written statement by the Company as to its
compliance with the reporting requirements of Rule 144 and of the Securities
Act and the Exchange Act (at any time after it has become subject to such
reporting requirements), a copy of the most recent annual or quarterly report
of the Company, and such other reports and documents so filed as such Affiliate
may reasonably request in availing itself of any rule or regulation of the
Commission allowing such Affiliate to sell any such securities without
Registration.

 

(i)                                     Reserved.

 

(j)                                     Limitation on Subsequent Registration Rights. The Company shall not, without the prior
written consent of each Affiliate, enter into any agreement with any other
holder or prospective holder of any securities of the Company that would allow
such other holder or prospective holder to include securities of the Company in
any registration statement on terms more favorable than the terms on which the
Affiliate may include shares of Registrable Securities in such Registration.

 

(k)                                  Holdback Agreements.

 

(i)                                     If and whenever the Company effects a
Registration pursuant to Section 2, each Affiliate that holds Registrable
Securities included in such Registration agrees not to

 

13

 

effect
any public sale or distribution, including any sale pursuant to Rule 144 under
the Securities Act, of any Registrable Securities within seven days prior to
and 90 days (unless advised in writing by the managing underwriter that a
longer period, not to exceed 180 days, is required) after the effective date of
the registration statement relating to such Registration, except as part of such
Registration; provided, however, that each such Affiliate only agrees to
such restriction if and to the extent that all other holders of Registrable
Securities included in such Registration (including without limitation,
officers and directors of the Company) similarly agree not to effect any such
sales or distributions during such periods.

 

(ii)                                  The Company agrees not to effect any public
sale or distribution of its equity securities or securities convertible into or
exchangeable or exercisable for any of such securities within seven days prior
to and 90 days (unless advised in writing by the managing underwriter that a
longer period, not to exceed 180 days, is required) after the effective date of
any such registration statement as described in Section 2(k)(i) (except
as part of such Registration or pursuant to a Registration on Form S-4 or
S-8 or any successor form). In addition, if requested by the managing
underwriter, the Company shall use its commercially reasonable best efforts to
cause each holder of Registrable Securities, to agree not to effect any such
public sale or distribution of such Registrable Securities during such period,
except as part of any such Registration if permitted, and to use its
commercially reasonable efforts to cause each such holder to enter into a
similar agreement to such effect with the Company.

 

(l)                                     Blockage Period. If (i) there has been or there is pending a
development or change in the business, affairs or prospects of Company or any
of its subsidiaries; (ii) Company’s counsel advised Company in writing that
such development or change should be disclosed in the registration statement,
the prospectus included therein, or an amendment or supplement thereto in order
to ensure that the registration statement and such prospectus, as amended or
supplemented, will not contain any misstatement 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 (or with respect to the prospectus, in light of
the circumstance under which such statements were made); and (iii) in the good
faith judgment of the officers or directors of Company, disclosure of such
development or change would either (x) have an adverse effect on the business
or operations of Company or (y) if the disclosure otherwise relates to a
material financing or acquisition of assets which has not yet been disclosed
and such disclosure would have an adverse effect on the likelihood of
consummating such transaction, then Company may deliver written notification to
the Affiliates that Registrable Securities may not be sold pursuant to the
registration statement (a “Blockage Notice”). Company shall have no
obligation to include in any such notice any reference to or description of the
facts based upon which the Company is delivering such notice. Company shall
delay during such Blockage Period the filing or effectiveness of any
registration statement required pursuant this Agreement. No Affiliate shall
sell any Registrable Securities pursuant to the registration statement for the
period (the “Blockage Period”) beginning on the date such Blockage
Notice was received by such Affiliate and ending on the date on which Company
notifies the Affiliates that the Blockage Period has ended, which Blockage Period
shall not exceed an aggregate of ninety (90) days in any calendar year, provided,
that such Blockage Period shall be extended for any period, not to exceed
forty-five (45) days in any calendar year, during which the Commission is
reviewing any proposed amendment to the registration (and

 

14

 

Company agrees promptly to
notify the Affiliates if the circumstances giving rise to such Blockage Period
no longer apply). Company shall promptly prepare and file any amendment or
supplement to the registration statement or the prospectus included therein
necessary so that at the conclusion of the Blockage Period, the registration
statement and the prospectus included therein do not contain any misstatements
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 (or with
respect to the prospectus, in light of the circumstance under which such
statements were made) and notify the Affiliates of such amendment or supplement
and of the conclusion of the Blockage Period.

 

SECTION 3.  TERMINATION

 

(a)                                  Termination.
The provisions of this Agreement shall terminate as to a particular Affiliate
at such time as such Affiliate has sold all of his or its Registrable
Securities in a Registration pursuant to the Securities Act or pursuant to Rule
144. Section 2(f) shall survive any termination of this Agreement.

 

SECTION 4.  MISCELLANEOUS

 

(a)                                  Governing Law. This Agreement and all actions arising out
of or in connection with this Agreement shall be governed by and construed in
accordance with the laws of the State of New York, applicable to contracts
executed in and to be performed entirely within that State, without regard to
the conflicts of law provisions of the State of New York.

 

(b)                                 Submission to Jurisdiction. All actions and proceedings arising out of
or relating to this agreement shall be heard and determined exclusively in any
New York state or federal court sitting in the Borough of Manhattan of the City
of New York. The parties hereto hereby (a) submit to the exclusive jurisdiction
of any state or federal court sitting in the Borough of Manhattan of the City
of New York for the purpose of any action arising out of or relating to this
agreement brought by any party hereto, and (b) irrevocably waive, and agree not
to assert by way of motion, defense, or otherwise, in any such action, any
claim that it is not subject personally to the jurisdiction of the above-named
courts, that its property is exempt or immune from attachment or execution,
that the action is brought in an inconvenient forum, that the venue of the
action is improper, or that this agreement or the transaction may not be
enforced in or by any of the above-named courts. Each of the parties hereto
hereby waives to the fullest extent permitted by applicable law any right it
may have to a trial by jury with respect to any litigation directly or
indirectly arising out of, under or in connection with this agreement. Each of
the parties hereto (a) certifies that no representative, agent or attorney of
any other party has represented, expressly or otherwise, that such other party
would not, in the event of litigation, seek to enforce that foregoing waiver
and (b) acknowledges that it and the others hereto have been induced to enter
into this agreement, as applicable, by, among other things, the mutual waivers
and certifications in this Section 3(c)

 

(c)                                  Notices. All notices and other communications under this Agreement shall be in
writing and shall be deemed given (i) when delivered personally by hand (with
written confirmation of receipt), (ii) when sent by facsimile (with written
confirmation of transmission) or (iii) one Business Day following the day sent
by overnight courier (with written confirmation of receipt), in each case at
the following addresses and facsimile numbers (or to such other address or
facsimile number as a party may have specified by notice given to the other
party pursuant to this provision):

 

15

 

	
   

  	
  (i)

  	
  If to the Company, to:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  HSW International, Inc.

  
	
   

  	
   

  	
  One Capital City Plaza,
  Suite 1500

  
	
   

  	
   

  	
  3350 Peachtree Road

  
	
   

  	
   

  	
  Atlanta, GA   30326

  
	
   

  	
   

  	
  Attention: Chief
  Executive Officer

  
	
   

  	
   

  	
  Facsimile: (404)
  760-3458

  
	
   

  	
   

  	
   

  
	
   

  	
  with a copy (which shall
  not constitute notice) to:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Greenberg Traurig, LLP

  
	
   

  	
   

  	
  3290 Northside Parkway, N.W., Suite 400

  
	
   

  	
   

  	
  Atlanta, GA  30327

  
	
   

  	
   

  	
  Attention:  James S. Altenbach, Esq.

  
	
   

  	
   

  	
  Facsimile:  (678) 553-2188

  

 

(ii)                                  If to an Affiliate, to the address and
facsimile number listed on the signature page attached hereto:

 

(d)                                 Reproduction of Documents. This Agreement and all documents relating
thereto, including, without limitation, any consents, waivers and modifications
which may hereafter be executed may be reproduced by the Affiliates by any
photographic, photostatic, microfilm, microcard, miniature photographic or
other similar process and the Affiliates may destroy any original document so
reproduced. The parties hereto agree and stipulate that any such reproduction shall
be admissible in evidence as the original itself in any judicial or
administrative proceeding (whether or not the original is in existence and
whether or not such reproduction was made by the Affiliates in the regular
course of business) and that any enlargement, facsimile or further reproduction
of such reproduction shall likewise be admissible in evidence.

 

(e)                                  Successors and Assigns. Subject to the restrictions on transfer
described in clauses (i) and (ii) below, the rights and obligations of the
Company and each Affiliate hereunder shall be binding upon and benefit the
successors, assigns, heirs, administrators and transferees of such parties.

 

(i)                                     The rights, interests or obligations
hereunder may not be assigned, by operation of law or otherwise, in whole or in
part, by an Affiliate without the prior written consent of the Company; provided,
however, an Affiliate may assign its interest to its partners, limited
partners, affiliates or heirs without the consent of the Company.

 

(ii)                                  The rights, interests or obligations
hereunder may not be assigned, by operation of law or otherwise, in whole or in
part, by the Company without the prior written consent of each Affiliate.

 

(f)                                    Amendment and Waivers. No failure or delay on the part of Company
or any Affiliate in exercising any right, power or remedy hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right, power or remedy preclude any other or

 

16

 

further exercise thereof or the exercise of any other right, power or
remedy. The remedies provided for herein are cumulative and are not exclusive
of any remedies that may be available to Company or an Affiliate at law or in
equity or otherwise. Any provision of this Agreement may be amended,
supplemented, modified or waived if, but only if, such amendment, supplement,
modification or waiver is in writing and is signed by all the parties hereto.

 

(g)                                 Severability. If any term or other provision of this
Agreement is invalid, illegal, or incapable of being enforced by any law or
public policy, all other terms or provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal, or incapable of being enforced, the parties
hereto shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the parties as closely as possible in an acceptable
manner in order that the transactions contemplated hereby are consummated as
originally contemplated to the greatest extent possible.

 

(h)                                 Counterparts. This Agreement may be executed in one or
more counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement. This Agreement may be executed by facsimile or other
electronic means.

 

(i)                                     Entire
Agreement. This Agreement constitutes the entire agreement, and supersedes
all other prior agreements and understandings, both written and oral, among the
parties, or any of them, with respect to the subject matter hereof and thereof
and, except as provided in Section 2(f) hereof, is not intended to and shall
not confer upon any Person other than the parties any rights or remedies
hereunder. The parties agree that time is of the essence with respect to the
performance of all obligations provided in this Agreement and effectuation of
the transactions contemplated thereby.

 

(j)                                     Specific Enforcement. The parties agree that irreparable damage
would occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in any New York State Court sitting
in the borough of Manhattan in the city of New York or any Federal Court
sitting in the borough of Manhattan in the city of New York, this being in
addition to any other remedy to which they are entitled at law or in equity.

 

(k)                                  Rules of Construction. Unless the context otherwise requires, the
singular shall include the plural and vice-versa, each pronoun in any gender
shall include all other genders, and provisions apply to successive events and
transactions. The words “hereof,” “hereby,” “herein” and “hereunder” and words
of similar import when used in this Agreement shall refer to this Agreement as
a whole and not to any particular provision of this Agreement. The word “including”
or any variation thereof means “including, without limitation” and shall not be
construed to limit any general statement that it follows to the specific or
similar items or matters immediately following it. The titles 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.

 

17

 

Where any provision in this Agreement refers to action to be taken by
any Person, or which such Person is prohibited from taking, such provision
shall be applicable whether such action is taken directly or indirectly by such
Person.

 

 

[Remainder of page intentionally left blank]

 

18

 

IN WITNESS WHEREOF, the
undersigned have executed this Agreement as of the date first set forth above.

 

	
   

  	
  HSW INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
        /s/ Bradley T.
  Zimmer

  	
   

  
	
   

  	
  Name: Bradley Zimmer

  
	
   

  	
  Title: Secretary

  

 

 

	
   

  	
  AFFILIATES

  
	
  MAILING ADDRESS:

  	
   

  
	
   

  	
   

  	
   

  	
  DEUTSCHE BANK AKTIENGESELLSCHAFT

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
  Fax:

  	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  ASHFORD CAPITAL
  MANAGEMENT, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
  Fax:

  	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
     /s/
  Kevin Jones

  	
   

  
	
   

  	
   

  	
   

  	
  Kevin Jones

  
	
   

  	
   

  	
   

  	
   

  
	
  Fax:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
     /s/
  Theodore P. Botts

  	
   

  
	
   

  	
   

  	
   

  	
  Theodore P. Botts

  
	
   

  	
   

  	
   

  	
   

  
	
  Fax:

  	
   

  	
   

  	
   

  	
   

  
												

 

 

~ Affiliate signatures continue on the next page ~

 

19

 

~ continuation of Affiliate signatures ~

 

 

	
   

  	
   

  	
     /s/ J.
  David Darnell

  
	
   

  	
   

  	
  J. David Darnell

  
	
   

  	
   

  	
   

  
	
  Fax:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
     /s/
  Heinz-Gerd Stein

  
	
   

  	
   

  	
  Dr. Heinz-Gerd Stein

  
	
   

  	
   

  	
   

  
	
  Fax:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
    /s/ Larrie A. Weil

  
	
   

  	
   

  	
  Larrie A. Weil

  
	
   

  	
   

  	
   

  
	
  Fax:

  	
   

  	
   

  	
   

  
					

 

20

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