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EXHIBIT 4.1 SECURITYHOLDERS AGREEMENT

                           SECURITYHOLDERS AGREEMENT

    This Securityholders Agreement is made as of December 1, 1999, by and among
On2.com Inc. (the "Company"), a Colorado corporation having its principal
address at 375 Greenwich Street, 4(th) Floor, New York, NY 10013, and those
persons named in Schedule A to this Agreement (collectively, the "Holders").
Certain capitalized terms used in this Agreement without definition shall have
the meanings given them in Section 13.

                                    PREAMBLE

    Each of the Holders is (a) the Holder of record of shares of Common Stock,
(b) the Holder of record of one or more Common Stock Warrants or (c) the Holder
of record of shares Series A Preferred.

    Prior to the Merger, certain of the Holders held shares of common stock of,
or warrants to acquire shares of common stock of Duck.

    Each of the Holders designated as a "Former Duck Holder" on Schedule A (the
"Former Duck Holders") voted in favor of or consented to the Merger.

    Pursuant to the Merger Agreement, on June 16, 1999 ACAC merged with and into
Duck and each of the outstanding shares of common stock of Duck was converted
into 0.889334306 shares of the Common Stock.

    The Merger Agreement also provided that each Holder of warrants to acquire
shares of Duck's common stock would exchange those warrants for certain Common
Stock Warrants in the ratio provided therein.

    Section 2.6 of the Merger Agreement provided that the Company would, on or
prior to the ninetieth day after the closing of the Merger, file a registration
statement with the Commission to register for resale to the public shares of the
Common Stock owned by the Former Duck Holders, shares of Common Stock underlying
the Common Stock Warrants and shares of the Common Stock underlying the
Series A Preferred, as well as shares of the Common Stock underlying options
issued to former holders of options to acquire common stock of Duck, on or prior
to the ninetieth day after the closing of the Merger.

    Pursuant to the MetaVisual Registration Rights Agreement, the Company has
granted certain rights to the persons who are parties thereto to register shares
of Common Stock held by them.

    Pursuant to the Berlin Registration Rights Agreement, the Company has
granted certain rights to the persons who are parties thereto to register shares
of Common Stock held by them.

    NOW, THEREFORE, in consideration of the premises and mutual agreements set
forth herein, the Company and the Holders agree as follows:

    1.  RESTRICTIONS ON TRANSFERABILITY. During the Term, except as permitted by
Section 3.1 or 3.2, no Holder may Sell any Restricted Securities, whether or not
for value, except in compliance with the terms and conditions of this Agreement,
regardless of whether the intended Sale is permitted pursuant to Rule 144 or is
otherwise exempt from the registration requirements of the Securities Act. At
such time as the Restricted Securities cease to be Restricted Securities under
the terms of this Agreement, the provisions of this Agreement shall no longer
apply to any securities that theretofore were Restricted Securities

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    2.  RESTRICTIVE LEGEND.

        2.1.  SHARES OF COMMON STOCK. Each certificate representing Restricted
    Securities that are shares of Common Stock shall be stamped or otherwise
    imprinted with a legend substantially in the following form (in addition to
    any legend required under applicable state securities laws or otherwise):

           THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
       INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
       (THE "SECURITIES ACT"). THESE SHARES MAY NOT BE SOLD, ASSIGNED,
       TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
       REGISTRATION OR AN EXEMPTION THEREFROM UNDER THE SECURITIES ACT.

           THE SALE, ASSIGNMENT, TRANSFER, PLEDGE AND OTHER DISPOSITION OF THE
       SHARES REPRESENTED BY THIS CERTIFICATE ARE RESTRICTED BY THE
       SECURITYHOLDERS AGREEMENT (THE "SECURITYHOLDERS AGREEMENT"), DATED AS OF
       DECEMBER 1, 1999, AMONG CERTAIN SECURITYHOLDERS OF THE CORPORATION. A
       COPY OF THE SECURITYHOLDERS AGREEMENT IS ON FILE WITH THE CORPORATE
       SECRETARY AT THE PRINCIPAL EXECUTIVE OFFICES OF THE CORPORATION. A COPY
       THEREOF MAY BE OBTAINED AT NO COST UPON WRITTEN REQUEST THEREFOR MADE BY
       THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE CORPORATE SECRETARY AT
       THE PRINCIPAL OFFICES OF THE CORPORATION.

        2.2.  SHARES OF PREFERRED STOCK. Each certificate representing
    Restricted Securities that are shares of Series A Preferred shall be stamped
    or otherwise imprinted with a legend substantially in the following form (in
    addition to any legend required under applicable state securities laws or
    otherwise):

           THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
       INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
       (THE "SECURITIES ACT"). THESE SHARES MAY NOT BE SOLD, ASSIGNED,
       TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
       REGISTRATION OR AN EXEMPTION THEREFROM UNDER THE SECURITIES ACT.

           THE SALE, ASSIGNMENT, TRANSFER, PLEDGE AND OTHER DISPOSITION OF THE
       SHARES REPRESENTED BY THIS CERTIFICATE ARE RESTRICTED BY THE
       SECURITYHOLDERS AGREEMENT (THE "SECURITYHOLDERS AGREEMENT"), DATED AS OF
       DECEMBER 1, 1999, AMONG CERTAIN SECURITYHOLDERS OF THE CORPORATION. A
       COPY OF THE SECURITYHOLDERS AGREEMENT IS ON FILE WITH THE CORPORATE
       SECRETARY AT THE PRINCIPAL EXECUTIVE OFFICES OF THE CORPORATION. A COPY
       THEREOF MAY BE OBTAINED AT NO COST UPON WRITTEN REQUEST THEREFOR MADE BY
       THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE CORPORATE SECRETARY AT
       THE PRINCIPAL OFFICES OF THE CORPORATION.

        2.3.  STOP TRANSFER INSTRUCTIONS. The Holders consent to the Company's
    making a notation on its records and giving instructions to any transfer
    agent of the Restricted Securities in order to implement the restrictions on
    transfer established in this Agreement.

    3.  NOTICE AND OTHER REQUIREMENTS OF TRANSFER.

        3.1.  PERMITTED SALES. During the Term, a Holder may Sell Restricted
    Securities:

           a.  the intended Sale is permitted or required by Section 10;

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           b.  a registration statement under the Securities Act covering such
       proposed sale is effective, and the Holder Sells in accordance with such
       registration statement;

           c.  (i) if the proposed Sale is, for value, including Sales made in a
       private offering by both the Company and certain of its stockholders
       scheduled to occur in December 1999 and the first quarter of 2000, or is
       a Sale to which the provisions of clauses a, b, d, and e of this Section
       do not apply, such Holder has notified the Company of the proposed Sale
       and has furnished the Company with a detailed statement of the
       circumstances surrounding the proposed Sale including the name and
       address of the buyer and identifying the Restricted Securities with
       respect to which such rights are being assigned, and (ii) the buyer, as a
       condition to the effectiveness of such Sale, has executed a counterpart
       of this Agreement expressly assuming the obligations of a Holder under
       this Agreement; and, if the Company requests, such Holder shall also
       furnish the Company with an opinion of counsel, reasonably satisfactory
       to the Company, that such Sale does not require registration of such
       Securities under the Securities Act;

           d.  (i) if the proposed Sale is a transfer by gift, or other transfer
       by a Holder to a member of the Holder's Immediate Family to which the
       provisions of clause e of this Section 3 does not apply, and (ii) the
       donee or other transferee, as a condition to the effectiveness of such
       Sale, has executed a counterpart of this Agreement expressly assuming the
       obligations of a Holder under this Agreement; or

           e.  (i) if the proposed Sale is a transfer to a spouse or former
       spouse pursuant to an agreement of separation or divorce approved by a
       court of competent jurisdiction, and (ii) the transferee, as a condition
       to the effectiveness of such Sale, has executed a counterpart of this
       Agreement expressly assuming the obligations of a Holder under this
       Agreement.

           f.  (i) if the proposed Sale is a transfer to an Affiliate, and
       (ii) the Affiliate transferee, as a condition to the effectiveness of
       such Sale, has executed a counterpart of this Agreement expressly
       assuming the obligations of a Holder under this Agreement.

           3.2.  SALES UNDER RULE 144. In addition to Section 3.1, during the
       period commencing on June 15, 2000 and ending on the last day of the
       Term, each Holder may Sell up to an aggregate of 25% (rounded to the
       nearest whole share) of the shares of Common Stock that are Restricted
       Securities as of the date of this Agreement if and only if such sales are
       made in full compliance with Rule 144.

    4.  PIGGYBACK REGISTRATION.

        4.1.  NOTICE TO HOLDERS REQUIRED. If at any time during the Term the
    Company shall determine to register any shares of Common Stock for its own
    account or the account of any of the Holders, other than (a) a transaction
    relating solely to the sale of convertible debt instruments, (b) a
    registration on Form S-4 or S-8 or another form not available for
    registering the Restricted Securities for sale to the public or (c) any
    registration comprised in whole or in substantial part of shares underlying
    stock options granted by the Company or its predecessor, the Company will
    give to the Holders notice as soon as practicable prior to filing the
    registration statement and include in such registration all the Restricted
    Securities specified in one or more written requests which have been made
    within 15 days after receipt of such written notice from the Company by any
    of the Holders, except as set forth in Section 4.2.

        4.2.  REGISTERED PUBLIC OFFERING INVOLVING AN UNDERWRITING. If the
    registration is for a registered public offering involving an underwritten
    offering, the Company shall so advise each Holder as a part of the written
    notice given pursuant to Section 4.1. In such event, the right of each
    Holder to registration pursuant to this Section shall be conditioned upon
    such Holder's participation in such underwriting and the inclusion of such
    Holder's Restricted Securities in the underwriting to the extent provided
    herein. If any Holder proposes to distribute his securities through such
    underwriting, such

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    Holder shall (together with the Company and the other Holders distributing
    their securities through such underwriting) enter into an underwriting
    agreement in customary form with the underwriter or underwriters selected
    for such underwriting by the Company. Notwithstanding any other provision of
    this Section 4, if the managing underwriter determines that marketing
    factors require a limitation of the number of shares to be underwritten, the
    managing underwriter may limit the number of Restricted Securities to be
    included in the underwriting or may limit the number of Restricted
    Securities to be included in such registration. The Company shall so advise
    each of the Holders, and the number of shares of Restricted Securities and
    other securities that may be included in the registration and underwriting
    shall be allocated among such Holder and other holders of Common Stock that
    hold rights granted by the Company to cause shares of Common Stock held by
    them to be included in such registration or underwriting, in proportion, as
    nearly as practicable, to the respective amounts of Restricted Securities
    held by each Holder and each other such holder that are requested to be
    included in the registration or underwriting. To facilitate the allocation
    of shares in accordance with the above provisions, the Company or the
    underwriter may round the number of shares allocated to any Holders to the
    nearest one hundred shares. If any of the Holders disapproves of the terms
    of any such underwriting, he may elect to withdraw therefrom by written
    notice to the Company. Any Restricted Securities excluded or withdrawn from
    such underwriting shall be withdrawn from such registration.

        4.3.  OTHER REGISTRATION RIGHTS. Each of the Holders acknowledges and
    agrees that (a) pursuant to the Berlin Registration Rights Agreement and the
    MetaVisual Registration Rights Agreement, certain holders of Common Stock
    are entitled to participate on a pro rata basis in registration of Common
    Stock that may occur pursuant to Section 4.1 and (b) the Company may from
    time to time grant comparable registration rights to other persons in order
    to facilitate business transactions which the Company determines to be in
    its best interest.

        4.4.  LOCKUP AGREEMENTS. In consideration for the Company's performance
    of its obligations under this Agreement, if any Restricted Securities of
    such Holder are included in a registration under Section 4.2, each Holder
    will at the request of the Company or the underwriters managing any
    underwritten offering of the Company's securities, agree not to sell any
    Restricted Securities (other than those included in the registration)
    without the prior written consent of the Company or such underwriters, as
    the case may be, for such period of time as the underwriters may specify.

    5.  NONPUBLIC INFORMATION. Notwithstanding any other provision of this
Agreement, the Company's obligation to file a registration statement under
Section 4.1, or to cause such registration statement to become and remain
effective, shall be suspended for a period not to exceed 90 days (and for
periods not exceeding, in the aggregate, 180 days in any 12-month period) if
there exists at the time material non-public information relating to the Company
which, in the reasonable opinion of the Company, should not be disclosed.

    6.  EXPENSES OF REGISTRATION. The Company will bear all reasonable expenses
incurred in connection with registrations pursuant to Section 4, including
without limitation all registration, filing and qualification fees, printing
expenses, fees and disbursements of counsel for the Company and independent
accountants for the Company and expenses of any special audits of the Company's
financial statements incidental to or required by such registration, fees of the
National Association of Securities Dealers, Inc., transfer taxes, fees of
transfer agents and registrars' fees, but the Company will not pay underwriters'
fees, discounts or commissions relating to the Restricted Securities or any fees
or expenses of legal counsel for any or all of the Holders.

    7.  REGISTRATION PROCEDURES. In the case of each registration effected by
the Company pursuant to this Agreement, the Company will keep the Holders
participating therein advised in writing as to the initiation of each
registration and as to the completion thereof.

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    8.  INDEMNIFICATION.

        8.1.  INDEMNITY BY THE COMPANY. If the Company registers any Restricted
    Securities under the Securities Act pursuant to Section 4, the Company will
    indemnify and hold harmless the Holders of such Restricted Securities
    thereunder, each underwriter of such Restricted Securities thereunder and
    each other person, if any, who controls any Holder or underwriter within the
    meaning of the Securities Act, against any losses, claims, damages or
    liabilities, joint or several, to which such Holders, underwriter or
    controlling persons may become subject under the Securities Act or
    otherwise, insofar as such losses, claims, damages or liabilities (or
    actions in respect thereof) arise out of or are based upon any untrue
    statement or alleged untrue statement of any material fact contained in any
    registration statement under which such Restricted Securities were
    registered under the Securities Act, any preliminary prospectus or final
    prospectus contained therein, or any amendment or supplement thereof, or
    arise out of or are based upon the omission or alleged omission to state
    therein a material fact required to be stated therein or necessary to make
    the statements therein not misleading, or any violation by the Company of
    any rule or regulation promulgated under the Securities Act or any state
    securities law applicable to the Company and relating to action or inaction
    required of the Company in connection with any such registration, and will
    reimburse the Holders, each of their respective officers, directors and
    partners, and each person controlling any of the Holders, each such
    underwriter and each person who controls any such underwriter, for any
    reasonable legal and any other expenses incurred in connection with
    investigating, defending or settling any such claim, loss, damage, liability
    or action, provided that the Company will not be liable in any such case to
    any Holder to the extent that any such claim, loss, damage or liability
    arises out of or is based on any untrue statement or omission based upon
    written information furnished to the Company or to an underwriter by an
    instrument duly executed by such Holder specifically for use therein.

        8.2.  INDEMNITY BY THE HOLDERS. Each Holder will, if Restricted
    Securities held by or issuable to such Holder are included in the securities
    as to which such registration is being effected, severally and not jointly,
    indemnify and hold harmless the Company, each of its directors, each officer
    who signs the registration statement, each underwriter, if any, of the
    Company's securities covered by such a registration statement, each person
    who controls the Company and each underwriter within the meaning of the
    Securities Act, against all claims, losses, expenses, damages and
    liabilities (or actions in respect thereof) arising out of or based on any
    untrue statement (or alleged untrue statement) of a material fact contained
    in any such registration statement, prospectus, offering circular or other
    document, or any omission (or alleged omission) to state therein a material
    fact required to be stated therein or necessary to make the statements
    therein not misleading, and will reimburse the Company, such directors,
    officers, partners, persons or underwriters for any reasonable legal or any
    other expenses incurred by them in connection with investigating, defending
    or settling any such claim, loss, damage, liability or action, in each case
    to the extent, but only to the extent, that such untrue statement (or
    alleged untrue statement) or omission (or alleged omission) is made in such
    registration statement, prospectus, offering circular or other document in
    reliance upon and in conformity with written information furnished to the
    Company by an instrument duly executed by such Holder specifically for use
    therein; provided, that the total amount for which any Holder, its officers,
    directors and partners, and any person controlling such Holders, shall be
    liable under this Section 8.2 shall not in any event exceed the proceeds
    (net of underwriting discounts and commissions) received by such Holder from
    the sale of Restricted Securities sold by such Holder in such registration.

        8.3.  NOTICE BY THE INDEMNIFIED PARTY. Each party entitled to
    indemnification under this Section 8 (the "Indemnified Party") shall give
    notice to the party required to provide indemnification (the "Indemnifying
    Party") promptly after such Indemnified Party has actual knowledge of any
    claims as to which indemnity may be sought, and shall permit the
    Indemnifying Party to assume the defense of any such claim or any litigation
    resulting therefrom, provided that counsel for the Indemnifying Party, who
    shall conduct the defense of such claim or litigation, shall be approved by
    the Indemnified Party

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    (whose approval shall not be unreasonably withheld), and the Indemnified
    Party may participate in such defense at such party's expense, and provided
    further that the failure of any Indemnified Party to give notice as provided
    herein shall not relieve the Indemnifying Party of its obligations
    hereunder, unless such failure resulted in actual detriment to the
    Indemnifying Party. No Indemnifying Party, in the defense of any such claim
    or litigation, shall, except with the consent of each Indemnified Party,
    consent to entry of any judgment or enter into any settlement which does not
    include as an unconditional term thereof the giving by the claimant or
    plaintiff to such Indemnified Party of a release from all liability in
    respect of such claim or litigation.

        8.4.  UNDERWRITING AGREEMENT. Notwithstanding the foregoing, to the
    extent that the provisions on indemnification contained in the underwriting
    agreements entered into among the selling Holders, the Company and the
    underwriters in connection with the underwritten public offering are in
    conflict with the foregoing provisions, the provisions in the underwriting
    agreement shall be controlling as to the Restricted Securities included in
    the public offering; provided, that if, as a results of this Section 8.4,
    the Holders, and any persons controlling such Holders is held liable for an
    amount which exceeds the aggregate proceeds received by such Holders from
    the sale of Restricted Securities included in a registration, as provided in
    Section 8.2, pursuant to such underwriting agreement (the "Excess
    Liability"), the Company shall reimburse any such Holders for such Excess
    Liability.

        8.5.  CONTRIBUTION. If the indemnification provided for in this Section
    is held by a court of competent jurisdiction to be unavailable to an
    Indemnified Party with respect to any loss, liability, claim, damage or
    expense referred to therein, then the Indemnifying Party, in lieu of
    indemnifying such Indemnified Party thereunder, shall contribute to the
    amount paid or payable by such Indemnified Party as a result of such loss,
    liability, claim, damage or expense 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 hand in connection with the statements or
    omissions which resulted in such loss, liability, claim, damage or expense
    as well as any other relevant equitable considerations. The relevant fault
    of the Indemnifying Party and 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 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. Notwithstanding the foregoing, the amount that any Holder shall be
    obligated to contribute pursuant to this Section 8.5 shall be limited to an
    amount equal to the proceeds to such Holder of the Restricted Securities
    sold pursuant to the registration statement which gives rise to such
    obligation to contribute (less the aggregate amount of any damages which
    such Holder has otherwise been required to pay in respect of such loss,
    claim, damage, liability or action or any substantially similar loss, claim,
    damage, liability or action arising from the sale of such Restricted
    Securities).

        8.6.  SURVIVAL OF INDEMNITY. The indemnification provided by this
    Section shall be a continuing right to indemnification and shall survive the
    registration and sale of any securities by any person entitled to
    indemnification hereunder and the Term.

    9.  HOLDER'S COOPERATION.

        9.1.  INFORMATION REGARDING HOLDERS. Each of the Holders shall promptly
    furnish to the Company such information regarding such Holder and the
    distribution proposed by such Holder as the Company may request in writing
    and as shall be required in connection with any registration referred to
    herein.

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    9.2.  OBLIGATIONS OF THE HOLDERS.  Each of the Holders holding shares
included in the registration will not (until further notice by the Company)
effect sales thereof (or deliver a prospectus to any purchaser) after receipt of
telegraphic or written notice from the Company to suspend sales to permit the
Company to correct or update a registration statement or prospectus. At the end
of the period during which the Company is obligated to keep any registration
statement filed under Section 4 current and effective as required by applicable
law, the Holders holding shares of Restricted Securities included in the
registration shall discontinue sales of shares pursuant to such registration
statement upon receipt of notice from the Company of its intention to remove
from registration the shares of Restricted Securities covered by such
registration statement that remain unsold, and each of the Holders shall notify
the Company of the number of such shares registered that remain unsold
immediately upon receipt of such notice from the Company.

10. SALES OF PROPORTIONATE PERCENTAGES OF SHARES.

    10.1.  TAG ALONG RIGHTS.

        a.  If during the Term any Holder or Holders of more than 33 1/3% of the
    Common Stock proposes to Sell (as such term is defined in Section 10.3) in a
    single transaction or a series of related transactions an aggregate number
    of shares of Stock which represents more than 33 1/3% of the issued and
    outstanding shares of Stock (other than to any Affiliates of such Holders),
    such Holders (the "Selling Holders") shall comply with the provisions set
    forth in Sections 10.1a through 10.1e. For all purposes of this Section,
    Warrantholders and Series A Stockholders shall be deemed to hold the shares
    of the Common Stock underlying their Common Stock Warrants and Series A
    Preferred, as applicable.

        b.  Prior to effecting any Sale limited by Section 10.1a, the Selling
    Holders shall notify the Company of the proposed sale pursuant to this
    Section (which notice shall set forth the terms and conditions of such
    proposed Sale in reasonable detail), and offer each other Holder (the "Other
    Holders") by such notice the right to participate in the Sale on the terms
    set out in the notice. The Company shall promptly send copies of the notice
    to each of the Other Holders. Each Other Holder may elect to participate in
    the contemplated Sale by notifying the Company within ten business days
    after receipt of the Company's notice to them, specifying the number of
    shares of the Common Stock that such Other Holder elects to Sell, which Sale
    shall be on the same terms and conditions (including purchase price)
    available to the Selling Holders. Each Other Holder may elect to Sell in the
    contemplated transaction up to a number of shares of the Common Stock equal
    to the product obtained by multiplying the number of shares of the Common
    Stock which the Other Holder owns by a fraction, the numerator of which
    shall be the number of shares of the Common Stock that the Selling Holders
    propose to Sell, and the denominator of which shall be the aggregate number
    of shares of the Common Stock that are held by Selling Holders. If the Other
    Holders and Selling Holders (singularly, a "Selling Party", and,
    collectively, the "Selling Parties") determine to sell in the aggregate more
    than the total number of shares of the Common Stock than the Selling
    Holders' buyer or buyers wish to purchase, then each Selling Party shall be
    entitled to sell to the buyer or buyers that number of shares of the Common
    Stock to be so purchased by the buyer or buyers from the Selling Parties
    multiplied by a fraction, the numerator of which is the number of shares of
    the Common Stock such Selling Party elects to Sell and the denominator of
    which is the aggregate number of shares of the Common Stock which all Other
    Holders have determined to Sell.

        c.  Each Other Holder electing to do so shall participate in a Sale to
    the Selling Holders' buyer or buyers pursuant to this Section. All shares of
    the Common Stock proposed to be sold by each of the Other Holders shall be
    sold free and clear of all liens, claims and encumbrances of any kind.

        d.  The exercise or nonexercise of the rights of the Other Holders under
    this Section shall not adversely affect any right of any Other Holder to
    participate in subsequent Sales by the Selling Holders that satisfy the
    conditions specified in this Section.

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        e.  Any sale or transfer made pursuant to this Section shall be
    consummated within 90 days of the expiration of the Selling Holders' sale
    notice.

    10.2.  BRING ALONG RIGHTS.

        a.  If during the Term Selling Holders shall intend to Sell or exchange
    in a business combination or otherwise, in a single transaction or in a
    series of related transactions, all the Common Stock owned by them in a bona
    fide arm's length transaction with a third party that desires to purchase
    not less than 80% of the Common Stock, such Selling Holders shall have the
    right to require that (X) the Holders other than the Selling Holders (the
    "Noninitiating Holders") Sell the same proportion of their shares of the
    Common Stock held as of the date of this Agreement in the same transaction
    at the same price and on the same terms and conditions applicable to the
    Selling Holders and (Y) if stockholder approval of the transaction is
    required, that each Noninitiating Holder shall vote his shares in favor
    thereof.

        b.  Each Noninitiating Holder shall participate in a Sale to the Selling
    Holders' buyer or buyers pursuant to this Section 10.2. All the Common Stock
    proposed to be sold by each Noninitiating Holder shall be sold free and
    clear of all liens, claims and encumbrances of any kind.

    10.3.  DEFINITION OF SELL/SALE.  For all purposes of Section 10, a "Sale"
shall include a merger, consolidation or similar combination, exchange, sale of
assets followed by a liquidation, or any disposition for cash, marketable
securities, or debt obligations, or a combination thereof; provided, that a
"Sale" shall not include a public offering of shares to be registered under the
Securities Act.

    11.  RELEASE OF THE COMPANY, ITS DIRECTORS AND OFFICERS.  Each Holder hereby
releases and discharges the Company, its directors and officers from any and all
claims, demands, damages, debts, liabilities, accounts, obligations, costs,
expenses, actions and causes of action of every kind and nature whatsoever,
whether now known or unknown, suspected or unsuspected, choate or inchoate,
whether arising before or after the date of this Agreement (a) arising under the
Merger Agreement and relating to any registration, sale or other transfer of
shares of capital stock or other securities of the Company or Duck or (b) in any
other way relating to any registration, sale or other transfer of shares of
capital stock or other securities of the Company or Duck, except in either case
for those obligations of the Company which are expressly set forth above in this
Agreement.

    12.  EFFECTIVENESS OF THIS AGREEMENT.  This Agreement shall become effective
when executed by Holders owning at least 66 2/3% of the Restricted Securities.

    13.  DEFINITIONS.  As used in this Agreement, the following terms shall have
the following meanings:

           a.  "ACAC" means Applied Capital Acquisition Corp., a Delaware
       corporation.

           b.  "Affiliate" has the meaning given it in Rule 405 under the
       Securities Act.

           c.  "Berlin Registration Rights Agreement" means the Registration
       Rights Agreement, dated November 11, 1999, between the Company and the
       persons named therein.

           d.  "Commission" shall mean the U. S. Securities and Exchange
       Commission, or any other federal agency at the time administering the
       Securities Act.

           e.  "Common Stock" shall mean shares of the Company's Common Stock,
       no par value.

           f.  "Common Stock Warrants" mean warrants to purchase shares of the
       Common Stock.

           g.  "Duck" means The Duck Corporation, a Delaware corporation and a
       wholly-owned subsidiary of the Company.

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           h.  "Exchange Act" shall mean the Securities Exchange Act of 1934, as
       amended, or any similar United States statute and the rules and
       regulations thereunder, all as the same shall be in effect at the time.

           i.  "Holders" shall mean the persons named in Schedule I to this
       Agreement and any other person who holds Restricted Securities and who
       has assumed the obligations of this Agreement pursuant to clauses c, d,
       and e of Section 3.

           j.  "Immediate Family" means the spouse, parent, child or grandchild
       or a Holder of a trust exclusively for the exclusive benefit of spouse,
       children or grandchildren of such Holder.

           k.  "Merger" means the merger transaction contemplated by the
       Agreement and Plan of Merger (the "Merger Agreement"), dated as of
       June 9, 1999, by and among the Company, Applied Capital Acquisition Corp.
       ("ACAC") and Duck.

           l.  "Merger Agreement" means the Agreement and Plan of Merger, dated
       as of June 9, 1999, by and among the Company, ACAC and Duck.

           m.  "MetaVisual Registration Rights Agreement" means the Registration
       Rights Agreement, dated September 27, 1999, between the Company and the
       persons named therein.

           n.  "Register," "registered" and "registration" shall refer to a
       registration effected by preparing and filing a registration statement in
       compliance with the Securities Act, and the declaration or ordering of
       the effectiveness of such registration statement, and compliance with
       applicable state securities laws of such states in which any of the
       Holders notifies the Company of his intention to offer Registrable
       Securities.

           o.  "Restricted Securities" shall mean the (i) the shares of the
       Common Stock held by the Holders, (ii) the shares of Common Stock
       issuable to the Warrantholders upon the exercise of the Warrants held by
       them and (iii) the shares of Common Stock issuable to the Holders of the
       Series A Preferred upon conversion of the Series A Preferred, in each
       case only to the extent the same have not been sold to the public. As to
       any particular Restricted Securities, such securities shall cease to be
       Restricted Securities when a registration statement with respect to the
       sale of such securities shall have become effective under the Securities
       Act and such securities shall have been disposed of under such
       registration statement; in no event however shall the fact that such
       securities shall have become eligible for resale pursuant to Rule 144
       terminate such securities as Restricted Securities under this Agreement
       (except to the extent set forth in Section 3.2), it the being intent of
       the parties to this Agreement that the restrictions imposed by Section 1
       of this Agreement will continue to apply to such securities until such
       restrictions terminate by operation of the express provisions of this
       Agreement and not otherwise. As to any particular Restricted Securities,
       such securities shall cease to be Restricted Securities when (i) such
       securities shall have been otherwise transferred or disposed of, and
       (x) new certificates therefor not bearing a legend restricting further
       transfer shall have been delivered by the Company, and (y) subsequent
       transfer or disposition of them shall not require their registration or
       qualification under the Securities Act or any similar state law then in
       force or compliance with Rule 144, or (ii) such securities shall have
       ceased to be outstanding.

           p.  "Rule 144" shall mean Rule 144 under the Securities Act or any
       successor or similar rule as may be enacted by the Commission from time
       to time.

           q.  "Sale" means any sale, transfer, assignment, pledge or other
       disposition; "Sell" means to sell, transfer, assign or otherwise dispose
       of; provided that for all purposes of Section 10 "Sale" and "Sell" shall
       have the particular meanings given them in Section 10.3.

           r.  "Rule 145" shall mean Rule 145 under the Securities Act or any
       successor or similar rule as may be enacted by the Commission from time
       to time.

                                       9
<PAGE>
           s.  "Securities Act" shall mean the Securities Act of 1933, as
       amended, or any similar United States statute and the rules and
       regulations thereunder, all as the same shall be in effect at the time.

           t.  "Series A Preferred" shall mean shares of the Company's Series A
       Preferred Stock, no par value.

           u.  "Series A Stockholder" mean a holder of Series A Preferred.

           v.  "Stockholder" means a holder of record of shares of the Common
       Stock.

           w.  "Term" means the period beginning on the date on which this
       Agreement has become effective pursuant to Section 12 and ending on
       December 20, 2000.

           x.  "Warrantholder" means a holder of record of Common Stock
       Warrants.

14. MISCELLANEOUS.

        14.1.  AMENDMENTS. This Agreement may be amended only by a written
    instrument executed by (a) the Holders of 75% of the Restricted Securities
    which are parties to this Agreement and (b) the Company. Any such amendments
    shall be binding upon all Holders who have executed or assumed this
    Agreement.

        14.2.  COUNTERPARTS. This Agreement may be executed in any number of
    counterparts, all of which shall constitute a single instrument.

        14.3.  NOTICES, ETC. All notices, requests, demands and other
    communications required or permitted to be given hereunder shall be in
    writing and shall be given personally, sent by facsimile transmission or
    sent by prepaid air courier or certified or express mail, postage prepaid.
    Any such notice shall be deemed to have been given (a) when received, if
    delivered in person, sent by facsimile transmission and confirmed in writing
    within three business days thereafter or sent by prepaid air courier or
    (b) three business days following the mailing thereof, if mailed by
    certified first class mail, postage prepaid, in the case of the Company to
    its address set forth in the initial paragraph of this Agreement or, in the
    case of the Holders, to their addresses as set forth in the Company's
    Stockholder list (or to such other address or addresses as a party may have
    advised the other in the manner provided in this Section 14.3).

        14.4.  SEVERABILITY. If any provision of this Agreement shall be held to
    be illegal, invalid or unenforceable, such illegality, invalidity or
    unenforceability shall attach only to such provision and shall not in any
    manner affect or render illegal, invalid or unenforceable any other
    provision of this Agreement, and this Agreement shall be carried out as if
    any such illegal, invalid or unenforceable provision were not contained
    herein.

        14.5.  GOVERNING LAW. This Agreement shall be governed by and construed
    under the laws of the State of New York without regard to principles of
    conflict of law.

        14.6.  JURISDICTION. Each of the Holders and the Company hereby
    irrevocably and unconditionally consents and submits to the exclusive
    jurisdiction of any state or federal court located within the County of New
    York, State of New York, in connection with any, actions, suits or
    proceedings arising out of or relating to this Agreement or any of the
    agreements delivered in connection herewith or the transactions contemplated
    hereby or thereby. Each of the Company and Holders hereby waives any
    objection to venue in such jurisdiction, and agrees that service of any
    summons, complaint, notice or other process relating to such proceeding may
    be effected as provided by Section 14.3.

                                       10
<PAGE>
    IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written above.

<TABLE>
<S>                                                    <C>  <C>
                                                       THE COMPANY:
                                                       ON2.COM INC.

                                                       By:
                                                            -----------------------------------------
                                                            Name: Daniel B. Miller
                                                            Title: President and Chief Executive
                                                                   Officer

                                                       THE HOLDERS:

                                                                       /s/ ERIC AMERES
                                                        ---------------------------------------------
                                                                         Eric Ameres

                                                                      /s/ JOHN GABRIEL
                                                        ---------------------------------------------
                                                                        John Gabriel

                                                                    /s/ DANIEL B. MILLER
                                                        ---------------------------------------------
                                                                      Daniel B. Miller

                                                                      /s/ EMILY HARROW
                                                        ---------------------------------------------
                                                                        Emily Harrow

                                                                       /s/ TIM MURPHY
                                                        ---------------------------------------------
                                                                         Tim Murphy

                                                                      /s/ DAVID SILVER
                                                        ---------------------------------------------
                                                                        David Silver

                                                                       /s/ FRAYA BERG
                                                        ---------------------------------------------
                                                                         Fraya Berg
</TABLE>

                                       11
<PAGE>
<TABLE>
<S>                                                    <C>  <C>
                                                               /s/ PETER BERGER / JANE BERGER
                                                        ---------------------------------------------
                                                                 Peter Berger / Jane Berger

                                                                      /s/ ARTHUR HARROW
                                                        ---------------------------------------------
                                                                        Arthur Harrow

                                                                     /s/ ANDREW LANGSAM
                                                        ---------------------------------------------
                                                                       Andrew Langsam

                                                       EDELSON TECHNOLOGY PARTNERS III, L.P.

                                                       By:  /s/ HARRY EDELSON
                                                            -----------------------------------------
                                                            Name: Harry Edelson
                                                            Title: General Partner

                                                       THE TRAVELERS INSURANCE COMPANY

                                                       By:  /s/ JORDAN M. STITZER
                                                            -----------------------------------------
                                                            Name: Jordan M. Stitzer
                                                            Title: Vice President
</TABLE>

                                       12<PAGE>
EXHIBIT 4.2 FORM OF INVESTORS' RIGHTS AGREEMENT

                          INVESTORS' RIGHTS AGREEMENT

    This Investors' Rights Agreement is made as of December 1, 1999, by and
among On2.com Inc. (the "Company"), a Colorado corporation having its principal
address at 375 Greenwich Street, 4(th) Floor, New York, NY 10013, and those
persons named in Schedule A to this Agreement (collectively, the "Holders").
Certain capitalized terms used in this Agreement without definition shall have
the meanings given them in Section 14.

                                    PREAMBLE

    Each of the Holders has acquired shares of Common Stock Warrants to acquire
Common Stock pursuant to the Common Stock Unit Subscription Agreement (the
"Subscription Agreement"), dated as of December 1, 1999, between the Company and
the persons named in Section I thereto.

    Pursuant to the Subscription Agreement, the Company and the Holders have
agreed to enter into an Investor's Rights Agreement.

    NOW, THEREFORE, in consideration of the premises and mutual agreements set
forth herein, the Company and the Holders agree as follows:

    1. RESTRICTIONS ON TRANSFERABILITY. None of the Restricted Securities may be
sold, assigned, transferred, pledged or otherwise disposed of, whether or not
for value, except in compliance with the terms and conditions of this Agreement.
At such time as the Restricted Securities cease to be Restricted Securities
under the terms of this Agreement, the provisions of this Agreement shall no
longer apply to the shares of the Common Stock that theretofore were Restricted
Securities

    2. RESTRICTIVE LEGEND.

        2.1. SHARES OF COMMON STOCK. Each certificate representing Restricted
    Securities that are shares of Common Stock shall be stamped or otherwise
    imprinted with a legend substantially in the following form (in addition to
    any legend required under applicable state securities laws or otherwise):

    THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT
    AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE
    "SECURITIES ACT"). THESE SHARES MAY NOT BE SOLD, ASSIGNED, TRANSFERRED,
    PLEDGED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR AN
    EXEMPTION THEREFROM UNDER THE SECURITIES ACT.

    THE SALE, ASSIGNMENT, TRANSFER, PLEDGE AND OTHER DISPOSITION OF THE SHARES
    REPRESENTED BY THIS CERTIFICATE ARE RESTRICTED BY THE INVESTOR'S RIGHTS
    AGREEMENT (THE "INVESTOR'S RIGHTS AGREEMENT"), DATED AS OF DECEMBER 1, 1999,
    AMONG CERTAIN SECURITYHOLDERS OF THE COMPANY. A COPY OF THE SECURITYHOLDERS
    AGREEMENT IS ON FILE WITH THE CORPORATE SECRETARY AT THE PRINCIPAL EXECUTIVE
    OFFICES OF THE CORPORATION. A COPY THEREOF MAY BE OBTAINED AT NO COST UPON
    WRITTEN REQUEST THEREFOR MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO
    THE CORPORATE SECRETARY AT THE PRINCIPAL OFFICES OF THE COMPANY.

        2.2. WARRANT CERTIFICATE. Each certificate representing Common Stock
    Warrants that shall bear a legend substantially in the following form (in
    addition to any legend required under applicable state securities laws or
    otherwise):

    THIS WARRANT AND ANY SHARES ISSUABLE UPON THE EXERCISE OF THIS WARRANT HAVE
    NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT"), NOR UNDER
    ANY STATE SECURITIES LAW AND SUCH SECURITIES MAY NOT

                                       1
<PAGE>
    BE PLEDGED, SOLD, ASSIGNED, HYPOTHECATED, OR OTHERWISE TRANSFERRED UNTIL
    (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE ACT
    AND ANY APPLICABLE STATE SECURITIES LAW OR (2) THE COMPANY RECEIVES AN
    OPINION OF COUNSEL TO THE COMPANY OR COUNSEL TO THE HOLDER OF SUCH
    SECURITIES, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE
    COMPANY, THAT SUCH SECURITIES MAY BE PLEDGED, SOLD, ASSIGNED, HYPOTHECATED,
    OR TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND
    APPLICABLE STATE SECURITIES LAWS.

    THE TRANSFER OF THIS WARRANT AND THE SHARES ISSUABLE UPON THE EXERCISE
    HEREOF ARE RESTRICTED AS DESCRIBED HEREIN.

    THE SALE, ASSIGNMENT, TRANSFER, PLEDGE AND OTHER DISPOSITION OF THIS WARRANT
    AND THE SHARES ISSUABLE UPON THE EXERCISE OF THIS WARRANT ARE RESTRICTED BY
    THE INVESTORS' RIGHTS AGREEMENT (THE "INVESTORS' RIGHTS AGREEMENT"), DATED
    AS OF DECEMBER 1, 1999. A COPY OF THE INVESTORS' RIGHTS AGREEMENT IS ON FILE
    WITH THE CORPORATE SECRETARY AT THE PRINCIPAL EXECUTIVE OFFICES OF THE
    COMPANY. A COPY THEREOF MAY BE OBTAINED AT NO COST UPON WRITTEN REQUEST
    THEREFOR MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE CORPORATE
    SECRETARY AT THE PRINCIPAL OFFICES OF THE COMPANY.

        2.3. STOP TRANSFER INSTRUCTIONS. The Holders consent to the Company's
    making a notation on its records and giving instructions to any transfer
    agent of the Restricted Securities in order to implement the restrictions on
    transfer established in this Agreement.

    3. NOTICE AND OTHER REQUIREMENTS OF TRANSFER. No Holder will sell, assign,
transfer, pledge or otherwise dispose of any Restricted Securities until the
first anniversary of the date of this Agreement, and thereafter a Holder may
sell, assign, transfer, pledge or otherwise dispose of any Restricted Securities
if and only if:

           a. the intended sale, assignment, transfer, pledge or other
       disposition is permitted by the other provisions of this Agreement; or

           b. there is in effect a registration statement under the Securities
       Act covering such proposed disposition and such disposition is made in
       accordance with such registration statement; or

           c. (i) such Holder has notified the Company of the proposed
       disposition and has furnished the Company with a detailed statement of
       the circumstances surrounding the proposed sale, pledge or other
       disposition for value, including the name and address of the buyer and
       identifying the Restricted Securities with respect to which such rights
       are being assigned, and (ii) the buyer, as a condition to the
       effectiveness of such disposition, has executed a counterpart of this
       Agreement expressly assuming the obligations of a Holder under this
       Agreement; and, if the Company requests, such Holder shall also furnish
       the Company with an opinion of counsel, reasonably satisfactory to the
       Company, that such disposition for value does not require registration of
       such shares under the Securities Act:

    4. PIGGYBACK REGISTRATION.

        4.1. NOTICE TO HOLDERS REQUIRED. If at any time during the Term the
    Company shall determine to register any shares of Common Stock for its own
    account or the account of any of the Holders, other than (a) a transaction
    relating solely to the sale of convertible debt instruments, (b) or a
    registration on Form S-4 or S-8 or another form not available for
    registering the Restricted Securities for sale to the public, or (c) any
    registration comprised in whole or in substantial part of shares underlying
    stock options granted by the Company or its predecessor, the Company will
    give to the Holders notice as soon as practicable prior to filing the
    registration statement and include in such registration all the

                                       2
<PAGE>
    Restricted Securities specified in one or more written requests which have
    been made within 15 days after receipt of such written notice from the
    Company by any of the Holders, except as set forth in Section 4.2

        4.2. REGISTERED PUBLIC OFFERING INVOLVING AN UNDERWRITING. If the
    registration is for a registered public offering involving an underwritten
    offering, the Company shall so advise each Holder as a part of the written
    notice given pursuant to Section 4.1. In such event, the right of each
    Holder to registration pursuant to this Section shall be conditioned upon
    such Holder's participation in such underwriting and the inclusion of such
    Holder's Restricted Securities in the underwriting to the extent provided
    herein. If any Holder proposes to distribute his securities through such
    underwriting, such Holder shall (together with the Company and the other
    Holders distributing their securities through such underwriting) enter into
    an underwriting agreement in customary form with the underwriter or
    underwriters selected for such underwriting by the Company. Notwithstanding
    any other provision of this Section 4, if the managing underwriter
    determines that marketing factors require a limitation of the number of
    shares to be underwritten, the managing underwriter may limit the number of
    Restricted Securities to be included in the underwriting or may limit the
    number of Restricted Securities to be included in such registration. The
    Company shall so advise each of the Holders, and the number of shares of
    Restricted Securities and other securities that may be included in the
    registration and underwriting shall be allocated among such Holder and other
    holders of Common Stock that hold rights granted by the Company to cause
    shares of Common Stock held by them to be included in such registration or
    underwriting, in proportion, as nearly as practicable, to the respective
    amounts of Restricted Securities held by each Holder and each other such
    holder that are requested to be included in the registration or
    underwriting. To facilitate the allocation of shares in accordance with the
    above provisions, the Company or the underwriter may round the number of
    shares allocated to any Holders to the nearest one hundred shares. If any of
    the Holders disapproves of the terms of any such underwriting, he may elect
    to withdraw therefrom by written notice to the Company. Any Restricted
    Securities excluded or withdrawn from such underwriting shall be withdrawn
    from such registration.

    5. NONPUBLIC INFORMATION. Notwithstanding any other provision of this
Agreement, the Company's obligation to file a registration statement under
Section 4.1, or to cause such registration statement to become and remain
effective, shall be suspended for a period not to exceed 90 days (and for
periods not exceeding, in the aggregate, 180 days in any 12-month period) if
there exists at the time material non-public information relating to the Company
which, in the reasonable opinion of the Company, should not be disclosed.

    6. EXPENSES OF REGISTRATION. The Company will bear all reasonable expenses
incurred in connection with registrations pursuant to Section 4, including
without limitation all registration, filing and qualification fees, printing
expenses, fees and disbursements of counsel for the Company and independent
accounts for the Company and expenses of any special audits of the Company's
financial statements incidental to or required by such registration, fees of the
National Association of Securities Dealers, Inc., transfer taxes, fees of
transfer agents and registrars' fees, but the Company will not pay underwriters'
fees, discounts or commissions relating to the Restricted Securities or any fees
or expenses legal counsel for any or all of the Holders.

    7. REGISTRATION PROCEDURES. In the case of each registration effected by the
Company pursuant to this Agreement, the Company will keep the Holders
participating therein advised in writing as to the initiation of each
registration and as to the completion thereof.

    8. INDEMNIFICATION.

        8.1. INDEMNITY BY THE COMPANY. If the Company registers any Restricted
    Securities under the Securities Act pursuant to Section 4, the Company will
    indemnify and hold harmless the Holders of such Restricted Securities
    thereunder, each underwriter of such Restricted Securities thereunder and

                                       3
<PAGE>
    each other person, if any, who controls any Holder or underwriter within the
    meaning of the Securities Act, against any losses, claims, damages or
    liabilities, joint or several, to which such Holders, underwriter or
    controlling persons may become subject under the Securities Act or
    otherwise, insofar as such losses, claims, damages or liabilities (or
    actions in respect thereof) arise out of or are based upon any untrue
    statement or alleged untrue statement of any material fact contained in any
    registration statement under which such Restricted Securities were
    registered under the Securities Act, any preliminary prospectus or final
    prospectus contained therein, or any amendment or supplement thereof, or
    arise out of or are based upon the omission or alleged omission to state
    therein a material fact required to be stated therein or necessary to make
    the statements therein not misleading, or any violation by the Company of
    any rule or regulation promulgated under the Securities Act or any state
    securities law applicable to the Company and relating to action or inaction
    required of the Company in connection with any such registration, and will
    reimburse the Holders, each of their respective officers, directors and
    partners, and each person controlling any of the Holders, each such
    underwriter and each person who controls any such underwriter, for any
    reasonable legal and any other expenses incurred in connection with
    investigating, defending or settling any such claim, loss, damage, liability
    or action, provided that the Company will not be liable in any such case to
    the extent that any such claim, loss, damage or liability arises out of or
    is based on any untrue statement or omission based upon written information
    furnished to the Company by an instrument duly executed by any of the
    Holders or underwriter specifically for use therein.

        8.2. INDEMNITY BY THE HOLDERS. The Holders will, if Restricted
    Securities held by or issuable to the Holders are included in the securities
    as to which such registration is being effected, indemnify and hold harmless
    the Company, each of its directors, each officer who signs the registration
    statement, each underwriter, if any, of the Company's securities covered by
    such a registration statement, each person who controls the Company and each
    underwriter within the meaning of the Securities Act, against all claims,
    losses, expenses, damages and liabilities (or actions in respect thereof)
    arising out of or based on any untrue statement (or alleged untrue
    statement) of a material fact contained in any such registration statement,
    prospectus, offering circular or other document, or any omission (or alleged
    omission) to state therein a material fact required to be stated therein or
    necessary to make the statements therein not misleading, and will reimburse
    the Company, such directors, officers, partners, persons or underwriters for
    any reasonable legal or any other expenses incurred by them in connection
    with investigating, defending or settling any such claim, loss, damage,
    liability or action, in each case to the extent, but only to the extent,
    that such untrue statement (or alleged untrue statement) or omission (or
    alleged omission) is made in such registration statement, prospectus,
    offering circular or other document in reliance upon and in conformity with
    written information furnished to the Company by an instrument duly executed
    by the Holders specifically for use therein; provided, that the total amount
    for which the Holders, its officers, directors and partners, and any person
    controlling such Holders, shall be liable under this Section 8.2 shall not
    in any event exceed the proceeds (net of underwriting discounts and
    commissions) received by the Holders from the sale of Restricted Securities
    sold by such Holders in such registration.

        8.3. NOTICE BY THE INDEMNIFIED PARTY. Each party entitled to
    indemnification under this Section 8 (the "Indemnified Party") shall give
    notice to the party required to provide indemnification (the "Indemnifying
    Party") promptly after such Indemnified Party has actual knowledge of any
    claims as to which indemnity may be sought, and shall permit the
    Indemnifying Party to assume the defense of any such claim or any litigation
    resulting therefrom, provided that counsel for the Indemnifying Party, who
    shall conduct the defense of such claim or litigation, shall be approved by
    the Indemnified Party (whose approval shall not be unreasonably withheld),
    and the Indemnified Party may participate in such defense at such party's
    expense, and provided further that the failure of any Indemnified Party to
    give notice as provided herein shall not relieve the Indemnifying Party of
    its obligations hereunder, unless such failure resulted in actual detriment
    to the Indemnifying Party. No Indemnifying Party, in the defense of any such
    claim or litigation, shall, except with the consent of each Indemnified
    Party,

                                       4
<PAGE>
    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 of such claim or litigation.

        8.4. UNDERWRITING AGREEMENT. Notwithstanding the foregoing, to the
    extent that the provisions on indemnification contained in the underwriting
    agreements entered into among the selling Holders, the Company and the
    underwriters in connection with the underwritten public offering are in
    conflict with the foregoing provisions, the provisions in the underwriting
    agreement shall be controlling as to the Restricted Securities included in
    the public offering; PROVIDED, that if, as a results of this Section 8.4,
    the Holders, and any persons controlling such Holders is held liable for an
    amount which exceeds the aggregate proceeds received by such Holders from
    the sale of Restricted Securities included in a registration, as provided in
    Section 8.2, pursuant to such underwriting agreement (the "Excess
    Liability"), the Company shall reimburse any such Holders for such Excess
    Liability.

        8.5. CONTRIBUTION. If the indemnification provided for in this Section
    is held by a court of competent jurisdiction to be unavailable to an
    Indemnified Party with respect to any loss, liability, claim, damage or
    expense referred to therein, then the Indemnifying Party, in lieu of
    indemnifying such Indemnified Party thereunder, shall contribute to the
    amount paid or payable by such Indemnified Party as a result of such loss,
    liability, claim, damage or expense 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 hand in connection with the statements or
    omissions which resulted in such loss, liability, claim, damage or expense
    as well as any other relevant equitable considerations. The relevant fault
    of the Indemnifying Party and 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 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. Notwithstanding the foregoing, the amount that any Holder shall be
    obligated to contribute pursuant to this Section 8.5 shall be limited to an
    amount equal to the proceeds to such Holder of the Restricted Securities
    sold pursuant to the registration statement which gives rise to such
    obligation to contribute (less the aggregate amount of any damages which
    such Holder has otherwise been required to pay in respect of such loss,
    claim, damage, liability or action or any substantially similar loss, claim,
    damage, liability or action arising from the sale of such Restricted
    Securities).

        8.6. SURVIVAL OF INDEMNITY. The indemnification provided by this Section
    shall be a continuing right to indemnification and shall survive the
    registration and sale of any securities by any person entitled to
    indemnification hereunder and the Term.

    9. LOCKUP AGREEMENT. In consideration for the Company's performance of its
obligations under this Agreement, each Holder will, in connection with any
registration of any Restricted Securities in an underwritten offering, at the
request of the Company or the underwriters managing any underwritten offering of
the Company's securities, agree not to sell, make any short sale of, loan, grant
any option for the purchase of, or otherwise dispose of any Restricted
Securities (other than those included in the registration) without the prior
written consent of the Company or such underwriters, as the case may be, for
such period of time (not to exceed 180 days) from the effective date of such
registration as the Company and the underwriters may specify, so long as the
Holders or stockholders holding more than one percent (1%) of the Common Stock
and all officers and directors of the Company are bound by a comparable
obligation.

    10. HOLDER'S COOPERATION.

        10.1. INFORMATION REGARDING HOLDERS. Each of the Holders shall promptly
    furnish to the Company such information regarding such Holder and the
    distribution proposed by such Holder as the

                                       5
<PAGE>
    Company may request in writing and as shall be required in connection with
    any registration referred to herein.

        10.2. OBLIGATIONS OF THE HOLDERS. Each of the Holders holding shares
    included in the registration will not (until further notice by the Company)
    effect sales thereof (or deliver a prospectus to any purchaser) after
    receipt of telegraphic or written notice from the Company to suspend sales
    to permit the Company to correct or update a registration statement or
    prospectus. At the end of the period during which the Company is obligated
    to keep any registration statement filed under Section 4 current and
    effective as required by applicable law, the Holders holding shares of
    Restricted Securities included in the registration shall discontinue sales
    of shares pursuant to such registration statement upon receipt of notice
    from the Company of its intention to remove from registration the shares of
    Restricted Securities covered by such registration statement that remain
    unsold, and each of the Holders shall notify the Company of the number of
    such shares registered that remain unsold immediately upon receipt of such
    notice from the Company.

    11. RULE 144. With a view to making available to the Holders of Restricted
Securities the benefits of certain rules and regulations of the SEC which may
permit the sale of the Restricted Securities to the public without registration,
the Company agrees to:

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

           (b) use its best 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.

    12. TERMINATION OF RIGHTS.

        12.1. The rights of any Holder to cause the Company to register
    securities under Section 4 shall terminate at such time as such Holder is
    able to dispose of all of the Restricted Securities owned by him in one
    three-month period pursuant to the provisions of Rule 144.

        12.2. Notwithstanding the provisions of Section 12.1, all rights of the
    Holders under this Agreement shall terminate at 5:00 p.m. Eastern time on
    the date seven years after the date of this Agreement.

    13. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents
and warrants to the Holders as follows:

        13.1. The execution, delivery and performance of this Agreement by the
    Company have been duly authorized by all requisite corporate action and will
    not violate any provision of law, any order of any court or other agency of
    government, the Articles of Organization or Bylaws of the Company or any
    provision of any indenture, agreement or other instrument to which it or any
    of its properties or assets is bound, conflict with, result in a breach of
    or constitute (with due notice or lapse of time or both) a default under any
    such indenture, agreement or other instrument or result in the creation or
    imposition of any lien, charge or encumbrance of any nature whatsoever upon
    any of the properties or assets of the Company.

        13.2. This Agreement has been duly executed and delivered by the Company
    and constitutes the legal, valid and binding obligation of the Company,
    enforceable in accordance with its terms, subject to (i) applicable
    bankruptcy, insolvency, reorganization, fraudulent conveyance and moratorium
    laws and other laws of general application affecting enforcement of
    creditors' rights generally and (ii) the availability of equitable remedies
    as such remedies may be limited by equitable principles of general
    applicability (regardless of whether enforcement is sought in a proceeding
    in equity or at law).

                                       6
<PAGE>
    14. DEFINITIONS. As used in this Agreement, the following terms shall have
the following meanings:

           a. "Commission" shall mean the U. S. Securities and Exchange
       Commission, or any other federal agency at the time administering the
       Securities Act.

           b. "Common Stock" shall mean shares of the Company's Common Stock, no
       par value.

           c. "Common Stock Warrants" mean warrants to purchase shares of the
       Common Stock.

           d. "Exchange Act" shall mean the Securities Exchange Act of 1934, as
       amended, or any similar United States statute and the rules and
       regulations thereunder, all as the same shall be in effect at the time.

           e. "Holders" shall mean the persons named in Schedule I to this
       Agreement and any other person who holds Restricted Securities and who
       has assumed the obligations of this Agreement pursuant to clauses c, d,
       and e of Section 3.

           f. "Register," "registered" and "registration" shall refer to a
       registration effected by preparing and filing a registration statement in
       compliance with the Securities Act, and the declaration or ordering of
       the effectiveness of such registration statement, and compliance with
       applicable state securities laws of such states in which any of the
       Holders notifies the Company of his intention to offer Registrable
       Securities.

           g. "Restricted Securities" shall mean the shares of the Common Stock
       issued to the Sellers pursuant to the Subscription Agreement, the Common
       Stock Warrants and shares of Common Stock issued upon due exercise of the
       Common Stock Warrants, in each case only to the extent the same have not
       been sold to the public. As to any particular Restricted Securities, such
       securities shall cease to be Restricted Securities when (i) a
       registration statement with respect to the sale of such securities shall
       have become effective under the Securities Act and such securities shall
       have been disposed of under such registration statement, (ii) such
       securities shall have become eligible for resale pursuant to Rule 144(k)
       and any restrictive legend on certificates representing such securities
       shall have been removed, (iii) such securities shall have been otherwise
       transferred or disposed of, and (x) new certificates therefor not bearing
       a legend restricting further transfer shall have been delivered by the
       Company, and (y) subsequent transfer or disposition of them shall not
       require their registration or qualification under the Securities Act or
       any similar state law then in force or compliance with Rule 144, or
       (iv) such securities shall have ceased to be outstanding. Notwithstanding
       the foregoing, Restricted Securities shall not include otherwise
       Restricted Securities (i) sold by a person in a transaction in which his
       rights under this Agreement are not properly assigned; or (ii) (A) sold
       to or through a broker or dealer or underwriter in a public distribution
       or a public securities transaction, or (B) sold in a transaction exempt
       from the registration and prospectus delivery requirements of the
       Securities Act under Section 4(1) thereof so that all transfer
       restrictions, and restrictive legends with respect thereto, if any, are
       removed upon the consummation of such sale or (C) the registration rights
       associated with such securities have been terminated pursuant to
       Section 13.

           h. "Rule 144" shall mean Rule 144 under the Securities Act or any
       successor or similar rule as may be enacted by the Commission from time
       to time.

           i. "Rule 145" shall mean Rule 145 under the Securities Act or any
       successor or similar rule as may be enacted by the Commission from time
       to time.

           j. "Securities Act" shall mean the Securities Act of 1933, as
       amended, or any similar United States statute and the rules and
       regulations thereunder, all as the same shall be in effect at the time.

                                       7
<PAGE>
    15. MISCELLANEOUS.

        15.1. AMENDMENTS. This Agreement may be amended only by a written
    instrument executed by (a) the Holders of 75% of the Restricted Securities
    which are subject to this Agreement and (b) the Company. Any such amendments
    shall be binding upon all Holders who have executed or assumed this
    Agreement.

        15.2. COUNTERPARTS. This Agreement may be executed in any number of
    counterparts, all of which shall constitute a single instrument.

        15.3. NOTICES, ETC. All notices, requests, demands and other
    communications required or permitted to be given hereunder shall be in
    writing and shall be given personally, sent by facsimile transmission or
    sent by prepaid air courier or certified or express mail, postage prepaid.
    Any such notice shall be deemed to have been given (a) when received, if
    delivered in person, sent by facsimile transmission and confirmed in writing
    within three business days thereafter or sent by prepaid air courier or
    (b) three business days following the mailing thereof, if mailed by
    certified first class mail, postage prepaid, in any such case to the
    respective addresses set forth in Schedule I to the Subscription Agreement
    (or to such other address or addresses as a party may have advised the other
    in the manner provided in this Section 15.3).

        15.4. SEVERABILITY. If any provision of this Agreement shall be held to
    be illegal, invalid or unenforceable, such illegality, invalidity or
    unenforceability shall attach only to such provision and shall not in any
    manner affect or render illegal, invalid or unenforceable any other
    provision of this Agreement, and this Agreement shall be carried out as if
    any such illegal, invalid or unenforceable provision were not contained
    herein.

        15.5. GOVERNING LAW. This Agreement shall be governed by and construed
    under the laws of the State of New York without regard to principles of
    conflict of law.

        15.6. JURISDICTION. Each of the Holders and the Company hereby
    irrevocably and unconditionally consents and submits to the exclusive
    jurisdiction of any state or federal court located within the County of New
    York, State of New York, in connection with any, actions, suits or
    proceedings arising out of or relating to this Agreement or any of the
    agreements delivered in connection herewith or the transactions contemplated
    hereby or thereby. Each of the Company and Holders hereby waives any
    objection to venue in such jurisdiction, and agrees that service of any
    summons, complaint, notice or other process relating to such proceeding may
    be effected as provided by Section 15.3.

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

<TABLE>
<S>                                                    <C>  <C>
                                                       THE COMPANY:
                                                       ON2.COM INC.

                                                       By:  /s/ DANIEL B. MILLER
                                                            -----------------------------------------
                                                            Name: Daniel B. Miller
                                                            Title: President and Chief Executive
                                                                   Officer
</TABLE>

                                       9

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