Document:

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                                                                  EXHIBIT 10(af)

         THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
         1933. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, OR HYPOTHECATED
         IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO
         OR AN OPINION OF COUNSEL (WHICH MAY BE IN-HOUSE COUNSEL) REASONABLY
         SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED
         UNDER THE SECURITIES ACT OF 1933. IN ADDITION, THESE SECURITIES ARE
         SUBJECT TO THE RESTRICTIONS ON TRANSFER SET FORTH IN SECTION 10 OF THIS
         WARRANT AGREEMENT.

                                WARRANT AGREEMENT

                   To Purchase Shares of the capital stock of
                      UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.
                        dated as of ______________, 2002

         WHEREAS, Universal Automotive Industries, Inc., a Delaware corporation
(the "Company") has entered into that certain Placement Agent Agreement, dated
as of January __, 2002 (the "Placement Agreement") with SBI-E2 Capital (USA)
Ltd., vFinance Investments, Inc.("vFinance") and SBI E2-Capital (HK) Limited
(SBI (HK) and together with vFinance the "Warrantholder"); and

         WHEREAS, the Company desires to grant to the Warrantholder, in
connection with such Placement Agreement, the right to purchase shares of the
Company's common stock, $.01 par value (the "Warrants") upon the terms of, and
subject to the conditions to, this Agreement;

         NOW, THEREFORE, in connection with the purchase of the Company's common
stock, $.01 par value ("Common Stock") by the Warrantholder and in consideration
of mutual covenants and agreements contained herein, the Company and the
Warrantholder certify and agree as follows:

         1. GRANT OF THE RIGHT TO PURCHASE STOCK. (a) The Company hereby grants
to the Warrantholder the right, and the Warrantholder is entitled, upon the
terms and subject to the conditions hereinafter set forth, to subscribe for and
purchase, from the Company, ___________ shares of the Company's fully paid and
non-assessable shares of Common Stock. The Exercise Price for the shares of
Common Stock issuable upon the exercise of this Warrant (the "Shares") shall be
$______ per share, subject to adjustment pursuant to Section 8 of this
Agreement.

         2. EXERCISE OF WARRANT. (a) Notice of Exercise. The purchase rights set
forth in this Warrant Agreement are exercisable by the Warrantholder, in whole
or in part, at any time during the period and prior to the expiration of the
term set forth in Section 3 of this Agreement by tendering to the Company at its
principal office a notice of exercise in the form attached hereto as Exhibit I
(the "Notice of Exercise"), duly completed and executed. Upon receipt of the
Notice of Exercise and the payment of the Exercise Price in accordance with the
terms of Section 2(b) or (c) of this Agreement, the Company shall issue to the
Warrantholder a certificate for the number of Shares purchased and shall execute
the Notice of Exercise indicating that no Shares remain subject to future
purchases.

                  (a) Payment of Exercise Price. Payment of the Exercise Price
shall be made (i) in cash or official bank check payable to the order of the
Company or by wire transfer; or (ii) in the manner provided in Section 2(b) of
this Agreement.

                  (b) Net Issuance Rights. Warrantholder may exercise its right
to receive Common Stock on a net basis, such that, without the exchange of any
funds and upon surrender of the Warrant, the

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Warrantholder receives shares of Common Stock equal to the value (as determined
below) of this Warrant by surrender of the Warrant at the principal office of
the of the Company together with notice of such election in which event the
Company shall issue to the Warrantholder a number of shares of Common Stock
computed using the following formula:

                  X = Y(A-B)
                      ------
                         A

                  X = the number of shares of Common Stock to be issued to the
                      Warrantholder.

Where:

                  Y = the number of shares of Common Stock subject to this
Warrant.

                  A = the fair market value of each share of the Company's
                      Common Stock

                           (i)      if the Company's Common Stock is actively
                                    traded over-the-counter, the fair market
                                    value shall be deemed to be the product of
                                    (x) the average of the closing prices of the
                                    Company's Common Stock's sales on all
                                    securities exchanges on which such security
                                    may at the time be listed, or, if there has
                                    been no sales on any such exchange on any
                                    day, the average of the highest bid and
                                    lowest asked prices on all such exchanges at
                                    the end of such day, or, if on any day such
                                    security is not so listed, the average of
                                    the representative bid and asked prices
                                    quoted on the Nasdaq Stock Market as of 4:00
                                    P.M., New York time, or, if on any day such
                                    security is not quoted by the Nasdaq Stock
                                    Market, the average of the highest bid and
                                    lowest asked prices on such day in the
                                    domestic over-the-counter market as reported
                                    by NASDAQ Small Cap Market, or any similar
                                    successor organization, in each such case
                                    averaged over a period of 21 days, ending
                                    one day before the day the Company receives
                                    the notice of election with regard to the
                                    net issuance and (y) the number of shares of
                                    Common Stock for which the Warrant is
                                    exercisable at the time of such election; or

                           (ii)     if at any time the Common Stock is not
                                    listed on any securities exchange or quoted
                                    over-the-counter or is not actively traded,
                                    the fair market value of Preferred Stock
                                    shall be the product of (x) the highest
                                    price per share which the Company could
                                    obtain from a willing buyer (not a current
                                    employee or director) for shares of the
                                    Company's Common Stock sold by the Company,
                                    from authorized but unissued shares, as
                                    determined in good faith by the Company's
                                    Board of Directors and (y) the number of
                                    shares of Common Stock for which the warrant
                                    is exercisable at the time of such exercise;
                                    or

                           (iii)    notwithstanding the provisions (i) and (ii)
                                    above, if the Company shall become subject
                                    to a Merger, the fair market value of Common
                                    Stock shall be deemed to be the value
                                    received by the holders of the Company's
                                    Common Stock pursuant to such Merger.

                  B = Exercise Price.

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         3. TERM OF THE WARRANT AGREEMENT. Except as otherwise provided for
herein, the term of this Warrant Agreement and the right to purchase Shares as
granted herein shall commence on ____________, 2002 [first anniversary of the
Initial Closing as defined in the Placement Agreement] and shall be exercisable
until _____________, 2006.

         4. RESERVATION OF SHARES. The Company will at all times have authorized
and reserved a sufficient number of shares of Common Stock to provide for the
exercise of the rights to purchase Common Stock as provided herein. During the
term of this Warrant Agreement, the Company shall at all times have authorized
and reserved a sufficient number of shares of Common Stock to provide for the
exercise of the rights to purchase such shares of Common Stock as provided
herein.

         5. NO FRACTIONAL SHARES OR SCRIP. No fractional shares or scrip
representing fractional shares shall be issued upon the exercise of the
Warrantholder's rights to purchase Shares, but in lieu of such fractional shares
the Company shall make a cash payment therefor upon the basis of the Exercise
Price then in effect.

         6. NO RIGHTS AS SHAREHOLDERS. This Warrant Agreement does not entitle
the Warrantholder to any voting rights or other rights as a shareholder of the
Company prior to the exercise of the Warrantholder's rights to purchase Shares
as provided for herein. No provision of this Warrant Agreement, in the absence
of affirmative action by the Warrantholder to purchase Shares, and no
enumeration in this Warrant Agreement of the rights or privileges of the
Warrantholder, will give rise to any liability of such Warrantholder for the
Exercise Price of the Shares acquirable by exercise hereof or as a stockholder
of the Company.

         7. WARRANTHOLDER REGISTRY. The Company shall maintain a registry
showing the name and address of the registered holder of this Warrant Agreement.

         8. ADJUSTMENT RIGHTS. The purchase price per share and the number of
Shares purchasable hereunder are subject to adjustment from time to time, as
follows:

                  (a) Merger and Sale of Assets. If at any time there shall be a
capital reorganization of the shares of the Company's Stock (other than a
combination, reclassification, exchange or subdivision of shares otherwise
provided for herein) or a merger or consolidation of the Company with or into
another corporation or the sale of all or substantially all of the Company's
properties and assets to any other person (other than such a transaction
constituting a Change of Control), effected in such a way that holders of Common
Stock shall be entitled to receive stock, securities, cash or other assets or
consideration in exchange for Common Stock, then, as a part of such transaction,
lawful provision shall be made so that the Warrantholder shall thereafter be
entitled to receive upon exercise of this Warrant and in full satisfaction of
its rights hereunder, the number of shares or other securities of the successor
corporation resulting from such transaction (which corporation may, but need not
be the Company), or the amount of cash or other consideration, as may be issued
or payable with respect to or in exchange for a number of outstanding shares of
Common Stock equal to the number of shares of such stock immediately theretofore
purchasable and receivable upon exercise of the rights represented hereby had
such transaction not taken place. If appropriate (as determined in good faith by
the Company's Board of Directors), adjustment shall be made by the Company's
Board of Directors in the application of the provisions of this Warrant
Agreement with respect to the rights and interest of the Warrantholder after the
reorganization or Change of Control to the end that the provisions of this
Warrant Agreement (including adjustments of the Exercise Price and number of
Shares purchasable pursuant to the terms and conditions of this Warrant
Agreement) shall be applicable after that event, as near as reasonably may be,
in relation to any shares deliverable after that event upon the exercise of the
Warrantholder's rights to purchase Shares pursuant to this Warrant Agreement.

<PAGE>

                  (b) Reclassification of Shares. If the Company at any time
shall, by combination, reclassification, exchange or subdivision of securities
or otherwise, change any of the securities as to which purchase rights under
this Warrant Agreement exist into the same or a different number of securities
of any other class or classes, this Warrant Agreement shall thereafter represent
the right to acquire such number and kind of securities as would have been
issuable as the result of such change with respect to the securities which were
subject to the purchase rights under this Warrant Agreement immediately prior to
such combination, reclassification, exchange, subdivision or other change.

                  (c) Subdivision or Combination of Shares. If the Company at
any time shall combine or subdivide its Shares of Common Stock, the Exercise
Price shall be proportionately decreased in the case of a subdivision, or
proportionately increased in the case of a combination.

                  (d) Stock Dividends. If the Company at any time shall pay a
dividend payable in, or make any other distribution (except any distribution
specifically provided for in the foregoing subsections (a) or (b)) of the
Company's Common Stock, including, without limitation, any shares of Common
Stock of the same series as the Shares subject to this Warrant Agreement, then
the Exercise Price shall be adjusted, from and after the date of determination
of stockholders entitled to receive such dividend or distribution, to that price
determined by multiplying the Exercise Price in effect immediately prior to such
date of determination by a fraction (i) the numerator of which shall be the
total number of all shares of the Company's Common Stock outstanding immediately
prior to such dividend or distribution, and (ii) the denominator of which shall
be the total number of all shares of the Company's Common Stock outstanding
immediately after such dividend or distribution.

                  (e) Issuance of Shares at Other Than Exercise Price. If the
Company should issue shares of its Common Stock, including, without limitation,
any shares of Common Stock of the same series as the Shares subject to this
warrant, at a price per share less than the Exercise Price in effect immediately
prior to such issuance, then the Exercise Price shall be adjusted by dividing
(i) the sum of (A) the total number of shares of the Company's Common Stock
outstanding immediately prior to such issuance multiplied by the then effective
Exercise Price and (B) the value of the consideration received by the Company
upon such issuance of such shares, by (ii) the total number of shares of the
Company's Common Stock outstanding immediately after such issuance. For the
purposes of this Section 8(e), the issuance of securities convertible into or
exercisable for the Company's Common Stock shall be deemed the issuance of the
number of shares of the Company's Common Stock into which such securities are
convertible or for which such securities are exercisable, and the consideration
received for such securities shall be deemed to include the minimum aggregate
amount payable upon conversion or exercise of such securities. In the event the
right to convert or exercise such securities expires unexercised, the Exercise
Price of shares issuable upon the exercise hereof shall be readjusted
accordingly. The sale or other disposition of any shares of Common Stock held in
the treasury of the Company, or of any securities resulting from any
reclassification of such shares or other securities which were effected while
they were held in the treasury of the Company, shall be deemed an issuance
thereof.

                  (f) Notice of Adjustments. In the event that: (i) the Company
shall declare any dividend or distribution upon its stock, whether in cash,
property, stock or other securities; (ii) the Company shall offer for
subscription pro rata to the holders of any class of its capital stock any
additional shares of stock of any class or other rights; (iii) there shall be
any capital reorganization, reclassification, consolidation, merger or sale of
all or substantially all of the Company's assets; or (iv) there shall be any
voluntary or involuntary dissolution, liquidation or winding up of the Company;
then, in connection with each such event, the Company shall send to the
Warrantholder:

                  (i) At least 20 days' prior written notice of the date on
         which the books of the

<PAGE>

         Company shall close or a record shall be taken for such dividend,
         distribution, subscription rights (specifying the date on which the
         holders of Shares shall be entitled thereto) or for determining rights
         to vote in respect of such capital reorganization, reclassification,
         consolidation, merger or sale of all or substantially all of the
         Company's assets, dissolution, liquidation or winding up (other than
         such a transaction constituting a Change of Control), and at least 45
         days' prior written notice of the date on which the books of the
         Company shall close or a record shall be taken for determining the
         right to vote in respect of a Change of Control; and

                  (ii) In the case of any such capital reorganization,
         reclassification, consolidation, merger or sale of all or substantially
         all of the Company's assets, dissolution, liquidation or winding up
         (other than such a transaction constituting a Change of Control), at
         least 20 days' prior written notice of the date when the same shall
         take place (and specifying the date on which the holders of Shares
         shall be entitled to exchange their Shares for securities or other
         property deliverable upon such capital reorganization,
         reclassification, consolidation, merger or sale of all or substantially
         all of the Company's assets, dissolution, liquidation or winding up),
         and, in the case of any Change of Control, at least 45 days' prior
         written notice of the date when the Change of Control shall take place.

                  Each such written notice shall set forth, in reasonable
detail, (i) the event requiring the adjustment, (ii) the amount of the
adjustment, (iii) the method by which such adjustment was calculated, (iv) the
Exercise Price, and (v) the number of shares subject to purchase hereunder after
giving effect to such adjustment, and shall be given by first class mail,
postage prepaid, addressed to the Warrantholder, at the address as shown on the
books of the Company.

                  (g) No Overissue. The Company will not take any action which
will result in any adjustment of the number of Shares issuable upon exercise of
this Warrant Agreement if the total number of Shares issuable after such action
upon exercise of the Warrant Agreement then outstanding, together with the total
number of Shares then outstanding, would exceed the total number of Shares then
authorized and not reserved for any purpose other than the purpose of issue upon
exercise of the Warrant Agreement.

         9. REPRESENTATIONS AND COVENANTS OF THE WARRANTHOLDER. This Warrant
Agreement has been entered into by the Company in reliance upon the following
representations and covenants of the Warrantholder, which by its execution
hereof the Warrantholder hereby confirms:

                  (a) Investment Purpose. The right to acquire Shares issuable
upon exercise of the Warrantholder's rights contained herein will be acquired
without a view to the sale or distribution of any part thereof, or engaging in
any public distribution of the same except pursuant to a registration or
exemption therefrom under applicable federal and state securities laws.

                  (b) Private Issue. The Warrantholder understands that (i) the
Shares issuable upon exercise of the Warrantholder's rights contained herein are
not registered under the Securities Act of 1933 (the "1933 Act") or qualified
under applicable state securities laws on the ground that the issuance
contemplated by this Warrant Agreement will be exempt from the registration and
qualifications requirements thereof, and (ii) the Company's reliance on such
exemption is predicated on the representations set forth in this Section 9.

                  (c) Disposition of the Warrantholder's Rights. In no event
will the Warrantholder make a disposition of any of its rights to acquire Shares
issuable upon exercise of such rights unless and until (i) it shall have
notified the Company of the proposed disposition, and (ii) if requested by the
Company, it shall have furnished the Company with an opinion of counsel (which
counsel may either be

<PAGE>

inside or outside counsel to the Warrantholder) reasonably satisfactory to the
Company and its counsel to the effect that (A) appropriate action necessary for
compliance with the 1933 Act has been taken, or (B) an exemption from the
registration requirements of the 1933 Act is available. Notwithstanding the
foregoing, the restrictions imposed upon the transferability of any of its
rights to acquire Shares issuable on the exercise of such rights do not apply to
transfers from the beneficial owner of any of the aforementioned securities to
its nominee or from such nominee to its beneficial owner or transfer to an
affiliate of Warrantholder including Warrantholder's parent or a majority owned
subsidiary of Warrantholder's parent or Warrantholder who takes subject to the
restrictions herein set forth, and shall terminate as to any particular Shares
when (1) such security shall have been effectively registered under the 1933 Act
and sold by the holder thereof in accordance with such registration or (2) such
security shall have been sold without registration in compliance with Rule 144
under the 1933 Act, or (3) a letter shall have been issued to the Warrantholder
at its request by the staff of the Securities and Exchange Commission or a
ruling shall have been issued to the Warrantholder at its request by such
Commission stating that no action shall be recommended by such staff or taken by
such Commission, as the case may be, if such security is transferred without
registration under the 1933 Act in accordance with the conditions set forth in
such letter or ruling and such letter or ruling specifies that no subsequent
restrictions on transfer are required. Whenever the restrictions imposed
hereunder shall terminate, as hereinabove provided, the Warrantholder or holder
of Shares then outstanding as to which such restrictions have terminated shall
be entitled to receive from the Company, without expense to such holder, one or
more new certificates for the Warrant or for such Shares not bearing any
restrictive legend.

         10. TRANSFERS.

                  THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
                  ACT OF 1933. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED,
                  OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
                  STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL (WHICH MAY
                  BE IN-HOUSE COUNSEL) REASONABLY SATISFACTORY TO THE COMPANY
                  THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES
                  ACT OF 1933. IN ADDITION, THESE SECURITIES ARE SUBJECT TO THE
                  RESTRICTIONS ON TRANSFER SET FORTH IN THIS SECTION 10.

                  (a) Subject to the restrictions, terms and conditions
contained in Section 9 of this Agreement and this Section 10, this Warrant
Agreement and all rights hereunder are transferable in whole or in part by the
Warrantholder and any successor transferee; provided, however, that in no event
shall the number of transfers of the rights and interests in all of the Warrant
Agreement exceed 3 transfers, excluding transfers to Warrantholder's parent or a
majority owned subsidiary of Warrantholder's parent or Warrantholder who takes
subject to the restrictions contained herein. The transfer shall be recorded on
the books of the Company upon receipt by the Company of a notice of transfer in
the form attached hereto as Exhibit II (the "Transfer Notice"), at its principal
offices and the payment to the Company of all transfer taxes and other
governmental charges imposed on such transfer.

                  (b) Legends. The Warrantholder agrees that the Company may
place or cause to be placed on this Warrant Agreement and the certificates
representing the Shares, any appropriate legend or legends containing
restrictions on transfer necessary under the 1933 Act and any other applicable
state corporations or securities statutes and regulations, including, but not
limited to, the legend appearing at the beginning of this Agreement.

         11. REGISTRATION RIGHTS. The Warrantholder shall have the right to
register the

<PAGE>

Shares issuable upon exercise of this Warrant (in the event the Warrant is
exercised to purchase Common Stock), as set forth in Exhibit III hereto which
provisions are incorporated herein and made a part hereof.

         12.      MISCELLANEOUS.

                  (a) Effective Date. The provisions of this Warrant Agreement
shall be construed and shall be given effect in all respects as if it had been
executed and delivered by the Company on the date hereof. This Warrant Agreement
shall be binding upon any successors or assigns of the Warrantholder and the
Company.

                  (b) Attorneys' Fees. In any litigation, arbitration or court
proceeding between the Company and the Warrantholder relating hereto, the
prevailing party shall be entitled to reasonable attorneys' fees and expenses
and all costs of proceedings incurred in enforcing this Warrant Agreement.

                  (c) Governing Law. This Warrant Agreement shall be governed by
and construed for all purposes under and in accordance with the laws of the
State of California.

                  (d) Counterparts. This Warrant Agreement may be executed in
two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.

                  (e) Titles and Subtitles. The titles of the Sections and
subsections of this Warrant Agreement are for convenience and are not to be
considered in construing this Agreement.

                  (f) Notices. Any notice required or permitted hereunder shall
be given in writing and shall be deemed effectively given upon personal delivery
or upon the expiration of 5 business days from deposit in the United States
mail, by registered or certified mail, or upon facsimile transmission during
normal business hours addressed

                           (i)      to the Warrantholder at

                                            and

                           (ii)     to the Company at

                                    Universal Automotive Industries, Inc.
                                    11859 South Central
                                    Alsip, Illinois 60803
                                    Attn:  Arvin Scott

                                    with a copy to

                                    Mitchell D. Goldsmith, Esq.
                                    Shefsky & Goldsmith, Ltd.
                                    444 N. Michigan Avenue
                                    Suite 2500
                                    Chicago, Illinois 60611
                                    Fax:  (312) 527-9285

<PAGE>

or at such other address as any such party may subsequently designate by written
notice to the other party.

                  (g) Specific Performance. The Company recognizes and agrees
that the Warrantholder will not have an adequate remedy if the Company fails to
comply with this Agreement and that damages will not be readily ascertainable,
and the Company expressly agrees that, in the event of such failure, it shall
not oppose an application by the Warrantholder or any other person entitled to
the benefit of this Agreement requiring specific performance of any or all
provisions hereof or enjoining the Company from continuing to commit any such
breach of this Agreement.

                  (h) Survival. The representations, warranties, covenants and
conditions of the respective parties contained herein or made pursuant to this
Warrant Agreement shall survive the execution and delivery of this Warrant
Agreement.

                  (i) Severability. In the event any one or more of the
provisions of this Warrant Agreement shall for any reason be held invalid,
illegal or unenforceable, the remaining provisions of this Warrant Agreement
shall be unimpaired, and the invalid, illegal or unenforceable provision shall
be Financing:

         IN WITNESS WHEREOF, the parties hereto have caused the Warrant
Agreement to be executed by its officers thereunto duly authorized.

Dated: ________, 2002

                                             Company:

                                             UNIVERSAL AUTOMOTIVE
                                             INDUSTRIES, INC.

                                             By:
                                             Title:

                                             Warrantholder:

                                             By:
                                             Its:

<PAGE>

                                    Exhibit I

                               NOTICE OF EXERCISE

To:

(1)      The undersigned Warrantholder hereby elects to purchase _____ shares of
         Common Stock of Universal Automotive Industries, Inc. (the "Shares"),
         pursuant to the terms of the Warrant Agreement' dated the [ ] day of
         _______, 2002 (the "Warrant Agreement") between Universal Automotive
         Industries, Inc. and the Warrantholder.

(2)      In exercising its rights to purchase the Shares, the undersigned hereby
         confirms and acknowledges the representations and warranties made in
         Section 9 of the Warrant Agreement.

(3)      Please issue a certificate or certificates representing said Shares in
         the name of the undersigned or in such other name as is specified
         below.

                                          (Name)

                                          (Address)

                                          (Address)

                                          (Taxpayer Identification Number)

                                          Warrantholder:

                                          By:

                                          Title:

                                          Date:

<PAGE>

                                            ACKNOWLEDGMENT OF EXERCISE

         The undersigned         , hereby acknowledges receipt of the "Notice of
Exercise" from _________________________, to purchase ____________ shares of the
Common Stock of _______________________, pursuant to the terms of the Warrant
Agreement, and further acknowledges that no shares remain subject to purchase
under the terms of the Warrant Agreement.

                              Company:  Universal Automotive Industries, Inc.

                              By:

                              Title:

                              Date:

                                   Exhibit II

         THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
         1933. IT MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, OR HYPOTHECATED IN
         THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR
         AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH
         REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933. IN
         ADDITION, THE WARRANT IS SUBJECT TO THE RESTRICTIONS ON TRANSFER SET
         FORTH IN SECTION 10 OF THE WARRANT AGREEMENT.

                                 TRANSFER NOTICE

         (To transfer or assign the foregoing Warrant Agreement execute this
form and supply required information. Do not use this form to purchase shares.)

         FOR VALUE RECEIVED, the foregoing Warrant Agreement and all rights
evidenced thereby are hereby transferred and assigned to

         (Please Print)

whose address is

                           Dated

                           Warrantholder's Signature

                           Warrantholder's Address

<PAGE>

Signature Guaranteed:

NOTE:             The signature to this Transfer Notice must correspond with the
                  name as it appears on the face of the Warrant Agreement,
                  without alteration or enlargement or any change whatever.
                  Officers of corporations and those acting in a fiduciary or
                  other representative capacity should file proper evidence of
                  authority to assign the foregoing Warrant Agreement.<PAGE>
                                                                  EXHIBIT 10(ag)

                         REGISTRATION RIGHTS PROVISIONS

         Universal Automotive Industries, Inc., a Delaware corporation (the
"Company") and vFinance Investments, Inc. and SBI E2 - Capital (HK) Limited
(collectively the "Representative") are parties to the Placement Agent Agreement
dated as of February 21, 2002 (the "Placement Agreement"), pursuant to which the
Company has agreed to issue the Representative a warrant (the "Representative
Warrant") dated as of _______________. The Representative and the Company have
agreed that the provisions herein contained shall govern the rights of the
Representative to cause the Company to register shares of (the Company's common
stock, $.01 par value "Common Stock") issuable to the Representative upon
exercise of the Representative's Warrant and certain other matters as set forth
herein;

1.       Registration Rights.  The Company covenants and agrees as follows:

         1.1      Definitions.  For purposes of this Section 1:

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

                  (b) The term "Form S-3" means such form under the Act as in
effect on the date hereof or any registration form under the Act subsequently
adopted by the SEC which permits inclusion or incorporation of substantial
information by reference to other documents filed by the Company with the SEC.

                  (c) The term "Holder" means any person owning or having the
right to. acquire Registrable Securities or any assignee thereof in accordance
with Section 1.13 hereof.

                  (d) The term "1934 Act" shall mean the Securities Exchange Act
of 1934, as amended.

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

                  (f) The term "Registrable Securities" means (i) the Common
Stock issuable or issued upon exercise of the Representative Warrant, and (ii)
any Common Stock of the Company issued as (or issuable upon the conversion or
exercise of any warrant, right or other security which is issued as) a dividend
or other distribution with respect to, or in exchange for or in replacement of
the shares referenced in clause (i) of this Schedule 1.1(f) or in this clause
(ii), excluding in all cases, however, any Registrable Securities sold by a
person in a transaction in which his rights under this Section 1 are not
assigned.

                  (g) The number of shares of "Registrable Securities then
outstanding" shall be determined by the number of shares of Common Stock
outstanding which are, and the number of shares of Common Stock issuable
pursuant to then exercisable or convertible securities which are, Registrable
Securities.

                  (h) The term "SEC" shall mean the Securities and Exchange
Commission.

         1.2      Request for Registration.

                  (a) If the Company shall receive at any time during the period
between

<PAGE>

_____________ 2003 first anniversary of the Initial Closing and _____________,
2006 [[fourth anniversary of the Initial Closing, a written request ("Demand
Request") from the Holders of a majority of the Registrable Securities then
outstanding that the Company file a registration statement under the Act
covering the registration of all or part of the Registrable Securities then
outstanding on Form S-1 or any similar long-form registration ("Long Form
Registrations") or on Form S-3 or any similar short-form registration ("Short
Form Registrations") if available, then the Company shall:

                           (i) within ten (10) days of the receipt of the Demand
         Request, give written notice of such request to all Holders in
         accordance with Section 2.5; and

                           (ii) file such registration statement within 60 days
         of its receipt of such Demand Request and use its best efforts to
         effect as soon as practicable after such filing, subject to the
         limitations of subsections 1.2(b), 1.2(c) and 1.2(d), the registration
         under the Act of all Registrable Securities covered by the Demand
         Request, together with all other Registrable Securities of any Holder
         joining in such Demand Request as are specified in a written request
         received by the Company within twenty (20) days of the giving of the
         notice described in clause (i) by the Company.

         Long-Form Registrations and Short-Form Registrations are collectively
referred to as "Demand Registrations." Demand Registrations shall be Short-Form
Registrations whenever the Company is permitted to use any applicable short
form. The Company shall use best efforts to make Short-Form Registrations
available for the sale of Registrable Securities.

         The Company shall not include in any Demand Registration any securities
that are not Registrable Securities without the prior written consent of the
holders of a majority of the Registrable Securities. If a Demand Registration is
an underwritten offering and the managing underwriter or underwriters advise the
Company in writing that, in its or their opinion, the number of Registrable
Securities and, if permitted hereunder, other securities requested to be
included in such offering, exceeds the number of Registrable Securities and
other securities, if any, that can be sold without having an adverse effect on
the price, timing, or distribution of such offering, the Company shall include
in such registration, prior to the inclusion of any securities that are not
Registrable Securities, the number of Registrable Securities requested to be
included, which, in the opinion of such underwriter or underwriters, can be sold
without having an adverse effect on the price, timing, or distribution of such
offering, pro rata among the respective holders thereof on the basis of the
number of Registrable Securities owned by each such holder, and only such lesser
number of other securities as shall not, in the opinion of the managing
underwriter or underwriters, be likely to have such an adverse effect.

                  (b) If the Holders initiating the registration request
hereunder ("Initiating Holders") intend to distribute the Registrable Securities
covered by their request by means of an underwriting, they shall so advise the
Company as a part of their request made pursuant to subsection 1.2(a) and the
Company shall include such information in the written notice referred to in
subsection 1.2(a). The underwriter will be selected by the Company and shall be
reasonably acceptable to a majority in interest of the Initiating Holders. In
such event, the right of any Holder to include his Registrable Securities in
such registration shall be conditioned upon such Holder's participation in such
underwriting and the inclusion of such Holder's Registrable Securities in the
underwriting (unless otherwise mutually agreed by a majority in interest of the
Initiating Holders and such Holder) to the extent provided herein. All Holders
proposing to distribute their securities through such underwriting shall
(together with the Company as provided in subsection 1.4(e)) enter into an
underwriting agreement in customary form with the underwriter or underwriters
selected for such underwriting. Notwithstanding any other provision of this
Section 1.2, if the underwriter advises the Initiating Holders in writing that
marketing factors require a limitation of the number of shares to be
underwritten, then the Initiating Holders shall so advise all

<PAGE>

Holders of Registrable Securities which would otherwise be underwritten pursuant
hereto, and the number of shares of Registrable Securities that may be included
in the underwriting shall be allocated among all Holders thereof, including the
Initiating Holders, in proportion (as nearly as practicable) to the amount of
Registrable Securities of the Company owned by each Holder; provided, however,
that the number of shares of Registrable Securities to be included in such
underwriting shall not be reduced unless all other securities are first entirely
excluded from the underwriting.

                  (c) Notwithstanding the foregoing, if the Company shall
furnish to Holders requesting a registration statement pursuant to this Section
1.2, a certificate signed by the Chief Executive Officer of the Company stating
that in the good faith judgment of the Board of Directors of the Company, it
would be seriously detrimental to the Company and its shareholders for such
registration statement to be filed and it is therefore essential to defer the
filing of such registration statement, the Company shall have the right to defer
taking action with respect to such filing for a period of not more than 120 days
after receipt of the request of the Initiating Holders; provided, however, that
the Company may not utilize this right more than once in any twelve-month
period.

                  (d) In addition, the Company shall not be obligated to effect,
or to take any action to effect, any registration pursuant to this Section 1.2:

                           (i) After the Company has effected two Long-Form or
         three Short-Form registrations pursuant to this Section 1.2, such
         registrations have been declared or ordered effective and the Holders
         of Registrable Securities covered by such registration are able to
         register and sell 100% of the Registrable Securities requested to be
         included in each such registration; or

                           (ii) 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 a date one hundred eighty (180) days after the
         effective date of, a registration subject to Section 1.3 hereof;
         provided that the Company is actively employing in good faith all
         reasonable efforts to cause such registration statement to become
         effective.

         1.3 Company Registration. If (but without any obligation to do so) the
Company proposes to register (including for this purpose a registration effected
by the Company for shareholders other than the Holders) any of its stock or
other securities under the Act in connection with the public offering of such
securities solely for cash (other than a registration relating solely to the
sale of securities to participants in a Company stock plan, a registration on
any form which does not include substantially the same information as would be
required to be included in a registration statement covering the sale of the
Registrable Securities or a registration in which the only Common Stock being
registered is Common Stock issuable upon conversion of debt securities which are
also being registered) (each, a "Company Registration"), the Company shall, at
such time, promptly give each Holder written notice of such registration. Upon
the written request of each Holder given within twenty (20) days after mailing
of such notice by the Company in accordance with Section 2.5, the Company shall,
subject to the provisions of Section 1.8, cause to be registered under the Act
all of the Registrable Securities that each such Holder has requested to be
registered; provided, however, if the Company is unable to obtain the consent,
if required, of the holders of registration rights associated with the Company's
Class A Preferred Stock to include Registrable Securities in any Company
Registration prior to _____________, 2002 first anniversary of the Initial
Closing, the Holders of Registrable Securities shall receive the right to
request one Demand Registration prior to _____________, 2002 first anniversary
of the Initial Closing, in addition to any Demand Registrations provided by
Section 1.2(d)(i).

         1.4 Obligations of the Company. Whenever required under this Section 1
to effect the

<PAGE>

registration of any Registrable Securities, the Company shall, as expeditiously
as reasonably possible:

                  (a) Prepare and file with the SEC a registration statement
with respect to such Registrable Securities and use its best efforts to cause
such registration statement to become effective, and, upon the request of the
Holders of a majority of the Registrable Securities registered thereunder, keep
such registration statement effective for a period of up to one hundred eighty
(180) days or until the distribution contemplated in the Registration Statement
has been completed; provided, however, that (i) such 180-day period shall be
extended for a period of time equal to the period the Holder refrains from
selling any securities included in such registration at the request of an
underwriter of Common Stock (or other securities) of the Company included in
such Registration Statement; and (ii) 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 180-day period shall be extended, if
necessary, to keep the registration statement effective until all such
Registrable Securities are sold, provided that Rule 415, or any successor rule
under the Act, permits an offering on a continuous or delayed basis, and
provided further that applicable rules under the Act governing the obligation to
file a post-effective amendment permit, in lieu of filing a post-effective
amendment which (I) includes any prospectus required by Section 10(a)(3) of the
Act or (II) 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 (I) and
(II) above to be contained in periodic reports filed pursuant to Section 13 or
15(d) of the 1934 Act in the registration statement. Notwithstanding the above,
the Company shall not be required to keep the registration statement effective
beyond 270 days, or such earlier time as all such Registrable Securities may be
sold to the public without restriction under Rule 144(k) of the Act.

                  (b) Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement as may be necessary to comply with the
provisions of the Act with respect to the disposition of all securities covered
by such registration statement.

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

                  (d) Use its best efforts to register and qualify the
securities covered by such registration statement under such other securities or
Blue Sky laws of such jurisdictions as shall be reasonably requested by the
Holders; provided that the Company shall not be required in connection therewith
or as a condition thereto to qualify to do business or to file a general consent
to service of process in any such states or jurisdictions, unless the Company is
already subject to service in such jurisdiction and except as may be required by
the Act.

                  (e) In the event of any underwritten public offering, enter
into and perform its obligations under an underwriting agreement, in usual and
customary form, with the managing underwriter of such offering. Each Holder
participating in such underwriting shall also enter into and perform its
obligations under such an agreement.

                  (f) Notify each Holder of Registrable Securities covered by
such registration statement at any time when a prospectus relating thereto is
required to be delivered under the Act of the happening of any event as a result
of which the prospectus included in such registration statement, as then in
effect, includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances then existing.

<PAGE>

                  (g) Cause all such Registrable Securities registered pursuant
hereunder to be listed on each securities exchange on which similar securities
issued by the Company are then listed or, alternatively, included in each
national quotation system in which similar securities issued by the Company are
then included.

                  (h) Provide a transfer agent and registrar for all Registrable
Securities registered pursuant hereunder and a CUSIP number for all such
Registrable Securities, in each case not later than the effective date of such
registration.

                  (i) Furnish, at the request of any Holder requesting
registration of Registrable Securities in an underwritten offering pursuant to
this Section 1, on the date that such Registrable Securities are delivered to
the underwriters for sale in connection with such registration, (i) an opinion,
dated 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, addressed to the underwriters and to the
Holders requesting registration of Registrable Securities and (ii) a letter
dated 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, addressed
to the underwriters and to the Holders requesting registration of Registrable
Securities.

         1.5      Furnish Information.

                  (a) It shall be a condition precedent to the obligations of
the Company to take any action pursuant to this Section 1 with respect to the
Registrable Securities of any selling Holder that such Holder shall furnish to
the Company such information regarding itself, the Registrable Securities held
by it, and the intended method of disposition of such securities as shall be
required to effect the registration of such Holder's Registrable Securities.

                  (b) The Company shall have no obligation with respect to any
registration requested pursuant to Section 1.2 if, due to the operation of
subsection 1.5(a), the number of shares or the anticipated aggregate offering
price of the Registrable Securities to be included in the registration does not
equal or exceed the number of shares required to originally trigger the
Company's obligation to initiate such registration as specified in subsection
1.2(a).

         1.6 Expenses of Demand Registration. All expenses other than
underwriting discounts and commissions incurred in connection with
registrations, filings or qualifications pursuant to Section 1.2, including
(without limitation) all registration, filing and qualification fees, printers'
and accounting fees, fees and disbursements of counsel for the Company
(including fees and disbursements of counsel for the Company in its capacity as
counsel to the selling Holders hereunder; if Company counsel does not make
itself available for this purpose, the Company will pay the reasonable fees and
disbursements of one counsel for the selling Holders) and the reasonable fees
and disbursements of one counsel for the selling Holders shall be borne by the
Company; provided, however, that the Company shall not be required to pay for
any expenses of any registration proceeding begun pursuant to Section 1.2 if the
registration request is subsequently withdrawn at the request of the Holders of
a majority of the Registrable Securities to be registered (in which case all
participating holders shall bear such expenses), unless the Holders of a
majority of the Registrable Securities agree to forfeit their right to one
demand registration pursuant to Section 1.2; provided further, however, that if
at the time of such withdrawal, the Holders have learned of a material adverse
change in the condition, business, or prospects of the Company from that known
to the Holders at the time of their request and have withdrawn the request with
reasonable promptness following disclosure by the Company of such material
adverse change, then the Holders shall not be required to pay any of such
expenses and shall retain their rights pursuant to Section 1.2. For

<PAGE>

purposes of this section, the Company's failure to complete a transaction with
Creative Friction will not be considered a material adverse change.

         1.7 Expenses of Company Registration. The Company shall bear and pay
all expenses incurred in connection with any registration, filing or
qualification of Registrable Securities with respect to the registrations
pursuant to Section 1.3 for each Holder (which right may be assigned as provided
in Section 1.12), including (without limitation) all registration, filing, and
qualification fees, printers and accounting fees relating or apportionable
thereto and the fees and disbursements of counsel for the Company in its
capacity as counsel to the selling Holders hereunder; if Company counsel does
not make itself available for this purpose after reasonable notice, the Company
will pay the reasonable fees and disbursements of one counsel for the selling
Holders selected by them, but excluding underwriting discounts and commissions
relating to Registrable Securities.

         1.8 Underwriting Requirements. In connection with any offering
involving an underwriting of shares of the Company's capital stock, the Company
shall not be required under Section 1.3 to include any of the Holders'
securities in such underwriting unless they accept the terms of the underwriting
as agreed upon between the Company and the underwriters selected by it (or by
other persons entitled to select the underwriters), and then only in such
quantity as the underwriters determine in their sole discretion will not,
jeopardize the success of the offering by the Company. If a Company Registration
is an underwritten registration on behalf of the Company, and the managing
underwriter or underwriters advise the Company in writing that, in its or their
opinion ,the number of securities requested to be included in such registration
exceeds the number that can be sold without having an adverse effect on the
price, timing, or distribution of such offering, then Company shall include in
such registration its securities in the following order of priority: (a) first,
one hundred percent (100%) of the securities that the Company proposes to sell
for its own account or for the account of other Persons; and (b) second, the
Registrable Securities requested to be included in such registration pursuant to
Section 1.3 together with all other securities eligible for inclusion in such
registration pro rata among the respective holders thereof on the basis of the
number of Registrable Securities and other securities, as applicable, owned by
the holders thereof; provided, however, that all of the securities referenced in
clause (a) have been included. The Registrable Securities shall be included in
any over allotment option granted to the underwriter on a pro rata basis with
other selling stockholders and prior to inclusion of any shares to be sold by
the Company. For purposes of clause (b) above concerning apportionment, for any
selling shareholder which is a holder of Registrable Securities and which is a
partnership or corporation, the partners, retired partners and shareholders of
such holder, or the estates and family members of any such partners and retired
partners and any trusts for the benefit of any of the foregoing persons shall be
deemed to be a single "selling shareholder", and any pro-rata reduction with
respect to such "selling shareholder" shall be based upon the aggregate amount
of shares carrying registration rights owned by all entities and individuals
included in such "selling shareholder", as defined in this sentence.

         1.9 Delay of Registration. No Holder shall have any right to obtain or
seek an injunction restraining or otherwise delaying any such registration as
the result of any controversy that might arise with respect to the
interpretation or implementation of this Section 1.

         1.10 Indemnification. In the event any Registrable Securities are
included in a registration statement under this Section 1:

                  (a) To the extent permitted by law, the Company will indemnify
and hold harmless each Holder, any underwriter (as defined in the Act) for such
Holder and each person, if any, who controls such Holder or underwriter within
the meaning of the Act or the 1934 Act, against any losses, claims, damages, or
liabilities (joint or several) to which they may become subject under the Act,
or the 1934 Act or other federal or state law, insofar as such losses, claims,
damages, or liabilities (or actions in

<PAGE>

respect thereof) arise out of or are based upon any of the following statements,
omissions or violations (collectively a "Violation"): (i) any untrue statement
or alleged untrue statement of a material fact contained in such registration
statement, including any preliminary prospectus or final prospectus contained
therein or any amendments or supplements thereto, or (ii) 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 (iii) any
violation or alleged violation by the Company of the Act, the 1934 Act, any
state securities law or any rule or regulation promulgated under the Act, or the
1934 Act or any state securities law; and the Company will pay to each such
Holder, underwriter or controlling person, as incurred, any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability, or action; provided, however,
that the indemnity agreement contained in this subsection 1.10(a) shall not
apply to amounts paid in settlement of any such loss, claim, damage, liability,
or action if such settlement is effected without the consent of the Company
(which consent shall not be unreasonably withheld), nor shall the Company be
liable in any such case for any such loss, claim, damage, liability, or action
to the extent that it arises out of or is based upon a Violation which occurs in
reliance upon and in conformity with written information furnished expressly for
use in connection with such registration by any such Holder, underwriter or
controlling person.

                  (b) To the extent permitted by law, each selling Holder will
indemnify and hold harmless the Company, each of its directors, each of its
officers who has signed the registration statement, each person, if any, who
controls the Company within the meaning of the Act, any underwriter, any other
Holder selling securities in such registration statement and any controlling
person of any such underwriter or other Holder, against any losses, claims,
damages, or liabilities (joint or several) to which any of the foregoing persons
may become subject, under the Act, or the 1934 Act or other federal or state
law, insofar as such losses, claims, damages, or liabilities (or actions in
respect thereto) arise out of or are based upon any Violation, in each case to
the extent (and only to the extent) that such Violation occurs in reliance upon
and in conformity with written information furnished by such Holder expressly
for use in connection with such registration; and each such Holder will pay, as
incurred, any legal or other expenses reasonably incurred by any person intended
to be indemnified pursuant to this subsection 1.10(b), in connection with
investigating or defending any such loss, claim, damage, liability, or action;
provided, however, that the indemnity agreement contained in this subsection
1.10(b) shall not apply to amounts paid in settlement of any such loss, claim,
damage, liability or action if such settlement is effected without the consent
of the Holder, which consent shall not be unreasonably withheld; provided, that,
in no event shall any indemnity under this subsection 1.10(b) exceed the gross
proceeds from the offering received by such Holder.

                  (c) Promptly after receipt by an indemnified party under this
Section 1.10 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section 1.10, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party
(together with all other indemnified parties which may be represented without
conflict by one counsel) shall have the right to retain one separate counsel,
with the fees and expenses to be paid by the indemnifying party if
representation of such indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual or potential differing
interests between such indemnified party and any other party represented by the
counsel retained by the indemnifying party in such proceeding. The failure to
deliver written notice to the indemnifying party within a reasonable time of the
commencement of any such action, if prejudicial to its ability to defend such
action, shall relieve such indemnifying party of any liability to the
indemnified party under this Section 1.10, but the omission so to deliver
written notice to the indemnifying party will not relieve it of any liability
that it may have to any indemnified party otherwise

<PAGE>

than under this Section 1.10.

                  (d) If the indemnification provided for in this Section 1.10
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 hereunder, 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 in
connection with the statements or omissions that resulted in such loss,
liability, claim, damage, or expense 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 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.

                  (e) Notwithstanding the foregoing, to the extent that the
provisions on indemnification and contribution contained in the underwriting
agreement entered into in connection with the underwritten public offering are
in conflict with the foregoing provisions, the provisions in the underwriting
agreement shall control.

                  (f) The obligations of the Company and Holders under this
Section 1.10 shall survive the completion of any offering of Registrable
Securities in a registration statement under this Section 1, and otherwise.

         1.11 Reports Under Securities Exchange Act of 1934. With a view to
making available to the Holders the benefits of Rule 144 promulgated under the
Act and any other rule or regulation of the SEC that may at any time permit a
Holder to sell securities of the Company to the public without registration or
pursuant to a registration on Form S-3, the Company agrees to use its best
efforts to:

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

                  (b) take such action as is necessary to enable the Holders to
utilize Form S-3 for the sale of their Registrable Securities;

                  (c) file with the SEC in a timely manner all reports and other
documents required of the Company under the Act and the 1934 Act; and

                  (d) take such further action as a majority of the holders of
the Registrable Securities may reasonably request, to the extent required to
enable such holders to sell Registrable Securities pursuant to: (a) Rule 144 and
144A adopted by the Securities and Exchange Commission under the Act (as such
rules may be amended from time to time) or any similar rules or regulations
hereafter adopted by the Securities and Exchange Commission; or (b) a
registration statement on Form S-2 or S-3 (if the Company is then able to use
such form) or any similar registration form hereafter adopted by the Securities
and Exchange Commission. Upon the request of the majority of the holders of the
Registrable Securities, the Company shall promptly supply such holders or its
respective prospective transferees with all information regarding the Company
required to be delivered in connection with a transfer pursuant to Rule 144A
under the Securities Act (or any similar provision then in force).

         1.12 Assignment of Registration Rights. The rights to cause the Company
to register

<PAGE>

Registrable Securities pursuant to this Section 1 may be assigned (but only with
all related obligations) by a Holder to a transferee or assignee of such
securities who, after such assignment or transfer, holds at least 10% of the
shares of Registrable Securities (subject to appropriate adjustment for stock
splits, stock dividends, combinations and other recapitalizations), provided:
(a) the Company is, within a reasonable time after such transfer, furnished with
written notice of the name and address of such transferee or assignee and the
securities with respect to which such registration tights are being assigned;
(b)such transferee or assignee agrees in writing to be bound by and subject to
the terms and conditions of this Agreement, including without limitation the
provisions of Section 1.14 below; and (c) such assignment shall be effective
only if immediately following such transfer the further disposition of such
securities by the transferee or assignee is restricted under the Act. For the
purposes of determining the number of shares of Registrable Securities held by a
transferee or assignee, the holdings of transferees and assignees of a
partnership who are partners or retired partners of such partnership (including
spouses and ancestors, lineal descendants and siblings of such partners or
spouses who acquire Registrable Securities by gift, will or intestate
succession) shall be aggregated together and with the partnership; provided that
all assignees and transferees who would not qualify individually for assignment
of registration rights shall have a single attorney-in-fact for the purpose of
exercising any rights, receiving notices or taking any action under this Section
1.

         1.13 Limitations on Subsequent Registration Rights. From and after the
date of this Agreement, the Company shall not, without the prior written consent
of the Holders of a majority of the outstanding Registrable Securities, enter
into any agreement with any holder or prospective holder of any securities of
the Company which would allow such holder or prospective holder (a) to include
such securities in any registration filed under Section 1.2 hereof, unless under
the terms of such agreement, such holder or prospective holder may include such
securities in any such registration only to the extent that the inclusion of his
securities will not reduce the amount of the Registrable Securities of the
Holders which is included or (b) to make a demand registration which could
result in such registration statement being declared effective prior to the
earlier of either of the dates set forth in subsection 1.2(a) or within one
hundred twenty (120) days of the effective date of any registration effected
pursuant to Section 1.2.

         1.14 "Market Stand-Off" Agreement. The Representative hereby agrees
that, during the period of duration specified by the Company and an underwriter
of common stock or other securities of the Company, following the effective date
of a registration statement of the Company filed under the Act, it shall not, to
the extent requested by the Company and such underwriter, directly or indirectly
sell, offer to sell, contract to sell (including, without limitation, any short
sale), grant any option to purchase or otherwise transfer or dispose of (other
than to donees who agree to be similarly bound) any securities of the Company
held by it at any time during such period except common stock included in such
registration; provided, however, that:

                  (a) all officers and directors of the Company and all other
persons with registration rights (whether or not pursuant to this Agreement)
enter into similar agreements; and

                  (b) such market stand-off time period shall not exceed 180
days.

                  In order to enforce the foregoing covenant, the Company may
impose stop-transfer instructions with respect to the Registrable Securities of
the Representative (and the shares or securities of every other person subject
to the foregoing restriction) until the end of such period.

                  Notwithstanding the foregoing, the obligations described in
this Section 1.14 shall not apply to a registration relating solely to employee
benefit plans on Form S-1 or Form S-8 or similar forms which may be promulgated
in the future, or a registration relating solely to a Commission Rule 145
transaction on Form S-4 or similar form which may be promulgated in the future.

<PAGE>
         1.15 Termination of Registration Rights. No Holder shall be entitled to
exercise any right provided for in this Section 1 after the fourth anniversary
following the Initial Closing (as defined in the Placement Agreement) of the
sale of securities pursuant to Private Placement contemplated by the Placement
Agreement.

2.       Miscellaneous.

         2.1 Successors and Assigns. Except as otherwise provided herein, the
terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties (including
transferees of any shares of Registrable Securities). Nothing in this Agreement,
express or implied, is intended to confer upon any party other than the parties
hereto or their respective successors and assigns any rights, remedies,
obligations, or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement.

         2.2 Governing Law. This Agreement shall be governed by and construed
under the laws of the State of Illinois.

         2.3 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

         2.4 Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.

         2.5 Notices. Unless otherwise provided, any notice required or
permitted under this Agreement shall be given in writing and shall be deemed
effectively given upon personal delivery to the party to be notified or upon
deposit with the United States Post Office, by registered or certified mail,
postage prepaid and addressed to the party to be notified at the address
indicated for such party on the signature page hereof, or at such other address
as such party may designate by ten (10) days' advance written notice to the
other parties.

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

         2.7 Amendments and Waivers. Any term of this Agreement may be amended
and the observance of any term of this Agreement may be waived (either generally
or in a particular instance and either retroactively or prospectively), only
with the written consent of the Company and the holders of a majority of the
Registrable Securities then outstanding. Any amendment or waiver effected in
accordance with this paragraph shall be binding upon each holder of any
Registrable Securities then outstanding, each future holder of all such
Registrable Securities, and the Company.

         2.8 Severability. If one or more provisions of this Agreement are held
to be unenforceable under applicable law, such provision shall be excluded from
this Agreement and the balance of the Agreement shall be interpreted as if such
provision were so excluded and shall be enforceable in accordance with its
terms.

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

                                          Universal Automotive Industries, Inc.

                                          By:
                                             ----------------------------------
                                             Title:
                                                   ----------------------------

                                          SBI E 2-Capital (HK) Limited

                                          By:
                                             ----------------------------------
                                             Title:
                                                   ----------------------------

                                          vFinance Investments, Inc.

                                          By:
                                             ----------------------------------
                                             Title:
                                                   ----------------------------

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