EXHIBIT C

                         REGISTRATION RIGHTS AGREEMENT


          This  Registration  Rights Agreement (this  "Agreement") is made as of
March 23,  2000,  by and  between  Sales  Online  Direct,  Inc.,  a  corporation
organized  under the laws of the State of Delaware,  U.S.A.,  with  headquarters
located at 4 Brussels Street, Worcester, Massachusetts 01610 (the "Company") and
Augustine Fund,  L.P., an Illinois  limited  partnership  with its  headquarters
located at 141 West Jackson Boulevard,  Suite 2181, Chicago, Illinois 60604 (the
"Purchaser").

          This  Agreement  is being  entered  into  pursuant to that  Securities
Purchase Agreement,  dated as of the date hereof, by and between the Company and
the Purchaser (the "Purchase Agreement").

          The Company and the Purchaser hereby agree as follows:

     1.   Definitions.

          Capitalized terms used and not otherwise defined herein shall
have the meanings  given such terms in the Purchase  Agreement.  As used in this
Agreement, the following terms shall have the following meanings:

          "Advice" shall have the meaning set forth in Section 3(m).

          "Affiliate"  means, with respect to any Person,  any other Person that
directly or indirectly controls or is controlled by or under common control with
such Person.  For the  purposes of this  definition,  "control,"  when used with
respect to any Person, means the possession, direct or indirect, of the power to
direct or cause the  direction  of the  management  and policies of such Person,
whether  through the ownership of voting  securities,  by contract or otherwise;
and the terms of  "affiliated,"  "controlling"  and  "controlled"  have meanings
correlative to the foregoing.

          "Blackout Period" shall have the meaning set forth in Section 3(n).

          "Board"  shall have the meaning set forth in Section  3(n).

          "Business Day" means any day except Saturday,  Sunday and any day that
shall be a legal holiday or a day on which banking  institutions in the state of
New York generally are authorized or required by law or other government actions
to close.

          "Commission" means the Securities and Exchange Commission.

          "Common Stock" means the Company's  Common Stock,  $.001 par value per
share.

          "Effectiveness Date" means with respect to the Registration  Statement
September 30, 2000.

<PAGE>


          "Effectiveness  Period"  shall have the  meaning  set forth in Section
2(a).

          "Event" shall have the meaning set forth in Section 7(e)(i).

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

          "Filing Date" means the 180th day following the Closing Date.

          "Holder" or "Holders" means the holder or holders, as the case may be,
from time to time of Registrable Securities.  "Indemnified Party" shall have the
meaning set forth in Section 5(c).

          "Indemnifying Party" shall have the meaning set forth in Section 5(c).

          "Losses" shall have the meaning set forth in Section 5(a).

          "Note" or "Notes"  means the Series A Eight  Percent (8%)  Convertible
Notes of the  Company,  the form of which is shown as Exhibit A to the  Purchase
Agreement,  issued or to be issued to the  Purchaser  pursuant  to the  Purchase
Agreement.

          "OTC  Bulletin  Board"  shall  mean  the  over-the-counter  electronic
bulletin board market or exchange.

          "Person"  means an individual or a  corporation,  partnership,  trust,
incorporated or  unincorporated  association,  joint venture,  limited liability
company, joint stock company,  government (or an agency or political subdivision
thereof) or other entity of any kind.

          "Proceeding" means an action, claim, suit, investigation or proceeding
(including,  without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced or threatened.

          "Prospectus"  means  the  prospectus   included  in  the  Registration
Statement  (including,  without  limitation,  a  prospectus  that  includes  any
information  previously  omitted from a prospectus filed as part of an effective
registration  statement  in  reliance  upon  Rule  430A  promulgated  under  the
Securities Act), as amended or supplemented by any prospectus  supplement,  with
respect  to  the  terms  of  the  offering  of any  portion  of the  Registrable
Securities covered by the Registration  Statement,  and all other amendments and
supplements to the  Prospectus,  including  post-effective  amendments,  and all
material incorporated by reference in such Prospectus.

          "Registrable Securities" means (i) the shares of Common Stock issuable
upon conversion of the Note (the "Conversion  Shares") or in payment of interest
in accordance  with the terms of the Note ("Interest  Shares"),  and exercise of
the Warrants (the "Warrant  Shares"),  and upon any stock split, stock dividend,
recapitalization  or similar  event  with  respect  to such  Conversion  Shares,
Interest  Shares,  Warrant  Shares or any Note,  (ii) the shares of Common

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<PAGE>

Stock issued upon any  redemption  of a Note  pursuant to the terms of the Notes
and (iii) any other dividend or other  distribution  with respect to, conversion
or exchange of, or in replacement of, Registrable Securities; provided, however,
that  Registrable  Securities  shall include (but not be limited to) a number of
shares of Common Stock (the "Required Number") equal to no less than the greater
of (x) 2,000,000  shares of Common Stock,  or (y) 200% of the maximum  number of
shares of Common Stock which would be issuable  upon  conversion  of the Not and
upon exercise of the Warrants, assuming such conversion and exercise occurred on
the Closing Date or the Filing Date,  whichever date would result in the greater
number of Registrable Securities.  Notwithstanding  anything contained herein to
the  contrary,  if the actual  number of shares of Common  Stock  issuable  upon
conversion  of the Note and upon  exercise of the Warrants  exceeds the Required
Number,  the term  "Registrable  Securities"  shall be  deemed to  include  such
additional  shares of Common  Stock as ar necessary to include all of the shares
of Common Stock issuable upon conversion of the Note, in payment of Interest (if
applicable) and upon exercise of the Warrants.

          "Registration  Statement"  means the  registration  statements and any
additional  registration  statements contemplated by Section 2(a), including (in
each case) the  Prospectus,  amendments  and  supplements  to such  registration
statement or  Prospectus,  including  pre- and  post-effective  amendments,  all
exhibits   thereto,   and  all  material   incorporated  by  reference  in  such
registration statement.

          "Rule 144" means Rule 144  promulgated by the  Commission  pursuant to
the  Securities  Act,  as such Rule may be  amended  from  time to time,  or any
similar  rule  or  regulation   hereafter   adopted  by  the  Commission  having
substantially the same effect as such Rule.

          "Rule 158" means Rule 158  promulgated by the  Commission  pursuant to
the  Securities  Act,  as such Rule may be  amended  from  time to time,  or any
similar  rule  or  regulation   hereafter   adopted  by  the  Commission  having
substantially the same effect as such Rule.

          "Rule 415" means Rule 415  promulgated by the  Commission  pursuant to
the  Securities  Act,  as such Rule may be  amended  from  time to time,  or any
similar  rule  or  regulation   hereafter   adopted  by  the  Commission  having
substantially the same effect as such Rule.

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

     2.   Registration.

          (a) Required Registration.  On or prior to the Filing Date the Company
shall prepare and file with the Commission a Registration Statement covering all
Registrable Securities for an offering to be made on a continuous basis pursuant
to Rule 415.  The  Registration  Statement  shall be on Form S-3  (except if the
Company is not then eligible to register for resale the  Registrable  Securities
on Form S-3,  in which case such  registration  shall be on another  appropriate
form in  accordance  herewith).  The Company shall use its best efforts to cause
the Registration  Statement to be declared effective under the Securities Act as
promptly as  possible  after the filing  thereof,  but in any event prior to the
Effectiveness  Date,  and  to  keep  such  Registration  Statement  continuously
effective  under the Securities Act until such date as is the earlier of (x) the
date when all Registrable Securities covered by such Registration Statement

                                      3

<PAGE>

have been sold or (y) the date on which the  Registrable  Securitie  may be sold
without any restriction  pursuant to Rule 144(k) as determined by the counsel to
the Company  pursuant to a written  opinion  letter,  addressed to the Company's
transfer  agent to such effect (the  "Effectiveness  Period").  If an additional
Registration  Statement  is  required to be filed  because the actual  number of
shares of Common Stock into which the Note is  convertible  and the Warrants are
exercisable exceeds the number of shares of Common Stock initially registered in
respect of the  Conversion  Shares,  the Interest  Shares and the Warrant Shares
based upon the  computation  on the Closing Date,  the Company shall have twenty
(20)  Business  Days to file such  additional  Registration  Statement,  and the
Company  shall  use its best  efforts  to  cause  such  additional  Registration
Statement to be declared effective by the Commission as soon as possible, but in
no event later than ninety (90) days after filing.

          (b) Shelf  Registration.  If the  Company  is not on the  Filing  Date
eligible to file a registration  statement on Form S-3, then as soon as possible
but  no  later  than  thirty  (30)  days  after  becoming  eligible  to  file  a
registration  statement  for a secondary or resale  offering of the  Registrable
Securities on Form S-3, the Company shall prepare and file with the Commission a
post-effective  amendment to Form SB-2 (or such other  applicable  form filed in
accordance with Section 2(a) above) on Form S-3 to continue the  registration of
all Registrable  Securities pursuant to a "shelf" Registration Statement on Form
S-3  covering  all  Registrable  Securities  for an  offering  to be  made  on a
continuous basis pursuant to Rule 415.  Notwithstanding anything to the contrary
contained herein,  at no time during the  Effectiveness  Period shall any of the
Registrable Securities cease being registered.

     3.   Registration Procedures.

          In connection with the Company's  registration  obligations hereunder,
the Company shall:

          (a)  Prepare  and file with the  Commission  on or prior to the Filing
Date,  a  Registration  Statement  on Form  S-3 (or if the  Company  is not then
eligible  to register  for resale the  Registrable  Securities  on Form S-3 such
registration  shall be on another  appropriate  form in accordance  herewith) in
accordance  with the method or methods of  distribution  thereof as specified by
the  Holder  (except  if  otherwise  directed  by the  Holder),  and  cause  the
Registration  Statement  to become  effective  and remain  effective as provided
herein;  provided,  however,  that not less than five (5) Business Days prior to
the  filing of the  Registration  Statement  or any  related  Prospectus  or any
amendment  or  supplement   thereto   (including  any  document  that  would  be
incorporated therein by reference),  the Company shall (i) furnish to the Holder
and its  counsel,  copies of all such  documents  proposed  to be  filed,  which
documents  (other than those  incorporated  by reference) will be subject to the
review of the  Holder an its  counsel , and (ii) at the  request  of the  Holder
cause its officers  and  directors,  counsel and  independent  certified  public
accountants  to  respond  to  such  inquiries  as  shall  be  necessary,  in the
reasonable   opinion  of  counsel  to  such  Holder,  to  conduct  a  reasonable
investigation  within the meaning of the  Securities  Act. The Company shall not
file the  Registration  Statement or any such  Prospectus  or any  amendments or
supplements  thereto to which the Holder or its counsel shall reasonably  object
in writing within three (3) Business Days of their receipt thereof.

                                       4

<PAGE>


          (b)  (i)  Prepare  and  file  with  the  Commission  such  amendments,
including  post-effective  amendments,  to the Registration  Statement as may be
necessary to keep the Registration  Statement  continuously  effective as to the
applicable  Registrable  Securities for the Effectiveness Period and prepare and
file with the Commission  such  additional  Registration  Statements in order to
register for resale under the Securities Act all of the Registrable  Securities;
(ii) cause the related  Prospectus to be amended or supplemented by any required
Prospectus supplement, and as so supplemented or amended to be filed pursuant to
Rule  424 (or any  similar  provisions  then in  force)  promulgated  under  the
Securities  Act; (iii) respond as promptly as possible to any comments  received
from the Commission with respect to the Registration  Statement or any amendment
thereto and as promptly as possible  provide the Holder true and complete copies
of all  correspondence  from and to the Commission  relating to the Registration
Statement;  and (iv) comply in all material  respects with the provisions of the
Securities  Act and the  Exchange  Act with  respect to the  disposition  of all
Registrable   Securities  covered  by  the  Registration  Statement  during  the
applicable  period in accordance with the intended methods of disposition by the
Holder thereof set forth in the Registration  Statement as so amended or in such
Prospectus as so supplemented.

          (c)  Notify the Holder of  Registrable  Securities  to be sold and its
counsel as promptly as possible (and, in the case of (i)(A) below, not less than
five (5)  Business  Days prior to such  filing)  and (if  requested  by any such
Person)  confirm  such  notice in  writing no later  than one (1)  Business  Day
following  the day (i)(A) when a  Prospectus  or any  Prospectus  supplement  or
post-effective  amendment to the Registration Statement is proposed to be filed;
(B) when the Commission  notifies th Company whether there will be a "review" of
such Registration  Statement and whenever the Commission  comments in writing on
such Registration  Statement and (C) with respect to the Registration  Statement
or any post-effective amendment, when the same has become effective; (ii) of any
request by the Commission or any other Federal or state  governmental  authority
for amendments or supplements to the Registration Statement or Prospectus or for
additional  information;  (iii) of the  issuance by the  Commission  of any stop
order suspending the effectiveness of the Registration Statement covering any or
all of the Registrable  Securities or the initiation of any Proceedings for that
purpose;  (iv) if at any time any of the  representations  and warranties of the
Company  contained in any  agreement  contemplated  hereby ceases to be true and
correct in all  material  respects;  (v) of the  receipt  by the  Company of any
notification  with respect to the suspension of the  qualification  or exemption
from  qualification  of  any of  the  Registrable  Securities  for  sale  in any
jurisdiction,  or the  initiation  or  threatening  of any  Proceeding  for such
purpose;  and (vi) of the  occurrence of any event that makes any statement made
in the  Registration  Statement or  Prospectus or any document  incorporated  or
deemed to be incorporated therein by reference untrue in any material respect or
that requires any revisions to the Registration  Statement,  Prospectus or other
documents so that, in the case of the Registration  Statement or the Prospectus,
as the case may be, it will not contain any untrue  statement of a material fact
or omit to state any material fact required to be stated therein or necessary to
make the statements  therein, in the light of the circumstances under which they
were made, not misleading.

          (d) Use its best  efforts  to avoid the  issuance  of,  or, if issued,
obtain the withdrawal  of, (i) any order  suspending  the  effectiveness  of the
Registration Statement or (ii) any suspension of the qualification (or exemption
from  qualification)  of any of  the  Registrable  Securities  for  sale  in any
jurisdiction, at the earliest practicable moment.

                                       5

<PAGE>

          (e) If  requested  by the  Holders of a majority  in  interest  of the
Registrable  Securities,  (i) promptly incorporate in a Prospectus supplement or
post-effective  amendment to the Registration  Statement such information as the
Company  reasonably agrees should be included therein and (ii) make all required
filings of such Prospectus  supplement or such post-effective  amendment as soon
as practicable after the Company has received  notification of the matters to be
incorporated in such Prospectus supplement or post-effective amendment.

          (f) Furnish to the Holder and its counsel,  without  charge,  at least
one conformed copy of each  Registration  Statement and each amendment  thereto,
including  financial  statements and schedules,  all documents  incorporated  or
deemed to be incorporated  therein by reference,  and all exhibits to the extent
requested by such Person  (including those previously  furnished or incorporated
by reference) promptly after the filing of such documents with the Commission.

          (g) Promptly deliver to the Holder and its counsel, without charge, as
many  copies  of  the  Prospectus  or  Prospectuses   (including  each  form  of
prospectus)  and each  amendment  or  supplement  thereto  as such  Persons  may
reasonably  request;  and  the  Company  hereby  consents  to the  use  of  such
Prospectus  and each  amendment  or  supplement  thereto by each of the  selling
Holders in connection with the offering and sale of the  Registrable  Securities
covered by such Prospectus and any amendment or supplement thereto.

          (h) Prior to any public  offering of Registrable  Securities,  use its
best  efforts to register or qualify or cooperate  with the selling  Holders and
its counsel in connection with the registration or  qualification  (or exemption
from such  registration or  qualification)  of such  Registrable  Securities for
offer  and sale  under  the  securities  or Blue Sky laws of such  jurisdictions
within the United States as any Holder reasonably  requests in writing,  to keep
each such  registration  or  qualification  (or exemption  therefrom)  effective
during  the  Effectiveness  Period  and to do any and all  other  acts or things
necessary or advisable to enable the  disposition in such  jurisdictions  of the
Registrable Securities covered by a Registration Statement;  provided,  however,
that the Company  shall not be required to qualify  generally  to do business in
any  jurisdiction  where it is not then so  qualified or to take any action that
would subject it to general service of process in any such jurisdiction where it
is not then so subject or subject  the Company to any  material  tax in any such
jurisdiction where it is not then so subject.

          (i) Cooperate with the Holder to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be sold pursuant
to a Registration Statement, which certificates shall be free of all restrictive
legends,  and to enable such Registrable  Securities to be in such denominations
and registered in such names as any Holder may request at least two (2) Business
Days prior to any sale of Registrable Securities.

          (j) Upon the occurrence of any event contemplated by Section 3(c)(vi),
as  promptly  as  possible,  prepare a  supplement  or  amendment,  including  a
post-effective  amendment,  to the Registration Statement or a supplement to the
related  Prospectus or any document  incorporated  or deemed to be  incorporated
therein  by  reference,  and file  any  other  required  document  so  that,  as
thereafter  delivered,  neither the  Registration  Statement nor such Prospectus
will contain an untrue  statement of a material fact or omit to state a material
fact

                                       6

<PAGE>

required to be stated therein or necessary to make the statements  therein,
in the light of the circumstances under which they were made, not misleading.

          (k) Use its best efforts to cause all Registrable  Securities relating
to such  Registration  Statement to be listed on the OTC Bulletin  Board and any
other securities exchange, quotation system, market or over-the-counter bulletin
board, if any, on which similar securities issued by the Company are then listed
as and when required pursuant to the Purchase Agreement.

          (l) Comply in all  material  respects  with all  applicable  rules and
regulations  of the  Commission  and make  generally  available  to its security
holders  earning  statements  satisfying  the provisions of Section 11(a) of the
Securities Act and Rule 158 not later than 45 days after the end of any 12-month
period  (or 90 days  after the end of any  12-month  period if such  period is a
fiscal  year)  commencing  on the first day of the first  fiscal  quarter of the
Company after the effective date of the Registration Statement,  which statement
shall conform to the requirements of Rule 158.

          (m) Require each selling Holder to furnish to the Company  information
regarding such Holder and the distribution of such Registrable  Securities as is
required by law to be disclosed in the Registration  Statement,  and the Company
may exclude from such registration the Registrable Securities of any such Holder
who fails to furnish  such  information  within a  reasonable  time prior to the
filing of each Registration  Statement,  supplemented  Prospectus and/or amended
Registration Statement.

          If  the  Registration  Statement  refers  to any  Holder  by  name  or
otherwise as the holder of any securities of the Company, then such Holder shall
have the right to require (if such reference to such Holder by name or otherwise
is not required by the  Securities  Act or any similar  federal  statute then in
force)  the  deletion  of the  reference  to such  Holder  in any  amendment  or
supplement to the  Registration  Statement  filed or prepared  subsequent to the
time that such reference ceases to be
required.

          Each  Holder  covenants  and  agrees  that  (i) it will  not  sell any
Registrable  Securities under the  Registration  Statement until it has received
copies of the  Prospectus as then amended or  supplemented  as  contemplated  in
Section 3(g) and notice from the Company that such  Registration  Statement  and
any  post-effective  amendments thereto have become effective as contemplated by
Section 3(c) and (ii) it and its officers, directors or Affiliates, if any, will
comply  with the  prospectus  delivery  requirements  of the  Securities  Act as
applicable to them in connection with sales of Registrable  Securities  pursuant
to the Registration Statement.

          Each Holder agrees by its acquisition of such  Registrable  Securities
that,  upon receipt of a notice from the Company of the  occurrence of any event
of the kind  described  in Section  3(c)(ii),  3(c)(iii),  3(c)(iv),  3(c)(v) or
3(c)(vi), such Holder will forthwith discontinue disposition of such Registrable
Securities under the  Registration  Statement until such Holder's receipt of the
copies of the  supplemented  Prospectus  and/or amended  Registration  Statement
contemplated  by Section 3(j), or until it is advised in writing (the  "Advice")
by the Company that the use of the applicable Prospectus may be resumed, and, in
either case, has received copies of any additional or supplemental  filings that
are incorporated or deemed to be incorporated by reference in such Prospectus or
Registration Statement.

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<PAGE>

          (n) If (i) there is  material  non-public  information  regarding  the
Company  which  the  Company's  Board  of  Directors  (the  "Board")  reasonably
determines  not to be in the  Company's  best interest to disclose and which the
Company is not  otherwise  required to disclose,  or (ii) there is a significant
business  opportunity  (including,  but  not  limited  to,  the  acquisition  or
disposition  of assets  (other than in the  ordinary  course of business) or any
merger,  consolidation,  tender offer or other similar transaction) available to
the Company  which the Board  reasonably  determines  not to be in the Company's
best  interest to disclose  and which the Company  would be required to disclose
under the  Registration  Statement,  then the  Company  may  postpone or suspend
filing or effectiveness  of a registration  statement for a period not to exceed
20 consecutive  days,  provided that the Company may not postpone or suspend its
obligation under this Section 3(n) for more than 45 days in the aggregate during
any 12 month period (each, a "Blackout Period"); provided, however, that no such
postponement  or suspension  shall be permitted for  consecutive 20 day periods,
arising out of the same set of facts, circumstances or transactions.

     4.   Registration Expenses

          All fees and expenses  incident to the  performance  of or  compliance
with this Agreement by the Company shall be borne by the Company  whether or not
the Registration  Statement is filed or becomes effective and whether or not any
Registrable Securities are sold pursuant to the Registration Statement. The fees
and  expenses  referred to in the  foregoing  sentence  shall  include,  without
limitation, (i) all registration and filing fees (including, without limitation,
fees and expenses  (A) with respect to filings  required to be made with the OTC
Bulletin Board and each other securities exchange or market on which Registrable
Securities  are  required  hereunder  to be listed,  (B) with respect to filings
required to be made with the Commission, (C) with respect to filings required to
be made under the OTC Bulletin Board and (D) in compliance with state securities
or Blue Sky laws  (including,  without  limitation,  fees and  disbursements  of
counsel  for the  Holder  in  connection  with  Blue  Sky  qualification  of the
Registrable  Securities and  determination of the eligibility of the Registrable
Securities for investment under the laws of such jurisdictions as the Holders of
a majority of Registrable  Securities may  designate)),  (ii) printing  expenses
(including,   without   limitation,   expenses  of  printing   certificates  for
Registrable   Securities  and  of  printing  prospectuses  if  the  printing  of
prospectuses  is  requested  by the  holders  of a majority  of the  Registrable
Securities included in the Registration Statement),  (iii) messenger,  telephone
and delivery  expenses,  (iv) fees and disbursements of counsel for the Company,
(v)  Securities  Act  liability  insurance,  if  the  Company  so  desires  such
insurance,  and (vi) fees and  expenses  of all other  Persons  retained  by the
Company in connection with the consummation of the transactions  contemplated by
this Agreement,  including, without limitation, the Company's independent public
accountants  (including the expenses of any comfort letters or costs  associated
with the  delivery  b  independent  public  accountants  of a comfort  letter or
comfort letters).  In addition,  the Company shall be responsible for all of its
internal   expenses   incurred  in  connection  with  the  consummation  of  the
transactions contemplated by this Agreement (including,  without limitation, all
salaries  and  expenses  of its  officers  and  employees  performing  legal  or
accounting  duties),  the  expense of any annual  audit,  the fees and  expenses
incurred in  connection  with the listing of the  Registrable  Securities on any
securities exchange as required hereunder.

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<PAGE>


          5. Indemnification

          (a) Indemnification by the Company. The Company shall, notwithstanding
any termination of this Agreement,  indemnify and hold harmless each Holder, the
officers,  directors,  agents,  and  employees of each of them,  each Person who
controls any such Holder (within the meaning of Section 15 of the Securities Act
or Section  20 of the  Exchange  Act) and the  officers,  directors,  agents and
employees of each such  controlling  Person,  to the fullest extent permitted by
applicable  law,  from  and  against  any  and  all  losses,  claims,   damages,
liabilities,  costs  (including,  without  limitation,  costs of preparation and
attorneys' fees) and expenses (collectively, "Losses"), as incurred, arising out
of or  relating to any untrue or alleged  untrue  statement  of a material  fact
contained  in  the  Registration  Statement,  any  Prospectus  or  any  form  of
prospectus  or in any  amendment  or  supplement  thereto or in any  preliminary
prospectus, or arising out of or relating to any omission or alleged omission of
a  material  fact  required  to be  stated  therein  or  necessary  to make  the
statements  therein  (in the case of any  Prospectus  or form of  prospectus  or
supplement  thereto,  in the light of the  circumstances  under  which they were
made) not misleading,  except to the extent,  but only to the extent,  that such
untrue statements or omissions are based upon information  regarding such Holder
furnished  in writing to the Company by such Holder  expressly  for use therein,
which  information was reasonably relied on by the Company for use therein or to
the  extent  that such  information  relates  to such  Holder  or such  Holder's
proposed method of  distribution of Registrable  Securities and was reviewed and
expressly  approved  in  writing  by  such  Holder  expressly  for  use  in  the
Registration  Statement,  such  Prospectus  or such form of Prospectus or in any
amendment or supplement thereto. The Company shall notify the Holder promptly of
the  institution,  threat or assertion of any Proceeding of which the Company is
aware in connection with the transactions  contemplated by this Agreement.  Such
indemnity shall remain in full force and effect  regardless of any investigation
made by or on behalf of an  Indemnified  Party and shall survive the transfer of
the Registrable Securities by the Holder.

          (b) Indemnification by Holder. The Holders shall,  notwithstanding any
termination  of this  Agreement,  severally and not jointly,  indemnify and hold
harmless the Company, the directors, officers, agents and employees, each Person
who controls the Company (within the meaning of Section 15 of the Securities Act
and Section 20 of the Exchange  Act),  and the  directors,  officers,  agents or
employees  of such  controlling  Persons,  to the fullest  extent  permitted  by
applicable  law,  from and against all Losses,  as  incurred,  arising out of or
based upon any untrue statement of a material fact contained in the Registration
Statement, any Prospectus,  or any form of prospectus,  or arising solely out of
or based  solely  upon any  omission  of a material  fact  required to be stated
therein  or  necessary  to make  the  statements  therein  (in  the  case of any
Prospectus  or form of prospectus  or  supplement  thereto,  in the light of the
circumstances  under which they were made) not  misleading,  to the extent,  but
only to the extent,  that such untrue  statement  or omission is contained in or
omitted  from any  information  so  furnished  in writing by such  Holder to the
Company  specifically  for  inclusion  in the  Registration  Statement  or  such
Prospectus and that such  information was reasonably  relied upon by the Company
for  use  in the  Registration  Statement,  such  Prospectus  or  such  form  of
prospectus or to the extent that such information relates to such Holder or such
Holder's  proposed  method of  distribution  of  Registrable  Securities and was
reviewed and expressly  approved in writing by such Holder  expressly for use in
the  Registration  Statement,   such  Prospectus  or  such  form  of  Prospectus
Supplement.

                                       9

<PAGE>

          (c) Conduct of Indemnification Proceedings. If any Proceeding shall be
brought or asserted  against  any Person  entitled to  indemnity  hereunder  (an
"Indemnified  Party"),  such Indemnified  Party promptly shall notify the Person
from whom  indemnity  is sought (the  "Indemnifying  Party) in writing,  and the
Indemnifying Party shall assume the defense thereof, including the employment of
counsel reasonably  satisfactory to the Indemnified Party and the payment of all
fees and expenses incurre in connection with defense thereof; provided, that the
failure of any  Indemnified  Party to give such  notice  shall not  relieve  the
Indemnifying Party of its obligations or liabilities pursuant to this Agreement,
except (and only) to the extent that it shall be finally  determined  by a court
of  competent  jurisdiction  (which  determination  is not  subject to appeal or
further  review)  that  such  failure  shall  have  proximately  and  materially
adversely prejudiced the Indemnifying Party.

          An Indemnified  Party shall have the right to employ separate  counsel
in any such Proceeding and to participate in the defense  thereof,  but the fees
and expenses of such counsel shall be at the expense of such  Indemnified  Party
or Parties unless:  (1) the Indemnifying Party has agreed in writing to pay such
fees and expenses;  or (2) the Indemnifying  Party shall have failed promptly to
assume  the  defense  of  such  Proceeding  and  to  employ  counsel  reasonably
satisfactory to such Indemnified Party in any such Proceeding;  or (3) the named
parties to any such Proceeding  (including any impleaded  parties)  include both
such Indemnified  Party and the Indemnifying  Party, and such Indemnified  Party
shall have been  advised by counsel  that a conflict  of  interest  is likely to
exist if the same  counsel  were to  represent  such  Indemnified  Party and the
Indemnifying  Party (in which  case,  if such  Indemnified  Party  notifies  the
Indemnifying  Party in writing that it elects to employ separate  counsel at the
expense of the Indemnifying  Party,  the  Indemnifying  Party shall not have the
right to assume the defense  thereof and such counsel shall be at the expense of
the  Indemnifying  Party).  The  Indemnifying  Party shall not be liable for any
settlement of any such Proceeding  effected without its written  consent,  which
consent shall not be unreasonably withheld. No Indemnifying Party shall, without
the prior written consent of the Indemnified Party, effect any settlement of any
pending Proceeding in respect of which any Indemnified Party is a party,  unless
such settlement includes an unconditional release of such Indemnified Party from
all liability on claims that are the subject matter of such Proceeding.

          All fees and expenses of the Indemnified  Party (including  reasonable
fees and expenses to the extent  incurred in connection  with  investigating  or
preparing  to defend  such  Proceeding  in a manner not  inconsistent  with this
Section) shall be paid to the Indemnified  Party,  as incurred,  within ten (10)
Business Days of written notice thereof to the Indemnifying Party (regardless of
whether it is ultimately determined that an Indemnified Party is not entitled to
indemnification  hereunder;  provided,  that the Indemnifying  Party may require
such  Indemnified  Party to undertake to reimburse all such fees and expenses to
the extent it is finally  judicially  determined that such Indemnified  Party is
not entitled to indemnification hereunder).

          (d) Contribution. If a claim for indemnification under Section 5(a) or
5(b) is unavailable to an Indemnified Party because of a failure or refusal of a
governmental  authority to enforce such  indemnification  in accordance with its
terms (by reason of public policy or otherwise),  then each Indemnifying  Party,
in lieu of indemnifying such Indemnified  Party,  shall contribute to the amount
paid or payable by such Indemnified Party as a result of such Losses, in

                                       10

<PAGE>

such  proportion  as is  appropriate  to  reflect  the  relative  fault  of  the
Indemnifying  Party  and  Indemnified  Party in  connection  with  the  actions,
statements  or  omissions  that  resulted  in such  Losses  as well as any other
relevant equitable considerations. The relative fault of such Indemnifying Party
and  Indemnified  Party shall be determined by reference to, among other things,
whether any action in question, including any untrue or alleged untrue statement
of a material fact or omission or alleged  omission of a material fact, has been
taken or made by, or relates to  information  supplied  by,  such  Indemnifying,
Party or Indemnified Party, and the parties' relative intent, knowledge,  access
to information and  opportunity to correct or prevent such action,  statement or
omission.  The amount paid or payable by a party as a result of any Losses shall
be deemed to include,  subject to the limitations set forth in Section 5(c), any
reasonable  attorneys'  or other  reasonable  fees or expenses  incurred by such
party in connection with any Proceeding to the extent such party would have been
indemnified  for such fees or expenses if the  indemnification  provided  for in
this Section was available to such party in accordance with its terms.

          The parties  hereto  agree that it would not be just and  equitable if
contribution  pursuant  to  this  Section  5(d)  were  determined  by  pro  rata
allocation or by any other method of allocation  that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
No Person guilty of fraudulent  misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to  contribution  from any Person
who was not guilty of such fraudulent misrepresentation.

          The indemnity and  contribution  agreements  contained in this Section
are in addition to any liability that the  Indemnifying  Parties may have to the
Indemnified Parties

     6.   Rule 144.

          As long as any Holder owns Notes, Interest Shares,  Conversion Shares,
Warrants  or Warrant  Shares,  the Company  covenants  to timely file (or obtain
extensions in respect  thereof and file within the applicable  grace period) all
reports  required to be filed by the Company  after the date hereof  pursuant to
Section  13(a) or 15(d) of the Exchange  Act and to promptly  furnish the Holder
with true and complete  copies of all such  filings.  As long as any Holder owns
Notes,  Interest Shares,  Conversion Shares,  Warrants or Warrant Shares, if the
Company is not  required to file reports  pursuant to Section  13(a) or 15(d) of
the Exchange  Act, it will  prepare and furnish to the Holder and make  publicly
available in accordance  with Rule 144(c)  promulgated  under the Securities Act
annual and  quarterly  financial  statements,  together  with a  discussion  and
analysis  of such  financial  statements  in form  and  substance  substantially
similar to those that would  otherwise  be  required  to be  included  in report
required  by Section  13(a) or 15(d) of the  Exchange  Act, as well as any other
information  required  thereby,  in the time period that such filings would have
been  required to have been made under the  Exchange  Act.  The Company  further
covenants  that it will take such  further  action as any Holder may  reasonably
request,  all to the extent  required from time to time to enable such Person to
sell Interest Shares,  Conversion Shares and Warrant Shares without registration
under the Securities  Act within the  limitation of the  exemptions  provided by
Rule 144  promulgated  under the Securities Act,  including  providing any legal
opinions of counsel to the Company referred to in the Purchase  Agreement.  Upon
the request of any Holder,  the Company  shall  deliver to such Holder a written
certification  of a duly  authorized  officer as to whether it has complied with
such requirements.

                                       11

<PAGE>


     7.   Miscellaneous.

          (a) Remedies.  In the event of a breach by the Company or by a Holder,
of any of their obligations under this Agreement, each Holder or the Company, as
the case may be, in addition to being entitled to exercise all rights granted by
law and under this Agreement, including recovery of damages, will be entitled to
specific  performance of its rights under this  Agreement.  The Company and each
Holder agree that monetary damages would not provide  adequate  compensation for
any losses incurred by reason of a breach by it of any of the provisions of this
Agreement  and  hereby  further  agrees  that,  in the event of any  action  for
specific  performance in respect of such breach, it shall waive the defense that
a remedy at law would be adequate.

          (b) No  Inconsistent  Agreements.  Neither  the Company nor any of its
subsidiaries  has, as of the date hereof  entered into and  currently in effect,
nor shall the Company or any of its  subsidiaries,  on or after the date of this
Agreement,  enter into any  agreement  with  respect to its  securities  that is
inconsistent  with  the  rights  granted  to the  Holder  in this  Agreement  or
otherwise  conflicts with the provisions  hereof except for registration  rights
provisions  disclosed  in the  Company's  Disclosure  Schedule  to the  Purchase
Agreement.  Except for registration rights provisions disclosed in the Company's
Disclosure  Schedule to the Purchase  Agreement,  neither the Company nor any of
its subsidiaries has previously  entered into any agreement  currently in effect
granting any  registration  rights with respect to any of its  securities to any
Person.

          (c) [Intentionally Omitted.]

          (d)  Piggy-Back  Registrations.  If at any time  when  there is not an
effective  Registration  Statement  covering (i) Conversion  Shares and Interest
Shares or (ii) Warrant  Shares,  the Company shall determine to prepare and file
with the Commission a registration statement relating to an offering for its own
account or the account of others under the  Securities  Act of any of its equity
securities,  other than on Form S-4 or Form S-8 (each as  promulgated  under the
Securities  Act) or its the  equivalents  relating  to equity  securities  to be
issued solely in connection  with any  acquisition  of any entity or business or
equity  securities  issuable in connection  with stock option or other  employee
benefit plans,  the Company shall send to each holder of Registrable  Securities
written  notice of such  determination  and,  if within  thirty  (30) days after
receipt of such  notice,  any such  holder  shall so  request in writing  (which
request shall specify the Registrable  Securities  intended to be disposed of by
the Purchaser), the Company will cause the registration under the Securities Act
of all  Registrable  Securities  which  the  Company  has been so  requested  to
register by the holder, to the extent requisite to permit the disposition of the
Registrable  Securities so to be registered,  provided that if at any time after
giving  written  notice of its intention to register any securities and prior to
the effective date of the  registration  statement filed in connection with such
registration,  the Company shall  determine for any reason not to register or to
delay  registration of such securities,  the Company may, at its election,  give
written notice of such determination to such holder and,  thereupon,  (i) in the
case of a determination not to register,  shall be relieved of its obligation to
register any Registrable  Securities in connection with such  registration  (but
not from its  obligation to pay expenses in  accordance  with Section 4 hereof),
and (ii) in the case of a determination to delay

                                       12

<PAGE>

registering,  shall be permitted to delay registering any Registrable Securities
being registered  pursuant to this Section 7(d) for the same period as the delay
in  registering  such  other  securities.  The  Company  shall  include  in such
registration  statement  all or any  part of such  Registrable  Securities  such
holder requests to be registered;  provided, however, that the Company shall not
be required to register any Registrable Securities pursuant to this Section 7(d)
that are eligible for sale pursuant to Rule 144(k) of the Securities Act. In the
case of an  underwritten  public  offering,  if the managing  underwriter(s)  or
underwriter(s)  should  reasonably  object to the  inclusion of the  Registrable
Securities  in  such   registration   statement,   then  if  the  Company  after
consultation with the managing  underwriter should reasonably determine that the
inclusion of such Registrable Securities,  would materially adversely affect the
offering  contemplated  in  such  registration  statement,  and  based  on  such
determination  recommends  inclusion in such registration  statement of fewer or
none of the  Registrable  Securities  of the  Holder,  then  (x) the  number  of
Registrable  Securities of the Holders included in such  registration  statement
shall  be  reduced  pro-rata  among  such  Holders  (based  upon the  number  of
Registrable  Securities  requested to be included in the  registration),  if the
Company after consultation with the  underwriter(s)  recommends the inclusion of
fewer Registrable  Securities,  or (y) none of the Registrable Securities of the
Holder shall be included in such  registration  statement,  if the Company after
consultation  with the  underwriter(s)  recommends the inclusion of none of such
Registrable Securities;  provided, however, that if securities are being offered
for the  account  of other  persons or  entities  as well as the  Company,  such
reduction  shall not represent a greater  fraction of the number of  Registrable
Securities  intended  to be offered by the Holder  than the  fraction of similar
reductions imposed on such other persons or entities (other than the Company).

          (e)  Failure to File  Registration  Statement  and Other  Events.  The
Company  and the  Purchaser  agree that the Holder  will  suffer  damages if the
Registration  Statement  is not  filed on or prior  to the  Filing  Date and not
declared  effective by the Commission on or prior to the Effectiveness  Date and
maintained in the manner contemplated herein during the Effectiveness  Period or
if certain other events occur.  The Company and the Holder further agree that it
would not be feasible to ascertain  the extent of such  damages with  precision.
Accordingly,  if (i) the Registration  Statement is not filed on or prior to the
Filing Date, or is not declared  effective by the  Commission on or prior to the
Effectiveness  Date (or in the event an  additional  Registration  Statement  is
filed because the actual number of shares of Common Stock into which the Note is
convertible  and the  Warrants are  exercisable  exceeds the number of shares of
Common Stock initially registered is not filed and declared effective within the
time periods set forth in Section 2(a)),  or (ii) the Company fails to file with
the  Commission  a request  for  acceleration  in  accordance  with Rule  12dl-2
promulgated  under the Exchange  Act within five (5)  Business  Days of the date
that the Company is notified (orally or in writing, whichever is earlier) by the
Commission that a Registration  Statement will not be "reviewed," or not subject
to  further  review,  or (iii)  the  Registration  Statement  is filed  with and
declared effective by the Commission but thereafter ceases to be effective as to
all  Registrable  Securities  at  any  time  prior  to  the  expiration  of  the
Effectiveness  Period,  without  being  succeeded  immediately  by a  subsequent
Registration  Statement filed with and declared effective by the Commission,  or
(iv)  trading in the Common  Stock shall be  suspended or if the Common Stock is
delisted  from the OTC  Bulletin  Board for any reason for more than ninety (90)
days in the aggregate,  or (v) the conversion rights of the Holder are suspended
for any reason,  including  by the  Company,  or (vi) the Company  breaches in a
material  respect  any  covenant or other  material  term or  condition  to this
Agreement, the the Notes, the Purchase Agreement (other than a representation or
warranty

                                       13

<PAGE>

contained  therein)  or any  other  agreement,  document,  certificate  or other
instrument delivered in connection with the transactions contemplated hereby and
thereby,  and such breach  continues  for a period of thirty days after  written
notice thereof to the Company, or (vii) the Company has breached Section 3(n) of
this Agreement (any such failure or breach being referred to as an "Event"), the
Company  shall pay in cash as  liquidated  damages for such failure and not as a
penalty to the Holder an amount  equal to 2% of the  Purchase  Price paid by the
Holder  for all Notes and  Warrants  (or Common  Stock  held by the Holder  upon
conversion or exercise thereof)  purchased and then outstanding  pursuant to the
Purchase  Agreement for each thirty (30) day period until the  applicable  Event
has been cured,  which shall be pro rated for such periods less than thirty (30)
days (the "Periodic Amount").  Payments to be made pursuant to this Section 7(e)
shall be due and payable immediately upon demand in immediately available funds.
The parties agree that the Periodic Amount  represents a reasonable  estimate on
the part of the  parties,  as of the date of this  Agreement,  of the  amount of
damages that may be incurred by the Holder if the Registration  Statement is not
filed on or prior to the Filing Date or has not been  declared  effective by the
Commission on or prior to the  Effectiveness  Date and  maintained in the manner
contemplated  herein  during the  Effectiveness  Period or if any other Event as
described herein has occurred.

          (f) Specific Enforcement, Consent to Jurisdiction.

              (i) The  Company  and the  Purchaser  acknowledge  and agree  that
irreparable  damage would occur in the event that any of the  provisions of this
Registration  Rights  Agreement or the Purchase  Agreement were not performed in
accordance  with  their  specific  terms  or  were  otherwise  breached.  It  is
accordingly  agreed that the  parties  shall be  entitled  to an  injunction  or
injunctions to prevent or cure breaches of the  provisions of this  Registration
Rights Agreement or the Purchase Agreement and to enforce specifically the terms
and provisions hereof or thereof,  this being in addition to any other remedy to
which any of them may be entitled by law or equity.

              (ii) Each of the Company and the Purchaser (i) hereby  irrevocably
submits to the  jurisdiction  of the United States District Court sitting in the
County of Cook,  State of  Illinois  for the  purposes  of any  suit,  action or
proceeding  arising  out of or  relating  to  this  Agreement  or  the  Purchase
Agreement  and (ii)  hereby  waives,  and agrees not to assert in any such suit,
action  or  proceeding,  any  claim  that it is not  personally  subject  to the
jurisdiction of such court, that the suit, action or proceeding is brought in an
inconvenient  forum or that the  venue of the  suit,  action  or  proceeding  is
improper. Each of the Company and the Purchaser consents to process being served
in any such suit,  action or  proceeding by mailing a copy thereof to such party
at the address in effect for notices to it under this  Agreement and agrees that
such service shall constitute good and sufficient  service of process and notice
thereof.  Nothing in this  Section 7(f) shall affect or limit any right to serve
process in any other manner permitted by law.

          (g)  Amendments  and  Waivers.   The  provisions  of  this  Agreement,
including  the  provisions  of this  sentence,  may not be amended,  modified or
supplemented,  and waivers or consents to departures from the provisions  hereof
may not be given,  unless the same shall be in writing and signed by the Company
and the Holder.  Notwithstanding  the  foregoing,  a waiver or consent to depart
from the provisions hereof with respect to a matter that relates  exclusively to
the rights of Holder and that does not directly or indirectly  affect the rights
of other Holders may

                                       14

<PAGE>

be given by Holders  of at least a majority  of the  Registrable  Securities  to
which such waiver or consent relates; provided,  however, that the provisions of
this sentence may not be amended, modified, or supplemented except in accordance
with the provisions of the immediately preceding sentence.

          (h) Notices. Any and all notices or other communications or deliveries
required or permitted to be provided  hereunder shall be in writing and shall be
deemed given and  effective on the earlier of (i) the date of  transmission,  if
such  notice or  communication  is  delivered  via  facsimile  at the  facsimile
telephone number specified for notice prior to 5:00 p.m., central standard time,
on a Business Day, (ii) the Business Day after the date of transmission, if such
notice or  communication  is delivered via facsimile at the facsimile  telephone
number specified for notice later than 5:00 p.m.,  central standard time, on any
date and earlier than 11:59 p.m., central time, on such date, (iii) the Business
Day following the date of mailing,  if sent by nationally  recognized  overnight
courier  service  or (iv)  actual  receipt  by the party to whom such  notice is
required  to be  given.  The  addresses  for such  communications  shall be with
respect  to each  party at such  party's  address  as set forth in the  Purchase
Agreement or to such other  address or addresses or facsimile  number or numbers
as any such  party may most  recently  have  designated  in writing to the other
parties hereto by such notice.

          (i) Successors and Assigns.  This Agreement  shall be binding upon and
inure to the benefit of the parties and their  successors and permitted  assigns
and shall inure to the benefit of the Holder and its successors and assigns. The
Company  may not  assign  this  Agreement  or any of its  rights or  obligations
hereunder    without    the   prior    written    consent    of   the    Holder.

          (j)  Assignment  of  Registration  Rights.  The rights of each  Holder
hereunder,  including  the  right  to  have  the  Company  register  for  resale
Registrable Securities in accordance with the terms of this Agreement,  shall be
automatically  assignable by each Holder to any transferee of such Holder of all
or a portion  of the Notes or the  Registrable  Securities  if:  (i) the  Holder
agrees in writing with the  transferee or assignee to assign such rights,  and a
copy of such  agreement  is furnished  to the Company  within a reasonable  time
after such assignment,  (ii) the Company is, within a reasonable time after such
transfer  or  assignment,  furnished  with  written  notice  of (a) the name and
address of such  transferee or assignee,  and (b) the securities with respect to
which  such  registration  rights  are  being  transferred  or  assigned,  (iii)
following such transfer or assignment the further disposition of such securities
by the  transferee  or  assignees is  restricted  under the  Securities  Act and
applicable  state  securities  laws,  (iv) at or  before  the time  the  Company
receives the written  notice  contemplated  by clause (ii) of this Section,  the
transferee or assignee  agrees in writing with the Company to be bound by all of
the provisions of this Agreement,  and (v) such transfer shall have been made in
accordance  with the  applicable  requirements  of the  Purchase  Agreement.  In
addition, each Holder shall have the right to assign its rights hereunder to any
other Person with the prior written consent of the Company,  which consent shall
not be  unreasonably  withheld.  The  rights to  assignment  shall  apply to the
Holders (and to subsequent) successors and assigns.

          (k)  Counterparts.  This  Agreement  may be  executed in any number of
counterparts,  each of which when so executed  shall be deemed to be an original
and, all of which taken together shall constitute one and the same Agreement. In
the event that any signature is

                                       15

<PAGE>

delivered by facsimile transmission, such signature shall create a valid binding
obligation  of the  party  executing  (or on  whose  behalf  such  signature  is
executed) the same with the same force and effect as if such facsimile signature
were the original thereof.

          (l) Governing Law. This  Agreement  shall be governed by and construed
in  accordance  with  the laws of the  State  of  Delaware,  without  regard  to
principles of conflicts of law thereof.

          (m) Cumulative  Remedies.  The remedies provided herein are cumulative
and not exclusive of any remedies provided by law.

          (n) Severability.  If any term, provision,  covenant or restriction of
this  Agreement is held to be invalid,  illegal,  void or  unenforceable  in any
respect, the remainder of the terms, provisions,  covenants and restrictions set
forth  herein  shall  remain  in full  force and  effect  and shall in no way be
affected,  impaired  or  invalidated,  and the  parties  hereto  shall use their
reasonable  efforts to find and employ an alternative  means to achieve the same
or substantially  the same result a that  contemplated by such term,  provision,
covenant  or  restriction.  It is  hereby  stipulated  and  declared  to be  the
intention of the parties  that they would have  executed  the  remaining  terms,
provisions, covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.

          (o) Headings.  The headings  herein are for  convenience  only, do not
constitute a part of this  Agreement  and shall not be deemed to limit or affect
any of the provisions hereof.

          (p)  Shares  Held by the  Company  and its  Affiliates.  Whenever  the
consent  or  approval  of  Holders  of a  specified  percentage  of  Registrable
Securities is required hereunder,  Registrable Securities held by the Company or
its  Affiliates  (other than any Holder or  transferees or successors or assigns
thereof  if such  Holder is deemed  to be an  Affiliate  solely by reason of its
holdings of such  Registrable  Securities)  shall not be counted in  determining
whether  such  consent or  approval  was given by the  Holders of such  required
percentage and shall not be counted as outstanding.

          (q) Notice of  Effectiveness.  Within two (2) business  days after the
Registration  Statement  which  includes the  Registrable  Securities is ordered
effective by the  Commission,  the Company shall deliver,  and shall cause legal
counsel for the Company to deliver,  to the transfer agent for such  Registrable
Securities  and to the Purchaser  (with copies to the Holders whose  Registrable
Securities  are  included  in such  Registration  Statement,  if other  than the
Purchaser)  confirmation  that the  Registration  Statement  has  been  declared
effective by the Commission in the form attached hereto as Exhibit A.


          IN WITNESS WHEREOF,  the parties hereto have caused this  Registration
Rights Agreement to be duly executed by their respective  authorized  persons as
of the date first indicated above.


                            [SIGNATURE PAGE FOLLOWS]

                                       16
<PAGE>




          [SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT DATED AS OF
                                MARCH 23, 2000]





                                   SALES ONLINE DIRECT, INC.


                                   By:  /s/Greg Rotman
                                        ----------------------------------------
                                        Name: Greg Rotman
                                        Title:  Chief Executive Officer




                                   AUGUSTINE FUND, L.P.

                                   By: Augustine Capital Management, L.L.C.

                                   By: /s/Thomas F. Duszynski
                                       -----------------------------------------
                                       Mr. Thomas F. Duszynski, Member






<PAGE>


                                    EXHIBIT A

            FORM OF NOTICE OF EFFECTIVENESS OF REGISTRATION STATEMENT

[NAME AND ADDRESS OF TRANSFER AGENT]
Attn:  _____________

The Augustine Fund, L.P.
C/o Augustine Capital Mangement, L.L.C.
141 West Jackson Blvd., Suite 2182
Chicago, Illinois 60604
Attn: Mr. Thomas F. Duszynski

                  Re:   Sales Online Direct, Inc.

Ladies and Gentlemen:

          We are counsel to Sales Online  Direct,  Inc., a Delaware  corporation
(the  "Company"),  and have  represented  the  Company in  connection  with that
certain Securities  Purchase Agreement (the "Purchase  Agreement"),  dated as of
March 23, 2000,  by and among the Company and the  Purchaser  named therein (the
"Holder")  pursuant to which the Company issued to the Holder its Series A Eight
Percent  (8%)   Convertible   Notes  (the  "Notes")  along  with  warrants  (the
"Warrants") to purchase shares of the Company's commo stock, $.001 par value per
share (the "Common Stock").  Pursuant to the Purchase Agreement, the Company has
also  entered  into  a  Registration  Rights  Agreement  with  the  Holder  (the
"Registration  Rights  Agreement"),   dated  of  even  date  with  the  Purchase
Agreement, pursuant to which the Company agreed, among other things, to register
the Registrable  Securities (as defined in the Registration  Rights  Agreement),
including the shares of Common Stock  issuable upon  conversion of the Notes and
exercise of the  Warrants,  under the  Securities  Act of 1933,  as amended (the
"1933 Act"). In connection with the Company's obligations under the Registration
Rights Agreement,  on , 2000, the Company filed a Registration Statement on Form
___ (File No. 333- ) (the  "Registration  Statement")  with the  Securities  and
Exchange  Commission  (the  "SEC")  relating  to the  resale of the  Registrable
Securities which names the Holder as a selling stockholder thereunder.

          In connection  with the foregoing,  we advise you that a member of the
SEC's  staff has  advised  us by  telephone  that the SEC has  entered  an order
declaring the Registration Statement effective under the 1933 Act at [ENTER TIME
OF  EFFECTIVENESS]  on [ENTER DATE OF  EFFECTIVENESS]  and we have no knowledge,
after  telephonic  inquiry of a member of the SEC's  staff,  that any stop order
suspending its  effectiveness  has been issued or that any  proceedings for that
purpose  are  pending  before,  or  threatened  by, the SEC and the  Registrable
Securities  are  available  for  resale  under  the  1933  Act  pursuant  to the
Registration Statement.

                                                 Very truly  yours,
                                                 [COMPANY  COUNSEL]
                                                 By: /s/


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