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                                                                    EXHIBIT 99.7


                         REGISTRATION RIGHTS AGREEMENT

         This Registration Rights Agreement (the "Agreement") is entered into
as of July 1, 1998, by and among Craftmade International, Inc., a Delaware
corporation (the "Company"), on the one hand, and Neall and Leslie Humphrey
(collectively, "Humphrey") and John DeBlois ("DeBlois" and, together with
Humphrey, the "Stockholders"), on the other hand.


                              W I T N E S S E T H:

         WHEREAS, Craftmade and Stockholders are parties to that certain Merger
Agreement (the "Merger Agreement"), dated as of July 1, 1998, by and among
Craftmade,  Trade Source International, Inc., a Delaware corporation, Humphrey,
DeBlois, the Wiley Family Trust, James Bezzerides, the Bezzco Inc. Employee
Retirement Trust and Trade Source International, Inc., a California
corporation; and

         WHEREAS, as part of the merger consideration, the Stockholders are
receiving shares of Common Stock, $0.01 par value per share (the "Common
Stock") of the Company, in the amount listed on Exhibit A hereto (the
"Stockholders' Shares"); and

         WHEREAS, the Company and the Stockholders wish to provide for certain
registration rights with regard to the Stockholders' Shares on the terms and
conditions set forth herein.

         NOW, THEREFORE, in consideration of the above premises, the mutual
promises herein contained and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:

         1.      Definitions.  As used herein, the following terms shall have
the following meanings:

         "Blocking Notice" shall mean a written notice to the effect that (i) a
distribution of Shares or the filing or effectiveness of a Registration
Statement, Prospectus, amendment or supplement, at such time would require the
public disclosure of material nonpublic information concerning a transaction,
proposed transaction or negotiations involving the Company or any of its
affiliates that, in the Company's reasonable judgment, could materially
interfere with such transaction, proposed transaction or negotiations or (ii)
such distribution of Shares or the filing or effectiveness of a Registration
Statement, Prospectus, amendment or supplement at such time otherwise would
require premature disclosure of nonpublic information that, in the Company's
reasonable judgment, could adversely affect or otherwise be detrimental to the
Company.

         "Closing Date" means the date of this Agreement.

         "Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time.
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         "Majority" means two or more of the Stockholders; provided, however,
that if any Stockholder transfers any Shares (together with the related
registration rights) to a permitted transferee under Section 15(a), then to the
extent such Stockholder retains any Shares, for purposes of this definition
such Stockholder and such permitted transferee shall be deemed to be one
Stockholder.

         "Registration Expenses" means all costs and expenses of each
Registration Statement, including without limitation printing, legal and
accounting expenses, SEC filing fees and "Blue Sky" fees and expenses relating
to the registration of Shares.

         "Registration Statement" means any registration statement under the
Securities Act that is filed by the Company to register sales of Shares by
Selling Stockholders (whether or not such registration statement also registers
the issuance or sale of other securities).

         "Rule 144" means Rule 144 (as currently in effect or as amended or any
successor or similar provision) promulgated by the SEC under the Securities
Act.

         "Rule 415" means Rule 415 (as currently in effect or as amended or any
successor or similar provision) promulgated by the SEC under the Securities
Act.

         "SEC" means the United States Securities and Exchange Commission.

         "Securities Act" means the Securities Act of 1933, as amended from
time to time.

         "Selling Expenses" means all underwriters' commissions or discounts,
brokers' fees or commissions, transfer or other taxes attributable to Shares
being offered and sold by any Selling Stockholder, all fees and expenses of
counsel incurred by any Selling Stockholder, other than such fees and expenses
as are defined as "Registration Expenses" above, and all fees and expenses of
any Stockholder's accountants.

         "Selling Stockholder" means any Stockholder whose Shares (in whole or
in part) are included in a Registration Statement.

         "Shares" means (a) the Stockholders' Shares and (b) any securities
issued or issuable in respect of the Stockholders' Shares by way of stock
dividend or stock split or in connection with a combination of shares,
recapitalization, reclassification, merger, consolidation or similar event, and
any other securities issued pursuant to any other pro rata distribution with
respect to such shares of Common Stock.  For purposes hereof, a share of Common
Stock ceases to be a Stockholders' Share or a Share (each as defined herein)
when (i) it has been effectively registered under the Securities Act and sold
or distributed pursuant to an effective Registration Statement covering it or
(ii) it has become eligible, in the opinion of counsel to the Company, to be
sold or distributed pursuant to Rule 144 (within the then-applicable volume
limitation pursuant to Rule 144(e)) or Rule 144(k).

                                       2



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         2.      Piggyback Registration.

                 (a)      Procedure.  Subject to the terms and conditions set
forth herein, if the Company proposes at any time to register any shares of
Common Stock (the "Company Shares") under the Securities Act for sale for the
Company's account in a primary underwritten offering, the Company will promptly
(but in no event less than thirty (30) days prior to the anticipated filing
date of the Company's registration statement (the "Piggyback Registration
Statement") pursuant to the Securities Act) give written notice (the "Piggyback
Notice") to the Stockholders of the Company's intention to effect such
registration (such notice to specify, to the extent known, the anticipated
filing date, the number of shares of Common Stock proposed to be registered and
the general distribution arrangements), and the Stockholders shall be entitled
to include in such Piggyback Registration Statement, as a part of such
underwritten offering, such number of Shares (the "Piggyback Shares") to be
sold for the account of Selling Stockholders (on the same terms and conditions
as the Company Shares) as shall be specified in written requests signed by the
applicable Stockholder and delivered to the Company not less than ten (10) days
before the later of (i) the anticipated filing date specified in the Piggyback
Notice or (ii) the actual filing date.  The Company shall make good faith
efforts to cause the Piggyback Registration Statement to become and remain
effective.

                 (b)      Limitations.  The Company's obligation to include
Piggyback Shares in a Piggyback Registration Statement is subject to each of
the following:

                          (i)     Abandoned Registration.  If, at any time
after giving the Piggyback Notice and prior to the effective date of the
Piggyback Registration Statement, the Company shall determine for any reason
not to register the Company Shares, then the Company may, at its election, give
written notice of such determination to the Selling Stockholders, and thereupon
the Company shall be relieved of its obligation to use any efforts to register
any Piggyback Shares in connection with such abandoned registration.  The
Company's election not to register the Company Shares pursuant to this Section
shall not constitute a breach hereof.

                          (ii)    Cutback.  If, in the reasonable opinion of
the managing underwriter of such offering, the distribution of all or a
specified portion of the Piggyback Shares would materially interfere with the
registration and sale of the Company Shares, then the number of each Selling
Stockholder's Piggyback Shares, and the number of shares of Common Stock to be
registered on behalf of any person other than the Company ("Other Holders"), to
be included in the Piggyback Registration Statement shall be reduced (pro rata
among all Selling Stockholders and Other Holders on the basis of the number of
shares that each Selling Stockholder and each Other Holder requested be
included) to such number, if any, that can be included without such
interference.  If, as a result of the cutback provisions of the preceding
sentence, any Selling Stockholder is not entitled to include all of his or her
requested Shares in such registration, then such Selling Stockholder may elect
to withdraw his or her request to include any or all of his or her Shares in
such registration.

                 (c)      Conditions to Inclusion.  As a condition to each
Selling Stockholder's right to include Piggyback Shares in a registration
pursuant to this Section, such Selling Stockholder





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shall, if requested by the Company or the managing underwriter in connection
with such registration and distribution (i) agree to sell such Selling
Stockholder's Piggyback Shares on the basis provided in any underwriting
arrangements entered into in connection therewith, (ii) complete and execute
all questionnaires, powers of attorney, indemnities, underwriting agreements
and other documents that are required under the terms of such underwriting
arrangements and (iii) promptly provide any Information reasonably requested,
in writing, by the Company or the managing underwriter.

                 (d)      Continuing Rights of Stockholders.  If a Stockholder
decides not to include all of his or her Shares in any Piggyback Registration
Statement filed by the Company pursuant to this Section 2, such Stockholder
shall nevertheless continue to have the right to include any Shares in any
Piggyback Registration Statement(s) as may be filed by the Company with respect
to offerings of shares of Common Stock, all upon the terms and conditions set
forth herein; provided, however, that, notwithstanding any other provision in
this Agreement to the contrary, the Company's obligation to register the Shares
pursuant to this Agreement shall expire after the Company has filed two (2)
Piggyback Registration Statements from the date of this Agreement.

         3.      Selling Stockholder Information.  Not later than the tenth day
after the date on which a Stockholder's Notice is delivered to the Company,
each such Stockholder supplying such Stockholder's Notice shall furnish the
Company with such information (the "Information") regarding such Selling
Stockholder, the Shares and such other information as may be required under the
Securities Act for preparation of the Registration Statement.  Each Selling
Stockholder shall thereafter promptly furnish to the Company all Information as
may be requested in writing by the Company from time to time to maintain the
effectiveness of any Registration Statement.
         If, within ten (10) days, a Selling Stockholder has not complied with
a written request from the Company for Information, then the Company shall not
be obligated to register Shares on behalf of such Selling Stockholder pursuant
to the Company's contemplated offering.

         4.      Other Securities.  The Company may, in its sole discretion,
include in any Registration Statement the issuance of securities by the Company
and the sale or distribution of securities previously issued to, or securities
issuable upon exercise of options or warrants previously issued to, other
persons.

         5.      Underwritten Distributions.  In any underwritten distribution
of Shares, each Selling Stockholder shall, if requested by the Company or the
underwriter or underwriters in connection with such distribution, (a) agree to
sell all or the applicable portion of such Selling Stockholder's Shares on the
basis provided in any underwriting arrangements entered into in connection
therewith and (b) complete and execute all questionnaires, powers of attorney,
indemnities, underwriting agreements and other documents that are required
under the terms of such underwriting arrangements.





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         6.      Registration Procedures.  In connection with the registration
of Shares pursuant hereto:

                 (a)      Registration Statement Content.  The Company shall
have the sole right to determine the content of any Registration Statement,
Prospectus, supplement thereto or amendment thereof; provided, however, that if
any Registration Statement refers to any Stockholder by name as the holder of
shares of Common Stock, then such Stockholder shall have the right to require
(i) the insertion in such Registration Statement of language, in form and
substance reasonably satisfactory to such Stockholder to the effect that such
Stockholder's ownership of shares of Common Stock should not be construed as a
recommendation by such Stockholder of the investment quality of the Company's
securities and that such ownership does not imply that such Stockholder will
assist in meeting any future financial requirements of the Company or (ii) the
deletion of such reference, unless counsel to the Company advises the Company
that such reference is required by the Securities Act or any similar federal
statute then in effect.

                 (b)      Amendments and Supplements.  The Company shall use
commercially reasonable efforts to prepare and file with the SEC such
amendments and supplements to any Registration Statement and the final
prospectus (a "Prospectus") used in connection therewith, as the Company deems
necessary to keep the Registration Statement or Prospectus in effect for a
period of 180 days from the effective date of such Registration Statement and
comply with the provisions of the Securities Act with respect to the
disposition of all Shares covered by the Registration Statement until the
earlier of such time (i) as all of such Shares have been disposed of in
accordance with the intended methods of disposition by the Stockholders as set
forth in the Registration Statement, (ii) the expiration of such 180 day period
or (iii) the deregistration of unsold Shares remaining under the Registration
Statement, pursuant to a written agreement among the Company and the holder or
holders of such unsold Shares.

                 (c)      Exchange Listing.  The Company shall use commercially
reasonable efforts to cause the Shares to be listed on the Nasdaq National
Market or such other securities exchange or national market system on which
shares of the Common Stock are principally traded at the time of such listing,
in accordance with the rules and practices of the Nasdaq National Market, such
other securities exchange or national market system and the SEC.

                 (d)      Blue Sky Laws. The Company shall use commercially
reasonable efforts to register or qualify (to the extent required by law) the
Shares covered by any Registration Statement under the applicable securities or
"Blue Sky" laws of such jurisdictions as the Stockholders reasonably request;
provided, however, that the Company shall not be obligated so to register or
qualify any the Shares in any jurisdiction (i) if the Company would be required
to qualify to do business in any jurisdiction where it is not now so qualified,
(ii) if the Company would be required to take any action which would subject it
to the service of process in suits other than those arising out of the offer or
sale of the securities covered by the Registration Statement or subject it to
taxation in any jurisdiction where it is not now so subject or (iii) if the
Company would be required to conform its capitalization or the composition of
its assets at the time to the securities or "Blue Sky" laws of such
jurisdiction.





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<PAGE>   6


         7.      Stockholder Undertakings.  Each Stockholder covenants with the
Company as follows:

                 (a)      No Stabilization.  No Stockholder shall effect any
stabilization transactions or engage in any stabilization activity proscribed
by Regulation M under the Exchange Act in connection with any securities of the
Company during the period of any distribution of the Shares by Selling
Stockholders pursuant to any Registration Statement.

                 (b)      Brokers.  Each Selling Stockholder (i) shall furnish
each broker through whom such Selling Stockholder offers the Shares such number
of copies of any Prospectus and any supplements thereto or amendments thereof
which such broker may require (provided that the Company has provided such
Selling Stockholder with such Prospectus, supplements and amendments), (ii)
shall inform such broker as to the number of Shares offered through such
broker, that such Shares are part of a distribution and that such broker is
subject to the provisions of Regulation M under the Exchange Act until such
time as such broker has completed the sale of all such Shares, and (iii) shall
notify such broker when distribution of the Shares by such Selling Stockholder
pursuant to any Registration Statement has been completed or any Registration
Statement is no longer effective or is withdrawn.

                 (c)      Amendments and Supplements.  Each Selling Stockholder
shall promptly furnish to each person (including each broker) to whom such
Selling Stockholder has delivered copies of the Prospectus an equivalent number
of copies of any amendment thereof or supplement thereto (provided that the
Company has provided such Selling Stockholder with such amendment or
supplement).

                 (d)      Transaction Information.  Each Stockholder shall
report promptly to the Company upon any disposition of Shares by such
Stockholder and upon completion of the distribution of such Selling
Stockholder's Shares pursuant to any Registration Statement.  Such report shall
contain the number of Shares disposed by such Stockholder, the date of such
disposition, the party to whom the Shares were transferred and the manner in
which such Shares were disposed.

                 (e)      Exchange Act Compliance.  Each Selling Stockholder
shall, at any time such Selling Stockholder is engaged in a distribution of the
Shares under any Registration Statement, comply to the extent required with
Rules 10b-5 and Regulation M (as currently in effect or as amended or any
successor or similar provisions) promulgated under the Exchange Act and shall
distribute the Shares solely in the manner described in any Registration
Statement, and shall not do any of the following during the period from the
effective date of any Registration Statement until the completion of any
offering of the Shares by such Selling Stockholder pursuant to such
Registration Statement:

                          (i)     Bid for or purchase, for any account in which
such Selling Stockholder or any affiliate of such Selling Stockholder has a
beneficial interest, any securities of the Company other than in transactions
permitted by Regulation M under the Exchange Act;





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                          (ii)    Attempt to induce any person to purchase any
securities of the Company other than in transactions permitted by Regulation M
under the Exchange Act; and

                          (iii)   Pay or offer or agree to pay to anyone,
directly or indirectly, any compensation for soliciting another to purchase any
securities of the Company on a national securities exchange or pay or offer or
agree to pay to anyone any compensation for purchasing securities of the
Company on a national securities exchange other than those securities offered
by such Selling Stockholder.

                 (f)      Publicity; Selling Efforts.  Each Selling Stockholder
shall not, during the period of any offering by such Selling Stockholder of any
Shares under any Registration Statement, use or disseminate any information
concerning the Company other than the Prospectus (or any amendment thereof or
supplement thereto furnished by the Company) and may not undertake any form of
publicity with respect to the Company or engage in any similar activities that
may be deemed to be an unlawful selling effort within the meaning of Section 9
of the Exchange Act.

                 (g)      Material Nonpublic Information.  A Stockholder shall
not offer to sell, sell or otherwise enter into any transaction in connection
with any Shares if the Stockholder is aware of material nonpublic information
regarding the Company or its subsidiaries.

                 (h)      Brokerage Commissions.  Except as disclosed in the
Prospectus, a Selling Stockholder will not pay unusual or special brokerage
commissions (other than ordinary brokerage arrangements) on any sales effected
through a broker, and no selling arrangement will have been entered into
between a Selling Stockholder and any securities dealer or broker.

                 (i)      Method of Disposition. In any distribution of Shares
pursuant to Rule 415, at least five (5) business days prior to any disposition
of the Shares, the applicable Selling Stockholder shall advise the Company of
the dates on which such disposition is expected to commence and terminate, the
number of such Selling Stockholder's Shares expected to be sold, the method of
disposition and such other information as the Company may reasonably request in
order to supplement the Prospectus in accordance with the rules and regulations
of the SEC.

         8.      Company Undertakings.  The Company covenants with the
Stockholders as follows:

                 (a)      Furnish Information.  Before filing a Registration
Statement, a preliminary prospectus or a Prospectus, the Company will furnish
each Selling Stockholder copies of such documents.  The Company also will
furnish to each Selling Stockholder such copies of each preliminary prospectus
and Prospectus as each Selling Stockholder may reasonably request and copies of
any other information necessary for the Selling Stockholder to effect a sale
pursuant to Rule 144.  The Company will furnish to each Selling Stockholder a
copy of all documents filed with and all correspondence from or to the SEC in
connection with the offering covered by any Registration Statement.
Notwithstanding any of the obligations of the Company set forth herein, the
Company shall only be required to furnish such audited annual or unaudited
quarterly





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or monthly financial statements required to keep the Registration Statement
effective under the Securities Act and any documents required to be filed
pursuant to the Exchange Act.

                 (b)      Material Developments.  The Company will notify each
Selling Stockholder of the happening of any event as a result of which a
Prospectus being used by such Selling Stockholder to sell Shares pursuant to a
Registration Statement contains an untrue statement of a material fact or omits
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. Following such notice and upon the Company's written
request, each Selling Stockholder shall deliver to the Company all copies
(other than permanent file copies then in any Stockholder's possession) of the
Prospectus that was in effect prior to such written notice.  Subject to Section
7, the Company thereafter will use commercially reasonable efforts to prepare
promptly a supplement or amendment of such Prospectus so that, as thereafter
delivered to the purchaser of the Shares, the Prospectus will not contain an
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.

                 (c)      Underwriting Agreements.  In any underwritten
distribution of Shares, the Company shall, to the extent required by the
managing underwriter of such distribution (i) enter into and perform the
Company's obligations under the applicable underwriting agreement, (ii) furnish
to the managing underwriter an opinion of counsel to the Company addressing
customary legal issues reasonably requested by the managing underwriter and
(iii) furnish to the managing underwriter a customary "comfort letter"
addressed to the managing underwriter from the Company's independent certified
public accountants.

         9.      Blocking Periods.  Each Selling Stockholder shall cease any
distribution of the Shares under any Registration Statement upon receipt of a
Blocking Notice from the Company. The period of time during which a Selling
Stockholder shall cease distribution of the Shares (the "Blocking Period")
shall be the earlier of sixty (60) days from the receipt of such Blocking
Notice by the Selling Stockholder or the date upon which such transaction,
proposed transaction or negotiations have been publicly disclosed or
terminated.  The Company promptly shall send each Selling Stockholder written
notice (the "Blocking Termination Notice") at the earliest of such times as (a)
such transaction, proposed transaction or negotiations have been publicly
disclosed or terminated, (b) such non-public information has been publicly
disclosed, or (c) counsel to the Company has determined that such disclosure is
not required due to subsequent events.  If any Blocking Period occurs after the
effective date of a Registration Statement, then the period during which the
Company is obligated to use commercially reasonable efforts to keep such
Registration Statement effective and from time to time to amend such
Registration Statement shall be extended by a number of days equal to the
length in days of the Blocking Period.

         Any sale, offer to sell or other transaction involving Shares by any
Selling Stockholder during a Blocking Period shall constitute a material breach
by such Selling Stockholder of his or her obligations hereunder.  Blocking
Notices for the reasons and for the periods of time set forth in this Section
shall not constitute a breach hereof by the Company.





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         The Company also may delay the filing of any Registration Statement,
Prospectus, amendment or supplement, or the effectiveness of any Registration
Statement, Prospectus, amendment or supplement, filed pursuant hereto upon
delivery of a Blocking Notice to the Selling Stockholders.  The Company's delay
in filing or pursuing the effectiveness of a Registration Statement,
Prospectus, amendment or supplement during a Blocking Period shall not
constitute a breach hereof.  At the conclusion of the Blocking Period, the
Company shall resume its efforts in connection with any such Registration
Statement, Prospectus, amendment or supplement and shall send a Blocking
Termination Notice to each Selling Stockholder.

         10.     Indemnification; Contribution.

                 (a)      Indemnification by Company.  The Company shall
indemnify and hold harmless, to the extent permitted by law, each Selling
Stockholder against all losses, claims, damages, liabilities and expenses
(including without limitation reasonable attorneys' fees) insofar as such
losses, claims, damages, liabilities and expenses arise out of or are based on
(i) any untrue or alleged untrue statement of a material fact contained in any
Registration Statement under which Shares owned by such Selling Stockholder
were registered under the Securities Act, any Prospectus or preliminary
prospectus or any amendment thereof or supplement thereto or any documents
filed under state securities or "Blue Sky" laws in connection therewith, (ii)
any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein (in the case of a
Prospectus, in the light of the circumstances under which they were made) not
misleading or (iii) any violations or alleged violation of the Securities Act,
the Exchange Act, any applicable state securities law or any rule or regulation
promulgated under the Securities Act, the Exchange Act or any applicable state
securities law in connection with the offering covered by such Registration
Statement (items (i), (ii) and (iii) are collectively referred to herein as
"Violations"); and the Company will reimburse each such Selling Stockholder for
reasonable 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
Section 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 loss, claim, damage,
liability or action to the extent that it arises out of or is based on a
Violation that occurs in reliance upon and in conformity with written
information furnished expressly for use in connection with such registration by
such Selling Stockholder.

                 (b)      Indemnification by Each Selling Stockholder.  In
connection with any Registration Statement in which a Selling Stockholder is
participating, each such Selling Stockholder shall, severally and not jointly,
indemnify and hold harmless, to the extent permitted by law, the Company, the
Company's directors and officers and each person, if any, who controls (within
the meaning of the Securities Act) the Company against any losses, claims,
damages, liabilities and expenses (including without limitation reasonable
attorneys' fees) insofar as such losses, claims, damages, liabilities and
expenses arise out of or are based on a Violation which occurs in reliance upon
and in conformity with written information furnished expressly for use in
connection with such registration by such Selling Stockholder, officer,
director, or controlling





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<PAGE>   10


person of such Selling Stockholder; and each such Selling Stockholder will
reimburse the Company, its officers and directors and each person, if any, who
controls the Company for reasonable legal or other expenses reasonably incurred
by the Company in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that the indemnity
agreement contained in this Section 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 such Selling Stockholder, which
consent shall not be unreasonably withheld, nor shall the Selling Stockholder
be liable in any such case for any loss, claim, damage, liability or action to
the extent that it arises out of or is based on a Violation that occurs in
reliance upon and in conformity with written information furnished expressly
for use in connection with such registration by the Company.

                 (c)      Indemnification Procedures.  Any person entitled to
indemnification hereunder shall give prompt written notice to the indemnifying
party after the receipt by such person of any written notice of the
commencement of any action, suit, proceeding or investigation or threat thereof
made in writing for which such person will claim indemnification or
contribution pursuant hereto and permit the indemnifying party to participate
therein and, to the extent that he, she or it desires, jointly with any other
indemnifying party similarly situated, to assume the defense of such claim with
counsel reasonably satisfactory to such indemnified party.  If the indemnifying
party elects to assume the defense of a claim, he, she or it  shall not be
liable to such indemnified party for legal expenses subsequently incurred by
such indemnified party in connection with the defense thereof other than
reasonable costs of investigation and except as otherwise provided below;
provided, however, that such indemnified party shall, at all times, cooperate
in the defense of the indemnified party.  The indemnifying party shall be
liable to the indemnified party for legal or other expenses incurred by the
indemnified party even if the indemnifying party has offered to assume the
defense thereof if (i) the employment of counsel by the indemnified party has
been authorized in writing by the indemnifying party, (ii) the indemnified
party shall have reasonably concluded that there may be a conflict of interest
between the indemnified party and the indemnifying party in conduct of the
defense of such action or (iii) the indemnifying party shall not in fact have
employed counsel to assume the defense of such action.  If the indemnifying
party is not entitled to, or elects not to, assume the defense of a claim, then
he, she or it  will not be obligated to pay the fees and expenses of more than
one counsel with respect to such claim.  The indemnifying party will not be
subject to any liability for any settlement made without its consent.  If the
failure of any person to give prompt notice to the indemnifying party of any
claim with respect to which he, she or it  seeks indemnification prejudices
such indemnifying party, such indemnifying party shall be relieved of his, her
or its obligation to indemnify such person to the extent that such indemnifying
party has been prejudiced; provided, however, that the indemnifying party shall
not be so relieved if the failure to give prompt notice to the indemnifying
party was beyond the control of the indemnified party.  No indemnifying party
will consent to entry of any judgment or enter into any settlement agreement
which does not include as an unconditional term thereof the giving by the
claimant or plaintiff to such indemnified party of a release from all liability
in respect of such claim or litigation.





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                 (d)      Contribution.  If the indemnification provided for in
this Section from the indemnifying party is unavailable to an indemnified party
hereunder in respect of any losses, claims, damages, liabilities or expenses
(including without limitation reasonable attorneys' fees) referred to therein,
then the 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, claims, damages, liabilities or expenses (including
without limitation reasonable attorneys' fees) in such proportion as is
appropriate to reflect not only the relative benefits received by the
indemnifying party on the one hand and the indemnified party on the other, but
also the relative fault of the indemnifying party and the indemnified party as
well as any other relevant equitable considerations.  The relative fault of
such indemnifying party and indemnified parties shall be determined by
reference to, among other things, whether any action in question, including any
untrue or alleged untrue statements of a material fact or omission or alleged
omission to state a material fact, has been made by, or relates to information
supplied by, such indemnifying party or indemnified parties, and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such action.  The amount paid or payable by a party as a result of the
losses, claims, damages, liabilities and expenses (including without limitation
reasonable attorneys' fees) referred to above shall be deemed to include,
subject to the limitations set forth in Section 10(c), any legal or other fees
or expenses reasonably incurred by such party in connection with any
investigation or proceeding.

                 The parties hereto acknowledge that it would not be just and
equitable if contribution pursuant to this Section 10(d) were determined by pro
rata allocation or by any other method of allocation which 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 Paragraph 11(f) of the Securities Act) shall be entitled to
contribution from any person who is not guilty of such fraudulent
misrepresentation.

         11.     Expenses.  The Company shall bear all Registration Expenses;
provided, however, that the Company shall have no obligation to pay or
otherwise bear the Selling Expenses of any Stockholder.

         12.     Termination.  This Agreement and the obligations of the
Company hereunder shall terminate on the earliest of (a) the first date on
which no shares of Common Stock held by any Stockholder constitute Shares
hereunder, (b) the date on which each party hereto agrees in writing to such
termination, (c) the first anniversary of the Closing Date (in accordance with
Rule 144(d)) and (d) the termination of the Company's obligation to register
the Shares pursuant to Section 2(d) hereof.

         13.     Rule 144 Reporting.  With a view to making available to the
Stockholders the benefits of certain rules and regulations of the SEC that may
permit the sale of the Shares to the public without registration, the Company
agrees to use commercially reasonable efforts during the term of this Agreement
to (a) make and keep public information available, as those terms are
understood and defined in Rule 144, (b) file with the SEC, in a timely manner,
all reports and other documents required of the Company under the Exchange Act
and (c) so long as any Stockholder owns any Shares, furnish to such Stockholder
upon written request a written





                                     11
<PAGE>   12


statement by the Company as to the Company's compliance with the reporting
requirements of Rule 144, a copy of the most recent annual or quarterly report
of the Company and such other reports, documents and information as a
Stockholder may reasonably request in availing himself or itself of any rule or
regulation of the SEC allowing it to sell any such securities without
registration.

         14.     Miscellaneous.

                 (a)      Successors and Assigns.  The registration rights
provided hereunder are not transferable and shall not inure to the benefit of
any persons other than the respective Stockholders; provided, however, each
Stockholder may transfer such Stockholder's registration rights hereunder to a
charitable remainder trust as defined in Section 664 of the Internal Revenue
Code, the Treasury Regulations promulgated thereunder, and the revenue
procedures and revenue rulings relating thereto.  Any such permitted transferee
shall succeed to a Stockholder's registration rights hereunder only if the
permitted transferee agrees in writing to perform all the obligations of a
Stockholder hereunder.  Thereafter, all references herein to a "Stockholder" or
"Stockholders" shall be deemed to include such permitted transferee.   Any
transfer or assignment in contravention of this Section shall be null and void.

                 (b)      Entire Agreement; Amendment.  This Agreement and the
other documents delivered pursuant hereto and referenced herein constitute the
full and entire understanding and agreement between the parties and supersede
any other agreement, written or oral, with regard to the subject matter hereof.
Except as expressly provided herein, neither this Agreement nor any term hereof
may be amended, waived, discharged or terminated, except by a written
instrument signed by the parties hereto.

                 (c)      Notices, Etc.  All notices and other communications
required or permitted hereunder shall be in writing and shall be mailed by
certified or registered mail, postage prepaid with return receipt requested,
telecopy (with hardcopy delivered by overnight courier service), or delivered
by hand, messenger or overnight courier service, and shall be deemed given when
received at the addresses of the parties set forth below, or at such other
address furnished in writing to the other parties hereto.

         If to the Company:                        Craftmade International,Inc.
                                                   650 South Royal Lane
                                                   Suite 100
                                                   P.O. Box #1037
                                                   Coppell, Texas 75019-1037





                                        12
<PAGE>   13



         If to the Stockholders:        Neall and Leslie Humphrey
                                        c/o Trade Source International, Inc.
                                        P.O. Box 5158
                                        El Dorado Hills, California 95630
                                       
                                        John DeBlois
                                        30 Eastbrook Road #301
                                        Dedham, Massachusetts 02026

                 (d)      No Third Party Beneficiary, Etc.  There shall be no
third party beneficiary hereof.  Neither the availability of, nor any limit on,
any remedy hereunder shall limit the remedies of any party hereto against third
parties.

                 (e)      Reformation; Severability.  In case any provision
hereof shall be invalid, illegal or unenforceable, such provision shall be
reformed to best effectuate the intent of the parties and permit enforcement
thereof, and the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.  If such
provision is not capable of reformation, it shall be severed from this
Agreement and enforceability of the remaining provisions shall not in any way
be affected or impaired thereby

                 (f)      Counterparts.  This Agreement may be executed in any
number of counterparts, each of which shall be an original, but all of which
together shall constitute one and the same instrument.  Any counterpart may be
delivered by facsimile; provided, however, that attachment thereof shall
constitute the representation and warranty of the person delivering such
signature that such person has full power and authority to attach such
signature and to deliver this Agreement.  Any facsimile signature shall be
replaced with an original signature as promptly as practicable.

                 (g)      Titles and Subtitles.  The titles of the paragraphs
and subparagraphs hereof are for convenience of reference only and are not to
be considered in construing this Agreement.  References to "Sections" herein
are references to sections of this Agreement.  The words "herein," "hereof,"
"hereto" and "hereunder" and other words of similar import refer to this
Agreement as a whole and not to any particular Article, Section or other
subdivision.

                 (h)      Governing Law; Attorneys' Fees.  This Agreement shall
be governed by, construed, interpreted and applied in accordance with the laws
of the State of Texas, without giving effect to any conflict of laws rules that
would refer the matter to the laws of another jurisdiction.

                 Each party hereto hereby irrevocably submits to the exclusive
jurisdiction of the United States District Court for the Northern District of
Texas and, if such court does not have jurisdiction, of the courts of the State
of Texas in Tarrant County, for the purposes of any action arising out of this
Agreement, or the subject matter hereof, brought by any other party.





                                             13
<PAGE>   14


                 To the extent permitted by applicable law, each Stockholder
hereby waives and agrees not to assert, by way of motion, as a defense or
otherwise in any such action, any claim (i) that it is not subject to the
jurisdiction of the above-named courts, (ii) that the action is brought in an
inconvenient forum, (iii) that it is immune from any legal process with respect
to itself or its property, (iv) that the venue of the suit, action or
proceeding is improper or (v) that this Agreement, or the subject matter
hereof, may not be enforced in or by such courts.

         The prevailing party in any action or proceeding relating to this
Agreement shall be entitled to recover reasonable attorneys' fees and other
costs from the non-prevailing parties, in addition to any other relief to which
such prevailing party may be entitled.

                 (i)      Escrow Shares.  The parties hereto acknowledge that
65,592 shares, as described on Exhibit A, of the Stockholders' Shares are the
Escrow Shares, as defined in the Escrow Agreement (the "Escrow Agreement"),
dated July 1, 1998, among the Company, Humphrey, DeBlois, Trade Source
International, Inc., a Delaware corporation and The Frost National Bank, a
national banking association.  The parties further acknowledge that the Escrow
Shares are subject to the terms of the Escrow Agreement.

                                   * * * * *





                                       14
<PAGE>   15



     This Agreement has been executed and delivered as of the date first written
 above.

                                  The Company:

                                  Craftmade International, Inc.


                                  By: /s/ James R. Ridings
                                      --------------------------------
                                  Name: James R. Ridings
                                        -------------------------------
                                  Title: President
                                        --------------------------------

                                  The Stockholders:




                                  /s/ Neall Humphrey 
                                  -----------------------------------
                                  Neall Humphrey 
                                         

                                  /s/ Leslie Humphrey 
                                  -------------------------------------
                                  Leslie Humphrey  


                                  /s/ John DeBlois 
                                  --------------------------------------
                                  John DeBlois 



                                      15
<PAGE>   16


                                   EXHIBIT A

                                  STOCKHOLDERS

<TABLE>
<CAPTION>

Stockholder                                                 Stockholders' Shares
-----------                                                 --------------------
<S>                                                         <C>            
Neall and Leslie Humphrey                                   396,967 (1)

John DeBlois                                                258,942 (2)

</TABLE>

(1)      39,697 shares of the Stockholders' Shares of Humphrey are Escrow
         Shares.

(2)      25,895 shares of the Stockholders' Shares of DeBlois are Escrow
         Shares.





                                             16