Document:

REGISTRATION RIGHTS AGREEMENT

     THIS  REGISTRATION  RIGHTS  AGREEMENT,  dated  as of March  7,  2000  (this
"Agreement"),  is made by and between TITAN MOTORCYCLE CO. OF AMERICA,  a Nevada
corporation (the  "Company"),  and the person named on the signature page hereto
(the "Initial Investor").

                                  WITNESSETH:
                                  -----------

     WHEREAS, in connection with the Subscription  Agreement,  dated as of March
7, 2000,  between  the  Initial  Investor  and the  Company  (the  "Subscription
Agreement"),  the  Company  has  agreed,  upon  the  terms  and  subject  to the
conditions  of the  Subscription  Agreement,  to issue  and sell to the  Initial
Investor  shares  (the  "Preferred  Shares") of Series B  Convertible  Preferred
Stock,  $.001 par value (the  "Series B  Preferred  Stock"),  of the  Company as
provided in the Subscription  Agreement,  which Preferred Shares are convertible
into shares (the  "Conversion  Shares")  of Common  Stock,  $.001 par value (the
"Common  Stock"),  of the Company,  and to issue common stock purchase  warrants
(the "Warrants") to purchase shares (the "Warrant Shares") of Common Stock; and

     WHEREAS,  to induce  the  Initial  Investor  to  execute  and  deliver  the
Subscription  Agreement,  the Company has agreed to provide certain registration
rights  under  the  Securities  Act of  1933,  as  amended,  and the  rules  and
regulations  thereunder,  or any similar  successor statute  (collectively,  the
"1933 Act"), and applicable state securities laws with respect to the Conversion
Shares and the Warrant Shares;

     NOW,  THEREFORE,  in consideration of the premises and the mutual covenants
contained  herein and other good and  valuable  consideration,  the  receipt and
sufficiency  of which are  hereby  acknowledged,  the  Company  and the  Initial
Investor hereby agree as follows:

     1. DEFINITIONS.

     (a) As used in this Agreement, the following terms shall have the following
meanings:

     "Blackout  Period" means the period of up to 30 consecutive days commencing
on the day  immediately  after the date the Company  notifies the Investors that
they are  required,  pursuant to Section  4(d),  to suspend  offers and sales of
Registrable  Securities  as a result of an event or  circumstance  described  in
Section 3(f)(1) during which period,  by reason of Section 3(f)(2),  the Company
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is not  required  to amend  the  Registration  Statement  or to  supplement  the
prospectus contained therein;  provided,  however, that in each case the Company
shall have determined,  in its reasonable  judgment,  that public  disclosure of
such event or circumstance at such time would be detrimental to the Company.

     "Certificate of Designations"  means the Certificate of Designations of the
Series B Convertible  Preferred Stock  establishing and designating the Series B
Preferred Stock and fixing the rights and preferences of such series as filed by
the Company with the Secretary of State of the State of Nevada.

     "Computation  Date" means, if a Registration  Event occurs,  any of (1) the
date which is 30 days after such Registration  Event occurs, if any Registration
Event is  continuing  on such  date,  (2)  each  date  which is 30 days  after a
Computation Date, if any Registration  Event is continuing on such date, and (3)
the date on which all Registration Events cease to continue.

     "Investor" or "Investors"  means the Initial Investor and any transferee or
assignee  who agrees to become  bound by the  provisions  of this  Agreement  in
accordance with Section 9 hereof.

     "Majority Holders" means those persons who hold a majority of the shares of
Series B  Preferred  Stock  which are then  outstanding,  including  such shares
originally  issued  pursuant  to  the  Subscription   Agreement  and  the  Other
Subscription Agreement.

     "Nasdaq" means the Nasdaq SmallCap Market.

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

     "register,"  "registered,"  and  "registration"  refer  to  a  registration
effected by  preparing  and filing a  Registration  Statement or  Statements  in
compliance  with the 1933 Act and pursuant to Rule 415 under the 1933 Act or any
successor  rule providing for offering  securities on a continuous  basis ("Rule
415"),  and the declaration or ordering of  effectiveness  of such  Registration
Statement by the SEC.

     "Registrable  Securities"  means  the  Conversion  Shares  and the  Warrant
Shares.

     "Registration  Event"  shall  mean  (1)  the  Company  fails  to  file  the
Registration  Statement which is required to be filed by the Company pursuant to
Section  2(a)  with the SEC  within  30 days  after the  Closing  Date,  (2) the
Registration  Statement covering the Registrable Securities which is required to
be filed by the Company pursuant to the first sentence of Section 2(a) hereof is
not effective  within 120 days after the Closing Date,  (3) the Company fails to
submit a request for  acceleration  of the  effective  date of the  Registration
Statement  in  accordance  with Section  3(a),  (4) the  Registration  Statement
required to be filed by the Company  pursuant to Section  2(a) shall cease to be
available for use by any Investor who is named therein as a selling  stockholder
for any reason (including, without limitation, by reason of an SEC stop order, a
material  misstatement  or  omission  in  such  Registration  Statement  or  the
information  contained in such  Registration  Statement  having become outdated)
other  than a Blackout  Period,  (5) the  Common  Stock  ceases to be listed for

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trading on any of the New York Stock  Exchange,  the  American  Stock  Exchange,
Inc.,  the Nasdaq  National  Market or the Nasdaq,  or (6) a holder of shares of
Series B Preferred  Stock having become unable to convert any shares of Series B
Preferred  Stock  in  accordance  with  Section  10(a)  of  the  Certificate  of
Designations  (other  than  by  reason  of the  4.9%  limitation  on  beneficial
ownership set forth therein or a redemption or repurchase thereof).

     "Registration  Period"  means  the  period  from  the  Closing  Date to the
earliest of (i) the date which is five years after the SEC Effective  Date, (ii)
the date on which each  Investor may sell all  Registrable  Securities  owned by
such  Investor  or  which  such  Investor  has  any  right  to  acquire  without
registration  under the 1933 Act pursuant to subsection (k) of Rule 144, without
restriction on the manner of sale or the volume of securities  which may be sold
in any period and  without the  requirement  for the giving of any notice to, or
the making of any filing with, the SEC and (iii) the date on which the Investors
no  longer  beneficially  own or have  any  right  to  acquire  any  Registrable
Securities.

     "Registration  Statement"  means a  registration  statement  of the Company
under the 1933 Act, including any amendment thereto.

     "Rule  144"  means  Rule 144  promulgated  under  the 1933 Act or any other
similar  rule or  regulation  of the SEC that may at any time permit a holder of
any  securities  to  sell  securities  of  the  Company  to the  public  without
registration under the 1933 Act.

     "SEC" means the Securities and Exchange Commission.

     "SEC Effective Date" means the date the Registration  Statement is declared
effective by the SEC.

     "SEC Filing Date" means the date the Registration  Statement is first filed
with the SEC pursuant to Section 2(a).

     (b) Capitalized terms defined in the introductory paragraph or the recitals
to  this  Agreement  shall  have  the  respective   meanings  therein  provided.
Capitalized  terms used herein and not otherwise  defined  herein shall have the
respective meanings set forth in the Subscription Agreement.

     2. REGISTRATION.

     (a) MANDATORY REGISTRATION.  (1) The Company shall prepare, and on or prior
to the  date  which is 30 days  after  the  Closing  Date,  file  with the SEC a
Registration  Statement  on Form S-3 which,  on the date of filing with the SEC,
covers the resale by the Initial  Investor of a number of shares of Common Stock
at least  equal to the sum of (x) a number of shares  of Common  Stock  equal to
175% of the number of shares of Common Stock  issuable  upon  conversion  of the
Preferred Shares, determined as if the Preferred Shares, together with 24 months
of accrued and unpaid  dividends  thereon,  were  converted in full at the Fixed
Conversion  Price (as defined in the  Certificate  of  Designations)  on the SEC
Filing  Date plus (y) the  number of  Warrant  Shares  (in each case  determined

                                       -3-
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without  regard to the  limitations  on  beneficial  ownership  contained in the
proviso  to  the  second  sentence  of  Section  10(a)  of  the  Certificate  of
Designations  and Section 1.1(b) of the Warrants).  If at any time the number of
shares of Common Stock  included in the  Registration  Statement  required to be
filed  as  provided  in the  first  sentence  of  this  Section  2(a)  shall  be
insufficient  to cover 125% of the number of shares of Common Stock  issuable on
conversion  in full of the  unconverted  Preferred  Shares  plus the  number  of
Warrant  Shares  issuable  upon  exercise  of  the  unexercised  portion  of the
Warrants,  then  promptly,  but in no  event  later  than  20  days  after  such
insufficiency  shall occur,  the Company  shall file with the SEC an  additional
Registration  Statement on Form S-3 (which shall not constitute a post-effective
amendment to the Registration  Statement filed pursuant to the first sentence of
this Section  2(a)),  covering such number of shares of Common Stock as shall be
sufficient  to permit such  conversion  and  exercise.  For all purposes of this
Agreement  such  additional  Registration  Statement  shall be  deemed to be the
Registration  Statement  required to be filed by the Company pursuant to Section
2(a) of this  Agreement,  and the Company and the Investors  shall have the same
rights and obligations with respect to such additional Registration Statement as
they shall have with respect to the initial  Registration  Statement required to
be  filed  by the  Company  pursuant  to this  Section  2(a).  The  Registration
Statement shall not include securities to be sold for the account of any selling
securityholder  other than the Investors and the investors  contemplated  by the
registration rights agreement entered into by the Company in connection with the
Other Subscription Agreement.

     (2) Prior to the SEC  Effective  Date or during any time  subsequent to the
SEC  Effective  Date  when the  Registration  Statement  for any  reason  is not
available  for  use  by any  Investor  for  the  resale  of  any of  Registrable
Securities,  the Company shall not file any other registration  statement or any
amendment thereto with the SEC under the 1933 Act or request the acceleration of
the effectiveness of any other registration  statement previously filed with the
SEC, other than any registration statement on Form S-4 or Form S-8.

     (b) CERTAIN OFFERINGS. If any offering pursuant to a Registration Statement
pursuant to Section 2(a) hereof involves an underwritten offering, Investors who
hold a  majority  in  interest  of the  Registrable  Securities  subject to such
underwritten  offering  shall have the right to select one legal counsel for the
Investors  and an  investment  banker or  bankers  and  manager or  managers  to
administer  the  offering,  which  investment  banker or  bankers  or manager or
managers shall be reasonably satisfactory to the Company. The Investors who hold
the  Registrable  Securities to be included in such  underwriting  shall pay all
underwriting  discounts  and  commissions  and other fees and  expenses  of such
investment  banker or bankers and manager or managers so selected in  accordance
with this Section 2(b) (other than fees and expenses relating to registration of
Registrable Securities under federal or state securities laws, which are payable
by the Company  pursuant to Section 5 hereof) with respect to their  Registrable
Securities  and the fees and  expenses of such legal  counsel so selected by the
Investors.

     (c)  PAYMENTS BY THE  COMPANY.  If a  Registration  Event  occurs,  on each
Computation  Date the Company shall pay each Investor an amount in cash equal to
1.5% of the aggregate subscription price paid by such Investor for the Preferred
Shares pursuant to the Subscription  Agreement (pro rated for any period of less
than 30 days).  Each such payment shall be made by wire transfer in  immediately
available funds on each  Computation  Date to such account as shall be specified

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for such  purpose by each  Investor.  Any such amount which is not paid when due
shall bear interest at the rate of 14% per annum (or such other rate as shall be
the maximum rate allowable by applicable law) until paid in full.

     (d) PIGGY-BACK REGISTRATIONS. If at any time the Company shall determine to
prepare and file with the SEC a Registration  Statement  relating to an offering
for its own  account or the  account of others  under the 1933 Act of any of its
equity securities,  other than on Form S-4 or Form S-8 or their then 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 Investor who is entitled to registration  rights under this Section
2(d)  written  notice of such  determination  and, if within ten (10) days after
receipt of such notice,  such Investor shall so request in writing,  the Company
shall include in such Registration  Statement all or any part of the Registrable
Securities  such  Investor  requests  to  be  registered,  except  that  if,  in
connection with any underwritten public offering for the account of the Company,
the managing  underwriter(s)  thereof shall impose a limitation on the number of
shares of Common  Stock  which may be  included  in the  Registration  Statement
because,  in such  underwriter(s)'  judgment,  such  limitation  is necessary to
effect  an  orderly  public  distribution  of the  securities  to be sold by the
Company,  then the Company  shall be obligated  to include in such  Registration
Statement only such limited portion of the  Registrable  Securities with respect
to which such  Investor has  requested  inclusion  hereunder.  Any  exclusion of
Registrable  Securities  shall be made pro rata among the  Investors  seeking to
include  Registrable  Securities,  in  proportion  to the number of  Registrable
Securities sought to be included by such Investors;  provided, however, that the
Company  shall not exclude  any  Registrable  Securities  unless the Company has
first excluded all outstanding  securities the holders of which are not entitled
by right to inclusion of securities in such Registration Statement; and provided
further,  however,  that,  after  giving  effect  to the  immediately  preceding
proviso,  any exclusion of  Registrable  Securities  shall be made pro rata with
holders of other  securities  having the right to include such securities in the
Registration Statement, based on the number of securities for which registration
is  requested  except  to the  extent  such pro  rata  exclusion  of such  other
securities is prohibited under any written agreement entered into by the Company
with the holder of such other securities prior to the date of this Agreement, in
which case such other  securities  shall be excluded,  if at all, in  accordance
with the  terms of such  agreement.  No right  to  registration  of  Registrable
Securities  under this Section 2(d) shall be construed to limit any registration
required  under Section 2(a) hereof.  The  obligations of the Company under this
Section  2(d) may be waived by  Investors  holding a majority in interest of the
Registrable  Securities  and shall  expire  after the Company has  afforded  the
opportunity for the Investors to exercise registration rights under this Section
2(d) for two registrations;  provided, however, that any Investor who shall have
had any  Registrable  Securities  excluded  from any  Registration  Statement in
accordance  with this Section 2(d) shall be entitled to include in an additional
Registration  Statement  filed by the  Company  the  Registrable  Securities  so
excluded.  Notwithstanding  any  other  provision  of  this  Agreement,  if  the
Registration  Statement  required to be filed  pursuant to Section  2(a) of this
Agreement  shall have been ordered  effective  by the SEC and the Company  shall
have maintained the effectiveness of such Registration  Statement as required by
this Agreement and if the Company shall  otherwise have complied in all material
respects with its obligations  under this Agreement,  then the Company shall not

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be  obligated  to  register  any  Registrable  Securities  on such  Registration
Statement referred to in this Section 2(d).

     (e)  ELIGIBILITY FOR FORM S-3. The Company meets the  requirements  for the
use of Form S-3 for registration of the Registrable Securities for resale by the
Investors.  The  Company  shall  file all  reports  required  to be filed by the
Company with the SEC in a timely manner so as to maintain such  eligibility  for
the use of Form S-3.

     3.  OBLIGATIONS OF THE COMPANY.  In connection with the registration of the
Registrable Securities, the Company shall:

     (a)  prepare  promptly,  and file with the SEC not later than 30 days after
the  Closing  Date,  a  Registration  Statement  with  respect  to the number of
Registrable  Securities provided in Section 2(a), and thereafter to use its best
efforts to cause each Registration  Statement relating to Registrable Securities
to  become  effective  as soon as  possible  after  such  filing,  and  keep the
Registration  Statement  effective  pursuant to Rule 415 at all times during the
Registration  Period;  submit to the SEC,  within three  Business Days after the
Company learns that no review of the Registration  Statement will be made by the
staff of the SEC or that the  staff of the SEC has no  further  comments  on the
Registration  Statement,  as the case  may be, a  request  for  acceleration  of
effectiveness of the Registration Statement to a time and date not later than 48
hours  after  the  submission  of such  request;  notify  the  Investors  of the
effectiveness  of the  Registration  Statement  on  the  date  the  Registration
Statement is declared effective; and the Company represents and warrants to, and
covenants  and  agrees  with,  the  Investors  that the  Registration  Statement
(including  any  amendments or supplements  thereto and  prospectuses  contained
therein),  at the time it is first filed with the SEC, at the time it is ordered
effective  by the  SEC  and at all  times  during  which  it is  required  to be
effective  hereunder  (and each such  amendment and supplement at the time it is
filed  with the SEC and at all times  during  which it is  available  for use in
connection  with the offer  and sale of the  Registrable  Securities)  shall not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein,  or necessary to make the statements  therein, in
light of the circumstances in which they were made, not misleading;

     (b) prepare and file with the SEC such amendments (including post-effective
amendments)  and  supplements to the  Registration  Statement and the prospectus
used in connection with the  Registration  Statement as may be necessary to keep
the  Registration  Statement  effective  at all times  during  the  Registration
Period, and, during the Registration  Period,  comply with the provisions of the
1933 Act with respect to the  disposition of all  Registrable  Securities of the
Company  covered by the  Registration  Statement  until such time as all of such
Registrable  Securities  have been disposed of in  accordance  with the intended
methods of  disposition  by the  seller or  sellers  thereof as set forth in the
Registration Statement;

     (c) furnish to each Investor whose  Registrable  Securities are included in
the Registration Statement and its legal counsel, (1) promptly after the same is
prepared  and  publicly  distributed,  filed  with  the SEC or  received  by the
Company, one copy of the Registration  Statement and any amendment thereto, each
preliminary  prospectus and prospectus and each amendment or supplement thereto,
each  letter  written by or on behalf of the  Company to the SEC or the staff of

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the SEC and each  item of  correspondence  from the SEC or the  staff of the SEC
relating to such  Registration  Statement (other than any portion of any thereof
which  contains  information  for  which the  Company  has  sought  confidential
treatment)  and  (2)  such  number  of  copies  of  a  prospectus,  including  a
preliminary  prospectus,  and all  amendments and  supplements  thereto and such
other documents,  as such Investor may reasonably request in order to facilitate
the disposition of the Registrable Securities owned by such Investor;

     (d) use  reasonable  efforts to (i)  register  and qualify the  Registrable
Securities  covered by the Registration  Statement under such securities or blue
sky laws of such  jurisdictions as the Investors who hold a majority in interest
of the Registrable Securities being offered reasonably request, (ii) prepare and
file  in  those   jurisdictions   such  amendments   (including   post-effective
amendments) and supplements to such  registrations and  qualifications as may be
necessary  to maintain the  effectiveness  thereof at all times until the end of
the  Registration  Period,  (iii) take such other actions as may be necessary to
maintain such registrations and qualifications in effect at all times during the
Registration  Period and (iv) take all other  actions  reasonably  necessary  or
advisable to qualify the Registrable  Securities for sale in such jurisdictions;
provided,  however,  that  the  Company  shall  not be  required  in  connection
therewith  or as a  condition  thereto  (I) to  qualify  to do  business  in any
jurisdiction  where it would not  otherwise  be required to qualify but for this
Section  3(d),  (II)  to  subject  itself  to  general   taxation  in  any  such
jurisdiction,  (III) to file a general consent to service of process in any such
jurisdiction,  (IV) to provide  any  undertakings  that cause more than  nominal
expense or burden to the Company or (V) to make any change in its Certificate of
Incorporation  or  by-laws,  which in each  case the Board of  Directors  of the
Company  determines to be contrary to the best  interests of the Company and its
stockholders;

     (e) in the event that the  Registrable  Securities  are being offered in an
underwritten  offering,   enter  into  and  perform  its  obligations  under  an
underwriting  agreement,  in  usual  and  customary  form,  including,   without
limitation,  customary  indemnification and contribution  obligations,  with the
underwriters of such offering;

     (f) (1) as promptly as  practicable  after  becoming aware of such event or
circumstance,  notify each  Investor of any event or  circumstance  of which the
Company  has  knowledge  (or in the case of an event  giving  rise to a Blackout
Period,  notify each Investor of the existence of such an event or  circumstance
without disclosing the substance  thereof),  as a result of which the prospectus
included in the Registration  Statement,  as then in effect,  includes an untrue
statement of a material  fact or omits to state a material  fact  required to be
stated  therein or necessary  to make the  statements  therein,  in light of the
circumstances  under  which they were  made,  not  misleading,  and use its best
efforts  promptly  to prepare a  supplement  or  amendment  to the  Registration
Statement to correct such untrue statement or omission,  file such supplement or
amendment  with  the SEC at such  time as shall  permit  the  Investors  to sell
Registrable  Securities  pursuant to the  Registration  Statement as promptly as
practicable,  and deliver a number of copies of such  supplement or amendment to
each Investor as such Investor may reasonably request;

     (2)  notwithstanding  Section  3(f)(1)  above,  if at any time the  Company
notifies the Investors as  contemplated by Section 3(f)(1) that the event giving
rise to such  notice  relates  to a  development  involving  the  Company  which
occurred  subsequent  to the  later  of (x) the SEC  Effective  Date and (y) the

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latest  date  prior  to  such  notice  on  which  the  Company  has  amended  or
supplemented the Registration Statement,  then the Company shall not be required
to use best efforts to make such amendment during a Blackout  Period;  provided,
however,  that (i) the aggregate  number of days on which any Blackout Period is
in effect may not exceed 30 days (whether or not  consecutive)  in any period of
12 consecutive  months;  (ii) no more than two Blackout  Periods may commence in
any period of 12  consecutive  months;  (iii) no  Blackout  Period may  commence
within  60 days  after  the end of an  earlier  Blackout  Period;  and (iv) if a
Blackout  Period  continues  for five or more  days,  on or before the fifth day
thereof  the  Company  shall  deliver  to each  Investor a  certified  copy of a
resolution of the  Company's  Board of Directors  confirming  that such Blackout
Period complies with the definition thereof in Section 1(a);

     (g) as promptly as practicable  after becoming aware of such event,  notify
each Investor who holds  Registrable  Securities being sold (or, in the event of
an underwritten  offering, the managing underwriters) of the issuance by the SEC
of any stop  order or other  suspension  of  effectiveness  of the  Registration
Statement at the earliest possible time;

     (h) permit a single  firm of counsel  designated  as selling  stockholders'
counsel by the  Investors  who hold a majority in  interest  of the  Registrable
Securities  being sold to review and comment on the  Registration  Statement and
all  amendments  and  supplements  thereto a reasonable  period of time prior to
their filing with the SEC;

     (i) make generally  available to its security holders as soon as practical,
but not later  than  ninety  (90) days  after  the close of the  period  covered
thereby,  an earnings  statement (in form  complying with the provisions of Rule
158 under the 1933 Act) covering a twelve-month  period beginning not later than
the first day of the Company's  fiscal quarter next following the effective date
of the Registration Statement;

     (j) in connection  with any  underwritten  offering,  at the request of the
Investors who hold a majority in interest of the  Registrable  Securities  being
sold,  furnish  on the date that  Registrable  Securities  are  delivered  to an
underwriter,  if any, for sale in connection with the Registration Statement (i)
a letter,  dated such date,  from the  Company's  independent  certified  public
accountants  in form  and  substance  as is  customarily  given  by  independent
certified public accountants to underwriters in an underwritten public offering,
addressed  to the  underwriters;  and (ii) an  opinion,  dated such  date,  from
counsel representing the Company for purposes of such Registration Statement, in
form and substance as is customarily  given in an underwritten  public offering,
addressed to the  underwriters and the Investors;  provided,  in each case, that
the Investors make any  confirmations or agreements to or with the Company,  its
accountants   or  its  counsel  as  are  necessary  or  required  by  applicable
professional requirements;

     (k)  make  available  for  inspection  by  any  Investor,  any  underwriter
participating in any disposition pursuant to the Registration Statement, and any
attorney, accountant or other agent retained by any such Investor or underwriter
(collectively,  the  "Inspectors"),  all pertinent  financial and other records,
pertinent corporate documents and properties of the Company  (collectively,  the
"Records"), as shall be reasonably necessary to enable each Investor to exercise
its due diligence  responsibility,  and cause the Company's officers,  directors

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and  employees to supply all  information  which any  Inspector  may  reasonably
request  for  purposes  of such due  diligence;  provided,  however,  that  each
Inspector shall hold in confidence and shall not make any disclosure  (except to
an Investor) of any Record or other information which the Company  determines in
good faith to be  confidential,  and the  Inspectors are so notified or aware of
this status,  unless (i) the disclosure of such Records is necessary to avoid or
correct a  misstatement  or omission  in any  Registration  Statement,  (ii) the
release of such Records is ordered  pursuant to a subpoena or other order from a
court or government  body of competent  jurisdiction or (iii) the information in
such  Records  has been made  generally  available  to the public  other than by
disclosure in violation of this or any other agreement. The Company shall not be
required  to  disclose  any  confidential  information  in such  Records  to any
Inspector   until  and  unless   such   Inspector   shall  have   entered   into
confidentiality  agreements (in form and substance  satisfactory to the Company)
with the Company with respect thereto, substantially in the form of this Section
3(k). Each Investor agrees that it shall,  upon learning that disclosure of such
Records  is  sought  in  or  by  a  court  or  governmental  body  of  competent
jurisdiction or through other means, give prompt notice to the Company and allow
the Company,  at the Company's own expense,  to undertake  appropriate action to
prevent  disclosure of, or to obtain a protective  order for, the Records deemed
confidential.  The  Company  shall  hold in  confidence  and  shall not make any
disclosure  of  information  concerning  an  Investor  provided  to the  Company
pursuant to Section 4(e) hereof  unless (i)  disclosure of such  information  is
necessary to comply with federal or state  securities  laws, (ii) the disclosure
of such  information is necessary to avoid or correct a misstatement or omission
in any Registration Statement,  (iii) the release of such information is ordered
pursuant  to a  subpoena  or other  order from a court or  governmental  body of
competent  jurisdiction  or  (iv)  such  information  has  been  made  generally
available  to the public  other than by  disclosure  in violation of this or any
other agreement. The Company agrees that it shall, upon learning that disclosure
of such  information  concerning  an  Investor  is  sought  in or by a court  or
governmental body of competent  jurisdiction or through other means, give prompt
notice to such Investor and allow such Investor, at such Investor's own expense,
to  undertake  appropriate  action  to  prevent  disclosure  of,  or to obtain a
protective order for, such information;

     (l) use its  best  efforts  (i) to  cause  all the  Registrable  Securities
covered by the  Registration  Statement to be listed on the Nasdaq or such other
principal  securities  market on which  securities  of the same  class or series
issued by the  Company are then  listed or traded or (ii) if  securities  of the
same class or series as the Registrable Securities are not then listed on Nasdaq
or any such other securities market, to cause all of the Registrable  Securities
covered  by the  Registration  Statement  to be  listed  on the New  York  Stock
Exchange, the American Stock Exchange or the Nasdaq National Market;

     (m) provide a transfer agent and  registrar,  which may be a single entity,
for  the  Registrable  Securities  not  later  than  the  effective  date of the
Registration Statement;

     (n)  cooperate  with the Investors who hold  Registrable  Securities  being
offered and the managing underwriter or underwriters,  if any, to facilitate the
timely  preparation  and delivery of  certificates  (not bearing any restrictive
legends)  representing  Registrable  Securities  to be offered  pursuant  to the
Registration  Statement and enable such certificates to be in such denominations
or amounts, as the case may be, as the managing underwriter or underwriters,  if

                                      -9-
<PAGE>
any, or the Investors may reasonably request and registered in such names as the
managing underwriter or underwriters, if any, or the Investors may request; and,
within  three  Business  Days  after a  Registration  Statement  which  includes
Registrable  Securities  is ordered  effective  by the SEC,  the  Company  shall
deliver to the transfer agent for the Registrable Securities (with copies to the
Investors  whose  Registrable  Securities  are  included  in  such  Registration
Statement) an instruction substantially in the form attached hereto as EXHIBIT 1
and shall  cause  legal  counsel  selected  by the  Company  to  deliver  to the
Investors  opinions of such counsel in the forms attached  hereto as EXHIBIT 2-A
and EXHIBIT 2-B (with copies to the Company's transfer agent);

     (o) during the period the Company is required to maintain  effectiveness of
the Registration  Statement  pursuant to Section 3(a), the Company shall not bid
for or  purchase  any  Common  Stock or any right to  purchase  Common  Stock or
attempt to induce any person to purchase any such security or right if such bid,
purchase or attempt  would in any way limit the right of the  Investors  to sell
Registrable  Securities by reason of the  limitations  set forth in Regulation M
under the 1934 Act; and

     (p) take all other reasonable  actions necessary to expedite and facilitate
disposition  by the  Investors  of the  Registrable  Securities  pursuant to the
Registration Statement.

     4. OBLIGATIONS OF THE INVESTORS. In connection with the registration of the
Registrable Securities, the Investors shall have the following obligations:

     (a) It shall be a condition  precedent to the obligations of the Company to
complete  the  registration  pursuant  to this  Agreement  with  respect  to the
Registrable Securities of a particular Investor that such Investor shall furnish
to the Company such information  regarding  itself,  the Registrable  Securities
held by it and the intended method of disposition of the Registrable  Securities
held by it as shall be reasonably  required to effect the  registration  of such
Registrable  Securities and shall execute such documents in connection with such
registration as the Company may reasonably  request. At least five days prior to
the first  anticipated  filing date of the Registration  Statement,  the Company
shall notify each  Investor of the  information  the Company  requires from each
such  Investor  (the  "Requested   Information")   if  any  of  such  Investor's
Registrable Securities are eligible for inclusion in the Registration Statement.
If at least  one  Business  Day prior to the  filing  date the  Company  has not
received  the  Requested   Information  from  an  Investor  (a   "Non-Responsive
Investor"),  then  the  Company  may  file the  Registration  Statement  without
including Registrable Securities of such Non-Responsive  Investor but, until the
Registration Statement is declared effective,  the Company shall not be relieved
of its obligation to file a Registration  Statement with the SEC relating to the
Registrable  Securities  of such  Non-Responsive  Investor  promptly  after such
Non-Responsive Investor provides the Requested Information;

     (b)  Each  Investor  by  such  Investor's  acceptance  of  the  Registrable
Securities  agrees to cooperate with the Company as reasonably  requested by the
Company  in  connection  with the  preparation  and  filing of the  Registration
Statement hereunder, unless such Investor has notified the Company in writing of
such  Investor's  election  to  exclude  all  of  such  Investor's   Registrable
Securities from the Registration Statement;

                                      -10-
<PAGE>
     (c)  In  the  event  Investors  holding  a  majority  in  interest  of  the
Registrable  Securities being registered  determine to engage the services of an
underwriter,  each  Investor  agrees to enter into and perform  such  Investor's
obligations  under an  underwriting  agreement,  in usual  and  customary  form,
including,  without  limitation,   customary  indemnification  and  contribution
obligations,  with the managing underwriter of such offering and take such other
actions as are  reasonably  required  in order to  expedite  or  facilitate  the
disposition of the Registrable Securities, unless such Investor has notified the
Company in writing of such Investor's election to exclude all of such Investor's
Registrable Securities from the Registration Statement;

     (d) Each Investor  agrees that, upon receipt of any notice from the Company
of the  happening  of any event of the kind  described  in Section 3(f) or 3(g),
such Investor will immediately discontinue disposition of Registrable Securities
pursuant to the  Registration  Statement  covering such  Registrable  Securities
until  such  Investor's  receipt of the  copies of the  supplemented  or amended
prospectus  contemplated  by Section  3(f) or 3(g) and,  if so  directed  by the
Company,  such  Investor  shall  deliver to the  Company  (at the expense of the
Company) or destroy (and deliver to the Company a  certificate  of  destruction)
all  copies  in such  Investor's  possession  of the  prospectus  covering  such
Registrable Securities current at the time of receipt of such notice;

     (e) No Investor may participate in any underwritten  registration hereunder
unless such Investor (i) agrees to sell such Investor's  Registrable  Securities
on the basis provided in any underwriting arrangements approved by the Investors
entitled hereunder to approve such arrangements, (ii) completes and executes all
questionnaires,  powers of attorney,  indemnities,  underwriting  agreements and
other  documents  reasonably  required  under  the  terms  of such  underwriting
arrangements  and  (iii)  agrees to pay its pro rata  share of all  underwriting
discounts and commissions and other fees and expenses of investment  bankers and
any  manager  or  managers  of  such  underwriting  and  legal  expenses  of the
underwriters applicable with respect to its Registrable Securities, in each case
to the  extent  not  payable  by the  Company  pursuant  to the  terms  of  this
Agreement; and

     (f) Each Investor agrees to take all reasonable actions necessary to comply
with the  prospectus  delivery  requirements  of the 1933 Act  applicable to its
sales of Registrable Securities.

     5.  EXPENSES  OF  REGISTRATION.   All  reasonable   expenses,   other  than
underwriting discounts and commissions and other fees and expenses of investment
bankers  and other than  brokerage  commissions,  incurred  in  connection  with
registrations,   filings  or  qualifications  pursuant  to  Sections  2  and  3,
including,  without  limitation,  all registration,  listing and  qualifications
fees, printers and accounting fees and the fees and disbursements of counsel for
the Company and the Investors shall be borne by the Company, PROVIDED,  HOWEVER,
that the  Investors  shall bear the fees and  out-of-pocket  expenses of the one
legal counsel selected by the Investors pursuant to Section 2(b) hereof.

     6. INDEMNIFICATION. In the event any Registrable Securities are included in
a Registration Statement under this Agreement:

                                      -11-
<PAGE>
     (a) To the extent  permitted by law, the Company  will  indemnify  and hold
harmless each Investor who holds such Registrable Securities,  the directors, if
any, of such Investor,  the officers, if any, of such Investor,  each person, if
any, who  controls  any Investor  within the meaning of the 1933 Act or the 1934
Act,  any  underwriter  (as  defined  in the 1933  Act) for the  Investors,  the
directors,  if  any,  of such  underwriter  and the  officers,  if any,  of such
underwriter,  and each person, if any, who controls any such underwriter  within
the  meaning of the 1933 Act or the 1934 Act (each,  an  "Indemnified  Person"),
against any losses, claims, damages,  liabilities or expenses (joint or several)
incurred (collectively,  "Claims") to which any of them may become subject under
the 1933 Act, the 1934 Act or  otherwise,  insofar as such Claims (or actions or
proceedings,  whether commenced or threatened,  in respect thereof) arise out of
or are based  upon any of the  following:  (i) any untrue  statement  or alleged
untrue statement of a material fact contained in the  Registration  Statement or
any  post-effective  amendment  thereof or the  omission or alleged  omission to
state therein a material fact required to be stated therein or necessary to make
the  statements  therein not  misleading,  (ii) any untrue  statement or alleged
untrue  statement of a material fact contained in any preliminary  prospectus if
used prior to the effective date of such Registration Statement, or contained in
the final  prospectus  (as amended or  supplemented,  if the  Company  files any
amendment thereof or supplement thereto with the SEC) or the omission or alleged
omission to state  therein any material  fact  necessary to make the  statements
made therein,  in light of the circumstances  under which the statements therein
were made,  not  misleading or (iii) any  violation or alleged  violation by the
Company of the 1933 Act, the 1934 Act, any state  securities  law or any rule or
regulation  under the 1933 Act,  the 1934 Act or any state  securities  law (the
matters  in  the  foregoing  clauses  (i)  through  (iii)  being,  collectively,
"Violations").  Subject  to the  restrictions  set  forth in  Section  6(d) with
respect  to the  number  of legal  counsel,  the  Company  shall  reimburse  the
Investors  and the other  Indemnified  Persons,  promptly as such  expenses  are
incurred  and are due  and  payable,  for any  legal  fees or  other  reasonable
expenses incurred by them in connection with investigating or defending any such
Claim.   Notwithstanding   anything  to  the  contrary   contained  herein,  the
indemnification agreement contained in this Section 6(a): (I) shall not apply to
a Claim  arising out of or based upon a Violation  which occurs in reliance upon
and in conformity  with  information  furnished in writing to the Company by any
Indemnified  Person or underwriter for such Indemnified Person expressly for use
in connection with the preparation of the Registration Statement, the prospectus
or any such  amendment  thereof or supplement  thereto,  if such  prospectus was
timely made available by the Company pursuant to Section 3(c) hereof;  (II) with
respect to any preliminary prospectus shall not inure to the benefit of any such
person from whom the person  asserting any such Claim  purchased the Registrable
Securities  that  are the  subject  thereof  (or to the  benefit  of any  person
controlling  such person) if the untrue  statement or omission of material  fact
contained in the preliminary prospectus was corrected in the prospectus, as then
amended or  supplemented,  if such  prospectus  was timely made available by the
Company  pursuant to Section 3(c)  hereof;  and (III) shall not apply to amounts
paid in settlement of any Claim if such settlement is effected without the prior
written  consent  of the  Company,  which  consent  shall  not  be  unreasonably
withheld. Such indemnity shall remain in full force and effect regardless of any
investigation  made by or on behalf of the Indemnified  Person and shall survive
the transfer of the Registrable  Securities by the Investors pursuant to Section
9.

                                      -12-
<PAGE>
     (b) In connection with any  Registration  Statement in which an Investor is
participating,  each such Investor agrees to indemnify and hold harmless, to the
same extent and in the same manner set forth in Section 6(a), the Company,  each
of its  directors,  each of its officers who signs the  Registration  Statement,
each person, if any, who controls the Company within the meaning of the 1933 Act
or the 1934 Act, any underwriter and any other  stockholder  selling  securities
pursuant to the  Registration  Statement or any of its  directors or officers or
any person who controls such  stockholder or  underwriter  within the meaning of
the 1933 Act or the 1934 Act  (collectively  and  together  with an  Indemnified
Person,  an  "Indemnified  Party"),  against  any Claim to which any of them may
become subject,  under the 1933 Act, the 1934 Act or otherwise,  insofar as such
Claim  arises  out of or is based  upon (i) any  Violation,  in each case to the
extent (and only to the extent) that such Violation  occurs in reliance upon and
in conformity with written information furnished to the Company by such Investor
expressly  for use in  connection  with such  Registration  Statement  or (ii) a
failure to comply with the prospectus delivery requirements of the 1933 Act; and
such Investor will reimburse any legal or other expenses  reasonably incurred by
any  Indemnified  Party in connection with  investigating  or defending any such
Claim; provided, however, that the indemnity agreement contained in this Section
6(b)  shall  not  apply  to  amounts  paid in  settlement  of any  Claim if such
settlement is effected without the prior written consent of such Investor, which
consent shall not be unreasonably withheld; provided, further, however, that the
Investor shall be liable under this Section 6(b) for only that amount of a Claim
as does not exceed the amount by which the net  proceeds to such  Investor  from
the sale of  Registrable  Securities  pursuant  to such  Registration  Statement
exceeds the cost of such Registrable Securities to such Investor. Such indemnity
shall remain in full force and effect regardless of any investigation made by or
on  behalf of such  Indemnified  Party and shall  survive  the  transfer  of the
Registrable  Securities by the Investors pursuant to Section 9.  Notwithstanding
anything  to  the  contrary  contained  herein,  the  indemnification  agreement
contained in this Section 6(b) with respect to any preliminary  prospectus shall
not inure to the benefit of any  Indemnified  Party if the untrue  statement  or
omission of material fact contained in the preliminary  prospectus was corrected
on a timely basis in the prospectus, as then amended or supplemented.

     (c) The Company shall be entitled to receive indemnities from underwriters,
selling brokers,  dealer managers and similar securities industry  professionals
participating in any  distribution,  to the same extent as provided above,  with
respect to  information  so furnished in writing by such persons  expressly  for
inclusion in the Registration Statement.

     (d) Promptly  after receipt by an Indemnified  Person or Indemnified  Party
under this Section 6 of notice of the commencement of any action  (including any
governmental  action),  such Indemnified Person or Indemnified Party shall, if a
Claim in respect thereof is to be made against any indemnifying party under this
Section  6,  deliver  to  the  indemnifying   party  a  written  notice  of  the
commencement  thereof  and the  indemnifying  party  shall  have  the  right  to
participate in, and, to the extent the  indemnifying  party so desires,  jointly
with any other indemnifying  party similarly  noticed,  to assume control of the
defense thereof with counsel selected by the  indemnifying  party but reasonably
acceptable to the Indemnified  Person or the Indemnified  Party, as the case may
be; provided,  however,  that an Indemnified  Person or Indemnified  Party shall
have the right to retain its own counsel  with the fees and  expenses to be paid
by the indemnifying  party, if, in the reasonable opinion of counsel retained by
the indemnifying  party, the  representation  by such counsel of the Indemnified

                                      -13-
<PAGE>
Person or Indemnified  Party and the  indemnifying  party would be inappropriate
due to actual or potential  differing  interests between such Indemnified Person
or  Indemnified  Party and any other party  represented  by such counsel in such
proceeding.  In such event,  the Company  shall pay for only one separate  legal
counsel for the Investors; such legal counsel shall be selected by the Investors
holding a majority  in interest of the  Registrable  Securities  included in the
Registration  Statement  to which the Claim  relates.  The  failure  to  deliver
written  notice  to the  indemnifying  party  within  a  reasonable  time of the
commencement of any such action shall not relieve such indemnifying party of any
liability to the Indemnified  Person or Indemnified  Party under this Section 6,
except to the extent that the indemnifying party is prejudiced in its ability to
defend such action. The indemnification required by this Section 6 shall be made
by  periodic   payments  of  the  amount   thereof  during  the  course  of  the
investigation or defense, as such expense, loss, damage or liability is incurred
and is due and payable.

     7. CONTRIBUTION. To the extent any indemnification by an indemnifying party
is  prohibited  or limited by law,  the  indemnifying  party  agrees to make the
maximum contribution with respect to any amounts for which it would otherwise be
liable  under  Section  6 to the  fullest  extent  permitted  by law;  provided,
however,  that (a) no contribution shall be made under  circumstances  where the
maker would not have been liable for  indemnification  under the fault standards
set  forth in  Section  6, (b) no  seller of  Registrable  Securities  guilty of
fraudulent  misrepresentation  (within the meaning of Section  11(f) of the 1933
Act) shall be entitled to contribution from any seller of Registrable Securities
who was not guilty of such fraudulent  misrepresentation and (c) contribution by
any seller of Registrable Securities shall be limited in amount to the amount by
which the net amount of  proceeds  received by such seller from the sale of such
Registrable  Securities  exceeds the purchase price paid by such seller for such
Registrable Securities.

     8. REPORTS UNDER 1934 ACT. With a view to making available to the Investors
the benefits of Rule 144, the Company agrees 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 1933 Act and the 1934 Act; and

     (c) furnish to each  Investor  so long as such  Investor  owns  Registrable
Securities,  promptly upon request,  (i) a written statement by the Company that
it has complied  with the reporting  requirements  of Rule 144 and the 1934 Act,
(ii) a copy of the most  recent  annual or  quarterly  report of the Company and
such other  reports and  documents  so filed by the Company and (iii) such other
information as may be reasonably  requested to permit the Investors to sell such
securities pursuant to Rule 144 without registration.

     9. ASSIGNMENT OF THE  REGISTRATION  RIGHTS.  The rights to have the Company
register   Registrable   Securities   pursuant  to  this   Agreement   shall  be
automatically assigned by the Investors to an Affiliate (as such term is defined
in the Certificate of  Designations)  thereof or to any transferee of all or any

                                      -14-
<PAGE>
portion of such  securities  which  portion is not less than  100,000  shares of
Common Stock (or to any transferee of all or any portion of the Preferred Shares
or the Warrants  which  transfer is  permitted by Sections  4(a) and 4(h) of the
Subscription  Agreement)  only if: (a) the  Investor  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, (b) the
Company  is,  within a  reasonable  time  after  such  transfer  or  assignment,
furnished with written notice of (i) the name and address of such  transferee or
assignee and (ii) the securities with respect to which such registration  rights
are being  transferred or assigned,  (c) immediately  following such transfer or
assignment  the further  disposition  of such  securities  by the  transferee or
assignee is restricted  under the 1933 Act and applicable state securities laws,
and  (d)  at or  before  the  time  the  Company  receives  the  written  notice
contemplated by clause (b) of this sentence the transferee or assignee agrees in
writing with the Company to be bound by all of the provisions  contained herein.
In  connection  with any such transfer the Company  shall,  at its sole cost and
expense, promptly after such assignment take such actions as shall be reasonably
acceptable  to the  Initial  Investor  and such  transferee  to assure  that the
Registration  Statement  and related  prospectus  are  available for use by such
transferee  for sales of the  Registrable  Securities  in  respect  of which the
rights  to  registration  have been so  assigned.  In  connection  with any such
assignment, each Investor shall have the right to assign to such transferee such
Investor's rights under the Subscription  Agreement by notice of such assignment
to the  Company.  Following  such  notice  of  assignment  of  rights  under the
Subscription Agreement,  the Company shall be obligated to such transferee,  and
such  transferee  shall be  obligated  to the  Company,  to  perform  all of its
covenants under the Subscription  Agreement as if such transferee were the Buyer
under the Subscription Agreement.

     10. AMENDMENT OF REGISTRATION  RIGHTS.  Any provision of this Agreement may
be amended and the observance  thereof may be waived  (either  generally or in a
particular  instance and either  retroactively or prospectively),  only with the
written  consent of the Majority  Holders.  Any amendment or waiver  effected in
accordance  with this  Section 10 shall be binding  upon each  Investor  and the
Company.

     11. MISCELLANEOUS.

     (a) A person or entity is deemed to be a holder of  Registrable  Securities
whenever such person or entity owns of record such  Registrable  Securities.  If
the Company receives conflicting instructions,  notices or elections from two or
more persons or entities with respect to the same  Registrable  Securities,  the
Company shall act upon the basis of  instructions,  notice or election  received
from the registered owner of such Registrable Securities.

     (b) Notices required or permitted to be given hereunder shall be in writing
and shall be deemed to be sufficiently given when personally delivered (by hand,
by  courier,  by  telephone  line  facsimile   transmission  (with  answer  back
confirmation) or other means) (i) if to the Company, at 2222 West Peoria Avenue,
Phoenix,  Arizona 85029,  Attention:  Chief  Executive  Officer,  telephone line
facsimile  transmission number (602) 331-0941,  (ii) if to the Initial Investor,
c/o Genesee  International,  Inc., 10500 N.E. 8th Street,  Suite 1920, Bellevue,
Washington  98004-4332,  telephone  line  facsimile  transmission  number  (425)
462-4645 and (iii) if to any other  Investor,  at such address as such  Investor
shall have provided in writing to the Company,  or at such other address as each

                                      -15-
<PAGE>
such party furnishes by notice given in accordance with this Section 11(b),  and
shall be effective upon receipt.

     (c)  Failure  of any  party to  exercise  any right or  remedy  under  this
Agreement or otherwise,  or delay by a party in exercising such right or remedy,
shall not operate as a waiver thereof.

     (d)  This  Agreement  shall  be  enforced,  governed  by and  construed  in
accordance  with the laws of the State of Arizona  applicable to agreements made
and to be performed  entirely within such State. In the event that any provision
of this Agreement is invalid or  unenforceable  under any applicable  statute or
rule of law, then such provision shall be deemed  inoperative to the extent that
it may  conflict  therewith  and shall be deemed  modified to conform  with such
statute  or rule of law.  Any  provision  hereof  which  may  prove  invalid  or
unenforceable  under any law shall not affect the validity or  enforceability of
any other provision hereof.

     (e) This  Agreement  constitutes  the entire  agreement  among the  parties
hereto with respect to the subject  matter  hereof.  There are no  restrictions,
promises, warranties or undertakings,  other than those set forth or referred to
herein. This Agreement  supersedes all prior agreements and understandings among
the parties hereto with respect to the subject matter hereof.

     (f) Subject to the  requirements of Section 9 hereof,  this Agreement shall
inure to the benefit of and be binding upon the  successors  and assigns of each
of the parties hereto.

     (g) All  pronouns  and  any  variations  thereof  refer  to the  masculine,
feminine or neuter, singular or plural, as the context may require.

     (h) The headings in this  Agreement are for  convenience  of reference only
and shall not limit or otherwise affect the meaning hereof.

     (i) The Company acknowledges that any failure by the Company to perform its
obligations under this Agreement,  including,  without limitation, the Company's
obligations under Section 3(n), or any delay in such performance could result in
damages to the Investors  and the Company  agrees that, in addition to any other
liability  the  Company  may have by reason of any such  failure  or delay,  the
Company shall be liable for all direct and  consequential  damages caused by any
such failure or delay.

     (j) Each party shall do and perform, or cause to be done and performed, all
such  further  acts and  things,  and shall  execute  and deliver all such other
agreements,  certificates,  instruments  and  documents,  as the other party may
reasonably  request in order to carry out the intent and accomplish the purposes
of this Agreement and the consummation of the transactions contemplated hereby.

     (k) The language used in this  Agreement  will be deemed to be the language
chosen by the parties to express  their  mutual  intent,  and no rules of strict
construction will be applied against any party.

                                      -16-
<PAGE>
     (l) This  Agreement  may be executed in two or more  counterparts,  each of
which shall be deemed an original but all of which shall  constitute one and the
same agreement.  This Agreement,  once executed by a party,  may be delivered to
the other party hereto by telephone  line  facsimile  transmission  of a copy of
this Agreement bearing the signature of the party so delivering this Agreement.

                                      -17-
<PAGE>
     IN WITNESS  WHEREOF,  the parties  have caused  this  Agreement  to be duly
executed by their  respective  officers  thereunto duly authorized as of day and
year first above written.

                                        TITAN MOTORCYCLE CO. OF AMERICA

                                        By: /s/ Francis S. Keery
                                           -------------------------------------
                                        Name: Francis S. Keery
                                        Title:  Chief Executive Officer

                                        ADVANTAGE FUND II LTD.

                                        By: Genessee International, Inc.,
                                            as General Manager

                                        By: /s/ Donald R. Morken
                                            ------------------------------------
                                            President
<PAGE>
                                                                   EXHIBIT 1
                                                                      TO
                                                                  REGISTRATION
                                                                RIGHTS AGREEMENT

                              [Company Letterhead]

                                     [Date]

Signature Stock Transfer, Inc.,
as Conversion Agent, Warrant Agent and Registrar
14675 Midway Road
Suite 221
Dallas, Texas 75244

Ladies and Gentlemen:

     This letter shall serve as our irrevocable  authorization  and direction to
you [(1) to transfer or re-register  the  certificates  for the shares of Common
Stock, $.001 par value (the "Common Stock"), of Titan Motorcycle Co. of America,
a Nevada corporation (the "Company"), represented by certificate numbers _______
and _______ for an aggregate  of _______  shares (the  "Outstanding  Shares") of
Common  Stock  presently  registered  in the name of [Name  of  Investors]  upon
surrender of such certificate(s) to you, notwithstanding the legend appearing on
such certificates,  and (2) ]* to issue (a) shares (the "Conversion  Shares") of
Common Stock to or upon the order of the holder from time to time on  conversion
of the shares (the "Preferred Shares") of Series B Convertible  Preferred Stock,
$.001 par value, of the Company upon receipt by you of a Notice of Conversion of
Series B  Convertible  Preferred  Stock in the form enclosed  herewith,  and (b)
shares (the "Warrant Shares") of Common Stock to or upon the order of the holder
from  time to time on  exercise  of the  Common  Stock  Purchase  Warrants  (the
"Warrants")  exercisable  for Common Stock issued by the Company upon receipt by
you of a Subscription Form from such holder in the form enclosed herewith.  [The
transfer or  re-registration  of the certificates for the Outstanding  Shares by
you  should be made at such  time as you are  requested  to do so by the  record
holder of the Outstanding  Shares.  The certificate issued upon such transfer or
re-registration  should be registered in such name as requested by the holder of
record of the  certificate  surrendered  to you and  should  not bear any legend
which  would  restrict  the  transfer  of the  shares  represented  thereby.  In
addition,  you are  hereby  directed  to remove  any  stop-transfer  instruction
relating to the Outstanding Shares.]* Certificates for the Conversion Shares and
Warrant Shares should not bear any restrictive  legend and should not be subject
to any stop-transfer restriction.

     Contemporaneously  with  the  delivery  of  this  letter,  the  Company  is
delivering to you an opinion of Snell & Wilmer L.L.P.  as to registration of the
resale of [the Outstanding Shares and]* the Conversion Shares and Warrant Shares
under the Securities Act of 1933, as amended.

----------
*    Omit if no  conversions  of Preferred  Stock or exercises of Warrants  have
     occurred before SEC registration is declared effective.
<PAGE>
     Should you have any questions concerning this matter, please contact me.

                                        Very truly yours,

                                        TITAN MOTORCYCLE CO. OF AMERICA

                                        By:
                                           -------------------------------------
                                        Name:
                                             -----------------------------------
                                        Title:
                                              ----------------------------------
Enclosures
cc: [Names of Investor]REGISTRATION RIGHTS AGREEMENT

     THIS  REGISTRATION  RIGHTS  AGREEMENT,  dated  as of March  7,  2000  (this
"Agreement"),  is made by and between TITAN MOTORCYCLE CO. OF AMERICA,  a Nevada
corporation (the  "Company"),  and the person named on the signature page hereto
(the "Initial Investor").

                                  WITNESSETH:
                                  -----------

     WHEREAS, in connection with the Subscription  Agreement,  dated as of March
7, 2000,  between  the  Initial  Investor  and the  Company  (the  "Subscription
Agreement"),  the  Company  has  agreed,  upon  the  terms  and  subject  to the
conditions  of the  Subscription  Agreement,  to issue  and sell to the  Initial
Investor  shares  (the  "Preferred  Shares") of Series B  Convertible  Preferred
Stock,  $.001 par value (the  "Series B  Preferred  Stock"),  of the  Company as
provided in the Subscription  Agreement,  which Preferred Shares are convertible
into shares (the  "Conversion  Shares")  of Common  Stock,  $.001 par value (the
"Common  Stock"),  of the Company,  and to issue common stock purchase  warrants
(the "Warrants") to purchase shares (the "Warrant Shares") of Common Stock; and

     WHEREAS,  to induce  the  Initial  Investor  to  execute  and  deliver  the
Subscription  Agreement,  the Company has agreed to provide certain registration
rights  under  the  Securities  Act of  1933,  as  amended,  and the  rules  and
regulations  thereunder,  or any similar  successor statute  (collectively,  the
"1933 Act"), and applicable state securities laws with respect to the Conversion
Shares and the Warrant Shares;

     NOW,  THEREFORE,  in consideration of the premises and the mutual covenants
contained  herein and other good and  valuable  consideration,  the  receipt and
sufficiency  of which are  hereby  acknowledged,  the  Company  and the  Initial
Investor hereby agree as follows:

     1. DEFINITIONS.

     (a) As used in this Agreement, the following terms shall have the following
meanings:

     "Blackout  Period" means the period of up to 30 consecutive days commencing
on the day  immediately  after the date the Company  notifies the Investors that
they are  required,  pursuant to Section  4(d),  to suspend  offers and sales of
Registrable  Securities  as a result of an event or  circumstance  described  in
Section 3(f)(1) during which period,  by reason of Section 3(f)(2),  the Company
<PAGE>
is not  required  to amend  the  Registration  Statement  or to  supplement  the
prospectus contained therein;  provided,  however, that in each case the Company
shall have determined,  in its reasonable  judgment,  that public  disclosure of
such event or circumstance at such time would be detrimental to the Company.

     "Certificate of Designations"  means the Certificate of Designations of the
Series B Convertible  Preferred Stock  establishing and designating the Series B
Preferred Stock and fixing the rights and preferences of such series as filed by
the Company with the Secretary of State of the State of Nevada.

     "Computation  Date" means, if a Registration  Event occurs,  any of (1) the
date which is 30 days after such Registration  Event occurs, if any Registration
Event is  continuing  on such  date,  (2)  each  date  which is 30 days  after a
Computation Date, if any Registration  Event is continuing on such date, and (3)
the date on which all Registration Events cease to continue.

     "Investor" or "Investors"  means the Initial Investor and any transferee or
assignee  who agrees to become  bound by the  provisions  of this  Agreement  in
accordance with Section 9 hereof.

     "Majority Holders" means those persons who hold a majority of the shares of
Series B  Preferred  Stock  which are then  outstanding,  including  such shares
originally  issued  pursuant  to  the  Subscription   Agreement  and  the  Other
Subscription Agreement.

     "Nasdaq" means the Nasdaq SmallCap Market.

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

     "register,"  "registered,"  and  "registration"  refer  to  a  registration
effected by  preparing  and filing a  Registration  Statement or  Statements  in
compliance  with the 1933 Act and pursuant to Rule 415 under the 1933 Act or any
successor  rule providing for offering  securities on a continuous  basis ("Rule
415"),  and the declaration or ordering of  effectiveness  of such  Registration
Statement by the SEC.

     "Registrable  Securities"  means  the  Conversion  Shares  and the  Warrant
Shares.

     "Registration  Event"  shall  mean  (1)  the  Company  fails  to  file  the
Registration  Statement which is required to be filed by the Company pursuant to
Section  2(a)  with the SEC  within  30 days  after the  Closing  Date,  (2) the
Registration  Statement covering the Registrable Securities which is required to
be filed by the Company pursuant to the first sentence of Section 2(a) hereof is
not effective  within 120 days after the Closing Date,  (3) the Company fails to
submit a request for  acceleration  of the  effective  date of the  Registration
Statement  in  accordance  with Section  3(a),  (4) the  Registration  Statement
required to be filed by the Company  pursuant to Section  2(a) shall cease to be
available for use by any Investor who is named therein as a selling  stockholder
for any reason (including, without limitation, by reason of an SEC stop order, a
material  misstatement  or  omission  in  such  Registration  Statement  or  the
information  contained in such  Registration  Statement  having become outdated)
other  than a Blackout  Period,  (5) the  Common  Stock  ceases to be listed for

                                      -2-
<PAGE>
trading on any of the New York Stock  Exchange,  the  American  Stock  Exchange,
Inc.,  the Nasdaq  National  Market or the Nasdaq,  or (6) a holder of shares of
Series B Preferred  Stock having become unable to convert any shares of Series B
Preferred  Stock  in  accordance  with  Section  10(a)  of  the  Certificate  of
Designations  (other  than  by  reason  of the  4.9%  limitation  on  beneficial
ownership set forth therein or a redemption or repurchase thereof).

     "Registration  Period"  means  the  period  from  the  Closing  Date to the
earliest of (i) the date which is five years after the SEC Effective  Date, (ii)
the date on which each  Investor may sell all  Registrable  Securities  owned by
such  Investor  or  which  such  Investor  has  any  right  to  acquire  without
registration  under the 1933 Act pursuant to subsection (k) of Rule 144, without
restriction on the manner of sale or the volume of securities  which may be sold
in any period and  without the  requirement  for the giving of any notice to, or
the making of any filing with, the SEC and (iii) the date on which the Investors
no  longer  beneficially  own or have  any  right  to  acquire  any  Registrable
Securities.

     "Registration  Statement"  means a  registration  statement  of the Company
under the 1933 Act, including any amendment thereto.

     "Rule  144"  means  Rule 144  promulgated  under  the 1933 Act or any other
similar  rule or  regulation  of the SEC that may at any time permit a holder of
any  securities  to  sell  securities  of  the  Company  to the  public  without
registration under the 1933 Act.

     "SEC" means the Securities and Exchange Commission.

     "SEC Effective Date" means the date the Registration  Statement is declared
effective by the SEC.

     "SEC Filing Date" means the date the Registration  Statement is first filed
with the SEC pursuant to Section 2(a).

     (b) Capitalized terms defined in the introductory paragraph or the recitals
to  this  Agreement  shall  have  the  respective   meanings  therein  provided.
Capitalized  terms used herein and not otherwise  defined  herein shall have the
respective meanings set forth in the Subscription Agreement.

     2. REGISTRATION.

     (a) MANDATORY REGISTRATION.  (1) The Company shall prepare, and on or prior
to the  date  which is 30 days  after  the  Closing  Date,  file  with the SEC a
Registration  Statement  on Form S-3 which,  on the date of filing with the SEC,
covers the resale by the Initial  Investor of a number of shares of Common Stock
at least  equal to the sum of (x) a number of shares  of Common  Stock  equal to
175% of the number of shares of Common Stock  issuable  upon  conversion  of the
Preferred Shares, determined as if the Preferred Shares, together with 24 months
of accrued and unpaid  dividends  thereon,  were  converted in full at the Fixed
Conversion  Price (as defined in the  Certificate  of  Designations)  on the SEC
Filing  Date plus (y) the  number of  Warrant  Shares  (in each case  determined

                                      -3-
<PAGE>
without  regard to the  limitations  on  beneficial  ownership  contained in the
proviso  to  the  second  sentence  of  Section  10(a)  of  the  Certificate  of
Designations  and Section 1.1(b) of the Warrants).  If at any time the number of
shares of Common Stock  included in the  Registration  Statement  required to be
filed  as  provided  in the  first  sentence  of  this  Section  2(a)  shall  be
insufficient  to cover 125% of the number of shares of Common Stock  issuable on
conversion  in full of the  unconverted  Preferred  Shares  plus the  number  of
Warrant  Shares  issuable  upon  exercise  of  the  unexercised  portion  of the
Warrants,  then  promptly,  but in no  event  later  than  20  days  after  such
insufficiency  shall occur,  the Company  shall file with the SEC an  additional
Registration  Statement on Form S-3 (which shall not constitute a post-effective
amendment to the Registration  Statement filed pursuant to the first sentence of
this Section  2(a)),  covering such number of shares of Common Stock as shall be
sufficient  to permit such  conversion  and  exercise.  For all purposes of this
Agreement  such  additional  Registration  Statement  shall be  deemed to be the
Registration  Statement  required to be filed by the Company pursuant to Section
2(a) of this  Agreement,  and the Company and the Investors  shall have the same
rights and obligations with respect to such additional Registration Statement as
they shall have with respect to the initial  Registration  Statement required to
be  filed  by the  Company  pursuant  to this  Section  2(a).  The  Registration
Statement shall not include securities to be sold for the account of any selling
securityholder  other than the Investors and the investors  contemplated  by the
registration rights agreement entered into by the Company in connection with the
Other Subscription Agreement.

     (2) Prior to the SEC  Effective  Date or during any time  subsequent to the
SEC  Effective  Date  when the  Registration  Statement  for any  reason  is not
available  for  use  by any  Investor  for  the  resale  of  any of  Registrable
Securities,  the Company shall not file any other registration  statement or any
amendment thereto with the SEC under the 1933 Act or request the acceleration of
the effectiveness of any other registration  statement previously filed with the
SEC, other than any registration statement on Form S-4 or Form S-8.

     (b) CERTAIN OFFERINGS. If any offering pursuant to a Registration Statement
pursuant to Section 2(a) hereof involves an underwritten offering, Investors who
hold a  majority  in  interest  of the  Registrable  Securities  subject to such
underwritten  offering  shall have the right to select one legal counsel for the
Investors  and an  investment  banker or  bankers  and  manager or  managers  to
administer  the  offering,  which  investment  banker or  bankers  or manager or
managers shall be reasonably satisfactory to the Company. The Investors who hold
the  Registrable  Securities to be included in such  underwriting  shall pay all
underwriting  discounts  and  commissions  and other fees and  expenses  of such
investment  banker or bankers and manager or managers so selected in  accordance
with this Section 2(b) (other than fees and expenses relating to registration of
Registrable Securities under federal or state securities laws, which are payable
by the Company  pursuant to Section 5 hereof) with respect to their  Registrable
Securities  and the fees and  expenses of such legal  counsel so selected by the
Investors.

     (c)  PAYMENTS BY THE  COMPANY.  If a  Registration  Event  occurs,  on each
Computation  Date the Company shall pay each Investor an amount in cash equal to
1.5% of the aggregate subscription price paid by such Investor for the Preferred
Shares pursuant to the Subscription  Agreement (pro rated for any period of less
than 30 days).  Each such payment shall be made by wire transfer in  immediately
available funds on each  Computation  Date to such account as shall be specified

                                      -4-
<PAGE>
for such  purpose by each  Investor.  Any such amount which is not paid when due
shall bear interest at the rate of 14% per annum (or such other rate as shall be
the maximum rate allowable by applicable law) until paid in full.

     (d) PIGGY-BACK REGISTRATIONS. If at any time the Company shall determine to
prepare and file with the SEC a Registration  Statement  relating to an offering
for its own  account or the  account of others  under the 1933 Act of any of its
equity securities,  other than on Form S-4 or Form S-8 or their then 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 Investor who is entitled to registration  rights under this Section
2(d)  written  notice of such  determination  and, if within ten (10) days after
receipt of such notice,  such Investor shall so request in writing,  the Company
shall include in such Registration  Statement all or any part of the Registrable
Securities  such  Investor  requests  to  be  registered,  except  that  if,  in
connection with any underwritten public offering for the account of the Company,
the managing  underwriter(s)  thereof shall impose a limitation on the number of
shares of Common  Stock  which may be  included  in the  Registration  Statement
because,  in such  underwriter(s)'  judgment,  such  limitation  is necessary to
effect  an  orderly  public  distribution  of the  securities  to be sold by the
Company,  then the Company  shall be obligated  to include in such  Registration
Statement only such limited portion of the  Registrable  Securities with respect
to which such  Investor has  requested  inclusion  hereunder.  Any  exclusion of
Registrable  Securities  shall be made pro rata among the  Investors  seeking to
include  Registrable  Securities,  in  proportion  to the number of  Registrable
Securities sought to be included by such Investors;  provided, however, that the
Company  shall not exclude  any  Registrable  Securities  unless the Company has
first excluded all outstanding  securities the holders of which are not entitled
by right to inclusion of securities in such Registration Statement; and provided
further,  however,  that,  after  giving  effect  to the  immediately  preceding
proviso,  any exclusion of  Registrable  Securities  shall be made pro rata with
holders of other  securities  having the right to include such securities in the
Registration Statement, based on the number of securities for which registration
is  requested  except  to the  extent  such pro  rata  exclusion  of such  other
securities is prohibited under any written agreement entered into by the Company
with the holder of such other securities prior to the date of this Agreement, in
which case such other  securities  shall be excluded,  if at all, in  accordance
with the  terms of such  agreement.  No right  to  registration  of  Registrable
Securities  under this Section 2(d) shall be construed to limit any registration
required  under Section 2(a) hereof.  The  obligations of the Company under this
Section  2(d) may be waived by  Investors  holding a majority in interest of the
Registrable  Securities  and shall  expire  after the Company has  afforded  the
opportunity for the Investors to exercise registration rights under this Section
2(d) for two registrations;  provided, however, that any Investor who shall have
had any  Registrable  Securities  excluded  from any  Registration  Statement in
accordance  with this Section 2(d) shall be entitled to include in an additional
Registration  Statement  filed by the  Company  the  Registrable  Securities  so
excluded.  Notwithstanding  any  other  provision  of  this  Agreement,  if  the
Registration  Statement  required to be filed  pursuant to Section  2(a) of this
Agreement  shall have been ordered  effective  by the SEC and the Company  shall
have maintained the effectiveness of such Registration  Statement as required by
this Agreement and if the Company shall  otherwise have complied in all material
respects with its obligations  under this Agreement,  then the Company shall not
be  obligated  to  register  any  Registrable  Securities  on such  Registration
Statement referred to in this Section 2(d).

                                      -5-
<PAGE>
     (e)  ELIGIBILITY FOR FORM S-3. The Company meets the  requirements  for the
use of Form S-3 for registration of the Registrable Securities for resale by the
Investors.  The  Company  shall  file all  reports  required  to be filed by the
Company with the SEC in a timely manner so as to maintain such  eligibility  for
the use of Form S-3.

     3.  OBLIGATIONS OF THE COMPANY.  In connection with the registration of the
Registrable Securities, the Company shall:

     (a)  prepare  promptly,  and file with the SEC not later than 30 days after
the  Closing  Date,  a  Registration  Statement  with  respect  to the number of
Registrable  Securities provided in Section 2(a), and thereafter to use its best
efforts to cause each Registration  Statement relating to Registrable Securities
to  become  effective  as soon as  possible  after  such  filing,  and  keep the
Registration  Statement  effective  pursuant to Rule 415 at all times during the
Registration  Period;  submit to the SEC,  within three  Business Days after the
Company learns that no review of the Registration  Statement will be made by the
staff of the SEC or that the  staff of the SEC has no  further  comments  on the
Registration  Statement,  as the case  may be, a  request  for  acceleration  of
effectiveness of the Registration Statement to a time and date not later than 48
hours  after  the  submission  of such  request;  notify  the  Investors  of the
effectiveness  of the  Registration  Statement  on  the  date  the  Registration
Statement is declared effective; and the Company represents and warrants to, and
covenants  and  agrees  with,  the  Investors  that the  Registration  Statement
(including  any  amendments or supplements  thereto and  prospectuses  contained
therein),  at the time it is first filed with the SEC, at the time it is ordered
effective  by the  SEC  and at all  times  during  which  it is  required  to be
effective  hereunder  (and each such  amendment and supplement at the time it is
filed  with the SEC and at all times  during  which it is  available  for use in
connection  with the offer  and sale of the  Registrable  Securities)  shall not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein,  or necessary to make the statements  therein, in
light of the circumstances in which they were made, not misleading;

     (b) prepare and file with the SEC such amendments (including post-effective
amendments)  and  supplements to the  Registration  Statement and the prospectus
used in connection with the  Registration  Statement as may be necessary to keep
the  Registration  Statement  effective  at all times  during  the  Registration
Period, and, during the Registration  Period,  comply with the provisions of the
1933 Act with respect to the  disposition of all  Registrable  Securities of the
Company  covered by the  Registration  Statement  until such time as all of such
Registrable  Securities  have been disposed of in  accordance  with the intended
methods of  disposition  by the  seller or  sellers  thereof as set forth in the
Registration Statement;

     (c) furnish to each Investor whose  Registrable  Securities are included in
the Registration Statement and its legal counsel, (1) promptly after the same is
prepared  and  publicly  distributed,  filed  with  the SEC or  received  by the
Company, one copy of the Registration  Statement and any amendment thereto, each
preliminary  prospectus and prospectus and each amendment or supplement thereto,
each  letter  written by or on behalf of the  Company to the SEC or the staff of

                                      -6-
<PAGE>
the SEC and each  item of  correspondence  from the SEC or the  staff of the SEC
relating to such  Registration  Statement (other than any portion of any thereof
which  contains  information  for  which the  Company  has  sought  confidential
treatment)  and  (2)  such  number  of  copies  of  a  prospectus,  including  a
preliminary  prospectus,  and all  amendments and  supplements  thereto and such
other documents,  as such Investor may reasonably request in order to facilitate
the disposition of the Registrable Securities owned by such Investor;

     (d) use  reasonable  efforts to (i)  register  and qualify the  Registrable
Securities  covered by the Registration  Statement under such securities or blue
sky laws of such  jurisdictions as the Investors who hold a majority in interest
of the Registrable Securities being offered reasonably request, (ii) prepare and
file  in  those   jurisdictions   such  amendments   (including   post-effective
amendments) and supplements to such  registrations and  qualifications as may be
necessary  to maintain the  effectiveness  thereof at all times until the end of
the  Registration  Period,  (iii) take such other actions as may be necessary to
maintain such registrations and qualifications in effect at all times during the
Registration  Period and (iv) take all other  actions  reasonably  necessary  or
advisable to qualify the Registrable  Securities for sale in such jurisdictions;
provided,  however,  that  the  Company  shall  not be  required  in  connection
therewith  or as a  condition  thereto  (I) to  qualify  to do  business  in any
jurisdiction  where it would not  otherwise  be required to qualify but for this
Section  3(d),  (II)  to  subject  itself  to  general   taxation  in  any  such
jurisdiction,  (III) to file a general consent to service of process in any such
jurisdiction,  (IV) to provide  any  undertakings  that cause more than  nominal
expense or burden to the Company or (V) to make any change in its Certificate of
Incorporation  or  by-laws,  which in each  case the Board of  Directors  of the
Company  determines to be contrary to the best  interests of the Company and its
stockholders;

     (e) in the event that the  Registrable  Securities  are being offered in an
underwritten  offering,   enter  into  and  perform  its  obligations  under  an
underwriting  agreement,  in  usual  and  customary  form,  including,   without
limitation,  customary  indemnification and contribution  obligations,  with the
underwriters of such offering;

     (f) (1) as promptly as  practicable  after  becoming aware of such event or
circumstance,  notify each  Investor of any event or  circumstance  of which the
Company  has  knowledge  (or in the case of an event  giving  rise to a Blackout
Period,  notify each Investor of the existence of such an event or  circumstance
without disclosing the substance  thereof),  as a result of which the prospectus
included in the Registration  Statement,  as then in effect,  includes an untrue
statement of a material  fact or omits to state a material  fact  required to be
stated  therein or necessary  to make the  statements  therein,  in light of the
circumstances  under  which they were  made,  not  misleading,  and use its best
efforts  promptly  to prepare a  supplement  or  amendment  to the  Registration
Statement to correct such untrue statement or omission,  file such supplement or
amendment  with  the SEC at such  time as shall  permit  the  Investors  to sell
Registrable  Securities  pursuant to the  Registration  Statement as promptly as
practicable,  and deliver a number of copies of such  supplement or amendment to
each Investor as such Investor may reasonably request;

     (2)  notwithstanding  Section  3(f)(1)  above,  if at any time the  Company
notifies the Investors as  contemplated by Section 3(f)(1) that the event giving
rise to such  notice  relates  to a  development  involving  the  Company  which
occurred  subsequent  to the  later  of (x) the SEC  Effective  Date and (y) the

                                      -7-
<PAGE>
latest  date  prior  to  such  notice  on  which  the  Company  has  amended  or
supplemented the Registration Statement,  then the Company shall not be required
to use best efforts to make such amendment during a Blackout  Period;  provided,
however,  that (i) the aggregate  number of days on which any Blackout Period is
in effect may not exceed 30 days (whether or not  consecutive)  in any period of
12 consecutive  months;  (ii) no more than two Blackout  Periods may commence in
any period of 12  consecutive  months;  (iii) no  Blackout  Period may  commence
within  60 days  after  the end of an  earlier  Blackout  Period;  and (iv) if a
Blackout  Period  continues  for five or more  days,  on or before the fifth day
thereof  the  Company  shall  deliver  to each  Investor a  certified  copy of a
resolution of the  Company's  Board of Directors  confirming  that such Blackout
Period complies with the definition thereof in Section 1(a);

     (g) as promptly as practicable  after becoming aware of such event,  notify
each Investor who holds  Registrable  Securities being sold (or, in the event of
an underwritten  offering, the managing underwriters) of the issuance by the SEC
of any stop  order or other  suspension  of  effectiveness  of the  Registration
Statement at the earliest possible time;

     (h) permit a single  firm of counsel  designated  as selling  stockholders'
counsel by the  Investors  who hold a majority in  interest  of the  Registrable
Securities  being sold to review and comment on the  Registration  Statement and
all  amendments  and  supplements  thereto a reasonable  period of time prior to
their filing with the SEC;

     (i) make generally  available to its security holders as soon as practical,
but not later  than  ninety  (90) days  after  the close of the  period  covered
thereby,  an earnings  statement (in form  complying with the provisions of Rule
158 under the 1933 Act) covering a twelve-month  period beginning not later than
the first day of the Company's  fiscal quarter next following the effective date
of the Registration Statement;

     (j) in connection  with any  underwritten  offering,  at the request of the
Investors who hold a majority in interest of the  Registrable  Securities  being
sold,  furnish  on the date that  Registrable  Securities  are  delivered  to an
underwriter,  if any, for sale in connection with the Registration Statement (i)
a letter,  dated such date,  from the  Company's  independent  certified  public
accountants  in form  and  substance  as is  customarily  given  by  independent
certified public accountants to underwriters in an underwritten public offering,
addressed  to the  underwriters;  and (ii) an  opinion,  dated such  date,  from
counsel representing the Company for purposes of such Registration Statement, in
form and substance as is customarily  given in an underwritten  public offering,
addressed to the  underwriters and the Investors;  provided,  in each case, that
the Investors make any  confirmations or agreements to or with the Company,  its
accountants   or  its  counsel  as  are  necessary  or  required  by  applicable
professional requirements;

     (k)  make  available  for  inspection  by  any  Investor,  any  underwriter
participating in any disposition pursuant to the Registration Statement, and any
attorney, accountant or other agent retained by any such Investor or underwriter
(collectively,  the  "Inspectors"),  all pertinent  financial and other records,
pertinent corporate documents and properties of the Company  (collectively,  the
"Records"), as shall be reasonably necessary to enable each Investor to exercise
its due diligence  responsibility,  and cause the Company's officers,  directors

                                      -8-
<PAGE>
and  employees to supply all  information  which any  Inspector  may  reasonably
request  for  purposes  of such due  diligence;  provided,  however,  that  each
Inspector shall hold in confidence and shall not make any disclosure  (except to
an Investor) of any Record or other information which the Company  determines in
good faith to be  confidential,  and the  Inspectors are so notified or aware of
this status,  unless (i) the disclosure of such Records is necessary to avoid or
correct a  misstatement  or omission  in any  Registration  Statement,  (ii) the
release of such Records is ordered  pursuant to a subpoena or other order from a
court or government  body of competent  jurisdiction or (iii) the information in
such  Records  has been made  generally  available  to the public  other than by
disclosure in violation of this or any other agreement. The Company shall not be
required  to  disclose  any  confidential  information  in such  Records  to any
Inspector   until  and  unless   such   Inspector   shall  have   entered   into
confidentiality  agreements (in form and substance  satisfactory to the Company)
with the Company with respect thereto, substantially in the form of this Section
3(k). Each Investor agrees that it shall,  upon learning that disclosure of such
Records  is  sought  in  or  by  a  court  or  governmental  body  of  competent
jurisdiction or through other means, give prompt notice to the Company and allow
the Company,  at the Company's own expense,  to undertake  appropriate action to
prevent  disclosure of, or to obtain a protective  order for, the Records deemed
confidential.  The  Company  shall  hold in  confidence  and  shall not make any
disclosure  of  information  concerning  an  Investor  provided  to the  Company
pursuant to Section 4(e) hereof  unless (i)  disclosure of such  information  is
necessary to comply with federal or state  securities  laws, (ii) the disclosure
of such  information is necessary to avoid or correct a misstatement or omission
in any Registration Statement,  (iii) the release of such information is ordered
pursuant  to a  subpoena  or other  order from a court or  governmental  body of
competent  jurisdiction  or  (iv)  such  information  has  been  made  generally
available  to the public  other than by  disclosure  in violation of this or any
other agreement. The Company agrees that it shall, upon learning that disclosure
of such  information  concerning  an  Investor  is  sought  in or by a court  or
governmental body of competent  jurisdiction or through other means, give prompt
notice to such Investor and allow such Investor, at such Investor's own expense,
to  undertake  appropriate  action  to  prevent  disclosure  of,  or to obtain a
protective order for, such information;

     (l) use its  best  efforts  (i) to  cause  all the  Registrable  Securities
covered by the  Registration  Statement to be listed on the Nasdaq or such other
principal  securities  market on which  securities  of the same  class or series
issued by the  Company are then  listed or traded or (ii) if  securities  of the
same class or series as the Registrable Securities are not then listed on Nasdaq
or any such other securities market, to cause all of the Registrable  Securities
covered  by the  Registration  Statement  to be  listed  on the New  York  Stock
Exchange, the American Stock Exchange or the Nasdaq National Market;

     (m) provide a transfer agent and  registrar,  which may be a single entity,
for  the  Registrable  Securities  not  later  than  the  effective  date of the
Registration Statement;

     (n)  cooperate  with the Investors who hold  Registrable  Securities  being
offered and the managing underwriter or underwriters,  if any, to facilitate the
timely  preparation  and delivery of  certificates  (not bearing any restrictive
legends)  representing  Registrable  Securities  to be offered  pursuant  to the
Registration  Statement and enable such certificates to be in such denominations
or amounts, as the case may be, as the managing underwriter or underwriters,  if

                                      -9-
<PAGE>
any, or the Investors may reasonably request and registered in such names as the
managing underwriter or underwriters, if any, or the Investors may request; and,
within  three  Business  Days  after a  Registration  Statement  which  includes
Registrable  Securities  is ordered  effective  by the SEC,  the  Company  shall
deliver to the transfer agent for the Registrable Securities (with copies to the
Investors  whose  Registrable  Securities  are  included  in  such  Registration
Statement) an instruction substantially in the form attached hereto as EXHIBIT 1
and shall  cause  legal  counsel  selected  by the  Company  to  deliver  to the
Investors  opinions of such counsel in the forms attached  hereto as EXHIBIT 2-A
and EXHIBIT 2-B (with copies to the Company's transfer agent);

     (o) during the period the Company is required to maintain  effectiveness of
the Registration  Statement  pursuant to Section 3(a), the Company shall not bid
for or  purchase  any  Common  Stock or any right to  purchase  Common  Stock or
attempt to induce any person to purchase any such security or right if such bid,
purchase or attempt  would in any way limit the right of the  Investors  to sell
Registrable  Securities by reason of the  limitations  set forth in Regulation M
under the 1934 Act; and

     (p) take all other reasonable  actions necessary to expedite and facilitate
disposition  by the  Investors  of the  Registrable  Securities  pursuant to the
Registration Statement.

     4. OBLIGATIONS OF THE INVESTORS. In connection with the registration of the
Registrable Securities, the Investors shall have the following obligations:

     (a) It shall be a condition  precedent to the obligations of the Company to
complete  the  registration  pursuant  to this  Agreement  with  respect  to the
Registrable Securities of a particular Investor that such Investor shall furnish
to the Company such information  regarding  itself,  the Registrable  Securities
held by it and the intended method of disposition of the Registrable  Securities
held by it as shall be reasonably  required to effect the  registration  of such
Registrable  Securities and shall execute such documents in connection with such
registration as the Company may reasonably  request. At least five days prior to
the first  anticipated  filing date of the Registration  Statement,  the Company
shall notify each  Investor of the  information  the Company  requires from each
such  Investor  (the  "Requested   Information")   if  any  of  such  Investor's
Registrable Securities are eligible for inclusion in the Registration Statement.
If at least  one  Business  Day prior to the  filing  date the  Company  has not
received  the  Requested   Information  from  an  Investor  (a   "Non-Responsive
Investor"),  then  the  Company  may  file the  Registration  Statement  without
including Registrable Securities of such Non-Responsive  Investor but, until the
Registration Statement is declared effective,  the Company shall not be relieved
of its obligation to file a Registration  Statement with the SEC relating to the
Registrable  Securities  of such  Non-Responsive  Investor  promptly  after such
Non-Responsive Investor provides the Requested Information;

     (b)  Each  Investor  by  such  Investor's  acceptance  of  the  Registrable
Securities  agrees to cooperate with the Company as reasonably  requested by the
Company  in  connection  with the  preparation  and  filing of the  Registration
Statement hereunder, unless such Investor has notified the Company in writing of
such  Investor's  election  to  exclude  all  of  such  Investor's   Registrable
Securities from the Registration Statement;

                                      -10-
<PAGE>
     (c)  In  the  event  Investors  holding  a  majority  in  interest  of  the
Registrable  Securities being registered  determine to engage the services of an
underwriter,  each  Investor  agrees to enter into and perform  such  Investor's
obligations  under an  underwriting  agreement,  in usual  and  customary  form,
including,  without  limitation,   customary  indemnification  and  contribution
obligations,  with the managing underwriter of such offering and take such other
actions as are  reasonably  required  in order to  expedite  or  facilitate  the
disposition of the Registrable Securities, unless such Investor has notified the
Company in writing of such Investor's election to exclude all of such Investor's
Registrable Securities from the Registration Statement;

     (d) Each Investor  agrees that, upon receipt of any notice from the Company
of the  happening  of any event of the kind  described  in Section 3(f) or 3(g),
such Investor will immediately discontinue disposition of Registrable Securities
pursuant to the  Registration  Statement  covering such  Registrable  Securities
until  such  Investor's  receipt of the  copies of the  supplemented  or amended
prospectus  contemplated  by Section  3(f) or 3(g) and,  if so  directed  by the
Company,  such  Investor  shall  deliver to the  Company  (at the expense of the
Company) or destroy (and deliver to the Company a  certificate  of  destruction)
all  copies  in such  Investor's  possession  of the  prospectus  covering  such
Registrable Securities current at the time of receipt of such notice;

     (e) No Investor may participate in any underwritten  registration hereunder
unless such Investor (i) agrees to sell such Investor's  Registrable  Securities
on the basis provided in any underwriting arrangements approved by the Investors
entitled hereunder to approve such arrangements, (ii) completes and executes all
questionnaires,  powers of attorney,  indemnities,  underwriting  agreements and
other  documents  reasonably  required  under  the  terms  of such  underwriting
arrangements  and  (iii)  agrees to pay its pro rata  share of all  underwriting
discounts and commissions and other fees and expenses of investment  bankers and
any  manager  or  managers  of  such  underwriting  and  legal  expenses  of the
underwriters applicable with respect to its Registrable Securities, in each case
to the  extent  not  payable  by the  Company  pursuant  to the  terms  of  this
Agreement; and

     (f) Each Investor agrees to take all reasonable actions necessary to comply
with the  prospectus  delivery  requirements  of the 1933 Act  applicable to its
sales of Registrable Securities.

     5.  EXPENSES  OF  REGISTRATION.   All  reasonable   expenses,   other  than
underwriting discounts and commissions and other fees and expenses of investment
bankers  and other than  brokerage  commissions,  incurred  in  connection  with
registrations,   filings  or  qualifications  pursuant  to  Sections  2  and  3,
including,  without  limitation,  all registration,  listing and  qualifications
fees, printers and accounting fees and the fees and disbursements of counsel for
the Company and the Investors shall be borne by the Company, PROVIDED,  HOWEVER,
that the  Investors  shall bear the fees and  out-of-pocket  expenses of the one
legal counsel selected by the Investors pursuant to Section 2(b) hereof.

     6. INDEMNIFICATION. In the event any Registrable Securities are included in
a Registration Statement under this Agreement:

                                      -11-
<PAGE>
     (a) To the extent  permitted by law, the Company  will  indemnify  and hold
harmless each Investor who holds such Registrable Securities,  the directors, if
any, of such Investor,  the officers, if any, of such Investor,  each person, if
any, who  controls  any Investor  within the meaning of the 1933 Act or the 1934
Act,  any  underwriter  (as  defined  in the 1933  Act) for the  Investors,  the
directors,  if  any,  of such  underwriter  and the  officers,  if any,  of such
underwriter,  and each person, if any, who controls any such underwriter  within
the  meaning of the 1933 Act or the 1934 Act (each,  an  "Indemnified  Person"),
against any losses, claims, damages,  liabilities or expenses (joint or several)
incurred (collectively,  "Claims") to which any of them may become subject under
the 1933 Act, the 1934 Act or  otherwise,  insofar as such Claims (or actions or
proceedings,  whether commenced or threatened,  in respect thereof) arise out of
or are based  upon any of the  following:  (i) any untrue  statement  or alleged
untrue statement of a material fact contained in the  Registration  Statement or
any  post-effective  amendment  thereof or the  omission or alleged  omission to
state therein a material fact required to be stated therein or necessary to make
the  statements  therein not  misleading,  (ii) any untrue  statement or alleged
untrue  statement of a material fact contained in any preliminary  prospectus if
used prior to the effective date of such Registration Statement, or contained in
the final  prospectus  (as amended or  supplemented,  if the  Company  files any
amendment thereof or supplement thereto with the SEC) or the omission or alleged
omission to state  therein any material  fact  necessary to make the  statements
made therein,  in light of the circumstances  under which the statements therein
were made,  not  misleading or (iii) any  violation or alleged  violation by the
Company of the 1933 Act, the 1934 Act, any state  securities  law or any rule or
regulation  under the 1933 Act,  the 1934 Act or any state  securities  law (the
matters  in  the  foregoing  clauses  (i)  through  (iii)  being,  collectively,
"Violations").  Subject  to the  restrictions  set  forth in  Section  6(d) with
respect  to the  number  of legal  counsel,  the  Company  shall  reimburse  the
Investors  and the other  Indemnified  Persons,  promptly as such  expenses  are
incurred  and are due  and  payable,  for any  legal  fees or  other  reasonable
expenses incurred by them in connection with investigating or defending any such
Claim.   Notwithstanding   anything  to  the  contrary   contained  herein,  the
indemnification agreement contained in this Section 6(a): (I) shall not apply to
a Claim  arising out of or based upon a Violation  which occurs in reliance upon
and in conformity  with  information  furnished in writing to the Company by any
Indemnified  Person or underwriter for such Indemnified Person expressly for use
in connection with the preparation of the Registration Statement, the prospectus
or any such  amendment  thereof or supplement  thereto,  if such  prospectus was
timely made available by the Company pursuant to Section 3(c) hereof;  (II) with
respect to any preliminary prospectus shall not inure to the benefit of any such
person from whom the person  asserting any such Claim  purchased the Registrable
Securities  that  are the  subject  thereof  (or to the  benefit  of any  person
controlling  such person) if the untrue  statement or omission of material  fact
contained in the preliminary prospectus was corrected in the prospectus, as then
amended or  supplemented,  if such  prospectus  was timely made available by the
Company  pursuant to Section 3(c)  hereof;  and (III) shall not apply to amounts
paid in settlement of any Claim if such settlement is effected without the prior
written  consent  of the  Company,  which  consent  shall  not  be  unreasonably
withheld. Such indemnity shall remain in full force and effect regardless of any
investigation  made by or on behalf of the Indemnified  Person and shall survive
the transfer of the Registrable  Securities by the Investors pursuant to Section
9.

                                      -12-
<PAGE>
     (b) In connection with any  Registration  Statement in which an Investor is
participating,  each such Investor agrees to indemnify and hold harmless, to the
same extent and in the same manner set forth in Section 6(a), the Company,  each
of its  directors,  each of its officers who signs the  Registration  Statement,
each person, if any, who controls the Company within the meaning of the 1933 Act
or the 1934 Act, any underwriter and any other  stockholder  selling  securities
pursuant to the  Registration  Statement or any of its  directors or officers or
any person who controls such  stockholder or  underwriter  within the meaning of
the 1933 Act or the 1934 Act  (collectively  and  together  with an  Indemnified
Person,  an  "Indemnified  Party"),  against  any Claim to which any of them may
become subject,  under the 1933 Act, the 1934 Act or otherwise,  insofar as such
Claim  arises  out of or is based  upon (i) any  Violation,  in each case to the
extent (and only to the extent) that such Violation  occurs in reliance upon and
in conformity with written information furnished to the Company by such Investor
expressly  for use in  connection  with such  Registration  Statement  or (ii) a
failure to comply with the prospectus delivery requirements of the 1933 Act; and
such Investor will reimburse any legal or other expenses  reasonably incurred by
any  Indemnified  Party in connection with  investigating  or defending any such
Claim; provided, however, that the indemnity agreement contained in this Section
6(b)  shall  not  apply  to  amounts  paid in  settlement  of any  Claim if such
settlement is effected without the prior written consent of such Investor, which
consent shall not be unreasonably withheld; provided, further, however, that the
Investor shall be liable under this Section 6(b) for only that amount of a Claim
as does not exceed the amount by which the net  proceeds to such  Investor  from
the sale of  Registrable  Securities  pursuant  to such  Registration  Statement
exceeds the cost of such Registrable Securities to such Investor. Such indemnity
shall remain in full force and effect regardless of any investigation made by or
on  behalf of such  Indemnified  Party and shall  survive  the  transfer  of the
Registrable  Securities by the Investors pursuant to Section 9.  Notwithstanding
anything  to  the  contrary  contained  herein,  the  indemnification  agreement
contained in this Section 6(b) with respect to any preliminary  prospectus shall
not inure to the benefit of any  Indemnified  Party if the untrue  statement  or
omission of material fact contained in the preliminary  prospectus was corrected
on a timely basis in the prospectus, as then amended or supplemented.

     (c) The Company shall be entitled to receive indemnities from underwriters,
selling brokers,  dealer managers and similar securities industry  professionals
participating in any  distribution,  to the same extent as provided above,  with
respect to  information  so furnished in writing by such persons  expressly  for
inclusion in the Registration Statement.

     (d) Promptly  after receipt by an Indemnified  Person or Indemnified  Party
under this Section 6 of notice of the commencement of any action  (including any
governmental  action),  such Indemnified Person or Indemnified Party shall, if a
Claim in respect thereof is to be made against any indemnifying party under this
Section  6,  deliver  to  the  indemnifying   party  a  written  notice  of  the
commencement  thereof  and the  indemnifying  party  shall  have  the  right  to
participate in, and, to the extent the  indemnifying  party so desires,  jointly
with any other indemnifying  party similarly  noticed,  to assume control of the
defense thereof with counsel selected by the  indemnifying  party but reasonably
acceptable to the Indemnified  Person or the Indemnified  Party, as the case may
be; provided,  however,  that an Indemnified  Person or Indemnified  Party shall
have the right to retain its own counsel  with the fees and  expenses to be paid
by the indemnifying  party, if, in the reasonable opinion of counsel retained by
the indemnifying  party, the  representation  by such counsel of the Indemnified

                                      -13-
<PAGE>
Person or Indemnified  Party and the  indemnifying  party would be inappropriate
due to actual or potential  differing  interests between such Indemnified Person
or  Indemnified  Party and any other party  represented  by such counsel in such
proceeding.  In such event,  the Company  shall pay for only one separate  legal
counsel for the Investors; such legal counsel shall be selected by the Investors
holding a majority  in interest of the  Registrable  Securities  included in the
Registration  Statement  to which the Claim  relates.  The  failure  to  deliver
written  notice  to the  indemnifying  party  within  a  reasonable  time of the
commencement of any such action shall not relieve such indemnifying party of any
liability to the Indemnified  Person or Indemnified  Party under this Section 6,
except to the extent that the indemnifying party is prejudiced in its ability to
defend such action. The indemnification required by this Section 6 shall be made
by  periodic   payments  of  the  amount   thereof  during  the  course  of  the
investigation or defense, as such expense, loss, damage or liability is incurred
and is due and payable.

     7. CONTRIBUTION. To the extent any indemnification by an indemnifying party
is  prohibited  or limited by law,  the  indemnifying  party  agrees to make the
maximum contribution with respect to any amounts for which it would otherwise be
liable  under  Section  6 to the  fullest  extent  permitted  by law;  provided,
however,  that (a) no contribution shall be made under  circumstances  where the
maker would not have been liable for  indemnification  under the fault standards
set  forth in  Section  6, (b) no  seller of  Registrable  Securities  guilty of
fraudulent  misrepresentation  (within the meaning of Section  11(f) of the 1933
Act) shall be entitled to contribution from any seller of Registrable Securities
who was not guilty of such fraudulent  misrepresentation and (c) contribution by
any seller of Registrable Securities shall be limited in amount to the amount by
which the net amount of  proceeds  received by such seller from the sale of such
Registrable  Securities  exceeds the purchase price paid by such seller for such
Registrable Securities.

     8. REPORTS UNDER 1934 ACT. With a view to making available to the Investors
the benefits of Rule 144, the Company agrees 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 1933 Act and the 1934 Act; and

     (c) furnish to each  Investor  so long as such  Investor  owns  Registrable
Securities,  promptly upon request,  (i) a written statement by the Company that
it has complied  with the reporting  requirements  of Rule 144 and the 1934 Act,
(ii) a copy of the most  recent  annual or  quarterly  report of the Company and
such other  reports and  documents  so filed by the Company and (iii) such other
information as may be reasonably  requested to permit the Investors to sell such
securities pursuant to Rule 144 without registration.

     9. ASSIGNMENT OF THE  REGISTRATION  RIGHTS.  The rights to have the Company
register   Registrable   Securities   pursuant  to  this   Agreement   shall  be
automatically assigned by the Investors to an Affiliate (as such term is defined
in the Certificate of  Designations)  thereof or to any transferee of all or any

                                      -14-
<PAGE>
portion of such  securities  which  portion is not less than  100,000  shares of
Common Stock (or to any transferee of all or any portion of the Preferred Shares
or the Warrants  which  transfer is  permitted by Sections  4(a) and 4(h) of the
Subscription  Agreement)  only if: (a) the  Investor  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, (b) the
Company  is,  within a  reasonable  time  after  such  transfer  or  assignment,
furnished with written notice of (i) the name and address of such  transferee or
assignee and (ii) the securities with respect to which such registration  rights
are being  transferred or assigned,  (c) immediately  following such transfer or
assignment  the further  disposition  of such  securities  by the  transferee or
assignee is restricted  under the 1933 Act and applicable state securities laws,
and  (d)  at or  before  the  time  the  Company  receives  the  written  notice
contemplated by clause (b) of this sentence the transferee or assignee agrees in
writing with the Company to be bound by all of the provisions  contained herein.
In  connection  with any such transfer the Company  shall,  at its sole cost and
expense, promptly after such assignment take such actions as shall be reasonably
acceptable  to the  Initial  Investor  and such  transferee  to assure  that the
Registration  Statement  and related  prospectus  are  available for use by such
transferee  for sales of the  Registrable  Securities  in  respect  of which the
rights  to  registration  have been so  assigned.  In  connection  with any such
assignment, each Investor shall have the right to assign to such transferee such
Investor's rights under the Subscription  Agreement by notice of such assignment
to the  Company.  Following  such  notice  of  assignment  of  rights  under the
Subscription Agreement,  the Company shall be obligated to such transferee,  and
such  transferee  shall be  obligated  to the  Company,  to  perform  all of its
covenants under the Subscription  Agreement as if such transferee were the Buyer
under the Subscription Agreement.

     10. AMENDMENT OF REGISTRATION  RIGHTS.  Any provision of this Agreement may
be amended and the observance  thereof may be waived  (either  generally or in a
particular  instance and either  retroactively or prospectively),  only with the
written  consent of the Majority  Holders.  Any amendment or waiver  effected in
accordance  with this  Section 10 shall be binding  upon each  Investor  and the
Company.

     11. MISCELLANEOUS.

     (a) A person or entity is deemed to be a holder of  Registrable  Securities
whenever such person or entity owns of record such  Registrable  Securities.  If
the Company receives conflicting instructions,  notices or elections from two or
more persons or entities with respect to the same  Registrable  Securities,  the
Company shall act upon the basis of  instructions,  notice or election  received
from the registered owner of such Registrable Securities.

     (b) Notices required or permitted to be given hereunder shall be in writing
and shall be deemed to be sufficiently given when personally delivered (by hand,
by  courier,  by  telephone  line  facsimile   transmission  (with  answer  back
confirmation) or other means) (i) if to the Company, at 2222 West Peoria Avenue,
Phoenix,  Arizona 85029,  Attention:  Chief  Executive  Officer,  telephone line
facsimile  transmission number (602) 331-0941,  (ii) if to the Initial Investor,
c/o Genesee  International,  Inc., 10500 N.E. 8th Street,  Suite 1920, Bellevue,
Washington  98004-4332,  telephone  line  facsimile  transmission  number  (425)
462-4645 and (iii) if to any other  Investor,  at such address as such  Investor
shall have provided in writing to the Company,  or at such other address as each
such party furnishes by notice given in accordance with this Section 11(b),  and
shall be effective upon receipt.

                                      -15-
<PAGE>
     (c)  Failure  of any  party to  exercise  any right or  remedy  under  this
Agreement or otherwise,  or delay by a party in exercising such right or remedy,
shall not operate as a waiver thereof.

     (d)  This  Agreement  shall  be  enforced,  governed  by and  construed  in
accordance  with the laws of the State of Arizona  applicable to agreements made
and to be performed  entirely within such State. In the event that any provision
of this Agreement is invalid or  unenforceable  under any applicable  statute or
rule of law, then such provision shall be deemed  inoperative to the extent that
it may  conflict  therewith  and shall be deemed  modified to conform  with such
statute  or rule of law.  Any  provision  hereof  which  may  prove  invalid  or
unenforceable  under any law shall not affect the validity or  enforceability of
any other provision hereof.

     (e) This  Agreement  constitutes  the entire  agreement  among the  parties
hereto with respect to the subject  matter  hereof.  There are no  restrictions,
promises, warranties or undertakings,  other than those set forth or referred to
herein. This Agreement  supersedes all prior agreements and understandings among
the parties hereto with respect to the subject matter hereof.

     (f) Subject to the  requirements of Section 9 hereof,  this Agreement shall
inure to the benefit of and be binding upon the  successors  and assigns of each
of the parties hereto.

     (g) All  pronouns  and  any  variations  thereof  refer  to the  masculine,
feminine or neuter, singular or plural, as the context may require.

     (h) The headings in this  Agreement are for  convenience  of reference only
and shall not limit or otherwise affect the meaning hereof.

     (i) The Company acknowledges that any failure by the Company to perform its
obligations under this Agreement,  including,  without limitation, the Company's
obligations under Section 3(n), or any delay in such performance could result in
damages to the Investors  and the Company  agrees that, in addition to any other
liability  the  Company  may have by reason of any such  failure  or delay,  the
Company shall be liable for all direct and  consequential  damages caused by any
such failure or delay.

     (j) Each party shall do and perform, or cause to be done and performed, all
such  further  acts and  things,  and shall  execute  and deliver all such other
agreements,  certificates,  instruments  and  documents,  as the other party may
reasonably  request in order to carry out the intent and accomplish the purposes
of this Agreement and the consummation of the transactions contemplated hereby.

     (k) The language used in this  Agreement  will be deemed to be the language
chosen by the parties to express  their  mutual  intent,  and no rules of strict
construction will be applied against any party.

                                      -16-
<PAGE>
     (l) This  Agreement  may be executed in two or more  counterparts,  each of
which shall be deemed an original but all of which shall  constitute one and the
same agreement.  This Agreement,  once executed by a party,  may be delivered to
the other party hereto by telephone  line  facsimile  transmission  of a copy of
this Agreement bearing the signature of the party so delivering this Agreement.

                                      -17-
<PAGE>
     IN WITNESS  WHEREOF,  the parties  have caused  this  Agreement  to be duly
executed by their  respective  officers  thereunto duly authorized as of day and
year first above written.

                                        TITAN MOTORCYCLE CO. OF AMERICA

                                        By: /s/ Francis S. Keery
                                           -------------------------------------
                                        Name: Francis S. Keery
                                        Title: Chief Executive Officer

                                         KOCH INVESTMENT GROUP LIMITED

                                        By: /s/ Josh Taylor
                                           -------------------------------------
                                        Name: Josh Taylor
                                        Title: Vice President

                                      -18-
<PAGE>
                                                                   EXHIBIT 1
                                                                      TO
                                                                  REGISTRATION
                                                                RIGHTS AGREEMENT

                              [Company Letterhead]

                                     [Date]

Signature Stock Transfer, Inc.,
as Conversion Agent, Warrant Agent and Registrar
14675 Midway Road
Suite 221
Dallas, Texas 75244

Ladies and Gentlemen:

     This letter shall serve as our irrevocable  authorization  and direction to
you [(1) to transfer or re-register  the  certificates  for the shares of Common
Stock, $.001 par value (the "Common Stock"), of Titan Motorcycle Co. of America,
a Nevada corporation (the "Company"), represented by certificate numbers _______
and _______ for an aggregate  of _______  shares (the  "Outstanding  Shares") of
Common  Stock  presently  registered  in the name of [Name  of  Investors]  upon
surrender of such certificate(s) to you, notwithstanding the legend appearing on
such certificates,  and (2) ]* to issue (a) shares (the "Conversion  Shares") of
Common Stock to or upon the order of the holder from time to time on  conversion
of the shares (the "Preferred Shares") of Series B Convertible  Preferred Stock,
$.001 par value, of the Company upon receipt by you of a Notice of Conversion of
Series B  Convertible  Preferred  Stock in the form enclosed  herewith,  and (b)
shares (the "Warrant Shares") of Common Stock to or upon the order of the holder
from  time to time on  exercise  of the  Common  Stock  Purchase  Warrants  (the
"Warrants")  exercisable  for Common Stock issued by the Company upon receipt by
you of a Subscription Form from such holder in the form enclosed herewith.  [The
transfer or  re-registration  of the certificates for the Outstanding  Shares by
you  should be made at such  time as you are  requested  to do so by the  record
holder of the Outstanding  Shares.  The certificate issued upon such transfer or
re-registration  should be registered in such name as requested by the holder of
record of the  certificate  surrendered  to you and  should  not bear any legend
which  would  restrict  the  transfer  of the  shares  represented  thereby.  In
addition,  you are  hereby  directed  to remove  any  stop-transfer  instruction
relating to the Outstanding Shares.]* Certificates for the Conversion Shares and
Warrant Shares should not bear any restrictive  legend and should not be subject
to any stop-transfer restriction.

     Contemporaneously  with  the  delivery  of  this  letter,  the  Company  is
delivering to you an opinion of Snell & Wilmer L.L.P.  as to registration of the
resale of [the Outstanding Shares and]* the Conversion Shares and Warrant Shares
under the Securities Act of 1933, as amended.

----------
*    Omit if no  conversions  of Preferred  Stock or exercises of Warrants  have
     occurred before SEC registration is declared effective.
<PAGE>
     Should you have any questions concerning this matter, please contact me.

                                        Very truly yours,

                                        TITAN MOTORCYCLE CO. OF AMERICA

                                        By:
                                           -------------------------------------
                                        Name:
                                             -----------------------------------
                                        Title:
                                              ----------------------------------
Enclosures
cc: [Names of Investor]

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