HAND BRAND DISTRIBUTION INC
<DOCUMENT>
<TYPE>EX-10.5
<SEQUENCE>7
<FILENAME>regrts.txt
<TEXT>
                                                                        Ex. 10.5


                          REGISTRATION RIGHTS AGREEMENT


     This REGISTRATION RIGHTS AGREEMENT (this "Agreement"),  dated as of January
16,  2002,  is made and  entered  into among Hand Brand  Distribution,  Inc.,  a
Florida  corporation (the  "Company"),  and Prima Capital Growth Fund LLC, a New
York limited liability corporation ("Investor").

     WHEREAS,  the Company  and the  Investor  have  entered  into that  certain
Private  Equity  Line of  Credit  Agreement,  dated as of the date  hereof  (the
"Investment Agreement"),  pursuant to which the Company will issue, from time to
time,  to the  Investor  up to  $30,000,000  worth of Common  Stock and  600,000
Warrants;

     WHEREAS,  pursuant to the terms of, and in partial  consideration  for, the
Investor's  agreement to enter into the  Investment  Agreement,  the Company has
agreed to provide the Investor with certain  registration rights with respect to
the Registrable Securities (as defined in the Investment Agreement);

     NOW,  THEREFORE,  in  consideration of the premises,  the  representations,
warranties,  covenants and  agreements  contained  herein and in the  Investment
Agreement,  and for other  good and  valuable  consideration,  the  receipt  and
sufficiency  of which is hereby  acknowledged,  intending  to be  legally  bound
hereby,  the parties hereto agree as follows  (capitalized terms used herein and
not defined  herein  shall have the meaning  ascribed to them in the  Investment
Agreement):

                                    ARTICLE I
                               REGISTRATION RIGHTS

     Section 1.1       FORM OF REGISTRATION STATEMENTS.

     (a) Filing of Registration  Statement.  Subject to the terms and conditions
of this Agreement,  the Company shall file with the SEC, within  forty-five (45)
days following the  Subscription  Date, a registration  statement on Form S-1 or
SB-2  under  the  Securities  Act  (the   "Registration   Statement")   for  the
registration of the resale by the Investor of Registrable Securities.

     (b) Effectiveness of the Registration Statement.  The Company shall use its
reasonable best efforts to have the Registration Statement declared effective by
the  SEC  by no  later  than  one  hundred  and  twenty  (120)  days  after  the
Subscription  Date and to insure  that the  Registration  Statement  remains  in
effect  throughout  the term of this  Agreement  as set  forth in  Section  4.2,
subject to the terms and conditions of this Agreement.

     (c) Failure to Obtain  Effectiveness  of  Registration  Statements.  In the
event  the  Company  fails  for any  reason to  obtain  the  effectiveness  of a
Registration  Statement within the time period set forth in Section 1.1(b),  the
Company shall pay to the Investor,  within three (3) Trading Days of the date by
which such Registration  Statement was required to have been declared effective,
$50,000.00  in  immediately  available  funds into an account  designated by the
Investor.  Such payments shall be made by wire transfer of immediately available
funds.

     (d)  Failure  to  Maintain   Effectiveness   of  Registration   Statements.
Subsequent to the initial  effectiveness  of a  Registration  Statement,  in the
event  the  Company  fails  to  maintain  the  effectiveness  of a  Registration
Statement  (or the  underlying  prospectus)  throughout  the period set forth in
Section 4.2,  and the  Investor  holds any  Registrable  Securities  at any time
during the period of such ineffectiveness (an "Ineffective Period"), the Company
shall  pay to  the  Investor,  in  immediately  available  funds  into  accounts
designated by the Investor, an amount equal to one percent (1%) of the aggregate
purchase price of such

<PAGE>


Registrable  Securities  which  are  issued  and  payable  to the  Investor  and
aggregate  Purchase  Price (as defined in the  Warrant)  of the  Warrant  Shares
(payable  proportionately  to the Investor of all of the Registrable  Securities
then  held by the  Investor  for  each  seven-calendar-day  period  (or  portion
thereof) of an  Ineffective  Period.  Such  payments  shall be made on the first
Trading Day after the earliest to occur of (i) the  expiration of the Commitment
Period,  (ii) the expiration of an Ineffective  Period,  (iii) the expiration of
the first  twenty-eight  calendar  days of an  Ineffective  Period  and (iv) the
expiration  of each  additional  twenty-eight  calendar-day  periods  during  an
Ineffective Period.

     (e) The parties  hereto  acknowledge  and agree that the sums payable under
Sections  1(c)  or  1(d)  above  shall  constitute  liquidated  damages  and not
penalties.  The  parties  further  acknowledge  that (i) the  amount  of loss or
damages  likely  to be  incurred  is  incapable  or is  difficult  to  precisely
estimate,  (ii)  the  amounts  specified  in  such  Sections  bear a  reasonable
proportion and are not plainly or grossly  disproportionate to the probable loss
likely to be incurred in connection with any failure by the Company to obtain or
maintain the effectiveness of a Registration Statement, (iii) one of the reasons
for the parties reaching an agreement as to such amounts was the uncertainty and
cost of  litigation  regarding  the  question  of actual  damages,  and (iv) the
parties  are  sophisticated  business  parties  and  have  been  represented  by
sophisticated and able legal and financial counsel and negotiated this Agreement
at arm's length.

                                   ARTICLE II
                             REGISTRATION PROCEDURES

     Section  2.1  FILINGS;   INFORMATION.   The  Company  will  facilitate  the
registration  of such  Registrable  Securities in accordance with the Investor's
intended methods of disposition  thereof.  Without  limiting the foregoing,  the
Company in each such case will do the  following as  expeditiously  as possible,
but in no event later than the  deadline,  if any,  prescribed  therefor in this
Agreement:

     (a) The  Company  shall  prepare  and  file  with  the  SEC a  registration
statement  on Form S-1 or Form SB-2 (if use of such forms are then  available to
the  Company  pursuant  to the rules of the SEC and,  if not, on such other form
promulgated  by the SEC for which the Company then  qualifies  and which counsel
for the Company shall deem appropriate and which form shall be available for the
sale of the  Registrable  Securities to be  registered  thereunder in accordance
with the provisions of this Agreement and in accordance with the intended method
of distribution of such Registrable Securities);  use reasonable best efforts to
cause such filed Registration Statement to become and remain effective (pursuant
to Rule 415 under the Securities Act, if applicable, or otherwise);  prepare and
file with the SEC such amendments and supplements to such Registration Statement
and the prospectus used in connection therewith as may be necessary to keep such
Registration Statement effective during the term of this Agreement;  prepare and
file, within one day after each Closing Date, any prospectus supplement required
under the  Securities  Act; and comply with the provisions of the Securities Act
with respect to the  disposition of all Registrable  Securities  covered by such
Registration  Statement  during  such  period in  accordance  with the  intended
methods of disposition by the Investor set forth in such Registration Statement.

     (b) The Company  shall file all necessary  amendments  to the  Registration
Statement in order to effectuate the purpose of this Agreement.

     (c) If so requested by the managing underwriters, if any, or the holders of
a majority in aggregate amount of the Registrable  Securities being  registered,
the  Company  shall (i)  promptly  incorporate  in a  prospectus  supplement  or
post-effective amendment such information as the managing underwriters,  if any,
and such holders  agree should be included  therein,  and (ii) make all required
filings of such  prospectus  supplement or  post-effective

<PAGE>


amendment as soon as practicable after the Company has received  notification of
the matters to be incorporated in such prospectus  supplement or  post-effective
amendment; provided, however, that the Company shall not be required to take any
action pursuant to this Section 2.1(c)(ii) that would, in the opinion of counsel
for the Company, violate applicable law.

     (d) In connection with the filing of a Registration Statement,  the Company
shall enter into such agreements and take all such other  reasonable  actions in
connection  therewith  (including  those  reasonably  requested  by the managing
underwriters, if any, or the holders of a majority in aggregate principal amount
of the Registrable Securities being sold) in order to expedite or facilitate the
disposition of such Registrable Securities,  and in such connection,  whether or
not  an  underwriting   agreement  is  entered  into  and  whether  or  not  the
registration is an underwritten registration,  (i) make such representations and
warranties to the holders of such Registrable  Securities and the  underwriters,
if any, with respect to the business of the Company  (including  with respect to
businesses  or  assets  acquired  or to be  acquired  by the  Company),  and the
Registration Statement, prospectus and documents, if any, incorporated or deemed
to be incorporated by reference  therein,  in each case, in form,  substance and
scope  as are  customarily  made by  issuers  to  underwriters  in  underwritten
offerings,  and confirm the same if and when requested;  (ii) if an underwriting
agreement is entered into, the same shall contain indemnification provisions and
procedures  no  less  favorable  to the  selling  holders  of  such  Registrable
Securities  and the  underwriters,  if any, than those set forth herein (or such
other  provisions  and  procedures  acceptable  to the  holders of a majority in
aggregate   principal   amount  of  Registrable   Securities   covered  by  such
Registration Statement and the managing underwriters, if any); and (iii) deliver
such documents and certificates as may be reasonably requested by the holders of
a majority in aggregate  principal  amount of the Registrable  Securities  being
sold,  their  counsel and the  managing  underwriters,  if any, to evidence  the
continued  validity of their  representations  and  warranties  made pursuant to
clause  (i) above  and to  evidence  compliance  with any  customary  conditions
contained in the underwriting  agreement or other agreement  entered into by the
Company.

     (e)  Five  Trading  Days  prior  to  filing  a  Registration  Statement  or
prospectus,  or any amendment or supplement thereto (excluding amendments deemed
to result from the filing of documents  incorporated by reference therein),  the
Company  shall  deliver  to the seller of  Registrable  Securities  and  counsel
representing the seller of Registrable Securities, in accordance with the notice
provisions of Section 4.8, copies of such Registration  Statement as proposed to
be filed,  together with exhibits  thereto,  which  documents will be subject to
review by such  parties,  and  thereafter  deliver to the seller of  Registrable
Securities and its counsel,  in accordance with the notice provisions of Section
4.8, such number of copies of such  Registration  Statement,  each amendment and
supplement thereto (in each case including all exhibits thereto), the prospectus
included in such Registration Statement (including each preliminary  prospectus)
and  such  other  documents  or  information  as the  Investor  or  counsel  may
reasonably  request in order to facilitate the  disposition  of the  Registrable
Securities.

     (f) After the  filing of the  Registration  Statement,  the  Company  shall
promptly  notify the Investor of any stop order issued or  threatened by the SEC
in connection  therewith and take all reasonable actions required to prevent the
entry of such stop order or to remove it if entered.

     (g) The Company  shall use its  reasonable  best efforts to (i) register or
qualify such Registrable Securities under such other securities or blue sky laws
of such  jurisdictions  in the United States as the Investor may  reasonably (in
light  of its  intended  plan of  distribution)  request,  and (ii)  cause  such
Registrable  Securities  to  be  registered  with  or  approved  by  such  other
governmental agencies or authorities in the United States as may be necessary by
virtue of the  business and  operations  of the Company and do any and all other
acts and things that may be  reasonably  necessary  or  advisable  to enable the
Investor to consummate the disposition of the Registrable  Securities;  provided
that the Company will not be required to qualify generally to do business in any
jurisdiction  where it would not  otherwise  be required to qualify but for this
paragraph (g), subject itself to taxation in any such  jurisdiction,  or consent
or subject itself to general service of process in any such jurisdiction.


<PAGE>


     (h) The Company shall  immediately  notify the Investor upon the occurrence
of any of the following events in respect of a Registration Statement or related
prospectus in respect of an offering of Registrable  Securities:  (i) receipt of
any request for additional  information by the SEC or any other federal or state
governmental  authority  during the period of  effectiveness of the Registration
Statement for amendments or supplements to the Registration Statement or related
prospectus;  (ii)  the  issuance  by the  SEC  or any  other  federal  or  state
governmental  authority of any stop order  suspending the  effectiveness  of the
Registration  Statement or the initiation of any  proceedings  for that purpose;
(iii)  receipt  of  any  notification  with  respect  to the  suspension  of the
qualification  or  exemption  from  qualification  of  any  of  the  Registrable
Securities for sale in any  jurisdiction or the initiation or threatening of any
proceeding  for such  purpose;  (iv) the  happening  of any event that makes any
statement  made in the  Registration  Statement  or  related  prospectus  or any
document  incorporated or deemed to be incorporated  therein by reference untrue
in any  material  respect  or that  requires  the  making of any  changes in the
Registration Statement,  related prospectus or documents so that, in the case of
the  Registration  Statement,  it will not  contain  any untrue  statement  of a
material fact or omit to state any material  fact required to be stated  therein
or necessary to make the statements therein not misleading, and that in the case
of the  related  prospectus,  it will not  contain  any  untrue  statement  of a
material fact or omit to state any material  fact required to be stated  therein
or necessary to make the statements  therein,  in the light of the circumstances
under which they were made,  not  misleading;  and (v) the Company's  reasonable
determination  that a  post-effective  amendment to the  Registration  Statement
would be  appropriate;  and the Company  will  promptly  make  available  to the
Investor any such supplement or amendment to the related prospectus.

     (i) The Company shall enter into  customary  agreements and take such other
actions as are  reasonably  required  in order to  expedite  or  facilitate  the
disposition of such Registrable  Securities  (whereupon the Investor may, at its
option, require that any or all of the representations, warranties and covenants
of the Company also be made to and for the benefit of the Investor).

     (j) The Company  shall make  available to the Investor (and will deliver to
Investor's  counsel),  subject to  restrictions  imposed  by the  United  States
federal  government  or any  agency or  instrumentality  thereof,  copies of all
correspondence between the SEC and the Company, its counsel or auditors and will
also make available for inspection by the Investor and any attorney,  accountant
or other professional retained by the Investor (collectively, the "Inspectors"),
all financial and other records, pertinent corporate documents and properties of
the Company  (collectively,  the "Records") as shall be reasonably  necessary to
enable  them to  exercise  their  due  diligence  responsibility,  and cause the
Company's officers and employees to supply all information  reasonably requested
by any Inspectors in connection with such Registration  Statement.  Records that
the Company determines,  in good faith, to be confidential and which it notifies
the Inspectors are confidential  shall not be disclosed by the Inspectors unless
(i)  the  disclosure  of such  Records  is  necessary  to  avoid  or  correct  a
misstatement or omission in such  Registration  Statement or (ii) the disclosure
or release of such Records is requested or required  pursuant to oral questions,
interrogatories,  requests for  information  or documents or a subpoena or other
order from a court of competent  jurisdiction  or other  process;  provided that
prior to any disclosure or release pursuant to clause (ii), the Inspectors shall
provide the Company  with prompt  notice of any such request or  requirement  so
that  the  Company  may seek an  appropriate  protective  order  or  waive  such
Inspectors' obligation not to disclose such Records; and, provided further, that
if  failing  the  entry of a  protective  order  or the  waiver  by the  Company
permitting  the  disclosure or release of such  Records,  the  Inspectors,  upon
advice of counsel,  are compelled to disclose such Records,  the  Inspectors may
disclose that portion of the Records  which  counsel has advised the  Inspectors
that the  Inspectors  are  compelled  to  disclose.  The  Investor  agrees  that
information obtained by it solely as a result of such inspections (not including
any  information  obtained  from a third  party who,  insofar as is known to the
Investor  after  reasonable  inquiry,  is not  prohibited  from  providing  such
information  by a  contractual,  legal or fiduciary

<PAGE>



obligation to the Company) shall be deemed confidential and shall not be used by
it as the basis for any market  transactions in the securities of the Company or
its Affiliates unless and until such information is made generally  available to
the public.  The  Investor  further  agrees  that it will,  upon  learning  that
disclosure of such Records is sought in a court of competent jurisdiction,  give
notice to the  Company  and allow the  Company,  at its  expense,  to  undertake
appropriate action to prevent disclosure of the Records deemed confidential.

     (k) The Company shall deliver,  in accordance with the notice provisions of
Section 4.8, to the Investor a signed counterpart, addressed to the Investor, of
(1) an opinion or opinions of counsel to the  Company,  in such form  reasonably
acceptable to the Investor,  and (2) to the extent required by law or reasonably
necessary  to  effect  a sale  of  Registrable  Securities  in  accordance  with
prevailing business practices at the time of any sale of Registrable  Securities
pursuant to a Registration  Statement,  a comfort letter or comfort letters from
the  Company's  independent  public  accountants,  each in  customary  form  and
covering  such  matters of the type  customarily  covered by opinions or comfort
letters, as the case may be, as the Investor therefore reasonably requests.

     (l) The  Company  shall  otherwise  comply  with all  applicable  rules and
regulations  of  the  SEC,  including,   without  limitation,   compliance  with
applicable reporting  requirements under the Exchange Act. (m) The Company shall
appoint a  transfer  agent and  registrar  for all such  Registrable  Securities
covered by such Registration Statement not later than the effective date of such
Registration Statement.

     (n) The Company may require the Investor to promptly  furnish in writing to
the Company such  information as may be legally required in connection with such
registration  including,  without  limitation,  all such  information  as may be
requested by the SEC or the National  Association  of  Securities  Dealers.  The
Investor  agrees to provide such  information  requested in connection with such
registration  within ten (10) business days after receiving such written request
and the  Company  shall  not be  responsible  for any  delays  in  obtaining  or
maintaining the effectiveness of the Registration  Statement  directly caused by
the Investor's failure to timely provide such information.

     Section 2.2  REGISTRATION  EXPENSES.  In connection with each  Registration
Statement,   the  Company  shall  pay  all  registration  expenses  incurred  in
connection  with the  registration  thereunder  (the  "Registration  Expenses"),
including, without limitation: (i) all registration, filing, securities exchange
listing and fees required by the National  Association  of  Securities  Dealers,
(ii) all  registration,  filing,  qualification  and other fees and  expenses of
compliance  with  securities  or blue sky laws  (including  reasonable  fees and
disbursements  of  counsel in  connection  with blue sky  qualifications  of the
Registrable  Securities),  (iii)  all word  processing,  duplicating,  printing,
messenger  and  delivery   expenses,   (iv)  the  Company's   internal  expenses
(including,  without  limitation,  all salaries and expenses of its officers and
employees  performing  legal or  accounting  duties),  (v) the fees and expenses
incurred in  connection  with the listing of the  Registrable  Securities,  (vi)
reasonable fees and  disbursements of counsel for the Company and customary fees
and  expenses  for  independent  certified  public  accountants  retained by the
Company  (including  the  expenses of any special  audits or comfort  letters or
costs associated with the delivery by independent  certified public  accountants
of such  special  audit(s) or comfort  letter(s)  requested  pursuant to Section
2.1(l) hereof),  (vii) the fees and expenses of any special experts  retained by
the Company in  connection  with such  registration,  (viii)  premiums and other
costs of policies of  insurance  against  liabilities  arising out of any public
offering of the Registrable  Securities being registered,  and (ix) any fees and
disbursements  of  underwriters  customarily  paid  by  issuers  or  sellers  of
securities,  but  excluding  underwriting  fees,  discounts,  transfer  taxes or
commissions,  if any, attributable to the sale of Registrable Securities,  which
shall be payable by each seller of Registrable


<PAGE>


Securities pro rata on the basis of the number of Registrable Securities of each
such seller that are included in a registration under this Agreement.

                                   ARTICLE III
                        INDEMNIFICATION AND CONTRIBUTION

     Section 3.1 INDEMNIFICATION BY THE COMPANY. The Company agrees to indemnify
and  hold  harmless  each  seller  of  Registrable  Securities,   its  partners,
Affiliates,  officers, directors, employees and duly authorized agents, and each
Person or entity,  if any,  who controls  the seller of  Registrable  Securities
within the  meaning of  Section  15 of the  Securities  Act or Section 20 of the
Exchange  Act,  together  with the partners,  Affiliates,  officers,  directors,
employees  and duly  authorized  agents  of such  controlling  Person  or entity
(collectively,  the "Controlling  Persons"),  from and against any loss,  claim,
damage, liability, costs and expenses (including, without limitation, reasonable
attorneys' fees and  disbursements  and costs and expenses of investigating  and
defending any such claim) (collectively,  "Damages"),  joint or several, and any
action or  proceeding  in respect  thereof  to which the  seller of  Registrable
Securities, its partners,  Affiliates,  officers, directors,  employees and duly
authorized  agents, and any such Controlling Person may become subject under the
Securities Act or otherwise as incurred and, insofar as such Damages (or actions
or proceedings  in respect  thereof) arise out of, or are based upon, any untrue
statement  or alleged  untrue  statement  of a material  fact  contained  in any
Registration  Statement or prospectus relating to the Registrable  Securities or
any preliminary prospectus, or arises out of, or are based upon, any omission or
alleged  omission to state therein a material fact required to be stated therein
or necessary to make the statements  therein not  misleading,  except insofar as
the same are based upon  information  furnished in writing to the Company by the
seller of Registrable  Securities expressly for use therein, and shall reimburse
the  seller of  Registrable  Securities,  its  partners,  Affiliates,  officers,
directors,  employees  and duly  authorized  agents,  and each such  Controlling
Person for any legal and other  expenses  reasonably  incurred  by the seller of
Registrable Securities, its partners, Affiliates, officers, directors, employees
and duly authorized  agents,  or any such Controlling  Person,  as incurred,  in
investigating  or defending  or preparing to defend  against any such Damages or
actions or proceedings;  provided, however, that the Company shall not be liable
to the seller of  Registrable  Securities  to the extent  that any such  Damages
arise  out of or are based  upon an untrue  statement  or  omission  made in any
preliminary  prospectus if (A) the seller of  Registrable  Securities  failed to
send or deliver a copy of the final  prospectus  delivered by the Company to the
seller  of  Registrable  Securities  with or prior to the  delivery  of  written
confirmation  of the sale by the seller of Registrable  Securities to the Person
asserting the claim from which such Damages arise,  and (B) the final prospectus
would have corrected such untrue  statement or alleged untrue  statement or such
omission or alleged  omission,  or (C) such untrue statement or omission made in
any  prospectus  was  furnished  to  the  Company  by a  seller  of  Registrable
Securities  or  described  such  seller of  Registrable  Securities  in a manner
consistent  with   representations  made  by  any  Investor  in  the  Investment
Agreement.

     Section  3.2  INDEMNIFICATION  BY SELLER OF  REGISTRABLE  SECURITIES.  Each
Seller of  Registrable  Securities  agrees to  indemnify  and hold  harmless the
Company and each person,  if any, who controls the Company,  or entity,  if any,
who controls the Company  within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act, and each officer of the Company who signs the
Registration  Statement,  the Company's  directors,  together with the partners,
Affiliates,  officers,  directors,  employees and duly authorized agents of such
controlling Person or entity (collectively, the "Controlling Persons"), from and
against any loss,  claim,  damage,  liability,  costs and  expenses  (including,
without limitation,  reasonable  attorneys' fees and disbursements and costs and
expenses  of  investigating   and  defending  any  such  claim)   (collectively,
"Damages"), joint or several, and any action or proceeding in respect thereof to
which the Company and Controlling Person may become subject under the Securities
Act or  otherwise  as  incurred  and,  insofar as such  Damages  (or  actions or
proceedings  in respect  thereof)  arise out of, or are based  upon,  any untrue
statement  or alleged  untrue  statement  of a material  fact


<PAGE>


contained  in  any  Registration   Statement  or  prospectus   relating  to  the
Registrable Securities or any preliminary  prospectus,  or arises out of, or are
based upon,  any omission or alleged  omission to state  therein a material fact
required to be stated  therein or necessary to make the  statements  therein not
misleading,  only  insofar as the same are based upon  information  furnished in
writing to the Company by the seller of Registrable Securities expressly for use
therein,  and shall reimburse the Company and each such  Controlling  Person for
any legal and other  expenses  reasonably  incurred by the Company,  or any such
Controlling Person, in investigating or defending or preparing to defend against
any such Damages or actions or proceedings;  provided,  however, that the seller
of Registrable  Securities  shall be limited to the proportion of any such loss,
claim,  damage,  liability or expense which is equal to the proportion  that the
public  offering price of the  Registrable  Securities  sold by the seller under
such  Registration  Statement  bears to the total public  offering  price of all
securities offered  thereunder,  but not in any event to exceed the net proceeds
received by the seller of  Registrable  Securities  from the sale of Registrable
Securities covered by such registration statement.

     Section 3.3 CONDUCT OF INDEMNIFICATION PROCEEDINGS.  Promptly after receipt
by any person or entity in respect of which  indemnity may be sought pursuant to
Section  3.1 or 3.2 (an  "Indemnified  Party")  of  notice  of any  claim or the
commencement of any action,  the Indemnified  Party shall, if a claim in respect
thereof is to be made against the person or entity  against whom such  indemnity
may be sought  (the  "Indemnifying  Party"),  notify the  Indemnifying  Party in
writing  of the  claim  or the  commencement  of such  action;  in the  event an
Indemnified Party shall fail to give such notice as provided in this Section 3.3
and the  Indemnifying  Party to whom  notice  was not given was  unaware  of the
proceeding to which such notice would have related and was materially prejudiced
by the failure to give such notice, the indemnification  provided for in Section
3.1 and 3.2 shall be reduced to the  extent of any  actual  prejudice  resulting
from such  failure  to so notify  the  Indemnifying  Party;  provided,  that the
failure to notify the Indemnifying Party shall not relieve it from any liability
that it may have to an  Indemnified  Party  otherwise  than under Section 3.1 or
3.2. If any such claim or action shall be brought against an Indemnified  Party,
and it shall notify the Indemnifying Party thereof, the Indemnifying Party shall
be entitled to participate therein,  and, to the extent that it wishes,  jointly
with any other  similarly  notified  Indemnifying  Party,  to assume the defense
thereof with counsel  reasonably  satisfactory to the Indemnified  Party.  After
notice from the Indemnifying  Party to the Indemnified  Party of its election to
assume the defense of such claim or action,  the Indemnifying Party shall not be
liable to the  Indemnified  Party for any legal or other  expenses  subsequently
incurred by the  Indemnified  Party in connection with the defense thereof other
than reasonable  costs of  investigation;  provided that the  Indemnified  Party
shall have the right to employ  separate  counsel to represent  the  Indemnified
Party and its controlling persons who may be subject to liability arising out of
any claim in respect of which indemnity may be sought by the  Indemnified  Party
against the Indemnifying  Party, but the fees and expenses of such counsel shall
be for the account of such Indemnified  Party unless (i) the Indemnifying  Party
and the  Indemnified  Party shall have mutually  agreed to the retention of such
counsel or (ii) in the reasonable  judgment of the Company and such  Indemnified
Party, representation of both parties by the same counsel would be inappropriate
due to  actual  or  potential  conflicts  of  interest  between  them,  it being
understood,  however,  that the Indemnifying Party shall not, in connection with
any one such claim or action or separate  but  substantially  similar or related
claims or  actions  in the same  jurisdiction  arising  out of the same  general
allegations or  circumstances,  be liable for the fees and expenses of more than
one separate firm of attorneys  together with appropriate  local counsel) at any
time  for all  Indemnified  Parties,  or for  fees  and  expenses  that  are not
reasonable.  No Indemnifying  Party shall,  without the prior written consent of
the  Indemnified  Party,  effect  any  settlement  of any  claim or  pending  or
threatened proceeding in respect of which the Indemnified Party is or could have
been a party and indemnity could have been sought  hereunder by such Indemnified
Party,  unless  such  settlement  includes  an  unconditional  release  of  such
Indemnified  Party from all liability  arising out of such claim or  proceeding.
Whether or not the defense of any claim or action is assumed by the Indemnifying
Party,  such  Indemnifying  Party will not be subject to



<PAGE>


any liability for any  settlement  made without its consent,  which consent will
not be unreasonably withheld.

     Section  3.4  OTHER  INDEMNIFICATION.   Indemnification   similar  to  that
specified  in the  preceding  paragraphs  of this  Article  3 (with  appropriate
modifications)  shall be given by the  Company  and each  seller of  Registrable
Securities with respect to any required  registration or other  qualification of
securities  under any  federal or state law or  regulation  of any  governmental
authority  other than the  Securities  Act. The  provisions  of this Article III
shall be in addition to any other  rights to  indemnification,  contribution  or
other  remedies  which an  Indemnified  Party may have pursuant to law,  equity,
contract or otherwise.

     Section  3.5  CONTRIBUTION.  If the  indemnification  provided  for in this
Article III is unavailable to the Indemnified  Parties in respect of any Damages
referred to herein,  then the Indemnifying  Party, in lieu of indemnifying  such
Indemnified  Party,  shall  contribute  to the  amount  paid or  payable by such
Indemnified  Party as a result of such  Damages  between  the Company on the one
hand and the Investor on the other,  in such  proportion  as is  appropriate  to
reflect the relative fault of the Company and of the Investor in connection with
such  statements or omissions,  as well as other equitable  considerations.  The
relative  fault of the Company on the one hand and of the  Investor on the other
shall be determined  by reference to, among other things,  whether the untrue or
alleged untrue  statement of a material fact or the omission or alleged omission
to state a material fact relates to information  supplied by such party, and the
parties'  relative intent,  knowledge,  access to information and opportunity to
correct or prevent  such  statement  or  omission.  The Company and the Investor
agree that it would not be just and equitable if  contribution  pursuant to this
Section 3.5 were  determined  by pro rata  allocation  or by any other method of
allocation that does not take into account the equitable considerations referred
to in the  immediately  preceding  paragraph.  The amount  paid or payable by an
Indemnified  Party as a result of the  Damages  referred  to in the  immediately
preceding  paragraph shall be deemed to include,  subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such Indemnified
Party in connection  with  investigating  or defending any such action or claim.
Notwithstanding  the  provisions  of this Section 3.5, the Investor  shall in no
event be required to contribute  any amount in excess of the amount by which the
total price at which the  Registrable  Securities  of the seller of  Registrable
Securities were sold to the public (less underwriting discounts and commissions)
exceeds the amount of any damages which the Investor has otherwise been required
to pay by reason of such  untrue or alleged  untrue  statement  or  omission  or
alleged omission. No Person guilty of fraudulent  misrepresentation  (within the
meaning  of  Section  11(f)  of  the  Securities   Act)  shall  be  entitled  to
contribution   from  any  Person   who  was  not   guilty  of  such   fraudulent
misrepresentation.

                                   ARTICLE IV
                                  MISCELLANEOUS

     Section 4.1 NO OUTSTANDING  REGISTRATION RIGHTS. The Company represents and
warrants to the seller of Registrable  Securities that there is not in effect on
the date hereof any  agreement  by the Company  pursuant to which any holders of
securities  of the  Company  have a right to cause the  Company to  register  or
qualify such  securities  under the Securities Act or any securities or blue sky
laws of any  jurisdiction  that  would  conflict  or be  inconsistent  with  any
provision of this Agreement or the  Investment  Agreement.  The Company  further
represents and warrants that upon issuance,  the Registrable Securities will not
have been issued or sold in violation of any  preemptive or other similar rights
of holders of any securities of the Company or any other person.

     Section  4.2 TERM.  The  registration  rights  provided  to the  holders of
Registrable  Securities hereunder shall terminate at such time as all Put Shares
and  Warrant  Shares (i) have been  disposed  of  pursuant  to the  Registration
Statement,  (ii) have  been  sold  under  circumstances  under  which all of the


<PAGE>


applicable conditions of Rule 144 (or any similar provision then in force) under
the Securities  Act ("Rule 144") are met, (iii) have been otherwise  transferred
to holders who may trade such shares  without  restriction  under the Securities
Act,  and the  Company  has  delivered a new  certificate  or other  evidence of
ownership for such securities not bearing a restrictive  legend,  or (iv) may be
sold without any time, volume or manner limitations  pursuant to Rule 144(k) (or
any similar provision then in effect) under the Securities Act in the opinion of
counsel to the Company,  which  counsel  shall be  reasonably  acceptable to the
holder of Registrable  Securities;  provided,  however,  that such  registration
rights  shall  not  terminate  sooner  than two years  following  the end of the
Commitment Period.  Notwithstanding the foregoing, paragraph (d) of Section 1.1,
Article III,  Section 4.8 and Section 4.9 shall survive the  termination of this
Agreement.

     Section 4.3 RULE 144. The Company  covenants  that it will file all reports
required to be filed by it under the  Securities  Act and the  Exchange  Act and
that it will take such further action as holders of  Registrable  Securities may
reasonably  request,  all to the extent required from time to time to enable the
seller  of  Registrable   Securities  to  sell  Registrable  Securities  without
registration  under the  Securities  Act within the limitation of the exemptions
provided by (a) Rule 144, as such Rule may be amended from time to time,  or (b)
any similar rule or regulation  hereafter adopted by the SEC. If at any time the
Company is not required to file such reports,  it will,  upon the request of any
holder of Registrable  Securities,  make publicly available other information so
long as necessary to permit sales  pursuant to Rule 144. Upon the request of the
seller of  Registrable  Securities,  the Company  will  deliver to the seller of
Registrable  Securities a written  statement as to whether it has complied  with
such requirements.

     Section 4.4 CERTIFICATE.  The Company will, at its expense,  forthwith upon
the request of any holder of  Registrable  Securities,  deliver to such holder a
certificate,  signed by the Company's principal  financial officer,  stating (a)
the Company's name,  address and telephone number (including area code), (b) the
Company's  Internal  Revenue Service  identification  number,  (c) the Company's
Commission  file  number,  (d) the  number  of  shares  of each  class  of Stock
outstanding  as shown by the most recent  report or  statement  published by the
Company,  and (e) whether the Company has filed the reports required to be filed
under the  Exchange  Act for a period of at least  ninety (90) days prior to the
date of such certificate and in addition has filed the most recent annual report
required to be filed thereunder.

     Section 4.5 AMENDMENT AND MODIFICATION. Any provision of this Agreement may
be waived,  provided that such waiver is set forth in a writing  executed by the
parties to this  Agreement.  The  provisions  of this  Agreement,  including the
provisions of this sentence, may not be amended,  modified or supplemented,  and
waivers or consents to departures  from the provisions  hereof may not be given,
unless the Company has obtained the written consent of the holders of a majority
of the then outstanding Registrable  Securities.  Notwithstanding the foregoing,
the  waiver of any  provision  hereof  with  respect  to a matter  that  relates
exclusively to the rights of holders of Registrable  Securities whose securities
are being sold  pursuant to a  Registration  Statement  and does not directly or
indirectly  affect the rights of other holders of Registrable  Securities may be
given by holders of at least a majority of the Registrable Securities being sold
by such  holders;  provided  that the  provisions  of this  sentence  may not be
amended,  modified or  supplemented  except in accordance with the provisions of
the immediately  preceding  sentence.  No course of dealing between or among any
Person having any interest in this Agreement will be deemed effective to modify,
amend or discharge any part of this  Agreement or any rights or  obligations  of
any person under or by reason of this Agreement.

     Section 4.6 SUCCESSORS AND ASSIGNS;  ENTIRE  AGREEMENT.  This Agreement and
all of the  provisions  hereof shall be binding upon and inure to the benefit of
the parties  hereto.  The Investor and Company may not assign their rights under
this Agreement. This Agreement, together with the Investment Agreement set forth
the entire  agreement  and  understanding  between the parties as to the


<PAGE>


subject  matter  hereof  and  merges  and  supersedes  all  prior   discussions,
agreements and understandings of any and every nature among them.

     Section 4.7 SEPARABILITY. In the event that any provision of this Agreement
or the application of any provision hereof is declared to be illegal, invalid or
otherwise unenforceable by a court of competent  jurisdiction,  the remainder of
this Agreement  shall not be affected  except to the extent  necessary to delete
such illegal,  invalid or  unenforceable  provision  unless that  provision held
invalid shall  substantially  impair the benefits of the  remaining  portions of
this Agreement.

     Section 4.8 NOTICES. All notices, demands, requests,  consents,  approvals,
and other communications required or permitted hereunder shall be in writing and
shall be (i)  personally  served,  (ii)  deposited  in the mail,  registered  or
certified,  return  receipt  requested,  postage  prepaid,  (iii)  delivered  by
reputable air courier service with charges prepaid,  or (iv) transmitted by hand
delivery,  telegram or facsimile,  addressed as set forth below or to such other
address as such party shall have specified most recently by written notice.  Any
notice or other communication  required or permitted to be given hereunder shall
be deemed  effective  (a) upon hand  delivery  or delivery  by  facsimile,  with
accurate  confirmation  generated by the transmitting  facsimile machine, at the
address or number designated below (if delivered on a business day during normal
business  hours where such notice is to be received),  or the first business day
following such delivery (if delivered other than on a business day during normal
business  hours  where  such  notice  is to be  received)  or (b) on the  second
business day following  the date of mailing by express  courier  service,  fully
prepaid,  addressed to such  address,  or upon actual  receipt of such  mailing,
whichever shall first occur. The addresses for such communications shall be:

         If to Hand Brand Distribution, Inc.:

                  Hand Brand Distribution, Inc.
                  9845 N.E. 2nd Avenue
                  Miami Shores, Florida 33138
                  Telecopier: _______________

         With a copy to (which communication shall not constitute notice):

                  JOEL BERNSTEIN, ESQ., P.A.
                  11900 Biscayne Boulevard
                  Suite 604
                  Miami, Florida 33181
                  Attn: Joel Bernstein
                  Telecopier: (305) 892-0822

         If to the Investor:

                  Prima Capital Growth Fund LLC
                  676A 9th Avenue, Suite 259
                  New York, NY 10036
                  Telecopier: 561-241-7145


<PAGE>

        And also a copy to (which communication shall not constitute notice):

                  Proskauer Rose, LLP
                  2255 Glades Road, Suite 340W
                  Boca Raton, FL 33431
                  Attn: Gayle Coleman, Esq.
                  Telecopier: (561) 241-7145

Either party hereto may from time to time change its address or facsimile number
for  notices  under this  Section  4.8 by giving at least ten (10)  days'  prior
written  notice of such changed  address or facsimile  number to the other party
hereto.

     Section 4.9  GOVERNING  LAW.  This  Agreement  shall be subject to the same
choice of law, venue and jurisdiction as the Investment  Agreement and construed
under the laws of the State of New York,  without  giving  effect to  provisions
regarding conflicts of law or choice of law.

     Section 4.10 HEADINGS.  The headings in this Agreement are for  convenience
of reference only and shall not constitute a part of this  Agreement,  nor shall
they affect their meaning, construction or effect.

     Section  4.11  COUNTERPARTS.  This  Agreement  may be  executed in multiple
counterparts, each of which shall be deemed to be an original instrument and all
of which together shall constitute one and the same instrument.

     Section 4.12 FURTHER  ASSURANCES.  Each party shall cooperate and take such
action as may be reasonably requested by another party in order to carry out the
provisions  and purposes of this  Agreement  and the  transactions  contemplated
hereby.

<PAGE>


     Section 4.13 REMEDIES.  In the event of a breach or a threatened  breach by
any party to this Agreement of its obligations  under this Agreement,  any party
injured or to be injured by such breach will be entitled to specific performance
of its rights under this Agreement or to injunctive relief, in addition to being
entitled to exercise all rights  provided in this  Agreement and granted by law.
The parties agree that the  provisions of this Agreement  shall be  specifically
enforceable,  it being agreed by the parties  that the remedy at law,  including
monetary  damages,   for  breach  of  any  such  provision  will  be  inadequate
compensation  for any loss and that any defense or  objection  in any action for
specific performance or injunctive relief that a remedy at law would be adequate
is waived.

     IN WITNESS WHEREOF, the parties hereto have caused this Registration Rights
Agreement to be executed by the undersigned,  thereunto duly  authorized,  as of
the date first set forth above.




                                     HAND BRAND DISTRIBUTION, INC.
                                     "Company"


                                     By: /s/
                                         --------------------------------------




                                     PRIMA CAPITAL GROWTH FUND LLC
                                     "Investor"


                                     By: /s/
                                         --------------------------------------
                                         Manager


</TEXT>
</DOCUMENT>
