
                             REGISTRATION AGREEMENT

         REGISTRATION  AGREEMENT  dated as of  November  7, 1996,  among  ACTION
PERFORMANCE  COMPANIES,  INC., an Arizona  corporation (the  "Company");  SPORTS
IMAGE,  INC., a North Carolina  corporation  ("SII");  and R. DALE EARNHARDT and
TERESA H. EARNHARDT (together "Earnhardt") who own all the capital stock of SII.
(SII and Earnhardt are referred to as the "Holders.")

                                   WITNESSETH

         The Company acquired  substantially  all of the assets of SII under the
terms of an Asset  Purchase  Agreement of even date. The  consideration  for the
assets of SII included  shares of Company's  Common  Stock (the  "Shares").  The
Shares are  "restricted  securities" as defined in Rule 144 under the Securities
Act of 1933, as amended. As a result, there are substantial  restrictions on the
ability of the Holders to sell the Shares in the absence of  registration  under
the  Securities Act of 1933 and applicable  state  securities  laws. In order to
enable the  Holders  to sell all or a portion of the  Shares,  the  Company  has
agreed to the terms of this Agreement.

         NOW THEREFORE,  in  consideration  of the premises,  and other good and
valuable  consideration,  the receipt,  adequacy,  and  sufficiency of which are
hereby acknowledged by the parties, the parties hereby agree as follows:

1.       REGISTRATION

         1.1 Definitions.  As used in this Agreement,  the following terms shall
have the following meanings:

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

                  (b) The term "Blackout  Period" means any period (A) beginning
on the date on which the Company  notifies  the Holders (as defined  below) that
(i) the Board of  Directors  of the Company,  in its good faith  judgement,  has
determined that there are material developments with respect to the Company such
that it would be seriously  detrimental to the Company and its  shareholders  to
utilize a registration statement pursuant to Sections 1.2 or 1.3 below; (ii) the
Board of Directors of the Company,  in its good faith  judgment,  has determined
that financial statements with respect to the Company,  which may be required to
utilize a  registration  statement  pursuant to Sections  1.2 or 1.3 below,  are
unavailable;  or (iii) the Company has  notified  the Holders that it intends to
file a registration  statement for a Subsequent  Financing within 30 days of the
mailing of such notice in accordance with Section 2.3 hereof,  and (B) ending on
the date (1) with respect to clause (i) above,  as soon as  practicable  but not
more than 30 days after the date on which the  Company  notifies  the Holders of
the Board of Directors' determination; (2) with respect to clause (ii) above, as
soon as financial statements  sufficient to permit Company to file or permit the
utilization of a registration statement under the Act have become available; and
(3) with respect to clause (iii) above,  90 days after the effective date of the
registration statement for the Subsequent Financing.

                  (c) The term  "Holders"  means those persons  owning or having
the right to acquire Registrable Securities (as defined below).

                  (d) The term "Maximum  Includable  Securities"  shall mean the
maximum number of shares of each type or class of the Company's  securities that
a  managing  or  principal  underwriter,  in  its  good  faith  judgment,  deems
practicable  to offer  and sell at that time in a firm  commitment  underwritten
offering without  materially and adversely  affecting the marketability or price
of the securities of the Company to be offered. When more than one type or class
of the Company's  securities are to be included in a registration,  the managing
or principal  underwriter of the offering shall  designate the maximum number of
each such type or class of securities that is included in the Maximum Includable
Securities.
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                  (e) The  term  "register,"  "registered,"  and  "registration"
refer  to a  registration  effected  by  preparing  and  filing  a  registration
statement or similar document in compliance with the Act, and the declaration or
ordering of effectiveness of such registration statement or document.

                  (f) The term  "Registrable  Security"  shall  refer to (i) the
Shares,  and (ii) any shares of Common Stock or other securities of Company that
may subsequently be issued or issuable with respect to the Shares as a result of
a  stock  split  or  dividend  or  any  sale,  transfer,  assignment,  or  other
transaction  by the Company or a Holder  involving the Shares and any securities
into  which  the  Shares  may  thereafter  be  changed  as a result  of  merger,
consolidation,  recapitalization, or otherwise. As to any particular Registrable
Securities,  such securities  will cease to be Registrable  Securities when they
have been distributed to the public pursuant to an offering registered under the
Act or  sold  to the  public  through  a  broker,  dealer,  or  market-maker  in
compliance with Rule 144 under the Act.

                  (g) "SEC" means the Securities and Exchange Commission.

                  (h) The term  "Subsequent  Financing" means an offering of the
Company's  Common Stock or other  securities  convertible  or  exercisable  into
shares of the  Company's  Common  Stock  within 36 months after the date of this
Agreement.

         1.2      Demand Registration Rights.

                  (a) If the Company shall receive at any time a written request
from  the  Holders  (the   "Initiating   Holders")  of  Shares   requesting  the
registration of Registrable  Securities,  then the Company shall, within 10 days
of the receipt  thereof,  give written notice of such request to all Holders and
shall,  subject  to the  limitations  of  Section  1.2(b),  effect  as  soon  as
practicable the  registration  under the Act of all Registrable  Securities that
the  Holders  request  to be  registered  within 60 days of the  mailing of such
notice by the Company in  accordance  with the notice  provisions of Section 2.3
hereof.

                  (b)  Notwithstanding  the  foregoing,  if  the  Company  shall
furnish to Holders requesting a registration  statement pursuant to this Section
1.2 a certificate signed by the President of the Company stating that a Blackout
Period is in effect,  the  Company  shall  have the right to defer  such  filing
during the term of such Blackout Period.

                  (c) If the Holders give written notice requesting registration
of their Registrable Securities pursuant to this Section 1.2, and if the Company
at that time is not eligible to register its securities on Form S-3, the Company
shall  prepare and file a  registration  statement  on Form S-1 or S-2 (or other
appropriate  form  for  the  general  registration  of  securities)  as  may  be
appropriate  in  accordance  with the  terms  and  conditions  set forth in this
Section 1.2.

                  (d) The Company may  propose to include  Additional  Shares of
Common  Stock or other  securities  to be sold by the  Company  and/or  by other
holders of Common Stock or other securities in any registration  statement to be
filed  pursuant to this Section 1.2. The Holders  shall have the right to reduce
the number of  Additional  Shares  requested  to be  registered  by the  Company
pursuant to this Section 1.2(c)  (including,  if necessary,  to zero) if, in the
good faith opinion of the  underwriter or  underwriters  of such  offering,  the
inclusion of such Additional  Shares would  materially and adversely  affect the
marketability  or price  of the  Registrable  Securities  to be  offered  by the
Holders in such registration.

                  (e) The  Company  shall be  obligated  to effect only one such
registration pursuant to this Section 1.2.
                                        2
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                  (f) The Holders shall have the right to select the underwriter
or  underwriters,  subject to the approval of the Company,  which approval shall
not be unreasonably  withheld,  that will undertake the sale and distribution of
the Shares to be included in a registration statement filed under the provisions
of this Section 1.2.

         1.3      Piggy-Back Registration Rights.

                  (a) Except as provided in Section  1.3(e),  if at any time the
Company  proposes  to  file  on  its  behalf  and/or  on  behalf  of  any of its
securityholders a registration  statement under the Act on Form S-1, S-2, or S-3
(or any other appropriate form for the general  registration of securities) with
respect to any of its capital stock or other securities,  the Company shall give
each  Holder  written  notice at least 20 days before the filing with the SEC of
such  registration   statement.  If  any  Holder  desires  to  have  Registrable
Securities  registered pursuant to this Section 1.3, such Holder shall so advise
the  Company in writing  within 15 days after the date of mailing of such notice
from the Company.  The Company shall thereupon include in such filing the number
of Registrable Securities for which registration is so requested, subject to its
right to reduce the number of Registrable  Securities as  hereinafter  provided,
and shall use its best  efforts  to  effect  registration  under the Act of such
Registrable Securities.  Notwithstanding the foregoing, the Company shall not be
required to provide notice of filing of a registration  statement and to include
therein any Registrable Securities if the proposed registration is

                           (i) a registration of stock options, stock purchases,
or compensation or incentive plans, or of securities issued or issuable pursuant
to any  such  plan,  or a  dividend  reinvestment  plan on Form  S-8,  or  other
comparable form then in effect; or

                           (ii) a  registration  of  securities  proposed  to be
issued in exchange for securities or assets of, or in connection  with, a merger
or consolidation with another corporation.

                  (b)  In  the  event  the   offering  in  which  any   Holder's
Registrable  Securities are to be included pursuant to this Section 1.3 is to be
underwritten,  the Company shall furnish the Holders with a written statement of
the managing or principal underwriter as to the Maximum Includable Securities as
soon as practicable  after the  expiration of the 15-day period  provided for in
Section  1.3(a).  If the total number of  securities  proposed to be included in
such registration  statement is in excess of the Maximum Includable  Securities,
the number of securities to be included within the coverage of such registration
statement shall be reduced to the Maximum Includable Securities as follows:

                           (i) no  reduction  shall  be  made in the  number  of
shares of capital stock or other  securities to be registered for the account of
the Company; and

                           (ii) the number of  Registrable  Securities and other
securities that may be included in the registration,  if any, shall be allocated
among the Holders of Registrable Securities and holders of other securities (the
"Other Holders")  requesting  inclusion on a pro rata basis,  with the number of
each  type or class of  securities  of each  Holder  and  Other  Holder  thereof
included in the registration to be that number determined by multiplying (A) the
total  number  of  such  type or  class  of  security  included  in the  Maximum
Includable  Securities  less (B) the number of such type or class of security to
be registered  for the account of the Company,  by a fraction,  the numerator of
which  will be the  total  number of such  type or class of  security  that such
Holder or Other  Holder  owns,  and the  denominator  of which will be the total
number of such type or class of security  owned by all Holders and Other Holders
that  have  requested  inclusion  of  such  type or  class  of  security  in the
registration.

                  (c) The  Company  shall,  in its sole  discretion,  select the
underwriter  or  underwriters,  if any,  that  are to  undertake  the  sale  and
distribution  of the  Registrable  Securities  to be included in a  registration
statement filed under the provisions of this Section 1.3.
                                        3
<PAGE>
                  (d) At  such  time  that  the  Company  intends  to  effect  a
Subsequent  Financing,  it shall  notify the  Holders  of such  intent and shall
designate the proposed offering as a Subsequent Financing.  Except to the extent
that the Company,  in its sole  discretion,  may otherwise  permit,  the Holders
shall have no right to have any Registrable  Securities  registered  pursuant to
this Section 1.3 in any Subsequent Financing.

                  (e) The right to registration  provided in this Section 1.3 is
in addition  to and not in lieu of the demand  registration  rights  provided in
Section 1.2. The provisions of this Section 1.3 shall not apply, however, to any
Holders requesting  registration pursuant to this Section 1.3 that are or may be
free, at the time, to sell within the next 90-day period all of the  Registrable
Securities with respect to which such  registration  was requested in accordance
with Rule 144 (or any similar rule or regulation) under the Act.

         1.4 Obligations of the Company.  Whenever required under Section 1.2 or
Section  1.3 to effect  the  registration  of any  Registrable  Securities,  the
Company shall, as expeditiously as reasonably possible:

                  (a) Prepare and file with the SEC a registration  statement on
such form as the Company  deems  appropriate  with  respect to such  Registrable
Securities  and use its best  efforts to cause such  registration  statement  to
become  effective.  With respect to  registration  statements  filed pursuant to
Section 1.2 or Section 1.3 hereof, upon the request of the Holders of a majority
of the Registrable Securities registered thereunder, the Company shall keep such
registration  statement  effective for up to 180 days, or such shorter period as
is reasonably required to dispose of all securities covered by such registration
statement,  provided that the Company shall keep a registration  statement filed
pursuant  to Section  1.2  effective  for an  additional  90 days if  reasonably
required to dispose of all securities covered by such registration statement.

                  (b) Notify the Holders  promptly after it has received  notice
of the time  when  such  registration  statement  has  become  effective  or any
supplement to any prospectus  forming a part of such registration  statement has
been filed.

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

                  (d) Advise each Holder  promptly after it has received  notice
or  obtained  knowledge  thereof  of the  issuance  of any stop order by the SEC
suspending  the  effectiveness  of  any  such  registration   statement  or  the
initiation or  threatening  of any  proceeding for that purpose and promptly use
its best  efforts to  prevent  the  issuance  of any stop order or to obtain its
withdrawal if such stop order should be issued.

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

                  (f)  Use  its  best   efforts  to  register  and  qualify  the
securities covered by such registration statement under such other securities or
Blue Sky laws of such  jurisdictions  as shall be  reasonably  requested  by the
Holders, provided that the Company shall not be required in connection therewith
or as a condition  thereto to qualify to do business,  to file a general consent
to service of process,  or to become subject to tax liability in any such states
or  jurisdictions,  or to agree to any  restrictions  as to the  conduct  of its
business in the ordinary course thereof.

                  (g) In the event of any underwritten  public  offering,  enter
into and perform its obligations under an underwriting  agreement,  in usual and
customary  form, with the managing  underwriter of such offering,  together with
each Holder participating in such underwritten  offering, as provided in Section
1.5(c).
                                        4
<PAGE>
                  (h)  Prepare  and  promptly  file with the SEC,  and  promptly
notify  such  Holders  of the filing of, any  amendment  or  supplement  to such
registration  statement  or  prospectus  as  may be  necessary  to  correct  any
statements  or  omissions  if, at the time when a  prospectus  relating  to such
securities is required to be delivered  under the Act, any event has occurred as
the  result of which any such  prospectus  must be amended in order that it does
not make any untrue  statement  of a  material  fact or omit to state a material
fact necessary to make the statements  therein, in light of the circumstances in
which they were made, not misleading.

                  (i) In case any of such  Holders  or any  underwriter  for any
such Holders is required to deliver a prospectus  at a time when the  prospectus
then in effect  may no  longer be used  under  the Act,  prepare  promptly  upon
request such  amendment or  amendments to such  registration  statement and such
prospectus as may be necessary to permit compliance with the requirements of the
Act.

                  (j) If any of the  Registrable  Securities  are then listed on
any securities  exchange or the Nasdaq Stock Market,  the Company will cause all
such Registrable  Securities covered by such registration statement to be listed
on such exchange or the Nasdaq Stock Market.

         1.5  Obligations of Holders.  It shall be a condition  precedent to the
obligations  of the Company to take any action  pursuant to this  Agreement that
each of the selling Holders shall:

                  (a)  Furnish  to  the  Company  such   information   regarding
themselves, the Registrable Securities held by them, the intended method of sale
or other  disposition  of such  securities  if the  registration  is pursuant to
Section  1.2, the identity of and  compensation  to be paid to any  underwriters
proposed to be employed in connection with such sale or other disposition if the
registration  is  pursuant to Section  1.2,  and such other  information  as may
reasonably  be  required  to  effect  the  registration  of  their   Registrable
Securities.

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

                  (c) In the event of any  underwritten  public  offering,  each
Holder  participating  in such  underwriting  shall  enter into and  perform its
obligations under the underwriting agreement for such offering, and if requested
to do so by the  underwriters  managing such  offering,  each Holder shall enter
into a customary holdback agreement.

         1.6 Expenses of Demand Registration. The Company shall bear and pay all
expenses incurred in connection with  registrations,  filings, or qualifications
pursuant to Section 1.2 (other than underwriting  discounts and commissions with
respect to Registrable Securities included in such registration and any fees and
costs of the  Holders'  legal  counsel or other  advisors),  including  (without
limitation) all registration,  filing, and qualification fees, Blue Sky fees and
expenses,  printers' and accounting fees,  costs of listing on Nasdaq,  costs of
furnishing such copies of each preliminary  prospectus,  final  prospectus,  and
amendments  thereto  as  each  Holder  may  reasonably  request,  and  fees  and
disbursements of counsel for the Company;  provided,  however,  that the Company
shall not be required to pay for any  expenses  of any  registration  proceeding
begun  pursuant  to Section  1.2 if the  registration  request  is  subsequently
withdrawn  at the  request  of the  Holders  of a  majority  of the  Registrable
Securities to be  registered  (in which case the Holders  participating  in such
offering  and  favoring  such  withdrawal  shall bear such  expenses);  provided
further, however, that if such registration request has been withdrawn by virtue
of a material  adverse  change in the condition,  business,  or prospects of the
Company  from that known to the Holders at the time of their  request,  then the
Holders shall not be required to pay any of such expenses and shall retain their
rights pursuant Section 1.2.
                                        5
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         1.7 Expenses of Piggy-Back Registration. The Company shall bear and pay
all  expenses  incurred  in  connection  with  any   registration,   filing,  or
qualification   of   Registrable   Securities   with  respect  to  each  of  the
registrations  pursuant to Section 1.3 (other than  underwriting  discounts  and
commissions with respect to Registrable Securities included in such registration
and any fees  and  costs  of the  Holders'  legal  counsel  or other  advisors),
including (without limitation) all registration, filing, and qualification fees,
Blue Sky fees and expenses,  printers' and accounting  fees, costs of listing on
Nasdaq,  costs of furnishing such copies of each preliminary  prospectus,  final
prospectus,  and amendments thereto as each Holder may reasonably  request,  and
fees disbursements of counsel for the Company.

         1.8  Indemnification.  In the  event  any  Registrable  Securities  are
included in a registration statement under this Agreement:

                  (a) The Company will  indemnify and hold harmless each Holder,
the officers and directors of each Holder,  any  underwriter  (as defined in the
Act) for such  Holder and each  person,  if any,  who  controls  such  Holder or
underwriter  within the  meaning of the Act or the  Securities  Exchange  Act of
1934,  as amended  (the "1934 Act"),  against any losses,  claims,  damages,  or
liabilities  (joint or  several)  to which  such  person or  persons  may become
subject under the Act, the 1934 Act, or other  federal or state law,  insofar as
such losses,  claims,  damages,  or liabilities (or actions in respect  thereof)
arise out of or are based upon any of the following  statements,  omissions,  or
violations  (collectively  a "Violation"):  (i) any untrue  statement or alleged
untrue  statement of a material fact  contained in any  registration  statement,
including any preliminary  prospectus or final prospectus  contained  therein or
any amendments or supplements  thereto, or (ii) the omission or alleged omission
to state therein a material  fact required to be stated  therein or necessary to
make the statements therein not misleading,  and the Company will reimburse each
such Holder,  officer or director,  underwriter,  or controlling  person for any
legal or other  expenses  reasonably  incurred  by such  person  or  persons  in
connection  with  investigating  or  defending  any such  loss,  claim,  damage,
liability, or action; provided,  however, that the indemnity agreement contained
in this Section 1.8(a) shall not apply to amounts paid in settlement of any such
loss, claim, damage, liability, or action if such settlement is effected without
the  consent of the  Company,  nor shall the Company be liable in any such loss,
claim,  damage,  liability,  or action to the extent that it arises out of or is
based upon (i) a Violation  that occurs in reliance upon and in conformity  with
written  information  furnished  expressly  for  use  in  connection  with  such
registration by such Holder,  underwriter,  or controlling  person,  or (ii) the
failure of such Holder,  underwriter, or controlling person to deliver a copy of
the registration  statement or the prospectus,  or any amendments or supplements
thereto, after the Company has furnished such person with a sufficient number of
copies of the same.

                  (b) Each selling  Holder will  indemnify and hold harmless the
Company,  each of its  officers  and  directors,  and each  person,  if any, who
controls  the Company  within the meaning of the Act,  any  underwriter  and any
other Holder  selling  securities in such  registration  statement or any of its
directors  or  officers  or any person who  controls  such  Holder,  against any
losses, claims,  damages, or liabilities (joint or several) to which the Company
or any such officer, director, controlling person, or underwriter or controlling
person may become  subject,  under the Act,  the 1934 Act,  or other  federal or
state law, insofar as such losses,  claims,  damages, or liabilities (or actions
in respect  thereto) arise out of or are based upon any Violation,  in each case
to the extent (and only to the extent)  that such  Violation  occurs in reliance
upon  and in  conformity  with  written  information  furnished  by such  Holder
expressly for use in  connection  with such  registration;  and each such Holder
will reimburse any legal or other expenses reasonably incurred by the Company or
any such officer,  director,  controlling  person,  underwriter  or  controlling
person,  other Holder,  officer,  director,  or controlling person in connection
with  investigating or defending any such loss,  claim,  damage,  liability,  or
action;  provided,  however,  that the  indemnity  agreement  contained  in this
Section  1.8(b) shall not apply to amounts paid in  settlement of any such loss,
claim, damage,  liability,  or action if such settlement is effected without the
consent  of  the  Holder.   Notwithstanding  anything  to  the  contrary  herein
contained,  a Holder's  indemnity  obligation,  in such  person's  capacity as a
Holder,  shall be limited to the net  proceeds  received by such Holder from the
offering out of which the indemnity obligation arises.
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                  (c) Promptly after receipt by an indemnified  party under this
Section  1.8  of  notice  of  the  commencement  of any  action  (including  any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying  party under this Section 1.8, deliver to
the  indemnifying  party a written  notice of the  commencement  thereof and the
indemnifying  party shall have the right to  participate  in, and, to the extent
the indemnifying  party so desires,  jointly with any other  indemnifying  party
similarly  noticed,   to  assume  the  defense  thereof  with  counsel  mutually
satisfactory to the parties; provided,  however, that an indemnified party shall
have the right to retain its own counsel,  with the fees and expenses to be paid
by the  indemnified  party,  except that such fees and expenses shall be paid by
the  indemnifying  party  if  representation  of such  indemnified  party by the
counsel retained by the indemnifying  party would be inappropriate due to actual
or potential  differing  interests  between such indemnified party and any other
party  represented  by such counsel in such  proceeding.  The failure to deliver
written  notice  to the  indemnifying  party  within  a  reasonable  time of the
commencement  of any such action,  if  prejudicial to its ability to defend such
action,   shall  relieve  such  indemnifying  party  of  any  liability  to  the
indemnified party under this Section 1.8, but the omission so to deliver written
notice to the  indemnifying  party will not relieve it of any liability  that it
may have to any indemnified party otherwise than under this Section 1.8.

                  (d) The indemnification  provided by this Section 1.8 shall be
a continuing  right to  indemnification  and shall survive the  registration and
sale  of any of the  Registrable  Securities  hereunder  and the  expiration  or
termination of this Agreement.

         1.9  Reports  Under  Securities  Exchange  Act of 1934.  With a view to
making  available to the Holders the benefits of Rule 144 promulgated  under the
Act, the Company agrees to use its best efforts 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 Act and the 1934 Act; and

                  (c)  furnish to any  Holder,  as long as the  Holder  owns any
Registrable  Securities,  forthwith upon request (i) a written  statement by the
Company that it has complied  with the reporting  requirements  of Rule 144, the
Act, 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  in availing any
Holder of any rule or regulation of the SEC that permits the selling of any such
securities without registration or pursuant to such form.

         1.10  Amendment  and Waiver.  Any  amendment or waiver of any provision
under  this  Agreement  may be  effected  only with the  written  consent of the
Company  and the Holders of at least a majority  of the  Registrable  Securities
then outstanding.

         1.11 Remedies. The parties hereto acknowledge and agree that the breach
of any part of this  Agreement  may  cause  irreparable  harm and that  monetary
damages alone may be  inadequate.  The parties hereto  therefore  agree that any
party shall be entitled to injunctive  relief or such other applicable remedy as
a court of competent jurisdiction may provide.  Nothing contained herein will be
construed to limit any party's right to any remedies at law,  including recovery
of damages for breach of any part of this Agreement.

2.       MISCELLANEOUS

         2.1  Notification  for  Benefit of  Holders.  In the event that (i) the
Company is  actively  pursuing  the  preparation  and  filing of a  registration
statement  for an  underwritten  offering  in which it may be  possible  for the
Holders to participate  pursuant to Section 1.3 of this Agreement,  and (ii) the
Holders are not actively pursuing an offering or selling Registrable  Securities
pursuant to an offering at that time, the Company shall promptly notify
                                        7
<PAGE>
the Holders of such  activity.  Upon receipt of such notice,  the Holders  shall
cease any sales of Registrable Securities pursuant to any registration statement
or otherwise until the earlier of (a) 90 days after receipt of such notice;  (b)
two trading days after the Company files such registration statement or publicly
announces  its  intention to file such  registration  statement  (subject to the
restrictions on any such sales provided for elsewhere in this Agreement); or (c)
the Company  notifies  the Holder that it no longer is  actively  pursuing  such
underwritten  offering.  The Company  shall  promptly  notify the Holders of any
changes in its plans for or active pursuit of such underwritten offering.

         2.2 Controlling  Law. This Agreement and all questions  relating to its
validity, interpretation,  performance and enforcement, shall be governed by and
construed in accordance  with the laws of the state of Arizona,  notwithstanding
any Arizona or other conflict-of-law provisions to the contrary.

         2.3 Notices. All notices,  requests,  demands, and other communications
required  or  permitted  under this  Agreement  shall be in writing and shall be
deemed to have been duly  given,  made,  and  received  when  delivered  against
receipt,  upon receipt of a facsimile  transmission,  or upon actual  receipt of
registered  or  certified  mail,  postage  prepaid,  return  receipt  requested,
addressed as set forth below:

                  (a)      If to the Company:

                           2401 West First Street
                           Phoenix, Arizona  85281
                           Attention:  Fred W. Wagenhals
                           Phone:  (602) 894-0100
                           Facsimile:  (602) 967-1403

                           with a copy given in the manner
                           prescribed above, to:

                           O'Connor, Cavanagh, Anderson,
                             Killingsworth & Beshears, P.A.
                           One East Camelback Road
                           Phoenix, Arizona  85012
                           Attention:  Robert S. Kant, Esq.
                           Phone:  (602) 263-2606
                           Facsimile:  (602) 263-2900

                  (b)      If to any Holder:

                           5301 West WT Harris Boulevard
                           Charlotte, North Carolina  28269
                           Attention:  R. Dale Earnhardt
                           Phone:  (704) 599-8100
                           Facsimile:  (704) 599-8126
                                        8
<PAGE>
                           with a copy given in the manner
                           prescribed above, to:

                           Gray, Layton, Drum, Kersh, Solomon,
                             Sigmon & Furr, P.A.
                           516 South New Hope Road
                           Gastonia, North Carolina  28053
                           Attention:  David M. Furr, Esq.
                           Phone:  (704) 865-4400
                           Facsimile:  (704) 866-8010


                  Any party may alter the  address  to which  communications  or
copies  are to be sent by  giving  notice  of such  change  to each of the other
parties  hereto in  conformity  with the  provisions  of this  paragraph for the
giving of notice.

         2.4 Binding Nature of Agreement.  This Agreement  shall be binding upon
and inure to the  benefit  of the  parties  hereto and their  respective  heirs,
personal representatives, successors, and assigns.

         2.5 Entire Agreement.  This Agreement contains the entire agreement and
understanding among the parties hereto with respect to the subject matter hereof
and supersedes  all prior and  contemporaneous  agreements  and  understandings,
inducements or conditions, express or implied, oral or written, except as herein
contained.  The  express  terms  hereof  control  and  supersede  any  course of
performance and/or usage of the trade inconsistent with any of the terms hereof.
This  Agreement  may not be modified or amended  other than by an  agreement  in
writing.

         2.6 Section  Headings.  The section  headings in this Agreement are for
convenience  only;  they form no part of this Agreement and shall not affect its
interpretation.

         2.7  Gender.  Words used  herein,  regardless  of the number and gender
specifically  used,  shall be deemed and  construed to include any other number,
singular or plural, and any other gender, masculine,  feminine or neuter, as the
context requires.

         2.8 Indulgences,  Not Waivers. Neither the failure nor any delay on the
part of a party to exercise any right,  remedy,  power,  or privilege under this
Agreement  shall  operate as a waiver  thereof,  nor shall any single or partial
exercise of any right, remedy, power, or privilege preclude any other or further
exercise of the same or any other right, remedy, power, or privilege,  nor shall
any  waiver of any  right,  remedy,  power,  or  privilege  with  respect to any
occurrence be construed as a waiver of such right,  remedy,  power, or privilege
with respect to any other occurrence.  No waiver shall be effective unless it is
in writing and is signed by the party asserted to have granted such waiver.

         2.9 Execution in  Counterparts.  This  Agreement may be executed in any
number of  counterparts,  each of which  shall be deemed  to be an  original  as
against  any party  whose  signature  appears  thereon,  and all of which  shall
together  constitute one and the same  instrument.  This Agreement  shall become
binding when one or more  counterparts  hereof,  individually or taken together,
shall  bear  the  signatures  of all  of the  parties  reflected  hereon  as the
signatories.  Any photographic or xerographic  copy of this Agreement,  with all
signatures  reproduced  on one  or  more  sets  of  signature  pages,  shall  be
considered  for  all  purposes  as of it were an  executed  counterpart  of this
Agreement.

         2.10  Provisions  Separable.  The  provisions  of  this  Agreement  are
independent and separable from each other, and no provision shall be affected or
rendered  invalid or unenforceable by virtue of the fact that for any reason any
other or others of them may be invalid or unenforceable in whole or in part.
                                        9
<PAGE>
         2.11 Number of Days.  In  computing  the number of days for purposes of
this Agreement,  all days shall be counted,  including  Saturdays,  Sundays, and
holidays; provided, however, that if the final day of any time period falls on a
Saturday,  Sunday, or holiday, then the final day shall be deemed to be the next
day which is not a Saturday, Sunday, or holiday.

         IN WITNESS  WHEREOF,  the undersigned has executed this Agreement as of
the date and year first above written.


                                              ACTION PERFORMANCE COMPANIES, INC.



                                              By:_______________________________


                                              SPORTS IMAGE, INC.



                                              By:_______________________________




                                              __________________________________
                                              R. Dale Earnhardt


                                              __________________________________
                                              Teresa H. Earnhardt
                                       10
