Exhibit 10.3

PATENT PURCHASE AGREEMENT

     This PATENT PURCHASE AGREEMENT (“Agreement”) is entered into as of
March 31, 2005 (“Effective Date”) by and between Tao Logic Systems LLC, a Nevada
limited liability company with an office at 3225 McLeod Dr., Suite 100, Las
Vegas, NV 89121 (“Purchaser”), and Mobility Electronics, Inc., a Delaware
corporation with an office at 17800 N. Perimeter Drive, Suite 200, Scottsdale,
Arizona 85255 (“Seller”). The parties hereby agree as follows.

1.   Background   1.1   Seller owns certain United States Letters Patents and/or
applications for United States Letters Patents and/or related foreign patents
and applications.   1.2   Seller wishes to sell its right, title and interest in
such patents and applications to Purchaser.   1.3   Purchaser wishes to purchase
such patents and applications.   2.   Definitions   2.1   “Assignment
Agreements” means the agreements assigning ownership of the Patents from the
inventors and/or prior owners to Seller.   2.2   “Entity” means any corporation,
partnership, limited liability company, association, joint stock company, trust,
joint venture, unincorporated organization, governmental entity (or any
department, agency, or political subdivision thereof) or any other legal entity.
  2.3   “Expansion and Docking Products” means any products that connect via a
bus, using the Patents, to a computing device (including but not limited to
handheld, tablet, server, desk top, personal digital assistant, laptop,
notebook, or any similar computing device), for the purpose of expanding or
connecting the computing device to various peripherals commonly connected to
computers in office or home or travel environments (including but not limited to
such peripherals as display monitors, drives, storage devices, USB and 1394
ports, PCI cards, Ethernet, keyboards, mice, and the like). Typical products
include docking products for portable computers and Seller’s line of expansion
products (including but not limited to expansion of available input/output slots
and/or drive bays in a computing system), and any derivatives, enhancements and
modifications thereof, as well as any new products and related semi-conductor
chips that may be implemented from time to time   2.4   “List of Prosecution
Counsel” means the names and addresses of prosecution counsel who prosecuted the
Patents and who are currently handling the Patents.   2.5   “Patents” means
those patents and applications listed in Exhibit A hereto, and all reissues,
reexaminations, extensions, continuations, continuations in part, continuing
prosecution applications, and divisions of such patents and applications; and
foreign counterparts to any of the foregoing including without limitation
utility models.

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2.6   “Person” means any individual or Entity.   2.7   “Subsidiary” means any
Entity that, as of or at any time after the Effective Date, is directly or
indirectly controlled by Seller, but only as long as such control exists. For
purposes of this definition, “control” means: (a) in the case of incorporated
Entities, ownership or control of fifty percent (50%) or more of the voting
power of the stock or participating shares entitled to vote for the election of
directors of such incorporated Entities; and (b) in the case of unincorporated
Entities, ownership or control of fifty percent (50%) or more of the equity
interest with power to direct the management and policies of such unincorporated
Entities. An entity shall be deemed to be a Subsidiary under this Agreement only
so long as all requisite conditions of being a Subsidiary are met.   3.  
Delivery and Payment   3.1   Delivery. Within thirty (30) days following the
Effective Date, Seller shall deliver to Purchaser’s representative at the below
delivery address (or to another representative/delivery address specified by
Purchaser prior to delivery) the Assignment Agreements, the List of Prosecution
Counsel, and all files and original documents owned or controlled by Seller
(including without limitation Letters Patents) relating to the Patents
including, without limitation, all prosecution files for pending patent
applications included in the Patents, and its own files relating to the issued
Patents.

     
Delivery Address:
  Meyertons, Hood, Kivlin, Kowert & Goetzel, P.C.

  Attention:            Noel Kivlin

  The Chase Building

  700 Lavaca, Suite 800

  Austin, Texas 78701-3102
 
   

  Telephone:       (512) 853-8800

  Facsimile:        (512) 853-8801

3.2   Purchase Price. The purchase price for the Patents shall be Thirteen
Million U.S. Dollars (US$13,000,000) (the “Purchase Price”).   3.3   Closing. On
or before May 16, 2005, Seller and Purchaser (or representatives designated by
them) shall meet at the delivery address (or another mutually agreed location)
and execute the following closing process: (i) Seller and Purchaser shall
determine whether all of the items listed in Section 3.1 have been delivered and
accounted for; (ii) if (i) is fully satisfied, Seller shall deliver to Purchaser
an Assignment of Patent Rights, a copy of which is attached hereto as Exhibit B
(the “Assignment of Patent Rights”), that has been fully executed and notarized
by Seller; and (iii) if (i) and (ii) are fully satisfied, Purchaser shall pay
the Purchase Price to Seller by wire transfer of immediately available funds.
The date upon which (i), (ii) and (iii) are all fully satisfied shall be the
“Closing Date”.   3.4   Failure to Close. If the requirements of 3.3(a)(i),
3.3(a)(ii), and 3.3(a)(iii) are not fully satisfied on or before May 16, 2005,
then: (x) Purchaser shall, and shall cause

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    Purchaser’s representative to, deliver to Seller all documentation,
instruments and agreements previously delivered to Purchaser (or Purchaser’s
representative) by Seller and/or its attorneys and agents; (y) Seller shall
destroy the executed Assignment of Patent Rights; and (z) this Agreement shall
terminate and Purchaser and Seller shall have no further obligations or duties
hereunder.   4.   Transfer of Patents; Grant of License   4.1   Patent
Assignment. Effective as of the Closing Date, Seller hereby sells, assigns,
transfers and conveys to Purchaser all right, title and interest it has in and
to the Patents and all inventions and discoveries described therein, including
without limitation, all rights of Seller under the Assignment Agreements, and
all rights of Seller to collect royalties under such Patents.   4.2   Assignment
of Causes of Action. Effective as of the Closing Date, Seller hereby sells,
assigns, transfers and conveys to Purchaser all right, title and interest it has
in and to all causes of action and enforcement rights, whether currently
pending, filed, or otherwise, for the Patents and all inventions and discoveries
described therein, including without limitation all rights to pursue damages,
injunctive relief and other remedies for past, current and future infringement
of the Patents.   4.3   Grant of License to Seller. Effective as of the Closing
Date, Purchaser hereby grants to Seller and its Subsidiaries a worldwide,
non-exclusive, perpetual, non-transferable (except as provided in Section 4.4
below), non-sublicensable, and royalty-free license under the Patents to do the
following: (a) make Expansion and Docking Products; (b) have a third party make
Expansion and Docking Products, or subcomponents of Expansion and Docking
Products, for Seller and its Subsidiaries; and (c) lease, use, market, sell,
offer for sale, import and otherwise dispose of Expansion and Docking Products
made by Seller, its Subsidiaries or by a third party in accordance with (a) or
(b) above.   4.4   Limitation on Transferability of Seller’s License. Seller and
its Subsidiaries may assign (without any further rights to assign or transfer
except as provided below) the above rights one time to an acquirer (an
“Acquiror”) of all, or substantially all, of the Expansion and Docking Business
conducted by Seller and its Subsidiaries (an “Acquisition”), provided that:
(a) Acquiror shall not be licensed under the Patents for any product being
offered or sold or planned (as evidenced in a formal product plan of some kind)
by Acquiror at any time on or prior to the date of the Acquisition (“Acquisition
Date”); and (b) Acquiror shall only be licensed under the Patents for Seller’s
Expansion and Docking Products which are: (i) on the Acquisition Date being
commercially offered and sold by Seller; (ii) on the Acquisition Date under
development and/or being planned by Seller (as evidenced by a road map or
product plan) and are released for commercial sale within twelve (12) months
after the Acquisition Date; or (iii) future enhancements and/or modifications of
the products set forth in (i) and (ii) above that have merely incremental
differences from such products. Upon Acquiror’s written request to Purchaser
prior to the Acquisition Date, Purchaser agrees that, as soon as reasonably
practicable prior to the Acquisition Date, it shall enter into good faith
negotiations with Acquiror intended to

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    result in a license under the Patents, on reasonable and non-discriminatory
terms and conditions, for Acquiror’s Expansion and Docking Products not included
in (b) above, provided that Purchaser shall have no obligation to continue such
negotiations for more than ninety (90) days after they are initiated. In the
event that Acquiror later sells all, or substantially all, of its Expansion and
Docking Business then the license granted under clause (b) of this Section 4.4
to the Acquiror shall be assignable (without any further right to assign or
transfer) to one such subsequent acquirer (“First Subsequent Acquiror”). Upon
such First Subsequent Acquiror’s written request to Purchaser prior to the date
of acquisition, Purchaser agrees that, as soon as reasonably practicable prior
to the date of the acquisition, it shall enter into good faith negotiations with
such First Subsequent Acquiror intended to result in a license under the
Patents, on reasonable and non-discriminatory terms and conditions, for such
First Subsequent Acquiror’s Expansion and Docking Products not already covered
by the license assignable to such First Subsequent Acquiror pursuant to this
Section 4.4, provided that Purchaser shall have no obligation to continue such
negotiations for more than ninety (90) days after they are initiated. In the
event that First Subsequent Acquiror later sells all, or substantially all, of
its Expansion and Docking Business then all licenses granted under Sections 4.3
and 4.4 are automatically revoked for any such subsequent purchaser.   5.   
Additional Obligations   5.1   Further Cooperation. At the reasonable request of
Purchaser, Seller shall execute and deliver such other instruments and do and
perform such other acts and things as may be necessary or desirable for
effecting completely the consummation of the transactions contemplated hereby,
including without limitation execution, acknowledgment and recordation of other
such papers, and using all reasonable commercial efforts to obtain the same from
the respective inventors, as necessary or desirable for fully perfecting and
conveying unto Purchaser the benefit of the transactions contemplated hereby.  
5.2   Payment of Fees. Seller shall pay any maintenance fees, annuities, and the
like due on the Patents on or before the Closing Date.   5.3   Seller’s Related
Cases. Seller agrees and covenants that it will not initiate or otherwise pursue
any reissue or reexamination of U.S. patents 5,941,965 and/or 6,256,691. Seller
agrees and covenants that it will remove and revoke all existing claims and
statements of priority, except for the existing claims of priority to
provisional patent application US 60/532,300, in U.S. patent applications US
10/766,660 and US 10/782,082 (the “No Priority Claim Patent Applications”) to
other patents and/or patent applications and it will not make any new claims of
priority in the No Priority Claim Patent Applications. Seller agrees and
covenants that it will not do anything in the prosecution of any of its patents
related to the Patents that would negatively impact the validity of the Patents
in any material way.   6.    Representations and Warranties

        Except as specifically described on Exhibit C to this Agreement, Seller
hereby represents and warrants to Purchaser as follows:

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6.1   Authority. Seller has the right and authority to enter into this Agreement
and to carry out its obligations hereunder.   6.2   Title and Contest. Seller
has good and marketable title to the Patents, including without limitation all
rights, title, and interest in the Patents to sue for infringement thereof. The
Patents are free and clear of all liens, mortgages, security interests or other
encumbrances, and restrictions on transfer. There are no actions, suits,
investigations, claims or proceedings threatened, pending or in progress
relating in any way to the Patents. There are no existing contracts, agreements,
options, commitments, proposals, bids, offers, or rights with, to, or in any
person to acquire any of the Patents.   6.3   Existing Licenses. No rights or
licenses have been granted under the Patents.   6.4   Restrictions on Rights.
Purchaser will not be subject to any covenant not to sue or similar restrictions
on its enforcement or enjoyment of the Patents as a result of the transaction
contemplated in this Agreement, or any prior transaction related to the Patents.
  6.5   Conduct. To the knowledge of Seller or its representatives has engaged
in any conduct, or omitted to perform any necessary act, the result of which
would invalidate any of the Patents or materially hinder their enforcement,
including but not limited to misrepresenting Seller’s patent rights to a
standard-setting organization.   6.6   Enforcement. Seller has not put a third
party on notice of actual or potential infringement of any of the Patents or
considered enforcement action(s) with respect to any of the Patents.   6.7  
Patent Office Proceedings. None of the Patents have been or are currently
involved in any reexamination, reissue, interference proceeding, or any similar
proceeding and that no such proceedings are pending or threatened.   6.8  
Related Assets. There are not other patents issued and/or applications pending
for or on behalf of Seller which include (or will include) claims such that
practice of any of the claims of the Patents conveyed in this Agreement would
reasonably require a license under any claim of such other patents.   6.9  
Fees. All maintenance fees, annuities, and the like due on the Patents on or
prior to April 20, 2005, have been timely paid.   6.10   Consents. Seller has
obtained all third party consents, approvals, and/or other authorizations
required to make the assignments of Section 4.   6.11   Validity and
Enforceability. The Patents have never been found invalid or unenforceable for
any reason in any administrative, arbitration, judicial or other proceeding, and
Seller has not received any notice or information of any kind from any source
suggesting that the Patents may be invalid or unenforceable. Seller makes no
representation that the Patents are valid and enforceable.

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6.12   Limitation on Representations and Warranties of Seller. EXCEPT AS
PROVIDED IN PARAGRAPHS 6.1 – 6.11 ABOVE, (i) SELLER DOES NOT REPRESENT OR
WARRANT THE PATENTABILITY OF ANY CLAIMED INVENTION IN, OR THE VALIDITY OF ANY
PATENT; (ii) SELLER DOES NOT REPRESENT OR WARRANT THAT THE MANUFACTURE, USE,
SALE, OFFERING FOR SALE, IMPORTATION, EXPORTATION OR OTHER DISTRIBUTION OF ANY
PRODUCT OR METHOD DISCLOSED AND CLAIMED IN ANY PATENT BY PURCHASER OR ANY
SUBLICENSEE OR ANYONE ELSE SHALL NOT CONSTITUTE AN INFRINGEMENT OF THE
INTELLECTUAL PROPERTY RIGHTS OF OTHERS; AND (iii) SELLER DOES NOT MAKES ANY
REPRESENTATIONS, OR EXTEND ANY WARRANTIES OF ANY KIND, EITHER EXPRESS OR
IMPLIED, WITH RESPECT TO ANY PATENT OR ANY PRODUCT, INCLUDING BUT NOT LIMITED TO
THE IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.  
7.   Miscellaneous   7.1   Limitation on Consequential Damages. NEITHER PARTY
SHALL BE LIABLE TO THE OTHER FOR LOSS OF PROFITS, OR ANY SPECIAL, CONSEQUENTIAL
OR INCIDENTAL DAMAGES, HOWEVER CAUSED, EVEN IF ADVISED OF THE POSSIBILITY OF
SUCH DAMAGE. THE PARTIES ACKNOWLEDGE THAT THESE LIMITATIONS ON POTENTIAL
LIABILITIES WERE AN ESSENTIAL ELEMENT IN SETTING CONSIDERATION UNDER THIS
AGREEMENT.   7.2   Limitation of Liability. EXCEPT IN CASE OF FRAUD, PURCHASER’S
TOTAL LIABILITY UNDER THIS AGREEMENT SHALL BE AN AMOUNT EQUAL TO THE FUNDS PAID
BY PURCHASER TO SELLER PURSUANT TO SECTION 3. EXCEPT IN CASE OF FRAUD, SELLER’S
TOTAL LIABILITY UNDER THIS AGREEMENT SHALL BE AN AMOUNT EQUAL TO THE AMOUNT OF
FUNDS RECEIVED BY SELLER UNDER SECTION 3. THE PARTIES ACKNOWLEDGE THAT THESE
LIMITATIONS ON POTENTIAL LIABILITIES WERE AN ESSENTIAL ELEMENT IN SETTING
CONSIDERATION UNDER THIS AGREEMENT.   7.3   Compliance with Laws.
Notwithstanding anything contained in this Agreement to the contrary, the
obligations of the parties shall be subject to all laws, present and future, of
any government having jurisdiction over the parties and this transaction, and to
orders, regulations, directions or requests of any such government.   7.4  
Confidentiality of Terms. The parties hereto shall keep the terms and existence
of this Agreement and the identities of the parties hereto confidential and
shall not now or hereafter divulge any of this information to any third party
except: (a) with the prior written consent of the other party; (b) as otherwise
may be required by law or legal process, including in confidence to legal and
financial advisors in their capacity of advising a party in such matters;
(c) during the course of litigation, so long as the disclosure of such terms and
conditions are restricted in the same manner as is the confidential information
of other litigating parties; (d) in confidence to its legal counsel,

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    accountants, banks and financing sources and their advisors solely in
connection with complying with financial transactions; or (e) Purchaser may
record the Assignment of Patent Rights or a similar memorandum of its purchase
with patent offices; provided that, in (b) through (d) above, (i) the disclosing
party shall use all legitimate and legal means available to minimize the
disclosure to third parties, including without limitation seeking a confidential
treatment request or protective order whenever appropriate or available; and
(ii) the disclosing party shall provide the other party with at least ten
(10) days prior written notice of such disclosure. Notwithstanding the above:
(i) upon execution of this Agreement by the parties hereto, the parties agree
that Seller may issue a Press Release, in the form of Exhibit D attached hereto
(the “Press Release”); and (ii) Seller may file this Agreement, and the exhibits
hereto, with the Securities and Exchange Commission, provided that Seller shall
redact the submitted Agreement and exhibits to the extent possible.   7.5  
Governing Law. Any claim arising under or relating to this Agreement shall be
governed by the internal substantive laws of the State of New York without
regard to principles of conflict of laws.   7.6   Jurisdiction. Each party
hereby agrees to jurisdiction and venue in the courts of the State of New York
or the Federal courts sitting therein for all disputes and litigation arising
under or relating to this Agreement.   7.7   Entire Agreement. The terms and
conditions of this Agreement, including its exhibits, constitutes the entire
agreement between the parties with respect to the subject matter hereof, and
merges and supersedes all prior and contemporaneous agreements, understandings,
negotiations and discussions. Neither of the parties shall be bound by any
conditions, definitions, warranties, understandings, or representations with
respect to the subject matter hereof other than as expressly provided herein.
The section headings contained in this Agreement are for reference purposes only
and shall not affect in any way the meaning or interpretation of this Agreement.
No oral explanation or oral information by either party hereto shall alter the
meaning or interpretation of this Agreement. No amendments or modifications
shall be effective unless in writing signed by authorized representatives of
both parties. These terms and conditions will prevail notwithstanding any
different, conflicting or additional terms and conditions which may appear on
any purchase order, acknowledgment or other writing not expressly incorporated
into this Agreement. This Agreement may be executed in two (2) or more
counterparts, all of which, taken together, shall be regarded as one and the
same instrument. The following exhibits are attached hereto and incorporated
herein: Exhibit A (entitled “Patent Rights to be Assigned”); Exhibit B (entitled
“Assignment of Patent Rights”); Exhibit C (entitled “Exceptions to Seller’s
Representations”); and Exhibit D (entitled “Form of Press Release”).

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7.8   Notices: All notices required or permitted to be given hereunder shall be
in writing, shall make reference to this Agreement, and shall be delivered by
hand, or dispatched by prepaid air courier or by registered or certified
airmail, postage prepaid, addressed as follows:

         

  If to Seller:   If to Purchaser:
 
       

  Mobility Electronics, Inc.   Tao Logic Systems LLC

  17800 N. Perimeter Drive, Suite 200   3225 McLeod Dr., Ste. 100

  Scottsdale, Arizona 85255   Las Vegas, NV 89121

  Attn: Chief Executive Officer   Attn: Managing Director

    Such notices shall be deemed served when received by addressee or, if
delivery is not accomplished by reason of some fault of the addressee, when
tendered for delivery. Either party may give written notice of a change of
address and, after notice of such change has been received, any notice or
request shall thereafter be given to such party at such changed address.

7.9   Relationship of Parties. The parties hereto are independent contractors.
Neither party has any express or implied right or authority to assume or create
any obligations on behalf of the other or to bind the other to any contract,
agreement or undertaking with any third party. Nothing in this Agreement shall
be construed to create a partnership, joint venture, employment or agency
relationship between Seller and Purchaser   7.10   Equitable Relief. Seller
agrees that damages alone would be insufficient to compensate Purchaser for a
breach of this Agreement, acknowledges that irreparable harm would result from a
breach of this Agreement, and consents to the entering of an order for
injunctive relief to prevent a breach or further breach, and the entering of an
order for specific performance to compel performance of any obligations under
this Agreement.   7.11   Severability. The terms and conditions stated herein
are declared to be severable. If any paragraph, provision, or clause in this
Agreement shall be found to be or held to be invalid or unenforceable in any
jurisdiction in which this Agreement is being performed, the remainder of this
Agreement shall be valid and enforceable and the parties shall use good faith to
negotiate a substitute, valid and enforceable provision which most nearly
effects the parties’ intent in entering into this Agreement.   7.12   Waiver.
Failure by either party to enforce any term of this Agreement shall not be
deemed a waiver of future enforcement of that or any other term in this
Agreement or any other agreement that maybe in place between the parties.  
7.13   Assignment. The terms and conditions of this Agreement shall inure to the
benefit of the parties hereto, and their respective successors, assigns and
other legal representatives, and shall be binding upon the parties hereto, and
their respective successors, assigns and other legal representatives.

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     In witness whereof, the parties have executed this Agreement as of the
Effective Date.

         
TAO LOGIC SYSTEMS LLC
      MOBILITY ELECTRONICS, INC.
 
       
Signature
      Signature
 
       
Printed Name
      Printed Name
 
       
Title
      Title

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