Exhibit 10.12


                          REGISTRATION RIGHTS AGREEMENT


     REGISTRATION RIGHTS AGREEMENT (this "AGREEMENT"), dated as of May 30, 2006,
by  and  among  Pediatric  Prosthetics,  Inc.,  an  Idaho  corporation  with its
headquarters  located  at  12926  Willowchase  Drive,  Houston,  TX  77070  (the
"COMPANY"),  and  each  of  the  undersigned  (together  with  their  respective
affiliates  and  any  assignee  or  transferee of all of their respective rights
hereunder,  the  "INITIAL  INVESTORS").

     WHEREAS:

     A.  In  connection  with the Securities Purchase Agreement by and among the
parties  hereto of even date herewith (the "Securities Purchase Agreement"), the
Company  has  agreed,  upon  the  terms  and subject to the conditions contained
therein, to issue and sell to the Initial Investors secured convertible notes in
the  aggregate  principal  amount  of  up  to  One Million Five Hundred Thousand
Dollars  ($1,500,000)  (the  "Notes")  that  are  convertible into shares of the
Company's  common  stock (the "Common Stock"), upon the terms and subject to the
limitations and conditions set forth in such Notes and warrants (the "Warrants")
to acquire an aggregate of 50,000,000 shares of Common Stock, upon the terms and
conditions  and  subject  to  the  limitations  and  conditions set forth in the
Warrants;  and

     B.  To  induce  the Initial Investors to execute and deliver the Securities
Purchase  Agreement,  the  Company  has  agreed  to provide certain registration
rights  under  the  Securities  Act  of  1933,  as  amended,  and  the rules and
regulations  thereunder,  or  any  similar  successor statute (collectively, the
"1933  ACT"),  and  applicable  state  securities  laws;

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

          1.  DEFINITIONS.
              -----------

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

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

                    (II) "REGISTER," "REGISTERED," and "REGISTRATION" refer to a
               registration  effected  by  preparing  and  filing a Registration
               Statement  or  Statements  in  compliance  with  the 1933 Act and
               pursuant  to  Rule  415  under the 1933 Act or any successor rule
               providing  for  offering  securities on a continuous basis ("RULE
               415"),  and  the declaration or ordering of effectiveness of such
               Registration  Statement  by  the  United  States  Securities  and
               Exchange  Commission  (the  "SEC").

                    (III)  "REGISTRABLE  SECURITIES" means the Conversion Shares
               issued  or  issuable upon conversion or otherwise pursuant to the

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               Notes and Additional Notes (as defined in the Securities Purchase
               Agreement)  including,  without  limitation,  Damages  Shares (as
               defined  in  the Notes) issued or issuable pursuant to the Notes,
               shares  of  Common  Stock  issued  or  issuable in payment of the
               Standard  Liquidated Damages Amount (as defined in the Securities
               Purchase  Agreement),  shares  issued  or  issuable in respect of
               interest  or  in  redemption  of the Notes in accordance with the
               terms  thereof)  and  Warrant  Shares  issuable, upon exercise or
               otherwise  pursuant  to  the Warrants and Additional Warrants (as
               defined  in the Securities Purchase Agreement), and any shares of
               capital  stock issued or issuable as a dividend on or in exchange
               for  or  otherwise  with  respect  to  any  of  the  foregoing.

                    (IV) "REGISTRATION STATEMENT" means a registration statement
               of  the  Company  under  the  1933  Act.

               B. Capitalized terms used herein and not otherwise defined herein
          shall  have  the  respective  meanings  set  forth  in  the Securities
          Purchase  Agreement  or  the  Convertible  Note.

          2.  REGISTRATION.
              ------------

               A.  MANDATORY REGISTRATION. The Company shall prepare, and, on or
                   ----------------------
          prior  to  sixty (60) days from the date of Closing (as defined in the
          Securities  Purchase Agreement) (the "FILING DATE"), file with the SEC
          a  Registration  Statement  on  Form  S-3 (or, if Form S-3 is not then
          available, on such form of Registration Statement as is then available
          to effect a registration of the Registrable Securities, subject to the
          consent  of  the  Initial  Investors,  which  consent  will  not  be
          unreasonably  withheld)  covering  the  resale  of  the  Registrable
          Securities  underlying  the  Notes  and  Warrants  issued  or issuable
          pursuant  to  the  Securities  Purchase  Agreement, which Registration
          Statement,  to  the  extent allowable under the 1933 Act and the rules
          and  regulations  promulgated  thereunder  (including Rule 416), shall
          state  that such Registration Statement also covers such indeterminate
          number  of  additional  shares  of Common Stock as may become issuable
          upon  conversion of or otherwise pursuant to the Notes and exercise of
          the  Warrants  to  prevent dilution resulting from stock splits, stock
          dividends  or  similar  transactions.  The  number of shares of Common
          Stock  initially  included  in such Registration Statement shall be no
          less  than  an  amount equal to two (2) times the sum of the number of
          Conversion  Shares that are then issuable upon conversion of the Notes
          and  Additional Notes (based on the Variable Conversion Price as would
          then  be  in  effect and assuming the Variable Conversion Price is the
          Conversion  Price at such time), and the number of Warrant Shares that
          are then issuable upon exercise of the Warrants, without regard to any
          limitation  on the Investor's ability to convert the Notes or exercise
          the  Warrants.  The  Company  acknowledges  that  the number of shares
          initially  included  in  the  Registration Statement represents a good
          faith  estimate  of  the  maximum  number  of  shares  issuable  upon
          conversion  of  the  Notes  and  upon  exercise  of  the  Warrants.

               B.  UNDERWRITTEN  OFFERING.  If  any  offering  pursuant  to  a
                   ----------------------
          Registration  Statement  pursuant  to  Section 2(a) hereof involves an
          underwritten  offering,  the Investors who hold a majority in interest
          of  the  Registrable Securities subject to such underwritten offering,
          with  the  consent of a majority-in-interest of the Initial Investors,

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          shall  have  the  right  to select one legal counsel and an investment
          banker  or bankers and manager or managers to administer the offering,
          which  investment  banker  or  bankers or manager or managers shall be
          reasonably  satisfactory  to  the  Company.

               C.  PAYMENTS  BY  THE  COMPANY.  The  Company  shall use its best
                   --------------------------
          efforts  to obtain effectiveness of the Registration Statement as soon
          as  practicable.  If  the  Registration  Statement(s)  covering  the
          Registrable Securities required to be filed by the Company pursuant to
          Section  2(a)  hereof  is  not  filed  by  the Filing Date or declared
          effective  by  the SEC on or prior to one hundred and forty-five (145)
          days  from  the date of Closing (as defined in the Securities Purchase
          Agreement),  or  after  the  Registration  Statement has been declared
          effective  by  the  SEC,  sales  of  all of the Registrable Securities
          cannot  be  made pursuant to the Registration Statement, or the Common
          Stock  is  not listed or included for quotation on the Nasdaq National
          Market ("NASDAQ"), the Nasdaq SmallCap Market ("NASDAQ SMALLCAP"), the
          New  York  Stock  Exchange (the "NYSE") or the American Stock Exchange
          (the "AMEX") after being so listed or included for quotation after the
          date  hereof,  or  the  Common  Stock  ceases  to  be  traded  on  the
          Over-the-Counter  Bulletin  Board  (the  "OTCBB")  or  any  equivalent
          replacement  exchange  prior to being listed or included for quotation
          on  one  of  the  aforementioned  markets,  then the Company will make
          payments  to  the Investors in such amounts and at such times as shall
          be  determined pursuant to this Section 2(c) as partial relief for the
          damages  to  the Investors by reason of any such delay in or reduction
          of  their  ability  to  sell  the Registrable Securities (which remedy
          shall  not  be  exclusive of any other remedies available at law or in
          equity).  The  Company  shall  pay  to  each  holder  of  the Notes or
          Registrable  Securities  an  amount  equal  to  the  then  outstanding
          principal  amount  of  the  Notes  (and,  in  the  case  of holders of
          Registrable  Securities, the principal amount of Notes from which such
          Registrable  Securities  were  converted)  ("OUTSTANDING  PRINCIPAL
          AMOUNT"),  multiplied  by the Applicable Percentage (as defined below)
          times  the  sum  of:  (i)  the  number of months (prorated for partial
          months)  after  the  Filing  Date or the end of the aforementioned one
          hundred  and  forty-five  (145)  day  period and prior to the date the
          Registration  Statement  is  declared  effective by the SEC, provided,
          however,  that  there  shall  be  excluded from such period any delays
          which  are solely attributable to changes required by the Investors in
          the Registration Statement with respect to information relating to the
          Investors,  including,  without  limitation,  changes  to  the plan of
          distribution,  or  to  the  failure  of the Investors to conduct their
          review of the Registration Statement pursuant to Section 3(h) below in
          a  reasonably  prompt  manner; (ii) the number of months (prorated for
          partial months) that sales of all of the Registrable Securities cannot
          be  made pursuant to the Registration Statement after the Registration
          Statement  has been declared effective (including, without limitation,
          when  sales  cannot  be  made  by  reason  of the Company's failure to
          properly  supplement  or  amend  the  prospectus  included  therein in
          accordance  with  the  terms of this Agreement, but excluding any days
          during  an  Allowed  Delay (as defined in Section 3(f)); and (iii) the
          number  of  months (prorated for partial months) that the Common Stock
          is  not  listed or included for quotation on the OTCBB, Nasdaq, Nasdaq
          SmallCap,  NYSE  or  AMEX  or that trading thereon is halted after the
          Registration  Statement  has  been  declared  effective.  The  term
          "APPLICABLE  PERCENTAGE"  means two hundredths (.02). (For example, if
          the  Registration  Statement becomes effective one (1) month after the
          end  of  such one hundred and forty-five (145) day period, the Company
          would pay $5,000 for each $250,000 of Outstanding Principal Amount. If

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          thereafter,  sales  could  not  be  made  pursuant to the Registration
          Statement for an additional period of one (1) month, the Company would
          pay  an  additional  $5,000 for each $250,000 of Outstanding Principal
          Amount.)  Such  amounts  shall  be  paid  in cash or, at the Company's
          option,  in  shares of Common Stock priced at the Conversion Price (as
          defined  in  the  Notes)  on  such  payment  date.

               D. PIGGY-BACK REGISTRATIONS. Subject to the last sentence of this
                  ------------------------
          Section  2(d),  if  at  any  time  prior  to  the  expiration  of  the
          Registration  Period  (as  hereinafter  defined)  the  Company  shall
          determine to file with the SEC a Registration Statement relating to an
          offering  for  its own account or the account of others under the 1933
          Act  of  any  of its equity securities (other than on Form S-4 or Form
          S-8  or  their  then  equivalents  relating to equity securities to be
          issued  solely  in  connection  with  any acquisition of any entity or
          business or equity securities issuable in connection with stock option
          or other bona fide, employee benefit plans), the Company shall send to
                   ---- ----
          each  Investor  who  is  entitled  to  registration  rights under this
          Section  2(d)  written  notice  of  such  determination and, if within
          fifteen  (15)  days  after  the  effective  date  of such notice, such
          Investor  shall  so  request  in writing, the Company shall include in
          such  Registration  Statement  all  or  any  part  of  the Registrable
          Securities such Investor requests to be registered, except that if, in
          connection  with  any  underwritten public offering for the account of
          the  Company  the  managing  underwriter(s)  thereof  shall  impose  a
          limitation  on  the  number  of  shares  of  Common Stock which may be
          included  in  the  Registration  Statement  because,  in  such
          underwriter(s)'  judgment,  marketing  or  other  factors dictate such
          limitation  is  necessary  to facilitate public distribution, then the
          Company  shall  be obligated to include in such Registration Statement
          only  such  limited portion of the Registrable Securities with respect
          to  which  such  Investor  has  requested  inclusion  hereunder as the
          underwriter  shall  permit.  Any  exclusion  of Registrable Securities
          shall  be  made  pro  rata  among  the  Investors  seeking  to include
          Registrable  Securities  in  proportion  to  the number of Registrable
          Securities sought to be included by such Investors; provided, however,
                                                              --------  -------
          that  the  Company shall not exclude any Registrable Securities unless
          the Company has first excluded all outstanding securities, the holders
          of  which  are  not  entitled  to inclusion of such securities in such
          Registration  Statement or are not entitled to pro rata inclusion with
          the  Registrable  Securities;  and  provided,  further, however, that,
                                              --------   -------  -------
          after  giving  effect  to  the  immediately  preceding  proviso,  any
          exclusion  of  Registrable  Securities  shall  be  made  pro rata with
          holders  of  other  securities  having  the  right  to  include  such
          securities  in  the  Registration  Statement  other  than  holders  of
          securities  entitled  to  inclusion  of  their  securities  in  such
          Registration  Statement  by  reason  of demand registration rights. No
          right  to  registration  of  Registrable Securities under this Section
          2(d)  shall  be  construed  to  limit  any registration required under
          Section  2(a)  hereof.  If  an  offering  in  connection with which an
          Investor  is  entitled  to  registration under this Section 2(d) is an
          underwritten offering, then each Investor whose Registrable Securities
          are  included  in  such Registration Statement shall, unless otherwise
          agreed  by  the Company, offer and sell such Registrable Securities in
          an  underwritten  offering  using the same underwriter or underwriters
          and,  subject  to  the provisions of this Agreement, on the same terms
          and  conditions  as  other  shares  of  Common  Stock included in such
          underwritten  offering.  Notwithstanding  anything to the contrary set
          forth  herein,  the  registration  rights of the Investors pursuant to
          this  Section  2(d)  shall  only be available in the event the Company
          fails  to  timely file, obtain effectiveness or maintain effectiveness
          of  any Registration Statement to be filed pursuant to Section 2(a) in
          accordance  with  the  terms  of  this  Agreement.

               E. ELIGIBILITY FOR FORM S-3, SB-2 OR S-1; CONVERSION TO FORM S-3.
                  -------------------------------------------------------------
          Except  as  set  forth  in  Schedule  2(e), the Company represents and
                                      -------------
          warrants  that it meets the requirements for the use of Form S-3, SB-2
          or  S-1  for registration of the sale by the Initial Investors and any
          other  Investors  of the Registrable Securities. The Company agrees to

<PAGE>

          file all reports required to be filed by the Company with the SEC in a
          timely manner so as to remain eligible or become eligible, as the case
          may  be,  and  thereafter  to maintain its eligibility, for the use of
          Form  S-3.  If  the Company is not currently eligible to use Form S-3,
          not  later  than  five (5) business days after the Company first meets
          the  registration eligibility and transaction requirements for the use
          of  Form S-3 (or any successor form) for registration of the offer and
          sale  by  the Initial Investors and any other Investors of Registrable
          Securities,  the  Company  shall file a Registration Statement on Form
          S-3  (or  such  successor  form)  with  respect  to  the  Registrable
          Securities  covered by the Registration Statement on Form SB-2 or Form
          S-1,  whichever  is  applicable,  filed  pursuant to Section 2(a) (and
          include  in  such  Registration  Statement on Form S-3 the information
          required  by  Rule 429 under the 1933 Act) or convert the Registration
          Statement  on  Form  SB-2  or Form S-1, whichever is applicable, filed
          pursuant  to Section 2(a) to a Form S-3 pursuant to Rule 429 under the
          1933  Act and cause such Registration Statement (or such amendment) to
          be  declared effective no later than thirty (30) days after filing. In
          the event of a breach by the Company of the provisions of this Section
          2(e),  the  Company  will  be  required  to  make payments pursuant to
          Section  2(c)  hereof.

          3.  OBLIGATIONS  OF  THE  COMPANY.
              -----------------------------

          In connection with the registration of the Registrable Securities, the
     Company  shall  have  the  following  obligations:

               A.  The Company shall prepare promptly, and file with the SEC not
          later  than  the Filing Date, a Registration Statement with respect to
          the  number  of  Registrable  Securities provided in Section 2(a), and
          thereafter  use  its best efforts to cause such Registration Statement
          relating  to  Registrable  Securities  to  become effective as soon as
          possible  after such filing but in no event later than one hundred and
          forty-five  (145)  days  from  the  date  of  Closing),  and  keep the
          Registration  Statement  effective  pursuant  to Rule 415 at all times
          until  such date as is the earlier of (i) the date on which all of the
          Registrable  Securities  have been sold and (ii) the date on which the
          Registrable  Securities  (in  the  opinion  of  counsel to the Initial
          Investors)  may be immediately sold to the public without registration
          or  restriction  (including,  without limitation, as to volume by each
          holder  thereof) under the 1933 Act (the "REGISTRATION PERIOD"), which
          Registration  Statement  (including  any  amendments  or  supplements
          thereto  and  prospectuses  contained  therein)  shall not contain any
          untrue  statement  of a material fact or omit to state a material fact
          required  to  be  stated  therein, or necessary to make the statements
          therein  not  misleading.

               B.  The  Company  shall  prepare  and  file  with  the  SEC  such
          amendments  (including  post-effective  amendments) and supplements to
          the Registration Statements and the prospectus used in connection with
          the  Registration  Statements  as  may  be  necessary  to  keep  the
          Registration Statements effective at all times during the Registration
          Period,  and,  during  such  period, comply with the provisions of the
          1933 Act with respect to the disposition of all Registrable Securities
          of  the Company covered by the Registration Statements until such time
          as  all  of  such  Registrable  Securities  have  been  disposed of in
          accordance  with  the intended methods of disposition by the seller or
          sellers  thereof  as  set forth in the Registration Statements. In the
          event  the  number  of shares available under a Registration Statement
          filed  pursuant  to this Agreement is insufficient to cover all of the
          Registrable Securities issued or issuable upon conversion of the Notes
          and exercise of the Warrants, the Company shall amend the Registration

<PAGE>

          Statement,  or  file  a  new Registration Statement (on the short form
          available therefor, if applicable), or both, so as to cover all of the
          Registrable  Securities,  in each case, as soon as practicable, but in
          any event within fifteen (15) days after the necessity therefor arises
          (based  on  the  market  price  of the Common Stock and other relevant
          factors  on  which the Company reasonably elects to rely). The Company
          shall  use  its  best  efforts  to  cause  such  amendment  and/or new
          Registration  Statement  to  become  effective  as soon as practicable
          following the filing thereof, but in any event within thirty (30) days
          after  the  date  on which the Company reasonably first determines (or
          reasonably  should  have determined) the need therefor. The provisions
          of  Section  2(c)  above  shall  be  applicable  with  respect to such
          obligation,  with  the  one  hundred and forty-five (145) days running
          from  the  day  the Company reasonably first determines (or reasonably
          should  have  determined)  the  need  therefor.

               C.  The  Company shall furnish to each Investor whose Registrable
          Securities  are  included  in  a  Registration Statement and its legal
          counsel  promptly  (but  in  no event more than two (2) business days)
          after  the  same  is prepared and publicly distributed, filed with the
          SEC,  or  received  by  the  Company,  one  copy  of each Registration
          Statement  and  any amendment thereto, each preliminary prospectus and
          prospectus  and each amendment or supplement thereto, and, in the case
          of the Registration Statement referred to in Section 2(a), each letter
          written  by or on behalf of the Company to the SEC or the staff of the
          SEC,  and each item of correspondence from the SEC or the staff of the
          SEC,  in each case relating to such Registration Statement (other than
          any  portion  of  any thereof which contains information for which the
          Company  has  sought  confidential treatment), and promptly (but in no
          event  more  than  two  (2)  business  days)  after  the  Registration
          Statement is declared effective by the SEC, such number of copies of a
          prospectus, including a preliminary prospectus, and all amendments and
          supplements  thereto  and  such  other  documents as such Investor may
          reasonably  request  in  order  to  facilitate  the disposition of the
          Registrable  Securities  owned  by  such  Investor.  The  Company will
          immediately  notify each Investor by facsimile of the effectiveness of
          each  Registration  Statement  or  any  post-effective  amendment. The
          Company  will  promptly  respond to any and all comments received from
          the  SEC  (which  comments  shall  promptly  be  made available to the
          Investors upon request), with a view towards causing each Registration
          Statement or any amendment thereto to be declared effective by the SEC
          as soon as practicable, shall promptly file an acceleration request as
          soon  as practicable (but in no event more than two (2) business days)
          following  the  resolution  or  clearance  of  all SEC comments or, if
          applicable,  following  notification  by  the  SEC  that  any  such
          Registration Statement or any amendment thereto will not be subject to
          review and shall, if required by SEC Rules, promptly file with the SEC
          a  final  prospectus as soon as practicable (but in no event more than
          two  (2)  business days) following receipt by the Company from the SEC
          of  an  order  declaring  the Registration Statement effective. In the
          event  of  a  breach  by the Company of the provisions of this Section
          3(c),  the  Company  will  be  required  to  make payments pursuant to
          Section  2(c)  hereof.

               D.  The  Company shall use reasonable efforts to (i) register and
          qualify  the  Registrable  Securities  covered  by  the  Registration
          Statements  under  such  other  securities  or "blue sky" laws of such
          jurisdictions  in  the  United  States  as  the  Investors  who hold a
          majority  in  interest  of  the  Registrable  Securities being offered
          reasonably  request, (ii) prepare and file in those jurisdictions such
          amendments  (including  post-effective  amendments) and supplements to
          such  registrations and qualifications as may be necessary to maintain
          the  effectiveness  thereof during the Registration Period, (iii) take

<PAGE>

          such  other actions as may be necessary to maintain such registrations
          and  qualifications  in  effect  at  all times during the Registration
          Period,  and  take all other actions reasonably necessary or advisable
          to  (a)  qualify  the  Registrable  Securities  for  sale  in  such
          jurisdictions;  provided,  however,  that  the  Company  shall  not be
          required  in connection therewith or as a condition thereto to qualify
          to  do  business  in  any jurisdiction where it would not otherwise be
          required  to  qualify but for this Section 3(d), (b) subject itself to
          general  taxation in any such jurisdiction, (c) file a general consent
          to  service  of  process  in  any  such  jurisdiction, (d) provide any
          undertakings  that  cause  the Company undue expense or burden, or (e)
          make any change in its charter or bylaws, which in each case the Board
          of  Directors  of  the  Company  determines to be contrary to the best
          interests  of  the  Company  and  its  shareholders.

               E.  In the event Investors who hold a majority-in-interest of the
          Registrable  Securities  being  offered  in  the  offering  (with  the
          approval  of  a  majority-in-interest of the Initial Investors) select
          underwriters  for  the  offering,  the  Company  shall  enter into and
          perform  its obligations under an underwriting agreement, in usual and
          customary  form,  including,  without  limitation,  customary
          indemnification and contribution obligations, with the underwriters of
          such  offering.

               F. As promptly as practicable after becoming aware of such event,
          the  Company shall notify each Investor of the happening of any event,
          of  which  the  Company  has  knowledge,  as  a  result  of  which the
          prospectus  included in any Registration Statement, as then in effect,
          includes an untrue statement of a material fact or omission to state a
          material  fact  required to be stated therein or necessary to make the
          statements  therein  not misleading, and use its best efforts promptly
          to  prepare a supplement or amendment to any Registration Statement to
          correct  such untrue statement or omission, and deliver such number of
          copies  of  such  supplement  or  amendment  to  each Investor as such
          Investor  may reasonably request; provided that, for not more than ten
          (10) consecutive trading days (or a total of not more than twenty (20)
          trading  days  in any twelve (12) month period), the Company may delay
          the  disclosure  of  material  non-public  information  concerning the
          Company (as well as prospectus or Registration Statement updating) the
          disclosure  of  which at the time is not, in the good faith opinion of
          the  Company,  in  the  best  interests  of  the  Company (an "ALLOWED
          DELAY"); provided, further, that the Company shall promptly notify the
          Investors in writing of the existence of (but in no event, without the
          prior  written  consent  of an Investor, shall the Company disclose to
          such  investor  any  of the facts or circumstances regarding) material
          non-public  information giving rise to an Allowed Delay and advise the
          Investors  in  writing  to  cease  all  sales  under such Registration
          Statement  until  the end of the Allowed Delay. Upon expiration of the
          Allowed  Delay, the Company shall again be bound by the first sentence
          of  this  Section  3(f)  with  respect  to the information giving rise
          thereto.

               G. The Company shall use its best efforts to prevent the issuance
          of  any  stop  order  or  other  suspension  of  effectiveness  of any
          Registration Statement, and, if such an order is issued, to obtain the
          withdrawal of such order at the earliest possible moment and to notify
          each  Investor who holds Registrable Securities being sold (or, in the
          event  of  an underwritten offering, the managing underwriters) of the
          issuance  of  such  order  and  the  resolution  thereof.

               H.  The  Company shall permit a single firm of counsel designated
          by the Initial Investors to review such Registration Statement and all

<PAGE>

          amendments  and  supplements  thereto  (as  well  as  all requests for
          acceleration  or  effectiveness  thereof)  a reasonable period of time
          prior  to  their  filing  with the SEC, and not file any document in a
          form  to  which  such  counsel reasonably objects and will not request
          acceleration  of  such  Registration Statement without prior notice to
          such  counsel.  The  sections  of such Registration Statement covering
          information  with  respect to the Investors, the Investor's beneficial
          ownership  of  securities  of  the  Company  or the Investors intended
          method  of  disposition of Registrable Securities shall conform to the
          information  provided  to  the  Company  by  each  of  the  Investors.

               I.  The  Company  shall  make generally available to its security
          holders  as  soon  as  practicable, but not later than one hundred and
          forty-five  (145)  days after the close of the period covered thereby,
          an  earnings  statement (in form complying with the provisions of Rule
          158  under  the 1933 Act) covering a twelve-month period beginning not
          later  than  the  first  day  of  the  Company's  fiscal  quarter next
          following  the  effective  date  of  the  Registration  Statement.

               J.  At the request of any Investor, the Company shall furnish, on
          the  date that Registrable Securities are delivered to an underwriter,
          if  any, for sale in connection with any Registration Statement or, if
          such  securities  are not being sold by an underwriter, on the date of
          effectiveness  thereof an opinion, dated as of such date, from counsel
          representing  the Company for purposes of such Registration Statement,
          in  form,  scope  and  substance  as  is  customarily  given  in  an
          underwritten  public  offering, addressed to the underwriters, if any,
          and  the  Investors  and a letter, dated such date, from the Company's
          independent  certified  public accountants in form and substance as is
          customarily  given  by  independent  certified  public  accountants to
          underwriters  in  an  underwritten  public  offering, addressed to the
          underwriters,  if  any,  and  the  Investors.

               K.  The  Company  shall  make available for inspection by (i) any
          Investor,  (ii)  any  underwriter  participating  in  any  disposition
          pursuant  to a Registration Statement, (iii) one firm of attorneys and
          one  firm  of  accountants  or  other  agents  retained by the Initial
          Investors,  (iv) one firm of attorneys and (v) one firm of accountants
          or  other  agents  retained  by  all  other Investors, and one firm of
          attorneys  retained  by  all  such  underwriters  (collectively,  the
          "INSPECTORS") all pertinent financial and other records, and pertinent
          corporate  documents  and properties of the Company, including without
          limitation,  records  of  conversions  by other holders of convertible
          securities  issued  by  the  Company and the issuance of stock to such
          holders  pursuant to the conversions (collectively, the "RECORDS"), as
          shall  be reasonably deemed necessary by each Inspector to enable each
          Inspector  to exercise its due diligence responsibility, and cause the
          Company's  officers, directors and employees to supply all information
          which  any  Inspector  may reasonably request for purposes of such due
          diligence;  provided,  however,  that  each  Inspector  shall  hold in
                      --------   -------
          confidence  and  shall not make any disclosure (except to an Investor)
          of  any  Record  or  other information which the Company determines in
          good  faith  to  be  confidential,  and  of  which  determination  the
          Inspectors  are so notified, unless (a) the disclosure of such Records
          is  necessary  to  avoid  or correct a misstatement or omission in any
          Registration  Statement,  (b)  the  release of such Records is ordered
          pursuant  to a subpoena or other order from a court or government body
          of  competent jurisdiction, or (c) the information in such Records has
          been  made  generally available to the public other than by disclosure
          in  violation of this or any other agreement. The Company shall not be
          required  to  disclose any confidential information in such Records to

<PAGE>

          any  Inspector until and unless such Inspector shall have entered into
          confidentiality  agreements (in form and substance satisfactory to the
          Company)  with  the Company with respect thereto, substantially in the
          form  of  this  Section 3(k). Each Investor agrees that it shall, upon
          learning that disclosure of such Records is sought in or by a court or
          governmental  body  of  competent jurisdiction or through other means,
          give  prompt  notice  to  the  Company  and  allow the Company, at its
          expense,  to undertake appropriate action to prevent disclosure of, or
          to  obtain  a  protective  order for, the Records deemed confidential.
          Nothing  herein (or in any other confidentiality agreement between the
          Company  and  any  Investor)  shall  be deemed to limit the Investor's
          ability  to sell Registrable Securities in a manner which is otherwise
          consistent  with  applicable  laws  and  regulations.

               L.  The  Company  shall  hold  in  confidence  and  not  make any
          disclosure  of  information  concerning  an  Investor  provided to the
          Company  unless  disclosure of such information is necessary to comply
          with  federal  or  state  securities  laws,  the  disclosure  of  such
          information  is  necessary  to  avoid  or  correct  a  misstatement or
          omission  in  any  Registration  Statement,  the  release  of  such
          information  is  ordered  pursuant to a subpoena or other order from a
          court  or  governmental  body  of  competent  jurisdiction,  or  such
          information has been made generally available to the public other than
          by disclosure in violation of this or any other agreement. The Company
          agrees  that  it  shall,  upon  learning  that  disclosure  of  such
          information  concerning  an  Investor  is  sought  in or by a court or
          governmental  body  of  competent jurisdiction or through other means,
          give  prompt  notice to such Investor prior to making such disclosure,
          and  allow  the  Investor,  at  its  expense, to undertake appropriate
          action  to prevent disclosure of, or to obtain a protective order for,
          such  information.

               M. The Company shall cause all the Registrable Securities covered
          by the Registration Statement to be listed on each national securities
          exchange on which securities of the same class or series issued by the
          Company  are  then  listed, if any, if the listing of such Registrable
          Securities  is  then permitted under the rules of such exchange, or to
          the  extent  the  securities  of the same class or series are not then
          listed  on  a national securities exchange, secure the designation and
          quotation,  of  all  the  Registrable  Securities  covered  by  the
          Registration  Statement  on  Nasdaq or, if not eligible for Nasdaq, on
          Nasdaq  SmallCap or, if not eligible for Nasdaq or Nasdaq SmallCap, on
          the  OTCBB  and,  without limiting the generality of the foregoing, to
          arrange  for  at least two market makers to register with the National
          Association  of Securities Dealers, Inc. ("NASD") as such with respect
          to  such  Registrable  Securities.

               N.  The  Company  shall  provide  a transfer agent and registrar,
          which may be a single entity, for the Registrable Securities not later
          than  the  effective  date  of  the  Registration  Statement.

               O.  The  Company  shall  cooperate  with  the  Investors who hold
          Registrable  Securities  being offered and the managing underwriter or
          underwriters,  if  any,  to  facilitate  the  timely  preparation  and
          delivery  of  certificates  (not  bearing  any  restrictive  legends)
          representing  Registrable  Securities  to  be  offered  pursuant  to a
          Registration  Statement  and  enable  such  certificates to be in such
          denominations  or  amounts,  as  the  case  may  be,  as  the managing
          underwriter  or  underwriters, if any, or the Investors may reasonably
          request  and  registered  in such names as the managing underwriter or
          underwriters,  if any, or the Investors may request, and, within three
          (3)  business  days  after  a  Registration  Statement  which includes
          Registrable  Securities  is  ordered effective by the SEC, the Company

<PAGE>

          shall  deliver,  and shall cause legal counsel selected by the Company
          to deliver, to the transfer agent for the Registrable Securities (with
          copies  to  the Investors whose Registrable Securities are included in
          such  Registration  Statement)  an  instruction  in  the form attached
          hereto  as  EXHIBIT  1  and  an  opinion  of  such counsel in the form
          attached  hereto  as  EXHIBIT  2.

               P. At the request of the holders of a majority-in-interest of the
          Registrable  Securities,  the  Company shall prepare and file with the
          SEC  such  amendments  (including  post-effective  amendments)  and
          supplements  to  a  Registration  Statement and any prospectus used in
          connection  with  the  Registration  Statement  as may be necessary in
          order  to  change  the  plan  of  distribution  set  forth  in  such
          Registration  Statement.

               Q.  From  and after the date of this Agreement, the Company shall
          not,  and  shall  not agree to, allow the holders of any securities of
          the  Company  to include any of their securities, in excess of 250,000
          shares  of  Common  Stock, in any Registration Statement under Section
          2(a)  hereof or any amendment or supplement thereto under Section 3(b)
          hereof without the consent of the holders of a majority-in-interest of
          the  Registrable  Securities.

               R.  The Company shall take all other reasonable actions necessary
          to expedite and facilitate disposition by the Investors of Registrable
          Securities  pursuant  to  a  Registration  Statement.

          4.  OBLIGATIONS  OF  THE  INVESTORS.
              -------------------------------

          In connection with the registration of the Registrable Securities, the
     Investors  shall  have  the  following  obligations:

               A.  It  shall  be a condition precedent to the obligations of the
          Company  to  complete the registration pursuant to this Agreement with
          respect  to  the  Registrable Securities of a particular Investor that
          such  Investor shall furnish to the Company such information regarding
          itself,  the Registrable Securities held by it and the intended method
          of  disposition  of  the Registrable Securities held by it as shall be
          reasonably  required  to  effect  the registration of such Registrable
          Securities  and  shall  execute such documents in connection with such
          registration as the Company may reasonably request. At least three (3)
          business  days  prior  to  the  first  anticipated  filing date of the
          Registration  Statement, the Company shall notify each Investor of the
          information  the  Company  requires  from  each  such  Investor.

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

               C.  In  the event Investors holding a majority-in-interest of the
          Registrable  Securities  being  registered  (with  the approval of the
          Initial Investors) determine to engage the services of an underwriter,
          each  Investor  agrees  to  enter  into  and  perform  such Investor's
          obligations  under  an  underwriting agreement, in usual and customary
          form,  including,  without  limitation,  customary indemnification and
          contribution  obligations,  with  the  managing  underwriter  of  such
          offering  and  take  such  other actions as are reasonably required in

<PAGE>

          order  to  expedite  or  facilitate the disposition of the Registrable
          Securities,  unless  such Investor has notified the Company in writing
          of  such  Investor's  election  to  exclude  all  of  such  Investor's
          Registrable  Securities  from  such  Registration  Statement.

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

               E.  No  Investor may participate in any underwritten registration
          hereunder  unless  such  Investor  agrees  to  sell  such  Investor's
          Registrable  Securities  on  the  basis  provided  in any underwriting
          arrangements  in usual and customary form entered into by the Company,
          completes  and  executes  all  questionnaires,  powers  of  attorney,
          indemnities,  underwriting  agreements  and other documents reasonably
          required under the terms of such underwriting arrangements, and agrees
          to  pay  its  pro  rata  share  of  all  underwriting  discounts  and
          commissions and any expenses in excess of those payable by the Company
          pursuant  to  Section  5  below.

          5.  EXPENSES  OF  REGISTRATION.
              --------------------------

          All  reasonable  expenses,  other  than  underwriting  discounts  and
     commissions,  incurred  in  connection  with  registrations,  filings  or
     qualifications pursuant to Sections 2 and 3, including, without limitation,
     all  registration,  listing and qualification fees, printers and accounting
     fees,  the  fees  and  disbursements  of  counsel  for the Company, and the
     reasonable  fees  and  disbursements of one counsel selected by the Initial
     Investors  pursuant  to Sections 2(b) and 3(h) hereof shall be borne by the
     Company  and  shall  be  included  in  the  fees  paid to counsel under the
     Securities  Purchase  Agreement  for  purposes  of  counsel selected by the
     Initial  Investors.

          6.  INDEMNIFICATION.
              ---------------

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

               A.  To  the  extent permitted by law, the Company will indemnify,
          hold  harmless  and  defend  each  Investor who holds such Registrable
          Securities,  the  directors, officers, partners, employees, agents and
          each  person  who controls any Investor within the meaning of the 1933
          Act  or  the  Securities  Exchange  Act of 1934, as amended (the "1934
          ACT"),  if  any,  any underwriter (as defined in the 1933 Act) for the
          Investors,  and  the directors, officers, partners, employees and each
          person  who  controls  any  such underwriter within the meaning of the
          1933  Act  or  the  1934  Act, if any (each, an "INDEMNIFIED PERSON"),
          against  any  joint or several losses, claims, damages, liabilities or
          expenses  (collectively,  together  with  actions,  proceedings  or
          inquiries  by  any regulatory or self-regulatory organization, whether

<PAGE>

          commenced or threatened, in respect thereof, "CLAIMS") to which any of
          them  may  become  subject  insofar as such Claims arise out of or are
          based  upon: (i) any untrue statement or alleged untrue statement of a
          material  fact  in a Registration Statement or the omission or alleged
          omission  to  state  therein  a material fact required to be stated or
          necessary  to  make  the  statements  therein not misleading; (ii) any
          untrue  statement  or  alleged  untrue  statement  of  a material fact
          contained in any preliminary prospectus if used prior to the effective
          date  of  such  Registration  Statement,  or  contained  in  the final
          prospectus  (as  amended  or  supplemented,  if  the Company files any
          amendment  thereof or supplement thereto with the SEC) or the omission
          or  alleged  omission  to state therein any material fact necessary to
          make  the statements made therein, in light of the circumstances under
          which  the  statements therein were made, not misleading; or (iii) any
          violation  or  alleged  violation  by the Company of the 1933 Act, the
          1934  Act,  any  other  law,  including, without limitation, any state
          securities  law,  or any rule or regulation thereunder relating to the
          offer  or  sale  of  the  Registrable  Securities  (the matters in the
          foregoing  clauses  (i)  through  (iii)  being,  collectively,
          "VIOLATIONS").  Subject  to the restrictions set forth in Section 6(c)
          with  respect  to  the  number  of  legal  counsel,  the Company shall
          reimburse  the  Indemnified  Person,  promptly  as  such  expenses are
          incurred  and  are  due  and payable, for any reasonable legal fees or
          other  reasonable  expenses  incurred  by  them  in  connection  with
          investigating or defending any such Claim. Notwithstanding anything to
          the contrary contained herein, the indemnification agreement contained
          in this Section 6(a): (i) shall not apply to a Claim arising out of or
          based upon a Violation which occurs in reliance upon and in conformity
          with  information  furnished  in  writing  to  the  Company  by  any
          Indemnified  Person  or  underwriter  for  such  Indemnified  Person
          expressly  for  use  in  connection  with  the  preparation  of  such
          Registration  Statement  or  any  such amendment thereof or supplement
          thereto,  if  such prospectus was timely made available by the Company
          pursuant  to Section 3(c) hereof; (ii) shall not apply to amounts paid
          in  settlement of any Claim if such settlement is effected without the
          prior  written  consent  of  the  Company,  which consent shall not be
          unreasonably  withheld;  and  (iii)  with  respect  to any preliminary
          prospectus,  shall  not inure to the benefit of any Indemnified Person
          if  the untrue statement or omission of material fact contained in the
          preliminary  prospectus  was  corrected  on  a  timely  basis  in  the
          prospectus, as then amended or supplemented, such corrected prospectus
          was  timely  made  available  by  the Company pursuant to Section 3(c)
          hereof, and the Indemnified Person was promptly advised in writing not
          to  use  the  incorrect  prospectus  prior to the use giving rise to a
          Violation  and  such  Indemnified Person, notwithstanding such advice,
          used  it.  Such  indemnity  shall  remain  in  full  force  and effect
          regardless  of  any  investigation  made  by  or  on  behalf  of  the
          Indemnified  Person  and shall survive the transfer of the Registrable
          Securities  by  the  Investors  pursuant  to  Section  9.

               B.  In  connection  with  any  Registration Statement in which an
          Investor is participating, each such Investor agrees severally and not
          jointly to indemnify, hold harmless and defend, to the same extent and
          in the same manner set forth in Section 6(a), the Company, each of its
          directors,  each of its officers who signs the Registration Statement,
          each  person,  if  any, who controls the Company within the meaning of
          the  1933  Act  or  the  1934  Act,  any  underwriter  and  any  other
          shareholder  selling securities pursuant to the Registration Statement
          or  any  of  its directors or officers or any person who controls such
          shareholder  or  underwriter within the meaning of the 1933 Act or the
          1934  Act  (collectively  and  together with an Indemnified Person, an
          "INDEMNIFIED  PARTY"),  against  any  Claim  to  which any of them may
          become subject, under the 1933 Act, the 1934 Act or otherwise, insofar
          as  such  Claim  arises  out of or is based upon any Violation by such
          Investor,  in  each  case  to the extent (and only to the extent) that

<PAGE>

          such  Violation occurs in reliance upon and in conformity with written
          information  furnished  to  the Company by such Investor expressly for
          use  in  connection  with  such Registration Statement; and subject to
          Section  6(c) such Investor will reimburse any legal or other expenses
          (promptly  as  such  expenses  are  incurred  and are due and payable)
          reasonably  incurred  by  them  in  connection  with  investigating or
          defending  any  such  Claim;  provided,  however,  that  the indemnity
                                        --------   -------
          agreement  contained  in  this Section 6(b) shall not apply to amounts
          paid in settlement of any Claim if such settlement is effected without
          the prior written consent of such Investor, which consent shall not be
          unreasonably  withheld;  provided, further, however, that the Investor
                                   --------  -------  -------
          shall  be liable under this Agreement (including this Section 6(b) and
          Section 7) for only that amount as does not exceed the net proceeds to
          such  Investor  as  a  result  of  the  sale of Registrable Securities
          pursuant  to  such Registration Statement. Such indemnity shall remain
          in full force and effect regardless of any investigation made by or on
          behalf of such Indemnified Party and shall survive the transfer of the
          Registrable  Securities  by  the  Investors  pursuant  to  Section  9.
          Notwithstanding  anything  to  the  contrary  contained  herein,  the
          indemnification  agreement contained in this Section 6(b) with respect
          to  any  preliminary  prospectus shall not inure to the benefit of any
          Indemnified Party if the untrue statement or omission of material fact
          contained  in  the  preliminary  prospectus  was corrected on a timely
          basis  in  the  prospectus,  as  then  amended  or  supplemented.

               C. Promptly after receipt by an Indemnified Person or Indemnified
          Party under this Section 6 of notice of the commencement of any action
          (including  any  governmental  action),  such  Indemnified  Person  or
          Indemnified  Party  shall, if a Claim in respect thereof is to be made
          against  any  indemnifying  party under this Section 6, deliver to the
          indemnifying  party  a written notice of the commencement thereof, and
          the indemnifying party shall have the right to participate in, and, to
          the  extent  the indemnifying party so desires, jointly with any other
          indemnifying party similarly noticed, to assume control of the defense
          thereof  with  counsel mutually satisfactory to the indemnifying party
          and  the  Indemnified Person or the Indemnified Party, as the case may
          be; provided, however, that an Indemnified Person or Indemnified Party
              --------  -------
          shall  have  the  right  to  retain  its own counsel with the fees and
          expenses  to  be paid by the indemnifying party, if, in the reasonable
          opinion  of  counsel  retained  by  the  indemnifying  party,  the
          representation  by  such  counsel  of  the  Indemnified  Person  or
          Indemnified  Party  and  the indemnifying party would be inappropriate
          due  to  actual  or  potential  differing  interests  between  such
          Indemnified  Person  or  Indemnified  Party  and  any  other  party
          represented by such counsel in such proceeding. The indemnifying party
          shall  pay  for  only  one  separate legal counsel for the Indemnified
          Persons  or  the  Indemnified  Parties,  as applicable, and such legal
          counsel  shall be selected by Investors holding a majority-in-interest
          of  the  Registrable Securities included in the Registration Statement
          to  which  the  Claim  relates  (with  the  approval  of  a
          majority-in-interest  of  the Initial Investors), if the Investors are
          entitled  to indemnification hereunder, or the Company, if the Company
          is  entitled  to indemnification hereunder, as applicable. The failure
          to  deliver  written  notice  to  the  indemnifying  party  within  a
          reasonable  time  of  the  commencement  of  any such action shall not
          relieve  such  indemnifying  party of any liability to the Indemnified
          Person or Indemnified Party under this Section 6, except to the extent
          that  the  indemnifying party is actually prejudiced in its ability to
          defend  such  action.  The  indemnification required by this Section 6
          shall  be  made  by periodic payments of the amount thereof during the
          course  of the investigation or defense, as such expense, loss, damage
          or  liability  is  incurred  and  is  due  and  payable.

<PAGE>

          7.  CONTRIBUTION.
              ------------

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

          8.  REPORTS  UNDER  THE  1934  ACT.
              -------------------------------

          With  a view to making available to the Investors the benefits of Rule
     144  promulgated under the 1933 Act or any other similar rule or regulation
     of  the SEC that may at any time permit the investors to sell securities of
     the  Company  to  the public without registration ("RULE 144"), the Company
     agrees  to:

               A. make and keep public information available, as those terms are
          understood  and  defined  in  Rule  144;

               B.  file  with  the  SEC in a timely manner all reports and other
          documents  required of the Company under the 1933 Act and the 1934 Act
          so  long as the Company remains subject to such requirements (it being
          understood  that  nothing herein shall limit the Company's obligations
          under  Section  4(c)  of  the  Securities  Purchase Agreement) and the
          filing  of  such  reports  and  other  documents  is  required for the
          applicable  provisions  of  Rule  144;  and

               C.  furnish  to  each  Investor  so  long  as  such Investor owns
          Registrable Securities, promptly upon request, (i) a written statement
          by the Company that it has complied with the reporting requirements of
          Rule  144,  the  1933  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 to permit the Investors to
          sell  such  securities  pursuant  to  Rule  144  without registration.

          9.  ASSIGNMENT  OF  REGISTRATION  RIGHTS.
              ------------------------------------

          The  rights  under this Agreement shall be automatically assignable by
     the  Investors  to  any  transferee  of  all  or any portion of Registrable
     Securities  if:  (i)  the Investor agrees in writing with the transferee or
     assignee  to  assign such rights, and a copy of such agreement is furnished
     to  the  Company  within  a reasonable time after such assignment, (ii) the
     Company  is,  within  a  reasonable time after such transfer or assignment,
     furnished with written notice of the name and address of such transferee or
     assignee, and the securities with respect to which such registration rights
     are  being  transferred  or  assigned,  (iii)  following  such  transfer or
     assignment, the further disposition of such securities by the transferee or
     assignee  is  restricted under the 1933 Act and applicable state securities

<PAGE>

     laws,  (iv)  at  or before the time the Company receives the written notice
     contemplated  by  clause  (ii) of this sentence, the transferee or assignee
     agrees  in  writing  with  the Company to be bound by all of the provisions
     contained herein, (v) such transfer shall have been made in accordance with
     the  applicable requirements of the Securities Purchase Agreement, and (vi)
     such  transferee  shall be an "ACCREDITED INVESTOR" as that term defined in
     Rule  501  of  Regulation  D  promulgated  under  the  1933  Act.

          10.  AMENDMENT  OF  REGISTRATION  RIGHTS.
               -----------------------------------

          Provisions of this Agreement may be amended and the observance thereof
     may  be  waived  (either  generally  or in a particular instance and either
     retroactively  or prospectively), only with written consent of the Company,
     each  of  the  Initial Investors (to the extent such Initial Investor still
     owns  Registrable Securities) and Investors who hold a majority interest of
     the  Registrable Securities. Any amendment or waiver effected in accordance
     with  this  Section 10 shall be binding upon each Investor and the Company.

          11.  MISCELLANEOUS.
               -------------

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

               B.  Any notices required or permitted to be given under the terms
          hereof  shall  be sent by certified or registered mail (return receipt
          requested)  or  delivered  personally  or  by  courier  (including  a
          recognized  overnight  delivery  service) or by facsimile and shall be
          effective  five  days  after  being  placed  in the mail, if mailed by
          regular  United  States mail, or upon receipt, if delivered personally
          or  by  courier (including a recognized overnight delivery service) or
          by  facsimile,  in  each  case addressed to a party. The addresses for
          such  communications  shall  be:

                              If to the Company:

                              Pediatric Prosthetics, Inc.
                              12926 Willowchase Drive
                              Houston, TX 77070
                              Attention:  Chief Executive Officer
                              Telephone:  (281) 897-1108
                              Facsimile:  (281)

<PAGE>

                              With a copy to:

                              David M. Loev, Esq.
                              2777 Allen Parkway, Suite 1000
                              Houston, TX 77019
                              Attention:   David M. Loev, Esq.
                              Telephone:  (713) 524-4110
                              Facsimile:   (713)  524-4122

If  to  an  Investor: to the address set forth immediately below such Investor's
name  on  the  signature  pages  to  the  Securities  Purchase  Agreement.

                              With a copy to:

                              Ballard Spahr Andrews & Ingersoll, LLP
                              1735 Market Street
                              51st Floor
                              Philadelphia, Pennsylvania  19103
                              Attention:  Gerald J. Guarcini, Esq.
                              Telephone:  215-865-8625
                              Facsimile:  215-864-8999


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

               D. THIS AGREEMENT SHALL BE ENFORCED, GOVERNED BY AND CONSTRUED IN
          ACCORDANCE  WITH  THE  LAWS  OF  THE  STATE  OF NEW YORK APPLICABLE TO
          AGREEMENTS  MADE  AND  TO  BE  PERFORMED  ENTIRELY  WITHIN SUCH STATE,
          WITHOUT  REGARD  TO  THE  PRINCIPLES  OF CONFLICT OF LAWS. THE PARTIES
          HERETO  HEREBY  SUBMIT  TO  THE  EXCLUSIVE  JURISDICTION OF THE UNITED
          STATES  FEDERAL  COURTS LOCATED NEW YORK, NEW YORK WITH RESPECT TO ANY
          DISPUTE  ARISING  UNDER THIS AGREEMENT, THE AGREEMENTS ENTERED INTO IN
          CONNECTION  HEREWITH  OR  THE  TRANSACTIONS  CONTEMPLATED  HEREBY  OR
          THEREBY. BOTH PARTIES IRREVOCABLY WAIVE THE DEFENSE OF AN INCONVENIENT
          FORUM  TO  THE  MAINTENANCE  OF  SUCH SUIT OR PROCEEDING. BOTH PARTIES
          FURTHER  AGREE  THAT  SERVICE  OF PROCESS UPON A PARTY MAILED BY FIRST
          CLASS  MAIL  SHALL  BE  DEEMED  IN  EVERY RESPECT EFFECTIVE SERVICE OF
          PROCESS  UPON THE PARTY IN ANY SUCH SUIT OR PROCEEDING. NOTHING HEREIN
          SHALL AFFECT EITHER PARTY'S RIGHT TO SERVE PROCESS IN ANY OTHER MANNER
          PERMITTED  BY  LAW.  BOTH  PARTIES  AGREE  THAT A FINAL NON-APPEALABLE
          JUDGMENT IN ANY SUCH SUIT OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE
          ENFORCED  IN  OTHER  JURISDICTIONS  BY SUIT ON SUCH JUDGMENT OR IN ANY
          OTHER  LAWFUL  MANNER. THE PARTY WHICH DOES NOT PREVAIL IN ANY DISPUTE

<PAGE>

          ARISING  UNDER  THIS  AGREEMENT  SHALL BE RESPONSIBLE FOR ALL FEES AND
          EXPENSES,  INCLUDING ATTORNEYS' FEES, INCURRED BY THE PREVAILING PARTY
          IN  CONNECTION  WITH  SUCH  DISPUTE.

               E.  In  the event that any provision of this Agreement is invalid
          or  unenforceable  under  any  applicable statute or rule of law, then
          such  provision  shall be deemed inoperative to the extent that it may
          conflict  therewith  and shall be deemed modified to conform with such
          statute  or  rule of law. Any provision hereof which may prove invalid
          or  unenforceable  under  any  law  shall  not  affect the validity or
          enforceability  of  any  other  provision  hereof.

               F.  This  Agreement,  the  Notes, the Warrants and the Securities
          Purchase  Agreement  (including  all  schedules  and exhibits thereto)
          constitute  the entire agreement among the parties hereto with respect
          to  the  subject matter hereof and thereof. There are no restrictions,
          promises,  warranties  or  undertakings, other than those set forth or
          referred  to  herein  and  therein.  This Agreement and the Securities
          Purchase  Agreement  supersede all prior agreements and understandings
          among the parties hereto with respect to the subject matter hereof and
          thereof.

               G.  Subject  to  the  requirements  of  Section  9  hereof,  this
          Agreement  shall  be  binding  upon  and  inure  to the benefit of the
          parties  and  their  successors  and  assigns.

               H.  The  headings  in  this  Agreement  are  for  convenience  of
          reference  only  and  shall  not  form  part  of,  or  affect  the
          interpretation  of,  this  Agreement.

               I.  This  Agreement  may be executed in two or more counterparts,
          each  of  which  shall  be  deemed  an original but all of which shall
          constitute  one and the same agreement and shall become effective when
          counterparts have been signed by each party and delivered to the other
          party.  This  Agreement, once executed by a party, may be delivered to
          the  other  party  hereto  by facsimile transmission of a copy of this
          Agreement  bearing  the  signature  of  the  party  so delivering this
          Agreement.

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

               K.  Except  as  otherwise provided herein, all consents and other
          determinations  to be made by the Investors pursuant to this Agreement
          shall  be  made  by  Investors  holding  a majority of the Registrable
          Securities,  determined  as  if  the all of the Notes then outstanding
          have  been  converted  into  for  Registrable  Securities.

               L.  The  Company  acknowledges  that  a  breach  by  it  of  its
          obligations  hereunder will cause irreparable harm to each Investor by
          vitiating  the  intent  and  purpose  of the transactions contemplated
          hereby.  Accordingly,  the Company acknowledges that the remedy at law
          for  breach of its obligations under this Agreement will be inadequate
          and  agrees,  in  the  event  of  a breach or threatened breach by the
          Company  of  any  of  the  provisions  under this Agreement, that each
          Investor  shall  be  entitled,  in  addition  to  all  other available
          remedies  in  law  or  in  equity,  and  in  addition to the penalties
          assessable  herein,  to  an  injunction  or  injunctions  restraining,

<PAGE>

          preventing  or  curing  any  breach  of  this Agreement and to enforce
          specifically the terms and provisions hereof, without the necessity of
          showing  economic  loss  and  without any bond or other security being
          required.

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



















                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]


<PAGE>

     IN  WITNESS WHEREOF, the Company and the undersigned Initial Investors have
caused  this  Agreement  to be duly executed as of the date first above written.


PEDIATRIC PROSTHETICS, INC.

/s/ Linda Putback-Bean
--------------------------------------
Linda Putback-Bean
Chief Executive Officer



AJW PARTNERS, LLC
By:  SMS Group, LLC


/s/ Corey S. Ribotsky
--------------------------------------
Corey S. Ribotsky
Manager



AJW OFFSHORE, LTD.
By:  First Street Manager II, LLC


/s/ Corey S. Ribotsky
--------------------------------------
Corey S. Ribotsky
Manager


AJW QUALIFIED PARTNERS, LLC
By:  AJW Manager, LLC


/s/ Corey S. Ribotsky
--------------------------------------
Corey S. Ribotsky
Manager


NEW MILLENNIUM CAPITAL PARTNERS, II, LLC
By:  First Street Manager II, LLC


/s/ Corey S. Ribotsky
--------------------------------------
Corey S. Ribotsky
Manager

<PAGE>