Document:

NONQUALIFIED STOCK OPTION AGREEMENT

            THIS AGREEMENT, effective as of the 20th day of April, 2006 (the
"Grant Date"), between Manchester Inc. (the "Company"), and Lawrence A. Taylor
(the "Optionee").

            WHEREAS, the Board of Directors has determined that it is in the
best interest of the corporation to provide additional incentive to selected
directors, officers, employees, consultants and strategic partners of the
Company; and

            WHEREAS, the Board of Directors has determined to grant a
non-qualified option to the Optionee as provided herein, and the Company and the
Optionee hereby wish to memorialize the terms and conditions applicable to the
Option;

            NOW, THEREFORE, the parties hereto agree as follows:

            1.   Grant of Option. Effective as of the Grant Date, the Company
hereby grants to the Optionee the right and option (the "Option") to purchase
all or any part of an aggregate of 100,000 shares of Company common stock (the
"Shares"), subject to, and in accordance with, the terms and conditions set
forth in this Agreement.

            2.   Purchase Price.

            The price at which the Optionee shall be entitled to purchase Shares
upon the exercise of the Option shall be US$4.63 per Share, being the closing
price of the Company's common stock on the OTC Bulletin Board on the trading day
immediately preceding the date of this Agreement.

            3.   Exerciseability of Option.

            The Option shall vest in accordance with the following schedule and
become exercisable with respect to the following number of Shares covered by the
Option so long as Optionee remains employed by the Company or continues to serve
the Company in a consulting capacity as of each such vesting date: 33.3% of the
Shares on each anniversary of the date of this Agreement.

            4.   Duration of Option.

            The Option shall be exercisable to the extent vested and in the
manner provided herein until the fifth anniversary of the date hereof so long as
Optionee remains in good standing with the Company as an employee or continuing
in service as a consultant to the Company. In the event the Optionee is an
employee of the Company and such employment of the Optionee is terminated for
cause, the Option, whether or not exercisable, shall terminate on the effective
date of the Optionee's termination of employment. If the employment of the
Optionee is terminated for any reason other than cause, the Optionee may at any
time within ninety (90) days after such termination of employment (but in no
event beyond the expiration of the stated term of the Option), exercise the
Option to the extent, but only to the extent, that the Option or portion thereof
was exercisable on the date of the termination of employment, after which time
the Option shall terminate in full. Nothing in this Agreement shall be
interpreted or construed to confer upon the Optionee any right with respect to
continuance of employment or consulting arrangements with the Company, nor shall
this Agreement interfere in any way with the right of the Company to terminate
the Optionee's employment or consulting services at any time.

<PAGE>

            5.   Manner of Exercise and Payment.

                  5.1   Subject to the terms and conditions of this Agreement
the Option may be exercised by delivery of written notice to the Company in the
form attached hereto, at its principal executive office. Such notice shall state
that the Optionee is electing to exercise the Option and the number of Shares in
respect of which the Option is being exercised and shall be signed by the person
or persons exercising the Option. If requested by the Company, such person or
persons shall (i) deliver this Agreement to an Officer of the Company who shall
endorse thereon a notation of such exercise and (ii) provide satisfactory proof
as to the right of such person or persons to exercise the Option.

                  5.2   The notice of exercise described in Section 5.1 shall be
accompanied by payment of the full purchase price for the Shares in respect of
which the Option is being exercised, in cash or by check.

                  5.3   Upon receipt of the notice of exercise and any payment
or other documentation as may be necessary pursuant to Section 5.2 relating to
the Shares in respect of which the Option is being exercised, the Company shall,
subject to this Agreement, take such action as may be necessary to effect the
transfer to the Optionee of the number of Shares as to which such exercise was
effective.

                  5.4   The Optionee shall not be deemed to be the holder of, or
to have any of the rights of a holder with respect to any Shares subject to the
Option until (i) the Option shall have been exercised pursuant to the terms of
this Agreement and the Optionee shall have paid the full purchase price for the
number of Shares in respect of which the Option was exercised, (ii) the Company
shall have issued and delivered the Shares to the Optionee, and (iii) the
Optionee's name shall have been entered as a stockholder of record on the books
of the Company, whereupon the Optionee shall have full voting and other
ownership rights with respect to such Shares during the period of ownership
thereof.

            6.   Cashless Exercise.

            In lieu of payment upon exercise of the Option as set forth in
Section 5, the Optionee may alternatively surrender to the Company for
cancellation a portion of this Option representing that number of unissued
shares underlying this Option which is equal to the quotient obtained by
dividing (A) the product obtained by multiplying the Purchase Price by the
number of shares of stock being purchased underlying the Option upon such
exercise, by (B) the difference obtained by subtracting the Purchase Price from
the closing price of the Company's common stock on the date immediately
preceding such date of such exercise; or (iii) by a combination of the foregoing
methods of payment selected by the Holder of this Option.

                                     - 2 -
<PAGE>

            7.   Non-Transferability.

            The Option shall not be transferable other than by will or by the
laws of descent and distribution or pursuant to a qualified domestic relations
order as defined in the U.S. Internal Revenue Code. During the lifetime of the
Optionee, the Option shall be exercisable only by the Optionee, except in the
case of an Option transferred pursuant to a qualified domestic relations order.

            8.   Securities Act Restrictions; Sales of Shares.

            The Optionee acknowledges that neither the U.S. Securities and
Exchange Commission (the "SEC") nor any state securities commission has approved
the Option nor any Shares issuable upon exercise thereof, nor passed upon or
endorsed the merits of this Option or the Shares; the Optionee further
understands and agrees that neither the Option nor the Shares have been
registered (i) under with the SEC under the Securities Act of 1933, as amended
(the "Securities Act") or (ii) with any state securities commission. The
Optionee understands that the neither the Option nor the Shares may be offered,
sold, transferred or otherwise disposed of in the U.S., its territories or
possessions, or to persons known to be residents of the U.S. or to a U.S. person
within the meaning of the Securities Act and the rules promulgated thereunder;
provided that the Shares may be so sold after the earlier to occur of the
effectiveness of a registration statement registering the Shares under the
Securities Act or the expiration of the restricted period under Rule 144
promulgated under the Securities Act and thereafter only if the Shares are
registered under the Securities Act or an exemption from the registration
requirements under the Securities Act is available. The Optionee acknowledges
that the Company has no obligation to cause the registration of this Option or
the Shares under the Securities Act. Following exercise of some or all of the
Option, Optionee agrees not to sell or transfer more than 25% of the aggregate
of all such Shares underlying the Option during any single calendar quarter and
that the certificates representing such Shares shall bear a legend to such
effect.

            9.   Adjustments.

            In the event of a change in capitalization, the Board of Directors
may make appropriate adjustments to the number and class of Shares or other
stock or securities subject to the Option and the purchase price for such Shares
or other stock or securities, provided, however, that the number of Shares
subject to the Option set forth in Section 1 reflects any and all changes in
capitalization of the Company as of the date hereof.

            10.  Effect of a Liquidation, Merger or Consolidation.

            Upon the effective date of (i) the liquidation or dissolution of the
Company or (ii) a merger or consolidation of the Company (a "Transaction"), the
Option shall continue in effect in accordance with its terms and the Optionee
shall be entitled to receive in respect of each Share subject to the Option,
upon exercise of the Option, the same number and kind of stock, securities,
cash, property or other consideration that each holder of a Share was entitled
to receive in the Transaction in respect of a Share.

                                     - 3 -
<PAGE>

            11.  Withholding of Taxes; Non-Qualified Stock Option Treatment

            The Company shall have the right to deduct from any distribution of
cash to the Optionee an amount equal to the federal, state and local income
taxes and other amounts as may be required by law to be withheld (the
"Withholding Taxes") with respect to the Option. If the Optionee is entitled to
receive Shares upon exercise of the Option, the Optionee shall pay the
Withholding Taxes to the Company in cash prior to the issuance of such Shares.
In satisfaction of the Withholding Taxes, the Optionee may make a written
election (the "Tax Election"), which may be accepted or rejected in the
discretion of the Company, to have withheld a portion of the Shares issuable to
him or her upon exercise of the Option, having an aggregate Fair Market Value,
on the date preceding the date of such issuance, equal to the Withholding Taxes.
This Option shall be construed as a non-qualified stock option for purposes of
interpretation under the Internal Revenue Code of 1986, as amended, and the
rules and regulations promulgated thereunder.

            12.  No Assignment.

            Except as otherwise provided herein, the rights of the Optionee
hereunder may not be assigned or otherwise transferred to any other party.

            13.  Modification of Agreement.

            This Agreement may be modified, amended, suspended or terminated,
and any terms or conditions may be waived, but only by a written instrument
executed by the parties hereto.

            14.  Severability.

            Should any provision of this Agreement be held by a court of
competent jurisdiction to be unenforceable or invalid for any reason, the
remaining provisions of this Agreement shall not be affected by such holding and
shall continue in full force in accordance with their terms.

            15.  Successors in Interest.

            This Agreement shall inure to the benefit of and be binding upon any
successor to the Company. This Agreement shall inure to the benefit of the
Optionee's legal representatives. All obligations imposed upon the Optionee and
all rights granted to the Company under this Agreement shall be final, binding
and conclusive upon the Optionee's heirs, executors, administrators and
successors.

                                     - 4 -
<PAGE>

            16.  Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.

            17.  Entire Agreement. This Agreement constitutes the entire
agreement, and supersedes all prior agreements, of the parties hereto relating
to the subject matter hereof, and there are no written or oral terms or
representations made by either party other than those contained herein. This
Agreement cannot be modified, altered or amended except by a writing signed by
all the parties. No waiver by either party of any provision or condition of this
Agreement at any time shall be deemed a waiver of such provision or condition at
any prior or subsequent time or of any other provision or condition at the same
or any prior or subsequent time.

            18.  Governing Law; Arbitration.

            (a)  This Agreement shall be governed by and construed in accordance
with the domestic laws of the State of Nevada without giving effect to any
choice of law or conflict of law provision or rule (whether of the State of
Nevada or any other jurisdiction) that would cause the application of the laws
of any jurisdiction other than the State of Nevada.

            (b)  The parties hereto agree to submit to arbitration any and all
matters in dispute or in controversy among them concerning the terms and
provisions of this Agreement. All such disputes and controversies shall be
determined and adjudged by the decision of an arbitrator (hereinafter sometimes
called the "Arbitrator") selected by mutual agreement of the parties hereto or
if the parties hereto fail to reach agreement on the Arbitrator within ten days
after a party has notified the other of its interest to submit a matter to
arbitration, the Arbitrator shall be selected by the American Arbitration
Association upon application made to it for such purpose by the parties.
Arbitration shall take place in Dallas, Texas or such other place as the parties
hereto may agree in writing. The Arbitrator shall reach and render a decision in
writing with respect to the amount, if any, of payment respecting the disputed
matter. Notwithstanding anything to the contrary herein, in no event will any
award include consequential or punitive damages of any kind or nature. The
arbitration proceedings shall be held in accordance with the applicable rules of
the American Arbitration Association. Any award rendered shall be final and
conclusive upon the parties and adjudgment thereon may be entered in the highest
court of the forum, state or federal, having jurisdiction. The fees and expenses
of the Arbitrator and the respective fees and expenses of the parties hereto in
connection with any such arbitration (including, without limitation, reasonable
fees and expenses of legal counsel and consultants) shall be paid by the party
against whom a decision by the Arbitrator is rendered.

            19.  Notices. Any notice required or permitted under this Agreement
shall be deemed to have been effectively made or given if in writing and
personally delivered, mailed properly addressed in a sealed envelope, postage
prepaid by certified or registered mail, delivered by a reputable overnight
delivery service, in each case with confirmation of receipt. Unless otherwise
changed by notice, notice shall be properly addressed to the Optionee if
addressed to the address of record then on file with the Company; and properly
addressed to the Company if addressed to its registered agent.

                                     - 5 -
<PAGE>

      IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above with the understanding that this Agreement shall
constitute a legal, valid, binding and enforceable obligation of the Company and
the Optionee, respectively.

                                MANCHESTER INC.

                                By:      /s/ Richard Gaines
                                         -----------------------------------
                                         Name: Richard Gaines
                                         Title:  Corporate Secretary

                                OPTIONEE

                                /s/ Lawrence A. Taylor
                                --------------------------------------------
                                Lawrence A. Taylor

                                     - 6 -
<PAGE>

                                 MANCHESTER INC.

                             STOCK OPTION AGREEMENT

                               Notice of Exercise

         Optionee
                  --------------------------------------------------------------

         Number of Shares purchased pursuant
         to Exercise of Option
                               -------------------------------------------------

         Exercise Date
                       ---------------------------------------------------------

         Exercise Price per Share
                                  ----------------------------------------------

         Aggregate Purchase Price
                                  ----------------------------------------------

         Form of Payment
                         -------------------------------------------------------

         By this exercise, the Optionee agrees to (i) promptly provide such
         additional documents as the Company may reasonably require and (ii)
         provide for the payment to the Company (in the manner designated by the
         Company) of tax withholding obligations, if any, relating to the
         exercise of this Option.

         Optionee:
                   -------------------------------------------------------------

                           By:
                               -------------------------------------------------
                                    Name:
                                          --------------------------------------
                                    Title:
                                            ------------------------------------

         Accepted:

         MANCHESTER INC.

                           By:
                               -------------------------------------------------
                                    Name:
                                          --------------------------------------
                                    Title:
                                            ------------------------------------INDEMNIFICATION AGREEMENT

            INDEMNIFICATION AGREEMENT, dated as of April 20, 2006, by and
between MANCHESTER INC., a Nevada corporation (the "Company"), and the director
and/or officer whose name appears on the signature page of this Agreement
("Indemnitee").

                                    RECITALS

            A.   Highly competent persons are becoming more reluctant to serve
as directors or officers or in other capacities unless they are provided with
reasonable protection through insurance or indemnification against risks of
claims and actions against them arising out of their service to and activities
on behalf of the corporations.

            B.   The Board of Directors of the Company (the "Board" or the
"Board of Directors") has determined that the Company should act to assure its
directors and officers that there will be increased certainty of such protection
in the future.

            C.   It is reasonable, prudent and necessary for the Company
contractually to obligate itself to indemnify such persons to the fullest extent
permitted by applicable law so that they will serve or continue to serve the
Company free from undue concern that they will not be so indemnified.

            D.   Indemnitee is willing to serve, to continue to serve and to
take on additional service for or on behalf of the Company on the condition that
Indemnitee be so indemnified.

                                    AGREEMENT

            In consideration of the premises and the covenants contained herein,
the Company and Indemnitee do hereby covenant and agree as follows:

            1.   Definitions. For purposes of this Agreement:

            (a)  "Affiliate" shall mean any corporation, partnership, joint
venture, trust or other enterprise in respect of which the Indemnitee is or was
or will be serving as a director, officer, advisory director or Board Committee
member at the request of the Company, and including, but not limited to, any
employee benefit plan of the Company or any of the foregoing.

            (b)  "Disinterested Director" shall mean a director of the Company
who is not or was not a party to the Proceeding in respect of which
indemnification is being sought by Indemnitee.

            (c)  "Expenses" shall include all attorneys' fees and costs,
retainers, court costs, transcripts, fees of experts, witness fees, travel
expenses, duplicating costs, printing and binding costs, telephone charges,
postage, delivery service fees and all other disbursements or expenses incurred
in connection with asserting or defending claims.

<PAGE>

            (d)  "Independent Counsel" shall mean a law firm or lawyer that
neither is presently nor in the past five years has been retained to represent:
(i) the Company or Indemnitee in any matter material to any such party or (ii)
any other party to the Proceeding giving rise to a claim for indemnification
hereunder. Notwithstanding the foregoing, the term "Independent Counsel" shall
not include any firm or person who, under the applicable standards of
professional conduct then prevailing, would have a conflict of interest in
representing any of the Company or Indemnitee in an action to determine
Indemnitee's right to indemnification under this Agreement. All Expenses of the
Independent Counsel incurred in connection with acting pursuant to this
Agreement shall be borne by the Company.

            (e)  "Losses" shall mean all losses, claims, liabilities, judgments,
fines, penalties and amounts paid in settlement in connection with any
Proceeding.

            (f)  "Proceeding" includes any action, suit, arbitration, alternate
dispute resolution mechanism, investigation, administrative hearing or any other
proceeding whether civil, criminal, administrative or investigative; provided,
however, that the term "Proceeding" shall include any action instituted by an
Indemnitee (other than an action to enforce indemnification rights under this
Agreement) only if such action is authorized by the Board of Directors.

      2.   Service by Indemnitee. Indemnitee agrees to begin or continue to
serve the Company or an Affiliate as a director and/or officer. Notwithstanding
anything contained herein, this Agreement shall not create a contract of
employment between the Company and Indemnitee, and the termination of
Indemnitee's relationship with the Company or an Affiliate by either party
hereto shall not be restricted by this Agreement.

      3.   Indemnification. The Company agrees to indemnify Indemnitee for, and
hold Indemnitee harmless from and against, any Losses or Expenses at any time
incurred by or assessed against Indemnitee arising out of or in connection with
the service of Indemnitee as a director, advisory director, Board Committee
member, officer, employee or agent of the Company or of an Affiliate
(collectively referred to as an "Officer or Director of the Company or of an
Affiliate"), whether the basis of such proceeding is alleged action in an
official capacity or in any other capacity while serving as an Officer or
Director of the Company or of an Affiliate, to the fullest extent permitted by
the laws of the State of Nevada in effect on the date hereof or as such laws may
from time to time hereafter be amended to increase the scope of such permitted
indemnification. Without diminishing the scope of the indemnification provided
by this Section 3, the rights of indemnification of Indemnitee provided
hereunder shall include but shall not be limited to those rights set forth
hereinafter.

      4.   Action or Proceeding Other Than an Action by or in the Right of the
Company. Indemnitee shall be entitled to the indemnification rights provided
herein if Indemnitee is a person who was or is made a party or is threatened to
be made a party to any pending, completed or threatened Proceeding, other than
an action by or in the right of the Company, by reason of (a) the fact that
Indemnitee is or was an Officer or Director of the Company or of an Affiliate or
(b) anything done or not done by Indemnitee in any such capacity. Pursuant to
this Section, Indemnitee shall be indemnified against Losses or Expenses
incurred by Indemnitee or on Indemnitee's behalf in connection with any
Proceeding, if Indemnitee acted in good faith and in a manner Indemnitee
reasonably believed to be in or not opposed to the best interests of the Company
and, with respect to any criminal Proceeding, had no reasonable cause to believe
his conduct was unlawful.

                                       2
<PAGE>

      5.   Actions by or in the Right of the Company. Indemnitee shall be
entitled to the indemnification rights provided herein if Indemnitee is a person
who was or is made a party or is threatened to be made a party to any pending,
completed or threatened Proceeding brought by or in the right of the Company to
procure a judgment in its favor by reason of (a) the fact that Indemnitee is or
was an Officer or Director of the Company or of an Affiliate or (b) anything
done or not done by Indemnitee in any such capacity. Pursuant to this Section,
Indemnitee shall be indemnified against Losses or Expenses actually and
reasonably incurred by Indemnitee or on Indemnitee's behalf in connection with
any Proceeding if Indemnitee acted in good faith and in a manner Indemnitee
reasonably believed to be in or not opposed to the best interests of the
Company. Notwithstanding the foregoing provisions of this Section, no such
indemnification shall be made in respect of any claim, issue or matter as to
which Nevada law expressly prohibits such indemnification by reason of an
adjudication of liability of Indemnitee to the Company; provided, however, that
in such event such indemnification shall nevertheless be made by the Company to
the extent that the courts of the State of Nevada or the court in which such
action or suit was brought shall determine equitable under the circumstances.

      6.   Indemnification for Losses and Expenses of Party Who is Wholly or
Partly Successful. Notwithstanding any provision of this Agreement, to the
extent that Indemnitee has been wholly successful on the merits or otherwise
absolved in any Proceeding on any claim, issue or matter, Indemnitee shall be
indemnified against all Losses or Expenses actually and reasonably incurred by
Indemnitee or on Indemnitee's behalf in connection therewith. If Indemnitee is
not wholly successful in such Proceeding but is successful, on the merits or
otherwise, as to one or more but less than all claims, issues or matters in such
Proceeding, the Company agrees to indemnify Indemnitee, to the maximum extent
permitted by law, against all Losses and Expenses incurred by Indemnitee in
connection with each successfully resolved claim, issue or matter. In any review
or Proceeding to determine the extent of indemnification, the Company shall bear
the burden of proving any lack of success and which amounts sought in indemnity
are allocable to claims, issues or matters which were not successfully resolved.
For purposes of this Section and without limitation, the termination of any such
claim, issue or matter by dismissal with or without prejudice shall be deemed to
be a successful resolution as to such claim, issue or matter.

      7.   Payment for Expenses of a Witness. Notwithstanding any other
provision of this Agreement, to the extent that Indemnitee is, by reason of the
fact that Indemnitee is or was an Officer or Director of the Company or of an
Affiliate, a witness in any Proceeding, the Company agrees to pay to Indemnitee
all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee's
behalf in connection therewith.

                                       3
<PAGE>

      8.   Advancement of Expenses and Costs. All Expenses incurred by or on
behalf of Indemnitee (or reasonably expected by Indemnitee to be incurred by
Indemnitee within three months) in connection with any Proceeding shall be paid
promptly by the Company, and in any event in advance of the final disposition of
such Proceeding within five (5) business days after the receipt by the Company
of a statement or statements from Indemnitee requesting from time to time such
advance or advances, whether or not a determination to indemnify has been made
under Section 9. Such statement or statements shall evidence such Expenses
incurred (or reasonably expected to be incurred) by Indemnitee in connection
therewith and shall include or be accompanied by a written undertaking by or on
behalf of Indemnitee to repay such amount if it shall ultimately be determined
that Indemnitee is not entitled to be indemnified therefor pursuant to the terms
of this Agreement. The right to indemnification of advances as granted by this
Section 8 shall be enforceable by the director or officer in any court of
competent jurisdiction, if the Company denies such request, in whole or in part,
or if no disposition thereof is made within five (5) business days. Such
person's costs and expenses incurred in connection with successfully
establishing his/her right to indemnification, in whole or in part, in any such
action shall also be indemnified by the Company. It shall be a defense to any
such action seeking an adjudication or award in arbitration pursuant to this
Agreement (other than an action brought to enforce a claim for the advance of
costs, charges and expenses under this Section 8 where the required undertaking,
if any, has been received by the Company) that the claimant has not met the
standard of conduct set forth in the laws of Nevada, as the same exists or
hereafter may be amended (but, in the case of any such amendment, only to the
extent that such amendment permits the Company to provide broader
indemnification rights than said law permitted the Company to provide prior to
such amendment), but the burden of proving such defense shall be on the Company.
Neither the failure of the Company (including its Board of Directors, its
independent legal counsel and its stockholders) to have made a determination
prior to the commencement of such action that indemnification of the claimant is
proper in the circumstances because he/she has met the applicable standard of
conduct set forth in the laws of Nevada, as the same exists or hereafter may be
amended (but, in the case of any such amendment, only to the extent that such
amendment permits the Company to provide broader indemnification rights that
said law permitted the Company to provide prior to such amendment), nor the fact
that there has been an actual determination by the Company (including its Board
of Directors, its independent legal counsel and its stockholders) that the
claimant has not met such applicable standard of conduct, shall be a defense to
any action brought by Indemnitee in respect of the Company's obligation to
advance payment for coverage of Expenses or create a presumption that Indemnitee
has not met the applicable standard of conduct.

      9.   Procedure for Determination of Entitlement to Indemnification. (a)
When seeking indemnification under this Agreement (which shall not include in
any case the right of Indemnitee to receive payments pursuant to Section 7 and
Section 8 hereof, which shall not be subject to this Section 9), Indemnitee
shall submit a written request for indemnification to the Company. Such request
shall include documentation or information which is reasonably necessary for the
Company to make a determination of Indemnitee's entitlement to indemnification
hereunder and which is reasonably available to Indemnitee. Determination of
Indemnitee's entitlement to indemnification shall be made promptly, but in no
event later than 60 days after receipt by the Company of Indemnitee's written
request for indemnification. The Secretary of the Company shall, promptly upon
receipt of Indemnitee's request for indemnification, advise the Board that
Indemnitee has made such request for indemnification.

                                       4
<PAGE>

            (b)  The entitlement of Indemnitee to indemnification under this
Agreement in respect of any pending, contemplated or threatened Proceeding shall
be determined in the specific case by (a) the Board of Directors by a majority
vote of those directors who were not party to such Proceeding, whether or not
they constitute a quorum of the Board of Directors, or (b) if such a quorum is
not obtainable, or if a quorum of disinterested directors so directs, by
Independent Counsel in a written opinion, or (c) by the stockholders.

            (c)  In the event the determination of entitlement is to be made by
Independent Counsel, such Independent Counsel shall be selected by the Board and
approved by Indemnitee. Upon failure of the Board and the Board of Directors to
so select such Independent Counsel or upon failure of Indemnitee to so approve,
such Independent Counsel shall be selected by the President of the Association
of the Bar of the City of New York.

            (d)  If the determination made pursuant to Section 9(b) is that
Indemnitee is not entitled to indemnification to the full extent of Indemnitee's
request, Indemnitee shall have the right to seek entitlement to indemnification
in accordance with the procedures set forth in Section 10 hereof.

            (e)  If the person or persons empowered pursuant to Section 9(b)
hereof to make a determination with respect to entitlement to indemnification
shall have failed to make the requested determination within 60 days after
receipt by the Company of such request, the requisite determination of
entitlement to indemnification shall be deemed to have been made and Indemnitee
shall be absolutely entitled to such indemnification, absent (i)
misrepresentation by Indemnitee of a material fact in the request for
indemnification or (ii) a final judicial determination that all or any part of
such indemnification is expressly prohibited by law.

            (f)  The termination of any Proceeding by judgment, order,
settlement or conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, adversely affect the rights of Indemnitee to
indemnification hereunder, except as may be specifically provided herein, or
create a presumption that Indemnitee did not act in good faith and in a manner
which Indemnitee reasonably believed to be in or not opposed to the best
interests of the Company or create a presumption that (with respect to any
criminal action or Proceeding) Indemnitee had reasonable cause to believe that
Indemnitee's conduct was unlawful.

            (g)  For purposes of any determination of good faith hereunder,
Indemnitee shall be deemed to have acted in good faith if in taking an action
Indemnitee relied on the records or books of account of the Company or an
Affiliate, including financial statements, or on information supplied to
Indemnitee by the officers of the Company or an Affiliate in the course of their
duties, or on the advice of legal counsel for the Company or an Affiliate or on
information or records given or reports made to the Company or an Affiliate by
an independent certified public accountant or by an appraiser or other expert
selected with reasonable care by the Company or an Affiliate. The Company shall
have the burden of establishing the absence of good faith. The provisions of
this Section 9(g) shall not be deemed to be exclusive or to limit in any way the
other circumstances in which the Indemnitee may be deemed to have met the
applicable standard of conduct set forth in this Agreement.

                                       5
<PAGE>

            (h)  The knowledge and/or actions, or failure to act, of any
director, officer, agent or employee of the Company or an Affiliate shall not be
imputed to Indemnitee for purposes of determining the right to indemnification
under this Agreement.

      10.  Remedies in Cases of Determination Not to Indemnify or to Advance
Expenses. (a) In the event that (i) a determination is made that Indemnitee is
not entitled to indemnification hereunder, (ii) advances are not made pursuant
to Section 8 hereof or (iii) payment has not been timely made following a
determination of entitlement to indemnification pursuant to Section 9 hereof,
Indemnitee shall be entitled to seek an adjudication in an appropriate court of
the State of Nevada or any other court of competent jurisdiction as to
Indemnitee's entitlement to such indemnification or advance.

            (b)  In the event a determination has been made in accordance with
the procedures set forth in Section 9 hereof, in whole or in part, that
Indemnitee is not entitled to indemnification, any judicial proceeding or
arbitration referred to in paragraph (a) of this Section 10 shall be de novo and
Indemnitee shall not be prejudiced by reason of any such prior determination
that Indemnitee is not entitled to indemnification, and the Company shall bear
the burdens of proof specified in paragraphs 6 and 9 hereof in such proceeding.

            (c)  If a determination is made or deemed to have been made pursuant
to the terms of Section 9 or 10 hereof that Indemnitee is entitled to
indemnification, the Company shall be bound by such determination in any
judicial proceeding or arbitration in the absence of (i) a misrepresentation of
a material fact by Indemnitee or (ii) a final judicial determination that all or
any part of such indemnification is expressly prohibited by law.

            (d)  The Company and Indemnitee agree that they shall be precluded
from asserting that the procedures and presumptions of this Agreement are not
valid, binding and enforceable. The Company and Indemnitee further agree to
stipulate in any such court that the Company and Indemnitee are bound by all of
the provisions of this Agreement and are precluded from making any assertion to
the contrary.

            (e)  To the extent deemed appropriate by the court, interest shall
be paid by the Company to Indemnitee at a reasonable interest rate for amounts
which the Company indemnifies or is obliged to indemnify the Indemnitee for the
period commencing with the date on which Indemnitee requested indemnification
(or reimbursement or advance of an Expense) and ending with the date on which
such payment is made to Indemnitee by the Company.

      11.  Expenses Incurred by Indemnitee to Enforce this Agreement. All
Expenses incurred by Indemnitee in connection with the preparation and
submission of Indemnitee's request for indemnification hereunder shall be borne
by the Company. In the event that Indemnitee is a party to or intervenes in any
proceeding in which the validity or enforceability of this Agreement is at issue
or seeks an adjudication to enforce Indemnitee's rights under, or to recover
damages for breach of, this Agreement, Indemnitee, if Indemnitee prevails in
whole in such action, shall be entitled to recover from the Company, and shall
be indemnified by the Company against, any Expenses incurred by Indemnitee. If
it is determined that Indemnitee is entitled to indemnification for part (but
not all) of the indemnification so requested, Expenses incurred in seeking
enforcement of such partial indemnification shall be reasonably prorated among
the claims, issues or matters for which the Indemnitee is entitled to
indemnification and for claims, issues or matters for which the Indemnitee is
not so entitled.

                                       6
<PAGE>

      12.  Non-Exclusivity. The rights of indemnification and to receive
advances as provided by this Agreement shall not be deemed exclusive of any
other rights to which Indemnitee may at any time be entitled under or by reason
of applicable law, any certificate of incorporation or by-laws, any agreement,
any vote of stockholders or any resolution of directors or otherwise. To the
extent Indemnitee would be prejudiced thereby, no amendment, alteration,
rescission or replacement of this Agreement or any provision hereof shall be
effective as to Indemnitee with respect to any action taken or omitted by such
Indemnitee in Indemnitee's position with the Company or an Affiliate or any
other entity which Indemnitee is or was serving at the request of the Company
prior to such amendment, alteration, rescission or replacement.

      13.  Duration of Agreement. This Agreement shall apply to any claim
asserted and any Losses and Expenses incurred in connection with any claim
asserted on or after the effective date of this Agreement and shall continue
until and terminate upon the later of: (a) 10 years after Indemnitee has ceased
to occupy any of the positions or have any of the relationships described in
Sections 3, 4 or 5 of this Agreement; or (b) one year after the final
termination of all pending or threatened Proceedings of the kind described
herein with respect to Indemnitee. This Agreement shall be binding upon the
Company and its successors and assigns and shall inure to the benefit of
Indemnitee and Indemnitee's spouse, assigns, heirs, devisee, executors,
administrators or other legal representatives.

      14.  Severability. Should any part, term or condition hereof be declared
illegal or unenforceable or in conflict with any other law, the validity of the
remaining portions or provisions of this Agreement shall not be affected
thereby, and the illegal or unenforceable portions of the Agreement shall be and
hereby are redrafted to conform with applicable law, while leaving the remaining
portions of this Agreement intact.

      15.  Counterparts. This Agreement may be executed in several counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same document.

      16.  Headings. Section headings are for convenience only and do not
control or affect meaning or interpretation of any terms or provisions of this
Agreement.

      17. Modification and Waiver. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by each of the
parties hereto.

      18.  No Duplicative Payment. The Company shall not be liable under this
Agreement to make any payment of amounts otherwise indemnifiable hereunder if
and to the extent that Indemnitee has otherwise actually received such payment
(net of Expenses incurred in collecting such payment) under this Agreement, any
insurance policy, contract, agreement or otherwise.

                                       7
<PAGE>

      19.  Notices. All notices, requests, demands and other communications
provided for by this Agreement shall be in writing (including telecopier or
similar writing) and shall be deemed to have been given at the time when mailed
in a registered or certified postpaid envelope in any general or branch office
of the United States Postal Service, or sent by Federal Express or other similar
overnight courier service, addressed to the address of the parties stated below
or to such changed address as such party may have fixed by notice or, if given
by telecopier, when such telecopy is transmitted and the appropriate answer back
is received.

            (a) If to  Indemnitee,  to the  address  of  record on file with the
            Company.

            (b) If to the Company to:

                  MANCHESTER INC.
                  100 Crescent Court, 7th Floor
                  Dallas, Texas 75201

            with a copy to:

                  Wuersch & Gering LLP
                  100 Wall Street, 21st Floor
                  New York, NY 10005
                  Attention:  Travis L. Gering, Esq.
                  Phone:  (212) 509-5050
                  Fax:      (212) 509-9559

      20.  GOVERNING LAW. THE PARTIES AGREE THAT THIS AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF
THE STATE OF NEVADA WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAWS PRINCIPLES
THEREOF.

      21.  Entire Agreement. Subject to the provisions of Section 12 hereof,
this Agreement constitutes the entire understanding between the parties and
supersedes all proposals, commitments, writings, negotiations and
understandings, oral and written, and all other communications between the
parties relating to the subject matter of this Agreement. This Agreement may not
be amended or otherwise modified except in writing duly executed by all of the
parties. A waiver by any party of any breach or violation of this Agreement
shall not be deemed or construed as a waiver of any subsequent breach or
violation thereof.

                           [Signature Page to follow]

                                       8
<PAGE>

            IN WITNESS WHEREOF, the parties hereto have executed this
Indemnification Agreement as of the date first above written.

                            MANCHESTER INC.

                               By:  /s/ Richard Gaines
                                    --------------------------------------------
                                    Name:  Richard Gaines
                                    Title: Corporate Secretary and Director

                            INDEMNITEE:

                            /s/ Lawrence A. Taylor
                            ----------------------------------------------------
                            Name:  Lawrence A. Taylor
                            Title: Consultant/Chief Financial Officer
                                   (effective upon issuance of
                                   Directors and Officers Insurance)

                                       9

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