Document:

THE PROJECT GROUP,INC.

                                November 24, 2004

TO: The Holders Identified on Schedule A

RE: Exercise Price Modification and Anti-dilution Rights

Dear Holders:

Reference is made to the Series B 4% Redeemable Preferred Stock ("Series B
Preferred Stock") and Common Stock Purchase Warrants (the "Warrants"), described
on Schedule A hereto, issued by The Project Group, Inc., a Nevada corporation
(the "Company") to the Holders identified on Schedule A hereto on or about March
9, 2004 pursuant to and in connection with a certain Securities Purchase
Agreement. Pursuant to the Certificate of Designation, Preferences and Rights
and Number of Shares of Series B 4% Redeemable Preferred Stock ("Certificate of
Designation"), each of the Holders of Series B Preferred Stock was granted the
right to convert such Series B Preferred Stock into Common Stock of the Company.
Pursuant to the Warrants, each of the Holders was granted the right, subject to
terms and conditions of the Warrant, to purchase shares of Common Stock of the
Company.

WHEREAS, the Company has determined that it is in the Company's best interests
to modify the terms of the Series B Preferred Stock and Warrants.

It is now therefore agreed by the Company and the Holders, for good and valuable
consideration, receipt of which is acknowledged, that:

      1.    The Exercise Price, as defined in the Warrants, is reduced to $0.05,
            subject to further adjustment as described in the Warrants.

      2.    The Holders agree to provide, within one week from date hereof, an
            aggregate of $100,000 in new funding to the Company in the form of
            convertible preferred stock (the "New Preferred Stock") having terms
            substantially identical to the Series B Preferred Stock, as set
            forth in the Certificate of Designation, except that the conversion
            price of such newly issued preferred stock into common stock of the
            Company shall be $.04 per share. The New Preferred Stock shall have
            "piggy back" registration rights. Neither the issue of New Preferred
            Stock, nor any prior issue, shall trigger a reduction in price of
            the conversion price of the Series B Preferred.

      3.    The Certificate of Designation (excluding the Certificate of
            Designation applying to the New Preferred Stock issuable pursuant to
            paragraph 2 above) shall be amended to add a provision such that,
            (A) if the Company shall, without the prior written consent of all
            of the Holders, other than in a

<PAGE>

            Permitted Issuance (as defined below), issue any common stock, or
            securities convertible into or exercisable for common stock (or
            modify any convertible or exercisable securities that may be
            outstanding), at a price per share, or bearing a conversion or
            exercise price per share, less than the then applicable conversion
            price of the Series B Preferred Stock (the "Preferred Stock
            Conversion Price"), then, on each such occasion, the Preferred Stock
            Conversion Price shall be automatically and immediately reduced to
            such lower price per share. For purposes hereof, "Permitted
            Issuances" that shall be excluded from adjustment to the Preferred
            Stock Conversion Price under this paragraph shall mean (i) issuances
            of securities (a) in full or partial consideration in connection
            with a strategic merger, consolidation or purchase of substantially
            all of the securities or assets of corporation or other entity, (b)
            as has been described in the reports filed with the Securities and
            Exchange Commission prior to the date hereof, (c) pursuant to the
            conversion or exercise of presently outstanding preferred stock,
            warrants, options or other convertible securities, and (d) for
            services, and (ii) issuances of warrants or options exercisable at
            prices not less than 80% of market price at the time of issuance
            provided that such warrants or options are issued for recruiting and
            other internal corporate purposes other than in capital raising
            transactions; and (B) upon notification to the Holders by Series A
            Preferred Shareholders ("Series A Holders") of their conversion, in
            whole, of Series A Preferred Stock into common stock, all Series B
            Preferred Stock shall be immediately and automatically converted
            into common shares by instruction to the transfer agent by the
            Company. The Series A Holders shall be prohibited from converting
            their shares into common stock or waiving their non dilution right
            for one year from this date, and in the event the Series A Holders
            waive, in whole, their non dilution rights under the Series A
            Preferred Stock without conversion into common shares, on and after
            that waiver, the Series B Holders shall lose any rights in this
            paragraph 3 relative to reduction of the Preferred Stock Conversion
            Price.

      4.    The Redemption Trigger Price of $0.60 stated in Section 13 of the
            Warrant is reduced to $0.14.

      5.    All terms employed in this letter, unless otherwise defined here,
            shall have the same meanings attributed to them in the Certificate
            of Designation, Preferred Stock and Warrants.

      6.    Except as modified herein, the Certificate of Designation, Preferred
            Stock, Warrants and documents delivered in connection therewith
            remain in full force and affect.

      7.    This letter constitutes the binding obligation of the Company and
            the Holder.

      8.    Both parties agree to hold each other harmless for any prior acts to
            the date of this release.

<PAGE>

      9.    In lieu of the Company reissuing Warrant certificates reflecting the
            reduced Conversion Rate and Exercise Price, a copy of this letter
            appended to the Warrant shall be deemed sufficient to evidence the
            reduction of the Exercise Rate. The Company shall, as soon as
            practical, prepare and file with the State of Nevada a certificate
            of designation reflecting the terms of the New Preferred Stock
            issuable pursuant to paragraph 2 hereof and an amended Certificate
            of Designation reflecting the revised terms of the Series B
            Preferred Stock. Pending the filing of those certificates of
            designation, this letter will be deemed sufficient evidence of the
            matters described herein relative to the preferred stock issuable
            pursuant to paragraph 2 and the amendment of the Series B Preferred
            Stock.

      10.   One member of the board of directors shall resign and a new member,
            designated in a writing signed by a majority in interest of the
            Holders, shall be appointed for a minimum two (2) year term.

THE PROJECT GROUP, INC.

By:
    ------------------------------

HOLDERS:

------------------------
------------

------------------------
------------THIS DEBENTURE HAS BEEN ACQUIRED FOR INVESTMENT PURPOSES ONLY AND NEITHER THIS
DEBENTURE NOR THE SECURITIES ISSUABLE UPON CONVERSION OF THIS DEBENTURE HAS BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR UNDER ANY APPLICABLE STATE SECURITIES LAWS. NEITHER THIS DEBENTURE NOR THE
SECURITIES ISSUABLE UPON CONVERSION OF THIS DEBENTURE MAY BE SOLD OR OTHERWISE
TRANSFERRED OR PLEDGED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION OR EXCLUSION FROM
THE REGISTRATION REQUIREMENTS THEREUNDER AND IN COMPLIANCE WITH APPLICABLE STATE
SECURITIES LAWS.

                                                                        $335,000

                             THE PROJECT GROUP, INC.

                            12% CONVERTIBLE DEBENTURE

      Section 1. General.

            For value received, The Project Group, Inc., a Nevada corporation
(the "PAYOR"), hereby promises to pay to the order of Corporate Strategies,
Inc., or assigns (the "PAYEE"), the principal amount of THREE HUNDRED THIRTY
FIVE THOUSAND DOLLARS AND ZERO CENTS ($335,000) plus interest accrued thereon,
as provided in this convertible debenture (the "DEBENTURE"). Except as provided
for herein, all payments required to be made hereunder, if any, shall be made in
such coin or currency of the United States of America as at the time of payment
shall be legal tender therein for the payment of public and private debts.

      Section 2. Computation of Interest.

            Interest shall accrue on the unpaid balance of the principal amount
of this Debenture (without any compounding) from and including the date hereof
to, but excluding, the date on which the principal amount of this Debenture is
paid in full (or converted in accordance with Section 13 hereof) at a rate per
annum (computed on the basis of a 360-day year and the actual number of days
elapsed)(the "INTEREST RATE") equal to twelve percent (12%).

      Section 3. Payment of Principal and Interest.

            (a) Interest accruing on this Debenture shall be payable in monthly
      installments on the last day of each calendar month (or, if such date is a
      Saturday, Sunday or legal holiday in the State of Texas, on the first
      business day thereafter)(each such date being referred to as an "INTEREST
      PAYMENT DATE"). The Payee may, at its option and by written notice given
      at least five business days prior to any Interest Payment Date (each such
      notice being referred to as a "SHARE INTEREST ELECTION NOTICE"), require
      that accrued interest otherwise required to be paid hereunder be paid in
      the form of shares of common stock (the "INTEREST SHARES") of Pro Squared,
      Inc. ("PRO SQUARED") held by the Corporation at the rate of one percent
      (1%) of the outstanding shares of Pro Squared common stock, measured as of
      October 14, 2004, for each $3,350 of accrued interest for which a Share
      Interest Election Notice is given. In the event that the Payee gives a
      Share Interest Election Notice and the Corporation does not, at that time,
      hold adequate shares of common stock of Pro Squared to deliver the
      Interest Shares required to be delivered pursuant to that Share Interest
      Election Notice, the Corporation shall cause Pro Squared to issue to the
      Payee sufficient additional shares of common stock of Pro Squared to
      satisfy the obligation of the Corporation to deliver Interest Shares
      pursuant to that notice.

                                      -1-
<PAGE>

            (b) If not prepaid by the Payor in accordance with Section 4,
      converted by the Payee in accordance with Section 13, or called for
      Non-Cash Prepayment by the Payee in accordance with Section 3(c), the
      principal of, and accrued but unpaid interest on, this Debenture shall be
      payable two year from the date hereof (the "MATURITY DATE") by wire
      transfer of immediately available funds to the account of the Payee, or by
      certified or official bank check payable to the Payee mailed to the Payee
      at the address of the Payee designated in Section 12.

            (c) Unless earlier prepaid or converted, on and after the first
      anniversary of the date hereof (the "NON-CASH PREPAYMENT TRIGGER DATE"),
      the Payee shall have the right to cause this Debenture to be prepaid (a
      "NON-CASH PREPAYMENT"), in part or in whole, by the Corporation for the
      Non-Cash Prepayment Price (as defined below), or a pro rata portion of the
      Non-Cash Prepayment Price equal to the proportion of the Debenture to be
      prepaid hereunder. The term "NON-CASH PREPAYMENT PRICE" shall mean a
      number of shares of common stock of Pro Squared which, when added to the
      Interest Shares delivered pursuant to Section 3(a), represents 67% of the
      issued and outstanding shares of common stock of Pro Squared at the time
      of determination of the Non-Cash Prepayment Price; provided, however, that
      where less than the entire original principal amount of the Debenture is
      to be prepaid pursuant to this Section 3(c), the Non-Cash Prepayment Price
      shall be reduced proportionally. The Payee may, at its option, require the
      Corporation to affect a Non-Cash Prepayment by providing written notice
      requesting a Non-Cash Prepayment and setting out the principal amount of
      the Debenture to be so prepaid (each such notice being referred to as a
      "NON-CASH PREPAYMENT NOTICE"), in which case the Corporation shall deliver
      to the holders the Non-Cash Prepayment Price not later than ten business
      days following delivery of the Non-Cash Prepayment Notice. In the event
      that the Payee gives a Non-Cash Prepayment Notice and the Corporation does
      not, at that time, hold adequate shares of common stock of Pro Squared to
      deliver the Non-Cash Prepayment Price required to be delivered pursuant to
      that Non-Cash Prepayment Notice, the Corporation shall cause Pro Squared
      to issue to the Payee sufficient additional shares of common stock of Pro
      Squared to satisfy the obligation of the Corporation to deliver the
      Non-Cash Prepayment Price pursuant to that notice.

      Section 4. Prepayment.

            This Debenture may be prepaid in whole or in part prior to the
Maturity Date at the sole election of the Payor; provided, however, that, except
as otherwise provided herein, any prepayment of this Debenture shall be subject
to payment of an early payment premium in an amount equal to twenty percent
(20%) of the principal amount so prepaid.

                                      -2-
<PAGE>

      Section 5. Defaults.

            Upon the occurrence of any of the following events, the entire
unpaid principal of this Debenture, together with all accrued interest hereon,
shall become immediately due and payable, and the Payee shall be entitled to
pursue all remedies that the Payee may have, at law or in equity, for the
enforcement and collection hereof:

            (a) The failure by Payor to make full payment of all interest and
      principal due on this Debenture on any Interest Payment Date or the
      Maturity Date, as appropriate; or

            (b) Any assignment for the benefit of Payor's creditors, filing of a
      petition in bankruptcy, consent to entry of an order for relief against it
      in an involuntary case, filing of a petition or application to any
      tribunal for the appointment of any receiver, trustee or similar official
      for it or a substantial part of its assets, or commencement of any
      proceedings under any bankruptcy, reorganization, arrangement,
      readjustment of debt, dissolution or liquidation law or statute of any
      jurisdiction, whether now or hereafter in effect; any adjudication of
      insolvency or bankruptcy of Payor, or the appointment of a receiver,
      trustee, assignee, liquidator, custodian or similar official of it or a
      substantial part of its assets, or the filing against Payor of any such
      petition or application, or the commencement of any such proceeding
      against it, which remains undismissed for a period of sixty (60) days or
      more; or

            (c) The entry by a court of competent jurisdiction of an order or
      decree under any bankruptcy law for relief against the Payor in an
      involuntary case, or for appointment of a receiver, trustee, assignee,
      liquidator or similar official of the Payor, or for any substantial part
      of its property, or an order for the liquidation of the Payor; where any
      such order or decree remains unstayed and in effect for thirty (30) days.

      Section 6. Defenses.

            The obligations of the Payor under this Debenture shall not be
subject to reduction, limitation, impairment, termination, defense, set-off,
counterclaim or recoupment for any reason.

      Section 7. Exchange or Replacement of Debenture.

            (a) The Payee may, at its option, in person or by duly authorized
      attorney, surrender this Debenture for exchange, at the principal business
      office of the Payor, and receive in exchange therefore, a new Debenture in
      the same principal amount as the unpaid principal amount of this Debenture
      and bearing interest at the same annual rate as this Debenture, each such
      new Debenture to be dated as of the date of this Debenture and to be in
      such principal amount as remains unpaid and payable to such person or
      persons, or order, as the Payee may designate in writing.

                                      -3-
<PAGE>

            (b) Upon receipt by the Payor of evidence satisfactory to it of the
      loss, theft, destruction, or mutilation of this Debenture and (in the case
      of loss, theft or destruction) of an indemnity reasonably satisfactory to
      it, and upon surrender and cancellation of this Debenture, if mutilated,
      the Payor will deliver a new Debenture of like tenor in lieu of this
      Debenture. Any Debenture delivered in accordance with the provisions of
      this Section 7 shall be dated as of the date of this Debenture.

      Section 8. Attorneys' and Collection Fees.

            Should the indebtedness evidenced by this Debenture or any part
hereof be collected at law or in equity or in bankruptcy, receivership or other
court proceedings, the Payor agrees to pay, in addition to the principal and
interest due and payable hereon, all costs of collection, including reasonable
attorneys' fees and expenses, incurred by the Payee in collecting or enforcing
this Debenture.

      Section 9. Waivers.

            The Payor hereby waives presentment, demand for payment, notice of
dishonor, notice of protest and all other notices or demands in connection with
the delivery, acceptance, performance or default of this Debenture. No delay by
the Payee in exercising any power or right hereunder shall operate as a waiver
of any power or right, nor shall any single or partial exercise of any power or
right preclude other or further exercise thereof, or the exercise thereof, or
the exercise of any other power or right hereunder or otherwise; and no waiver
whatsoever or modification of the terms hereof shall be valid unless set forth
in writing by the Payee and then only to the extent set forth therein.

      Section 10. Amendments.

            This Debenture may not be amended without the express written
consent of both the Payor and the Payee.

      Section 11. Governing Law.

            This Debenture is made and delivered in, and shall be governed by
and construed in accordance with the laws of the State of Texas (without giving
effect to principles of conflicts of laws of the State of Texas or any other
state). Any action to enforce the terms of this Debenture shall be exclusively
brought in the state and/or federal courts in Harris County, Texas.

      Section 12. Notices.

            All notices, requests, demands and other communications to any party
hereunder shall be in writing (including facsimile or similar writing) and shall
be given to such party at its address or facsimile number set forth below or
such other address or facsimile number as such party may hereafter specify by
notice to the other parties listed below:

                                      -4-
<PAGE>

            (a)   If to Payor:   The Project Group, Inc.
                                 333 N. Sam Houston Pkwy E., Suite 275
                                 Houston, Texas 77060
                                 Attention:  Craig Crawford
                                 Facsimile:  281-445-3373

            (b)   If to Payee:   Corporate Strategies, Inc.
                                 1770 St. James Place, Suite 116
                                 Houston, Texas 77056
                                 Attention:  Tim Connolly

Each such notice, request or other communication shall be effective (i) upon
receipt (provided, however, that notices received on a Saturday, Sunday or legal
holiday or after 5:00 p.m. on any other day will be deemed to have been received
on the next business day), if given by legible facsimile transmission with proof
from sender of confirmation of receipt, or (ii) if given by any other means,
when delivered at the address specified in this Section 12.

      Section 13. Conversion.

            (a) Conversion Rights. Subject to Payor's right to prepay, in part
or in whole, the Debenture in the manner described in Section 4, which right
shall continue for a period of ten calendar days following a Conversion Notice
(as defined below), Payee shall have the right to convert the Debenture into
shares of common stock (the "COMMON STOCK") of the Payor at a rate (the
"CONVERSION RATE") determined by dividing the principal amount so converted by
the product determined by multiplying (i) 75% by (ii) the average of the lowest
five closing prices of the Common Stock over the twenty trading days immediately
preceding the delivery of a Conversion Notice.

            (b) Mechanics of Conversion. The Payee may exercise the conversion
right specified above by surrendering to the Corporation the Debenture,
accompanied by a notice (a "CONVERSION NOTICE") specifying the principal amount
of the Debenture to be converted; provided that the Corporation shall not be
obligated to issue to any certificates evidencing the shares of Common Stock
issuable upon such conversion unless the Debenture is delivered to the
Corporation. Conversion of the Debenture may be exercised in whole or in part by
the Payee by faxing an executed and completed notice of conversion to the
Corporation and delivering the original notice of conversion and the Debenture
to the Corporation by express courier within three (3) business days of
exercise. Conversion shall be deemed to have been effected on the date when
delivery of the Conversion Notice and the Debenture are delivered to the
Corporation and such date is referred to herein as the "CONVERSION DATE".
Subject to the provisions of subparagraph 13(d)(iv) and the prepayment rights of
the Payor, as promptly as practicable thereafter, the Corporation shall issue
and deliver to the Payee the number of full shares of Common Stock to which the
Payee is entitled. Subject to the provisions of subparagraph 13(d)(iv), the
Payee shall be deemed to have become a holder of record of such Common Stock on
the applicable Conversion Date. Upon conversion of only a portion of the
outstanding principal amount covered by the Debenture, the Corporation shall
issue and deliver to or upon the written order of the Payee, at the expense of
the Corporation, a new Debenture evidencing the then unpaid and unconverted
principal balance of the Debenture.

                                      -5-
<PAGE>

            (c) Fractional Shares. No fractional shares of Common Stock or scrip
shall be issued upon conversion of this Debenture. Instead of any fractional
shares of Common Stock that would otherwise be issuable upon conversion of any
portion of this Debenture, the number of shares issuable upon conversion will be
rounded up to the nearest whole share.

            (d) Conversion Rate Adjustments. The Conversion Rate shall be
subject to adjustment from time to time as follows:

            (i) Stock Dividends, Subdivisions, Reclassifications or
      Combinations. If the Corporation shall (A) declare a dividend or make a
      distribution on its Common Stock in shares of its Common Stock, (B)
      subdivide or reclassify the outstanding shares of Common Stock into a
      greater number of shares, or (C) combine or reclassify the outstanding
      Common Stock into a smaller number of shares, the Conversion Rate in
      effect at the time of the record date for such dividend or distribution or
      the effective date of such subdivision, combination or reclassification
      shall be proportionately adjusted so that the Payee, after such date,
      shall be entitled to receive the number of shares of Common Stock which he
      would have owned or been entitled to receive had such Debenture been
      converted immediately prior to such date. Successive adjustments in the
      Conversion Rate shall be made whenever any event specified above shall
      occur.

            (ii) Other Distributions. In case the Corporation shall fix a record
      date for the making of a distribution to all holders of shares of its
      Common Stock (A) of shares of any class other than its Common Stock or (B)
      of evidence of indebtedness of the Corporation or any Subsidiary or (C) of
      assets (excluding cash dividends or distributions, and dividends or
      distributions referred to in the foregoing paragraph), or (D) of rights or
      warrants, the Payee shall, upon the exercise of his right to convert after
      such record date, receive, in addition to the shares of Common Stock to
      which he is entitled, the amount of such shares, indebtedness or assets
      (or, at the option of the Corporation, the sum equal to the value thereof
      at the time of distribution as determined by the Board of Directors in its
      sole discretion) that would have been distributed to such holder if he had
      exercised his right to convert immediately prior to the record date for
      such determination.

            (iii) Consolidation, Merger, Sale, Lease or Conveyance. In case of
      any consolidation with or merger of the Corporation with or into another
      corporation, or in case of any sale, lease or conveyance to another
      corporation of the assets of the Corporation or substantially all of its
      assets, this Debenture shall after the date of such consolidation, merger,
      sale, lease or conveyance be convertible into the number of shares of
      stock or other securities or property (including cash) to which the Common
      Stock issuable (at the time of such consolidation, merger, sale, lease or
      conveyance) upon conversion of this Debenture would have been entitled
      upon such consolidation, merger, sale, lease or conveyance; and in any
      such case, if necessary, the provisions set forth herein with respect to
      the rights and interests thereafter of the Payee shall be appropriately
      adjusted so as to be applicable, as nearly as may reasonably be, to any
      shares of stock or other securities or property thereafter deliverable on
      the conversion of this Debenture.

                                      -6-
<PAGE>

            (iv) Timing of Issuance of Additional Common Stock Upon Certain
      Adjustments. In any case in which the provisions of this subparagraph (d)
      shall require that any adjustment shall become effective immediately after
      a record date for an event, the Corporation may defer until the occurrence
      of such event, issuing to the Payee, with respect to any portion of this
      Debenture converted after such record date and before the occurrence of
      such event the additional shares of Common Stock issuable upon such
      conversion by reason of the adjustment required by such event over and
      above the shares of Common Stock issuable upon such conversion before
      giving effect to such adjustment.

            (e) Statement Regarding Adjustments. Whenever the Conversion Rate
shall be adjusted as provided in subparagraph 13(d), the Corporation shall
forthwith file, at the office of any transfer agent Debenture and at the
principal office of the Corporation, a statement showing in detail the facts
requiring such adjustment and the Conversion Rate that shall be in effect after
such adjustment, and the Corporation shall also cause a copy of such statement
to be sent by first class mail, postage prepaid, to the Payee. Such copy may be
included as part of a notice required to be mailed under the provisions of
subparagraph 13(f).

            (f) Notice to Holders. In the event the Corporation shall propose to
take any action of the type described in clause (d) (but only if the action
would result in an adjustment in the Conversion Rate), the Corporation shall
give notice to the Payee, in the manner set forth in subparagraph 13(e), which
notice shall specify the record date, if any, with respect to any such action
and the approximate date on which such action is to take place. Such notice
shall also set forth such facts with respect thereto as shall be reasonably
necessary to indicate the effect of such action (to the extent such effect may
be known at the date of such notice) on the Conversion Price and the number,
kind or class of shares or other securities or property which shall be
deliverable upon conversion of this Debenture. In the case of any action which
would require the fixing of a record date, such notice shall be given at least
10 days prior to the date so fixed, and in case of all other action, such notice
shall be given at least 10 days prior to the taking of such proposed action.
Failure to give such notice, or any defect therein, shall not, however, affect
the legality or validity of any such action.

            (g) Costs. The Corporation shall pay all documentary, stamp,
transfer or other transactional taxes attributable to the issuance or delivery
of shares of Common Stock upon conversion of any portion of this Debenture;
provided that the Corporation shall not be required to pay any taxes which may
be payable in respect of any transfer involved in the issuance or delivery of
any certificate for such shares in a name other than that of the Payee.

            (h) Reservation of Shares. The Corporation shall reserve at all
times so long as any portion of this Debenture shall remain outstanding, free
from preemptive rights, out of its treasury stock or authorized but unissued
Common Stock, or both, solely for the purpose of effecting the conversion of
this Debenture, sufficient shares of Common Stock to provide for the conversion
of the full unpaid balance of this Debenture.

                                      -7-
<PAGE>

            (i) Valid Issuance. All shares of Common Stock which may be issued
upon conversion of this Debenture will upon issuance by the Corporation be duly
and validly issued, fully paid and nonassessable and free from all taxes, liens
and charges with respect to the issuance thereof, and the Corporation shall take
no action which will cause a contrary result (including, without limitation, any
action which would cause the Conversion Price to be less than the par value, if
any, of the Common Stock).

      Section 14. No Rights of Stockholders.

            Except as otherwise provided herein, this Debenture shall not
entitle the Payee to any of the rights of a stockholder of the Payor, including
without limitation, the right to vote, to receive dividends and other
distributions, or to receive any notice of, or to attend, meetings of
stockholders or any other proceedings of the Payor, unless and to the extent
converted into shares of Common Stock in accordance with the terms hereof.

            IN WITNESS WHEREOF, the Payor has caused this Debenture to be duly
executed by its duly authorized officer as of the date indicated below.

                                        THE PROJECT GROUP, INC.
Date: November 24, 2004

                                        By: /s/ Craig Crawford
                                           -------------------------------------
                                           Name:  Craig Crawford
                                           Title: President

                                      -8-
<PAGE>

                                     ANNEX A

                                CONVERSION NOTICE

(To be Executed by the Registered Holder
in order to Convert the Debenture)

RE:    The Project Group, Inc.
       12% Convertible Debenture in the original principal amount of $335,000

The undersigned hereby irrevocably elects to convert the above Debenture into
shares of Common Stock, $0.001 par value per share, of The Project Group, Inc.
according to the provisions hereof, as of the date written below.

Conversion calculations:                ________________________________________
                                        Date of Conversion Notice

                                        ________________________________________
                                        Principal Amount of Note to be Converted

                                        ________________________________________
                                        Conversion Price
                                        (Pursuant to Section 13(a))

                                        ________________________________________
                                        Number of Shares to be Issued
                                        Upon Conversion

                                        ________________________________________
                                        Signature

                                        ________________________________________
                                        Name

                                        _______________________________________
                                        Address

                                      -9-

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