Document:

SECURITIES
      PURCHASE AGREEMENT

     

    THIS SECURITIES
      PURCHASE AGREEMENT
      (this
“Agreement”)
      dated
      as of August 25, 2004 by and among TEXAS
      PROTOTYPES, INC.,
      a Texas
      corporation (the “Company”),
      and
      the Buyers listed on Schedule I attached hereto (individually, a “Buyer”
or
      collectively “Buyers”).

     

    WITNESSETH:

     

    WHEREAS,
      the
      Company and the Buyer(s) are executing and delivering this Agreement in reliance
      upon an exemption from securities registration pursuant to Section 4(2) and/or
      Rule 506 of Regulation D (“Regulation
      D”)
      as
      promulgated by the U.S. Securities and Exchange Commission (the “SEC”)
      under
      the Securities Act of 1933, as amended (the “1933
      Act”);

     

    WHEREAS,
      the
      parties desire that, upon the terms and subject to the conditions contained
      herein, the Company shall issue and sell to the Buyer(s), as provided herein,
      and the Buyer(s) shall purchase up to $1,400,000 (the “Purchase
      Price”)
      of
      secured convertible debentures (the “Convertible
      Debentures”),
      which
      shall be convertible into shares of the Company’s common stock, par value $0.001
      (the “Common
      Stock”)
      (as
      converted, the “Conversion
      Shares”)
      in the
      respective amounts set forth opposite each Buyer(s) name on Schedule I (the
      “Subscription
      Amount”);
      and

     

    WHEREAS,
      contemporaneously with the execution and delivery of this Agreement, the parties
      hereto are executing and delivering a Registration Rights Agreement (the
“Investor
      Registration Rights Agreement”)
      pursuant to which the Company has agreed to provide certain registration rights
      under the 1933 Act and the rules and regulations promulgated there under, and
      applicable state securities laws; and

     

    WHEREAS,
      the
      aggregate proceeds of the sale of the Convertible Debentures contemplated hereby
      shall be held in escrow pursuant to the terms of an Escrow Agreement (the
“Escrow
      Agreement”)
      of
      even date herewith.

     

    WHEREAS,
      contemporaneously with the execution and delivery of this Agreement, the parties
      hereto are executing and delivering Irrevocable Transfer Agent
      Instructions (the “Irrevocable
      Transfer Agent Instructions”).

     

    WHEREAS,
      contemporaneously with the execution and delivery of this Agreement, the parties
      hereto are executing and delivering a Security Agreement (the “Security
      Agreement”)
      pursuant to which the Company has agreed to provide the Buyer a security
      interest in Pledged Collateral (as this term is defined in the Security
      Agreement) to secure Company’s obligations under this Agreement, the Convertible
      Debenture, the Investor Registration Rights Agreement, the Irrevocable Transfer
      Agent Instructions, the Security Agreement or any other obligations of the
      Company to the Investor.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    NOW,
      THEREFORE,
      in
      consideration of the mutual covenants and other agreements contained in this
      Agreement the Company and the Buyer(s)hereby agree as follows:

     

    1. PURCHASE
      AND SALE OF CONVERTIBLE DEBENTURES.

     

    (a) Purchase
      of Convertible Debentures.
      Subject
      to the satisfaction (or waiver) of the terms and conditions of this Agreement,
      each Buyer agrees, severally and not jointly, to purchase at the Closing and
      the
      Company agrees to sell and issue to each Buyer, severally and not jointly,
      at
      the Closing, Convertible Debentures in amounts corresponding with the
      Subscription Amount set forth opposite each Buyer’s name on Schedule I hereto.
      Upon execution hereof by a Buyer, the Buyer shall wire transfer the Subscription
      Amount set forth opposite his name on Schedule I in same-day funds or a check
      payable to “Butler Gonzalez LLP, as Escrow Agent for Texas Prototypes,
      Inc./Cornell Capital Partners, LP”, which Subscription Amount shall be held in
      escrow pursuant to the terms of the Escrow Agreement (as hereinafter defined)
      and disbursed in accordance therewith.

     

    (b) Closing
      Date.
      The
      Closing of the purchase and sale of the Convertible Debentures shall take place
      on or before the fifth (5th)
      business day following the date hereof, subject to notification of satisfaction
      of the conditions to the Closing set forth herein and in Sections 6 and 7 below
      (or such later date as is mutually agreed to by the Company and the Buyer(s))
      (the “Closing
      Date”).
      The
      Closing shall occur on the Closing Date at the offices of the Buyer (or such
      other place as is mutually agreed to by the Company and the Buyer(s)).

     

    (c) Escrow
      Arrangements; Form of Payment.
      Upon
      execution hereof by Buyer(s) and pending the Closing, the aggregate proceeds
      of
      the sale of the Convertible Debentures to Buyer(s) pursuant hereto shall be
      deposited in a non-interest bearing escrow account with Butler Gonzalez LLP,
      as
      escrow agent (the “Escrow
      Agent”),
      pursuant to the terms of the Escrow Agreement. Subject to the satisfaction
      of
      the terms and conditions of this Agreement, on the Closing Date, (i) the Escrow
      Agent shall deliver to the Company in accordance with the terms of the Escrow
      Agreement such aggregate proceeds for the Convertible Debentures to be issued
      and sold to such Buyer(s), minus a structuring fee of $50,000 to the Buyer
      pursuant to Section 4(g) hereof, which shall be paid directly from the
      gross proceeds of the Closing held in escrow, by wire transfer of immediately
      available funds in accordance with the Company’s written wire instructions, and
      (ii) the Company shall deliver to each Buyer, Convertible Debentures which
      such Buyer(s) is purchasing in amounts indicated opposite such Buyer’s name on
      Schedule I, duly executed on behalf of the Company.

     

    2. BUYER’S
      REPRESENTATIONS AND WARRANTIES.

     

    Each
      Buyer represents and warrants, severally and not jointly, that:

     

    (a) Investment
      Purpose.
      Each
      Buyer is acquiring the Convertible Debentures and, upon conversion of
      Convertible Debentures, the Buyer will acquire the Conversion Shares then
      issuable, for its own account for investment only and not with a view towards,
      or for resale in connection with, the public sale or distribution thereof,
      except pursuant to sales registered or exempted under the 1933 Act; provided,
      however, that by making the representations herein, such Buyer reserves the
      right to dispose of the Conversion Shares at any time in accordance with or
      pursuant to an effective registration statement covering such Conversion Shares
      or an available exemption under the 1933 Act.

     

    
      
        
        

      

      
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    (b) Accredited
      Investor Status.
      Each
      Buyer is an “Accredited
      Investor”
as
      that
      term is defined in Rule 501(a)(3) of Regulation D.

     

    (c) Reliance
      on Exemptions.
      Each
      Buyer understands that the Convertible Debentures are being offered and sold
      to
      it in reliance on specific exemptions from the registration requirements of
      United States federal and state securities laws and that the Company is relying
      in part upon the truth and accuracy of, and such Buyer’s compliance with, the
      representations, warranties, agreements, acknowledgments and understandings
      of
      such Buyer set forth herein in order to determine the availability of such
      exemptions and the eligibility of such Buyer to acquire such
      securities.

     

    (d) Information.
      Each
      Buyer and its advisors (and his or, its counsel), if any, have been furnished
      with all materials relating to the business, finances and operations of the
      Company and information he deemed material to making an informed investment
      decision regarding his purchase of the Convertible Debentures and the Conversion
      Shares, which have been requested by such Buyer. Each Buyer and its advisors,
      if
      any, have been afforded the opportunity to ask questions of the Company and
      its
      management. Neither such inquiries nor any other due diligence investigations
      conducted by such Buyer or its advisors, if any, or its representatives shall
      modify, amend or affect such Buyer’s right to rely on the Company’s
      representations and warranties contained in Section 3 below. Each Buyer
      understands that its investment in the Convertible Debentures and the Conversion
      Shares involves a high degree of risk. Each Buyer is in a position regarding
      the
      Company, which, based upon employment, family relationship or economic
      bargaining power, enabled and enables such Buyer to obtain information from
      the
      Company in order to evaluate the merits and risks of this investment. Each
      Buyer
      has sought such accounting, legal and tax advice, as it has considered necessary
      to make an informed investment decision with respect to its acquisition of
      the
      Convertible Debentures and the Conversion Shares.

     

    (e) No
      Governmental Review.
      Each
      Buyer understands that no United States federal or state agency or any other
      government or governmental agency has passed on or made any recommendation
      or
      endorsement of the Convertible Debentures or the Conversion Shares, or the
      fairness or suitability of the investment in the Convertible Debentures or
      the
      Conversion Shares, nor have such authorities passed upon or endorsed the merits
      of the offering of the Convertible Debentures or the Conversion
      Shares.

     

    (f) Transfer
      or Resale.
      Each
      Buyer understands that except as provided in the Investor Registration Rights
      Agreement: (i) the Convertible Debentures have not been and are not being
      registered under the 1933 Act or any state securities laws, and may not be
      offered for sale, sold, assigned or transferred unless (A) subsequently
      registered thereunder, or (B) such Buyer shall have delivered to the Company
      an
      opinion of counsel, in a generally acceptable form, to the effect that such
      securities to be sold, assigned or transferred may be sold, assigned or
      transferred pursuant to an exemption from such registration requirements; (ii)
      any sale of such securities made in reliance on Rule 144 under the 1933 Act
      (or
      a successor rule thereto) (“Rule 144”)
      may be
      made only in accordance with the terms of Rule 144 and further, if Rule 144
      is not applicable, any resale of such securities under circumstances in which
      the seller (or the person through whom the sale is made) may be deemed to
      be an underwriter (as that term is defined in the 1933 Act) may require
      compliance with some other exemption under the 1933 Act or the rules and
      regulations of the SEC thereunder; and (iii) neither the Company nor any other
      person is under any obligation to register such securities under the 1933 Act
      or
      any state securities laws or to comply with the terms and conditions of any
      exemption thereunder. The Company reserves the right to place stop transfer
      instructions against the shares and certificates for the Conversion
      Shares.

     

    
      
        
        

      

      
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    (g) Legends.
      Each
      Buyer understands that the certificates or other instruments representing the
      Convertible Debentures and or the Conversion Shares shall bear a restrictive
      legend in substantially the following form (and a stop transfer order may be
      placed against transfer of such stock certificates):

     

    THE
      SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
      SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE
      SECURITIES HAVE BEEN ACQUIRED SOLELY FOR INVESTMENT PURPOSES AND NOT WITH A
      VIEW
      TOWARD RESALE AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED
      IN
      THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER
      THE
      SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, OR
      AN
      OPINION OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT
      REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS. 

     

    The
      legend set forth above shall be removed and the Company within two (2) business
      days shall issue a certificate without such legend to the holder of the
      Conversion Shares upon which it is stamped, if, unless otherwise required by
      state securities laws, (i) in connection with a sale transaction, provided
      the
      Conversion Shares are registered under the 1933 Act or (ii) in connection with
      a
      sale transaction, after such holder provides the Company with an opinion of
      counsel, which opinion shall be in form, substance and scope customary for
      opinions of counsel in comparable transactions, to the effect that a public
      sale, assignment or transfer of the Conversion Shares may be made without
      registration under the 1933 Act. 

     

    (h) Authorization,
      Enforcement.
      This
      Agreement has been duly and validly authorized, executed and delivered on behalf
      of such Buyer and is a valid and binding agreement of such Buyer enforceable
      in
      accordance with its terms, except as such enforceability may be limited by
      general principles of equity or applicable bankruptcy, insolvency,
      reorganization, moratorium, liquidation and other similar laws relating to,
      or
      affecting generally, the enforcement of applicable creditors’ rights and
      remedies.

     

    
      
        
        

      

      
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    (i) Receipt
      of Documents.
      Each
      Buyer and his or its counsel has received and read in their entirety: (i) this
      Agreement and each representation, warranty and covenant set forth herein,
      the
      Security Agreement, the Investor Registration Rights Agreement, the Escrow
      Agreement, and the Irrevocable transfer Agent Instructions; (ii) all due
      diligence and other information necessary to verify the accuracy and
      completeness of such representations, warranties and covenants;
      (iii) answers to all questions each Buyer submitted to the Company
      regarding an investment in the Company; and each Buyer has relied on the
      information contained therein and has not been furnished any other documents,
      literature, memorandum or prospectus.

     

    (j) Due
      Formation of Corporate and Other Buyers.
      If the
      Buyer(s) is a corporation, trust, partnership or other entity that is not an
      individual person, it has been formed and validly exists and has not been
      organized for the specific purpose of purchasing the Convertible Debentures
      and
      is not prohibited from doing so.

     

    (k) No
      Legal Advice From the Company.
      Each
      Buyer acknowledges that it had the opportunity to review this Agreement and
      the
      transactions contemplated by this Agreement with his or its own legal counsel
      and investment and tax advisors. Each Buyer is relying solely on such counsel
      and advisors and not on any statements or representations of the Company or
      any
      of its representatives or agents for legal, tax or investment advice with
      respect to this investment, the transactions contemplated by this Agreement
      or
      the securities laws of any jurisdiction. 

     

    (l) No
      Buyer
      makes any representation or warranty regarding the Company’s ability to
      successfully become a public company or to have any registration statement
      filed
      by the Company pursuant to the Registration Rights Agreement or otherwise
      declared effective by the SEC. The Company has the sole obligation to make
      any
      and all such filings as may be necessary to become a public company and to
      have
      any registration statement declared effective by the SEC. 

     

    3. REPRESENTATIONS
      AND WARRANTIES OF THE COMPANY.

     

    The
      Company represents and warrants to each of the Buyers that, except as set forth
      in the Disclosure Schedule attached as Exhibit “A” hereto:

     

    (a) Organization
      and Qualification.
      The
      Company and its subsidiaries are corporations duly organized and validly
      existing in good standing under the laws of the jurisdiction in which they
      are
      incorporated, and have the requisite corporate power to own their properties
      and
      to carry on their business as now being conducted. Each of the Company and
      its
      subsidiaries is duly qualified as a foreign corporation to do business and
      is in
      good standing in every jurisdiction in which the nature of the business
      conducted by it makes such qualification necessary, except to the extent that
      the failure to be so qualified or be in good standing would not have a material
      adverse effect on the Company and its subsidiaries taken as a
      whole.

     

    (b) Authorization,
      Enforcement, Compliance with Other Instruments.
      (i) The Company has the requisite corporate power and authority to enter
      into and perform this Agreement, the Security Agreement, the Investor
      Registration Rights Agreement, the Escrow Agreement, the Irrevocable Transfer
      Agent Instructions, and any related agreements, and to issue the Convertible
      Debentures and the Conversion Shares in accordance with the terms hereof and
      thereof, (ii) the execution and delivery of this Agreement, the Security
      Agreement, the Investor Registration Rights Agreement, the Escrow Agreement,
      the
      Irrevocable Transfer Agent Instructions (as defined herein) and any related
      agreements by the Company and the consummation by it of the transactions
      contemplated hereby and thereby, including, without limitation, the issuance
      of
      the Convertible Debentures, the Conversion Shares and the reservation for
      issuance and the issuance of the Conversion Shares issuable upon conversion
      or
      exercise thereof, have been duly authorized by the Company’s Board of Directors
      and no further consent or authorization is required by the Company, its Board
      of
      Directors or its stockholders, (iii) this Agreement, the Security Agreement,
      the
      Investor Registration Rights Agreement, the Escrow Agreement, the Irrevocable
      Transfer Agent Instructions and any related agreements have been duly executed
      and delivered by the Company, (iv) this Agreement, the Security Agreement,
      the
      Investor Registration Rights Agreement, the Escrow Agreement, the Irrevocable
      Transfer Agent Instructions and any related agreements constitute the valid
      and
      binding obligations of the Company enforceable against the Company in accordance
      with their terms, except as such enforceability may be limited by general
      principles of equity or applicable bankruptcy, insolvency, reorganization,
      moratorium, liquidation or similar laws relating to, or affecting generally,
      the
      enforcement of creditors’ rights and remedies. The authorized officer of the
      Company executing this Agreement, the Security Agreement, the Investor
      Registration Rights Agreement, the Escrow Agreement, the Irrevocable Transfer
      Agent Instructions and any related agreements knows of no reason why the Company
      cannot file the registration statement as required under the Investor
      Registration Rights Agreement or perform any of the Company’s other obligations
      under such documents. 

     

    
      
        
        

      

      
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    (c) Capitalization.
      As
      of the
      date hereof, the authorized capital stock of the Company consists of
      500,000,000 shares of stock, all of which shares are designated as Common Stock,
      $.001 par value per share. All
      of
      such outstanding shares have been validly issued and are fully paid and
      nonassessable. Except as disclosed in the Disclosure Schedule, no shares of
      Common Stock are subject to preemptive rights or any other similar rights or
      any
      liens or encumbrances suffered or permitted by the Company. Except as disclosed
      in the Disclosure Schedule, as of the date of this Agreement, (i) there are
      no
      outstanding options, warrants, scrip, rights to subscribe to, calls or
      commitments of any character whatsoever relating to, or securities or rights
      convertible into, any shares of capital stock of the Company or any of its
      subsidiaries, or contracts, commitments, understandings or arrangements by
      which
      the Company or any of its subsidiaries is or may become bound to issue
      additional shares of capital stock of the Company or any of its subsidiaries
      or
      options, warrants, scrip, rights to subscribe to, calls or commitments of any
      character whatsoever relating to, or securities or rights convertible into,
      any
      shares of capital stock of the Company or any of its subsidiaries, (ii) there
      are no outstanding debt securities and (iii) there are no agreements or
      arrangements under which the Company or any of its subsidiaries is obligated
      to
      register the sale of any of their securities under the 1933 Act (except pursuant
      to the Registration Rights Agreement) and (iv) there are no outstanding
      registration statements and there are no outstanding comment letters from the
      SEC or any other regulatory agency. There are no securities or instruments
      containing anti-dilution or similar provisions that will be triggered by the
      issuance of the Convertible Debentures as described in this Agreement. The
      Company has furnished to the Buyer true and correct copies of the Company’s
      Articles of Incorporation, as amended and as in effect on the date hereof (the
      “Articles
      of Incorporation”),
      and
      the Company’s By-laws, as in effect on the date hereof (the “By-laws”),
      and
      the terms of all securities convertible into or exercisable for Common Stock
      and
      the material rights of the holders thereof in respect thereto other than stock
      options issued to employees and consultants. 

     

    
      
        
        

      

      
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    (d) Issuance
      of Securities.
      The
      Convertible Debentures are duly authorized and, upon issuance in accordance
      with
      the terms hereof, shall be duly issued, fully paid and nonassessable, are free
      from all taxes, liens and charges with respect to the issue thereof. The
      Conversion Shares issuable upon conversion of the Convertible Debentures have
      been duly authorized and reserved for issuance. Upon conversion or exercise
      in
      accordance with the Convertible Debentures the Conversion Shares will be duly
      issued, fully paid and nonassessable.

     

    (e) No
      Conflicts.
      Except
      as disclosed in the Disclosure Schedule, the execution, delivery and performance
      of this Agreement, the Security Agreement, the Investors Registration Rights
      Agreement, the Escrow Agreement and the Irrevocable Transfer Agent Instructions
      by the Company and the consummation by the Company of the transactions
      contemplated hereby will not (i) result in a violation of the Articles of
      Incorporation, any certificate of designations of any outstanding series of
      preferred stock of the Company or the By-laws or (ii) conflict with or
      constitute a default (or an event which with notice or lapse of time or both
      would become a default) under, or give to others any rights of termination,
      amendment, acceleration or cancellation of, any agreement, indenture or
      instrument to which the Company or any of its subsidiaries is a party, or result
      in a violation of any law, rule, regulation, order, judgment or decree
      (including federal and state securities laws and regulations and the rules
      and
      regulations of The National Association of Securities Dealers Inc.’s OTC
      Bulletin Board on which the Common Stock is quoted) applicable to the Company
      or
      any of its subsidiaries or by which any property or asset of the Company or
      any
      of its subsidiaries is bound or affected. Except as disclosed in the Disclosure
      Schedule, neither the Company nor its subsidiaries is in violation of any term
      of or in default under its Articles of Incorporation or By-laws or their
      organizational charter or by-laws, respectively, or any material contract,
      agreement, mortgage, indebtedness, indenture, instrument, judgment, decree
      or
      order or any statute, rule or regulation applicable to the Company or its
      subsidiaries. The business of the Company and its subsidiaries is not being
      conducted, and shall not be conducted in violation of any material law,
      ordinance, or regulation of any governmental entity. Except as specifically
      contemplated by this Agreement and as required under the 1933 Act and any
      applicable state securities laws, the Company is not required to obtain any
      consent, authorization or order of, or make any filing or registration with,
      any
      court or governmental agency in order for it to execute, deliver or perform
      any
      of its obligations under or contemplated by this Agreement or the Registration
      Rights Agreement in accordance with the terms hereof or thereof. Except as
      disclosed in the Disclosure Schedule, all consents, authorizations, orders,
      filings and registrations which the Company is required to obtain pursuant
      to
      the preceding sentence have been obtained or effected on or prior to the date
      hereof. The Company and its subsidiaries are unaware of any facts or
      circumstance, which might give rise to any of the foregoing.

     

    (f) Financial
      Statements.
      As of
      their respective dates, the financial statements of the Company (the
“Financial
      Statements”)
      for
      the two most recently completed fiscal years and any subsequent interim period
      complied as to form in all material respects with applicable accounting
      requirements and the published rules and regulations of the SEC with respect
      thereto. Such financial statements have been prepared in accordance with
      generally accepted accounting principles, consistently applied, during the
      periods involved (except (i) as may be otherwise indicated in such Financial
      Statements or the notes thereto, or (ii) in the case of unaudited interim
      statements, to the extent they may exclude footnotes or may be condensed or
      summary statements) and, fairly present in all material respects the financial
      position of the Company as of the dates thereof and the results of its
      operations and cash flows for the periods then ended (subject, in the case
      of
      unaudited statements, to normal year-end audit adjustments). No other
      information provided by or on behalf of the Company to the Buyer, including,
      without limitation, information referred to in this Agreement, contains any
      untrue statement of a material fact or omits to state any material fact
      necessary in order to make the statements therein, in the light of the
      circumstances under which they were made, not misleading.

     

    
      
        
        

      

      
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    (g) Absence
      of Litigation.
      Except
      as disclosed in the Disclosure Schedule, there is no action, suit, proceeding,
      inquiry or investigation before or by any court, public board, government
      agency, self-regulatory organization or body pending against or affecting the
      Company, the Common Stock or any of the Company’s subsidiaries, wherein an
      unfavorable decision, ruling or finding would (i) have a material adverse effect
      on the transactions contemplated hereby (ii) adversely affect the validity
      or
      enforceability of, or the authority or ability of the Company to perform its
      obligations under, this Agreement or any of the documents contemplated herein,
      or (iii) except as expressly disclosed in the Disclosure Schedule, have a
      material adverse effect on the business, operations, properties, financial
      condition or results of operations of the Company and its subsidiaries taken
      as
      a whole.

     

    (h) Acknowledgment
      Regarding Buyer’s Purchase of the Convertible Debentures.
      The
      Company acknowledges and agrees that the Buyer(s) is acting solely in the
      capacity of an arm’s length purchaser with respect to this Agreement and the
      transactions contemplated hereby. The Company further acknowledges that the
      Buyer(s) is not acting as a financial advisor or fiduciary of the Company (or
      in
      any similar capacity) with respect to this Agreement and the transactions
      contemplated hereby and any advice given by the Buyer(s) or any of their
      respective representatives or agents in connection with this Agreement and
      the
      transactions contemplated hereby is merely incidental to such Buyer’s purchase
      of the Convertible Debentures or the Conversion Shares. The Company further
      represents to the Buyer that the Company’s decision to enter into this Agreement
      has been based solely on the independent evaluation by the Company and its
      representatives.

     

    (i) No
      General Solicitation.
      Neither
      the Company, nor any of its affiliates, nor any person acting on its or their
      behalf, has engaged in any form of general solicitation or general advertising
      (within the meaning of Regulation D under the 1933 Act) in connection with
      the
      offer or sale of the Convertible Debentures or the Conversion
      Shares.

     

    (j) No
      Integrated Offering.
      Neither
      the Company, nor any of its affiliates, nor any person acting on its or their
      behalf has, directly or indirectly, made any offers or sales of any security
      or
      solicited any offers to buy any security, under circumstances that would require
      registration of the Convertible Debentures or the Conversion Shares under the
      1933 Act or cause this offering of the Convertible Debentures or the Conversion
      Shares to be integrated with prior offerings by the Company for purposes of
      the
      1933 Act.

     

    
      
        
        

      

      
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    (k) Employee
      Relations.
      Neither
      the Company nor any of its subsidiaries is involved in any labor dispute nor,
      to
      the knowledge of the Company or any of its subsidiaries, is any such dispute
      threatened. None of the Company’s or its subsidiaries’ employees is a member of
      a union and the Company and its subsidiaries believe that their relations with
      their employees are good.

     

    (l) Intellectual
      Property Rights.
      The
      Company and its subsidiaries own or possess adequate rights or licenses to
      use
      all trademarks, trade names, service marks, service mark registrations, service
      names, patents, patent rights, copyrights, inventions, licenses, approvals,
      governmental authorizations, trade secrets and rights necessary to conduct
      their
      respective businesses as now conducted. The Company and its subsidiaries do
      not
      have any knowledge of any infringement by the Company or its subsidiaries of
      trademark, trade name rights, patents, patent rights, copyrights, inventions,
      licenses, service names, service marks, service mark registrations, trade secret
      or other similar rights of others, and, to the knowledge of the Company there
      is
      no claim, action or proceeding being made or brought against, or to the
      Company’s knowledge, being threatened against, the Company or its subsidiaries
      regarding trademark, trade name, patents, patent rights, invention, copyright,
      license, service names, service marks, service mark registrations, trade secret
      or other infringement; and the Company and its subsidiaries are unaware of
      any
      facts or circumstances which might give rise to any of the
      foregoing.

     

    (m) Environmental
      Laws.
      The
      Company and its subsidiaries are (i) in compliance with any and all applicable
      foreign, federal, state and local laws and regulations relating to the
      protection of human health and safety, the environment or hazardous or toxic
      substances or wastes, pollutants or contaminants (“Environmental
      Laws”),
      (ii)
      have received all permits, licenses or other approvals required of them under
      applicable Environmental Laws to conduct their respective businesses and (iii)
      are in compliance with all terms and conditions of any such permit, license
      or
      approval.

     

    (n) Title.
      Any
      real property and facilities held under lease by the Company and its
      subsidiaries are held by them under valid, subsisting and enforceable leases
      with such exceptions as are not material and do not interfere with the use
      made
      and proposed to be made of such property and buildings by the Company and its
      subsidiaries.

     

    (o) Insurance.
      The
      Company and each of its subsidiaries are insured by insurers of recognized
      financial responsibility against such losses and risks and in such amounts
      as
      management of the Company believes to be prudent and customary in the businesses
      in which the Company and its subsidiaries are engaged. Neither the Company
      nor
      any such subsidiary has been refused any insurance coverage sought or applied
      for and neither the Company nor any such subsidiary has any reason to believe
      that it will not be able to renew its existing insurance coverage as and when
      such coverage expires or to obtain similar coverage from similar insurers as
      may
      be necessary to continue its business at a cost that would not materially and
      adversely affect the condition, financial or otherwise, or the earnings,
      business or operations of the Company and its subsidiaries, taken as a
      whole.

     

    (p) Regulatory
      Permits.
      The
      Company and its subsidiaries possess all material certificates, authorizations
      and permits issued by the appropriate federal, state or foreign regulatory
      authorities necessary to conduct their respective businesses, and neither the
      Company nor any such subsidiary has received any notice of proceedings relating
      to the revocation or modification of any such certificate, authorization or
      permit.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    (q) Internal
      Accounting Controls.
      The
      Company and each of its subsidiaries maintain a system of internal accounting
      controls sufficient to provide reasonable assurance that (i) transactions are
      executed in accordance with management’s general or specific authorizations,
      (ii) transactions are recorded as necessary to permit preparation of financial
      statements in conformity with generally accepted accounting principles and
      to
      maintain asset accountability, and (iii) the recorded amounts for assets is
      compared with the existing assets at reasonable intervals and appropriate action
      is taken with respect to any differences.

     

    (r) No
      Material Adverse Breaches, etc.
      Except
      as set forth in the Disclosure Schedule, neither the Company nor any of its
      subsidiaries is subject to any charter, corporate or other legal restriction,
      or
      any judgment, decree, order, rule or regulation which in the judgment of the
      Company’s officers has or is expected in the future to have a material adverse
      effect on the business, properties, operations, financial condition, results
      of
      operations or prospects of the Company or its subsidiaries. Except as set forth
      in the Disclosure Schedule, neither the Company nor any of its subsidiaries
      is
      in breach of any contract or agreement which breach, in the judgment of the
      Company’s officers, has or is expected to have a material adverse effect on the
      business, properties, operations, financial condition, results of operations
      or
      prospects of the Company or its subsidiaries.

     

    (s) Tax
      Status.
      Except
      as set forth in the Disclosure Schedule, the Company and each of its
      subsidiaries has made and filed all federal and state income and all other
      tax
      returns, reports and declarations required by any jurisdiction to which it
      is
      subject and (unless and only to the extent that the Company and each of its
      subsidiaries has set aside on its books provisions reasonably adequate for
      the
      payment of all unpaid and unreported taxes) has paid all taxes and other
      governmental assessments and charges that are material in amount, shown or
      determined to be due on such returns, reports and declarations, except those
      being contested in good faith and has set aside on its books provision
      reasonably adequate for the payment of all taxes for periods subsequent to
      the
      periods to which such returns, reports or declarations apply. There are no
      unpaid taxes in any material amount claimed to be due by the taxing authority
      of
      any jurisdiction, and the officers of the Company know of no basis for any
      such
      claim.

     

    (t) Certain
      Transactions.
      Except
      as set forth in the Disclosure Schedule, and except for arm’s length
      transactions pursuant to which the Company makes payments in the ordinary course
      of business upon terms no less favorable than the Company could obtain from
      third parties and other than the grant of stock options disclosed in the
      Disclosure Schedule, none of the officers, directors, or employees of the
      Company is presently a party to any transaction with the Company (other than
      for
      services as employees, officers and directors), including any contract,
      agreement or other arrangement providing for the furnishing of services to
      or
      by, providing for rental of real or personal property to or from, or otherwise
      requiring payments to or from any officer, director or such employee or, to
      the
      knowledge of the Company, any corporation, partnership, trust or other entity
      in
      which any officer, director, or any such employee has a substantial interest
      or
      is an officer, director, trustee or partner.

     

    
      
        
        

      

      
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    (u) Fees
      and Rights of First Refusal.
      The
      Company is not obligated to offer the securities offered hereunder on a right
      of
      first refusal basis or otherwise to any third parties including, but not limited
      to, current or former shareholders of the Company, underwriters, brokers, agents
      or other third parties.

     

    (v) The
      Company acknowledges that the Buyer is relying on the representations and
      warranties made by the Company hereunder and that such representations and
      warranties are a material inducement to the Buyer purchasing the Convertible
      Debentures. The Company further acknowledges that without such representations
      and warranties of the Company made hereunder, the Buyer would not enter into
      this Agreement.

     

    4. COVENANTS.

     

    (a) Best
      Efforts.
      Each
      party shall use its best efforts timely to satisfy each of the conditions to
      be
      satisfied by it as provided in Sections 6 and 7 of this Agreement.

     

    (b) Form
      D.
      The
      Company agrees to file a Form D with respect to the Conversion Shares as
      required under Regulation D and to provide a copy thereof to each Buyer promptly
      after such filing. The Company shall, on or before the Closing Date, take such
      action as the Company shall reasonably determine is necessary to qualify the
      Conversion Shares, or obtain an exemption for the Conversion Shares for sale
      to
      the Buyers at the Closing pursuant to this Agreement under applicable securities
      or “Blue
      Sky”
laws
      of
      the states of the United States, and shall provide evidence of any such action
      so taken to the Buyers on or prior to the Closing Date.

     

    (c) Reporting
      Status.
      Commencing on the effectiveness of the registration statement filed with the
      SEC
      pursuant to the Investor Registration Rights Agreement and until the earlier
      of
      (i) the date as of which the Buyer(s) may sell all of the Conversion Shares
      without restriction pursuant to Rule 144(k) promulgated under the 1933 Act
      (or
      successor thereto), or (ii) the date on which (A) the Buyer(s) shall have
      sold all the Conversion Shares and (B) none of the Convertible Debentures are
      outstanding (the “Registration
      Period”),
      the
      Company shall file in a timely manner all reports required to be filed with
      the
      SEC pursuant to the 1934 Act and the regulations of the SEC thereunder, and
      the
      Company shall not terminate its status as an issuer required to file reports
      under the 1934 Act even if the 1934 Act or the rules and regulations thereunder
      would otherwise permit such termination.

     

    (d) Use
      of
      Proceeds.
      The
      Company will use the proceeds from the sale of the Convertible Debentures for
      general corporate and working capital purposes.

     

    (e) Reservation
      of Shares.
      The
      Company shall take all action reasonably necessary to at all times have
      authorized, and reserved for the purpose of issuance, such number of shares
      of
      Common Stock as shall be necessary to effect the issuance of the Conversion
      Shares. If at any time the Company does not have available such shares of Common
      Stock as shall from time to time be sufficient to effect the conversion of
      all
      of the Conversion Shares of the Company shall call and hold a special meeting
      of
      the shareholders within sixty (60) days of such occurrence, for the sole purpose
      of increasing the number of shares authorized. The Company’s management shall
      recommend to the shareholders to vote in favor of increasing the number of
      shares of Common Stock authorized. Management shall also vote all of its shares
      in favor of increasing the number of authorized shares of Common
      Stock.

     

    
      
        
        

      

      
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    (f) Listings
      or Quotation.
      The
      Company shall, concurrently with the effectiveness of the registration statement
      filed with the SEC pursuant to the Investor Registration Rights Agreement,
      secure the listing or quotation of its Common Stock (including, without
      limitation, the Conversion Shares) upon a national securities exchange,
      automated quotation system or the Over-The-Counter Bulletin Board (“OTCBB”)
      maintained by the National Association of Securities Dealers, Inc. The Company
      shall maintain the listing or quotation of the Common Stock for so long as
      the
      Investor is the beneficial owner of any Common Stock or Conversion Shares
      (whether obtained or to be obtained under this Agreement, the Convertible
      Debentures or any other agreement between the Company and the Buyer. The Company
      shall maintain the Common Stock’s authorization for quotation on the OTCBB. It
      shall be an event of default hereunder if the Company fails to strictly comply
      with its obligations under this Section 4(f).

     

    (g) Fees
      and Expenses.
      Except
      as set forth below, each of the Company and the Buyer(s) shall pay all costs
      and
      expenses incurred by such party in connection with the negotiation,
      investigation, preparation, execution and delivery of this Agreement, the Escrow
      Agreement, the Investor Registration Rights Agreement, the Security Agreement
      and the Irrevocable Transfer Agent Instructions. The Buyer(s) shall be entitled
      to a commitment fee of ten percent (10%) on the Purchase Price, which shall
      be deducted from the Purchase Price. The Company shall be solely responsible
      for
      all costs incurred or to be incurred in connection with the Registration Rights
      Agreement of even date herewith, including, without limitation, all filing
      fees
      and costs and expenses incurred in preparing and filing the Registration
      Statement described in the Registration Rights Agreement and for printing and
      mailing accompanying Prospectus. 

     

    On
      the
      Closing Date, the Company shall pay to the Buyer a structuring fee of
      $60,000 (the “Structuring
      Fee”).
      The
      Structuring Fee shall be paid directly from the gross proceeds of the Closing
      and shall be deemed fully earned on the date hereof. The Company shall be solely
      responsible for the contents of any such registration statement, prospectus
      or
      other filing made with the SEC or otherwise used in the offering of the
      Company’s securities (except as such disclosure relates solely to the
      Investor and then only to the extent that such disclosure conforms with
      information furnished in writing by the Investor to the Company), even if the
      Buyer or its agents as an accommodation to the Company participate or assist
      in
      the preparation of such registration statement, prospectus or other SEC filing.
      The Company shall retain its own legal counsel to review, edit, confirm and
      do
      all things such counsel deems necessary or desirable to such registration
      statement, prospectus or other SEC filing to ensure that it does not contain
      an
      untrue statement or alleged untrue statement of material fact or omit or alleged
      to omit a material fact necessary to make the statements made therein, in light
      of the circumstances under which the statements were made, not misleading.
      On
      the Closing Date, the Company shall pay to Schiff Hardin LLP, the Company’s
      legal counsel, $35,000.

     

    (h) Corporate
      Existence.
      So long
      as any of the Convertible Debentures remain outstanding, the Company shall
      not
      directly or indirectly consummate any merger, reorganization, restructuring,
      reverse stock split consolidation, sale of all or substantially all of the
      Company’s assets or any similar transaction or related transactions (each such
      transaction, an “Organizational
      Change”)
      unless, prior to the consummation an Organizational Change, the Company obtains
      the written consent of each Buyer. In any such case, the Company will make
      appropriate provision with respect to such holders’ rights and interests to
      insure that the provisions of this Section 4(h) will thereafter be applicable
      to
      the Convertible Debentures.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    (i) Transactions
      With Affiliates.
      So long
      as any Convertible Debentures are outstanding, the Company shall not, and shall
      cause each of its subsidiaries not to, enter into, amend, modify or supplement,
      or permit any subsidiary to enter into, amend, modify or supplement any
      agreement, transaction, commitment, or arrangement with any of its or any
      subsidiary’s officers, directors, person who were officers or directors at any
      time during the previous two (2) years, stockholders who beneficially own five
      percent (5%) or more of the Common Stock, or Affiliates (as defined below)
      or
      with any individual related by blood, marriage, or adoption to any such
      individual or with any entity in which any such entity or individual owns a
      five
      percent (5%) or more beneficial interest (each a “Related
      Party”),
      except for (a) customary employment arrangements and benefit programs on
      reasonable terms, (b) any investment in an Affiliate of the Company, (c) any
      agreement, transaction, commitment, or arrangement on an arms-length basis
      on
      terms no less favorable than terms which would have been obtainable from a
      person other than such Related Party, (d) any agreement transaction, commitment,
      or arrangement which is approved by a majority of the disinterested directors
      of
      the Company, for purposes hereof, any director who is also an officer of the
      Company or any subsidiary of the Company shall not be a disinterested director
      with respect to any such agreement, transaction, commitment, or arrangement.
      “Affiliate”
for
      purposes hereof means, with respect to any person or entity, another person
      or
      entity that, directly or indirectly, (i) has a ten percent (10%) or more equity
      interest in that person or entity, (ii) has ten percent (10%) or more common
      ownership with that person or entity, (iii) controls that person or entity,
      or
      (iv) shares common control with that person or entity. “Control”
or
      “controls”
for
      purposes hereof means that a person or entity has the power, direct or indirect,
      to conduct or govern the policies of another person or entity.

     

    (j) Transfer
      Agent.
      The
      Company covenants and agrees that, in the event that the Company’s agency
      relationship with the transfer agent should be terminated for any reason prior
      to a date which is two (2) years after the Closing Date, the Company shall
      immediately appoint a new transfer agent and shall require that the new transfer
      agent execute and agree to be bound by the terms of the Irrevocable Transfer
      Agent Instructions (as defined herein).

     

    (k) Restriction
      on Issuance of the Capital Stock.
      So long
      as any Convertible Debentures are outstanding, the Company shall not, without
      the prior written consent of the Buyer(s), issue or sell shares of Common Stock
      or Preferred Stock (i) without consideration or for a consideration per share
      less than the Bid Price of the Common Stock determined immediately prior to
      its
      issuance, (ii) any warrant, option, right, contract, call, or other security
      instrument granting the holder thereof, the right to acquire Common Stock
      without consideration or for a consideration less than such Common Stock’s Bid
      Price value determined immediately prior to it’s issuance, (iii) enter into any
      security instrument granting the holder a security interest in any and all
      assets of the Company, or (iv) file any registration statement on Form S-8
      in
      excess of 10,000,000 shares of common stock.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    5. TRANSFER
      AGENT INSTRUCTIONS.

     

    The
      Company shall issue the Irrevocable Transfer Agent Instructions to its transfer
      agent irrevocably appointing Butler Gonzalez LLP as its agent for purpose of
      having certificates issued, registered in the name of the Buyer(s) or its
      respective nominee(s), for the Conversion Shares representing such amounts
      of
      Convertible Debentures as specified from time to time by the Buyer(s) to the
      Company upon conversion of the Convertible Debentures, for interest owed
      pursuant to the Convertible Debenture, and for any and all Liquidated Damages
      (as this term is defined in the Investor Registration Rights Agreement). Butler
      Gonzalez LLP shall be paid a cash fee of Fifty Dollars ($50) for every occasion
      they act pursuant to the Irrevocable Transfer Agent Instructions. The Company
      shall not change its transfer agent without the express written consent of
      the
      Buyer(s), which may be withheld by the Buyer(s) in its sole discretion. Prior
      to
      registration of the Conversion Shares under the 1933 Act, all such certificates
      shall bear the restrictive legend specified in Section 2(g) of this Agreement.
      The Company warrants that no instruction other than the Irrevocable Transfer
      Agent Instructions referred to in this Section 5, and stop transfer instructions
      to give effect to Section 2(g) hereof (in the case of the Conversion Shares
      prior to registration of such shares under the 1933 Act) will be given by the
      Company to its transfer agent and that the Conversion Shares shall otherwise
      be
      freely transferable on the books and records of the Company as and to the extent
      provided in this Agreement and the Investor Registration Rights Agreement.
      Nothing in this Section 5 shall affect in any way the Buyer’s obligations and
      agreement to comply with all applicable securities laws upon resale of
      Conversion Shares. If the Buyer(s) provides the Company with an opinion of
      counsel, in form, scope and substance customary for opinions of counsel in
      comparable transactions to the effect that registration of a resale by the
      Buyer(s) of any of the Conversion Shares is not required under the 1933 Act,
      the
      Company shall within two (2) business days instruct its transfer agent to issue
      one or more certificates in such name and in such denominations as specified
      by
      the Buyer. The Company acknowledges that a breach by it of its obligations
      hereunder will cause irreparable harm to the Buyer by vitiating the intent
      and
      purpose of the transaction contemplated hereby. Accordingly, the Company
      acknowledges that the remedy at law for a breach of its obligations under this
      Section 5 will be inadequate and agrees, in the event of a breach or threatened
      breach by the Company of the provisions of this Section 5, that the
      Buyer(s) shall be entitled, in addition to all other available remedies, to
      an
      injunction restraining any breach and requiring immediate issuance and transfer,
      without the necessity of showing economic loss and without any bond or other
      security being required.

     

    6. CONDITIONS
      TO THE COMPANY’S OBLIGATION TO SELLER.

     

    The
      obligation of the Company hereunder to issue and sell the Convertible Debentures
      to the Buyer(s) at the Closing is subject to the satisfaction, at or before
      the
      Closing Date, of each of the following conditions, provided that these
      conditions are for the Company’s sole benefit and may be waived by the Company
      at any time in its sole discretion:

     

    (a) Each
      Buyer shall have executed this Agreement, the Security Agreement, the Escrow
      Agreement and the Investor Registration Rights Agreement and the Irrevocable
      Transfer Agent Instructions and delivered the same to the Company.

     

    
      
        
        

      

      
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    (b) The
      Buyer(s) shall have delivered to the Escrow Agent the Purchase Price for
      Convertible Debentures in respective amounts as set forth next to each Buyer
      as
      outlined on Schedule I attached hereto and the Escrow Agent shall have delivered
      the net proceeds to the Company by wire transfer of immediately available U.S.
      funds pursuant to the wire instructions provided by the Company.

     

    (c) The
      representations and warranties of the Buyer(s) shall be true and correct in
      all
      material respects as of the date when made and as of the Closing Date as though
      made at that time (except for representations and warranties that speak as
      of a
      specific date), and the Buyer(s) shall have performed, satisfied and complied
      in
      all material respects with the covenants, agreements and conditions required
      by
      this Agreement to be performed, satisfied or complied with by the Buyer(s)
      at or
      prior to the Closing Date.

     

    (d) The
      Company shall have filed a form UCC -1 with regard to the Pledged Property
      and
      Pledged Collateral as detailed in the Security Agreement dated the date hereof
      and provided proof of such filing to the Buyer(s). 

     

    7. CONDITIONS
      TO THE BUYER’S OBLIGATION TO PURCHASE.

     

    The
      obligation of the Buyer(s) hereunder to purchase the Convertible Debentures
      at
      the Closing is subject to the satisfaction, at or before the Closing Date,
      of
      each of the following conditions, provided that these conditions are for the
      Buyer’s sole benefit and may be waived by the Buyer(s) at any time in its sole
      discretion:

     

    (a) The
      Company shall have executed this Agreement, the Security Agreement, the
      Convertible Debenture, the Escrow Agreement, the Irrevocable Transfer
      Instructions and the Investor Registration Rights Agreement, and delivered
      the
      same to the Buyer(s).

     

    (b) The
      representations and warranties of the Company shall be true and correct in
      all
      material respects (except to the extent that any of such representations and
      warranties is already qualified as to materiality in Section 3 above, in which
      case, such representations and warranties shall be true and correct without
      further qualification) as of the date when made and as of the Closing Date
      as
      though made at that time (except for representations and warranties that speak
      as of a specific date) and the Company shall have performed, satisfied and
      complied in all material respects with the covenants, agreements and conditions
      required by this Agreement to be performed, satisfied or complied with by the
      Company at or prior to the Closing Date. If requested by the Buyer, the Buyer
      shall have received a certificate, executed by the President of the Company,
      dated as of the Closing Date, to the foregoing effect and as to such other
      matters as may be reasonably requested by the Buyer including, without
      limitation an update as of the Closing Date regarding the representation
      contained in Section 3(c) above.

     

    (c) The
      Company shall have executed and delivered to the Buyer(s) the Convertible
      Debentures in the respective amounts set forth opposite each Buyer(s) name
      on
      Schedule I attached hereto.

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    (d) The
      Buyer(s) shall have received an opinion of counsel in a form satisfactory to
      the
      Buyer(s).

     

    (e) The
      Company shall have provided to the Buyer(s) a certificate of good standing
      from
      the Secretary of State of Texas.

     

    (f) As
      of the
      Closing Date, the Company shall have reserved out of its authorized and unissued
      Common Stock, solely for the purpose of effecting the conversion of the
      Convertible Debentures, shares of Common Stock to effect the conversion of
      all
      of the Conversion Shares then outstanding.

     

    (g) The
      Irrevocable Transfer Agent Instructions, in form and substance satisfactory
      to
      the Buyer, shall have been delivered to and acknowledged in writing by the
      Company’s transfer agent.

     

    (h) The
      Company shall have provided to the Investor an acknowledgement, to the
      satisfaction of the Investor, from Malone & Bailey, PLLC, the Company’s
      independent certified public accountants, as to its ability to provide all
      consents required in order to file a registration statement in connection with
      this transaction.

     

    (i) The
      Company shall have filed a form UCC -1 with regard to the Pledged Property
      and
      Pledged Collateral as detailed in the Security Agreement and provided proof
      of
      such filing to the Buyer(s).

     

    (j) The
      Company shall obtained the approval of its board of directors and a majority
      of
      its outstanding shares of capital stock (voting as separate classes, if required
      by applicable law) to increase its authorized common stock to a number mutually
      acceptable to the Company and the Investor.

     

    8. INDEMNIFICATION.

     

    (a) In
      consideration of the Buyer’s execution and delivery of this Agreement and
      acquiring the Convertible Debentures and the Conversion Shares hereunder, and
      in
      addition to all of the Company’s other obligations under this Agreement, the
      Company shall defend, protect, indemnify and hold harmless the Buyer(s) and
      each
      other holder of the Convertible Debentures and the Conversion Shares, and
      all of their officers, directors, employees and agents (including, without
      limitation, those retained in connection with the transactions contemplated
      by
      this Agreement) (collectively, the “Buyer
      Indemnitees”)
      from
      and against any and all actions, causes of action, suits, claims, losses, costs,
      penalties, fees, liabilities and damages, and expenses in connection therewith
      (irrespective of whether any such Buyer Indemnitee is a party to the action
      for
      which indemnification hereunder is sought), and including reasonable attorneys’
fees and disbursements (the “Indemnified
      Liabilities”),
      incurred by the Buyer Indemnitees or any of them as a result of, or arising
      out
      of, or relating to (a) any misrepresentation or breach of any representation
      or
      warranty made by the Company in this Agreement, the Convertible Debentures
      or
      the Investor Registration Rights Agreement or any other certificate, instrument
      or document contemplated hereby or thereby, (b) any breach of any covenant,
      agreement or obligation of the Company contained in this Agreement, or the
      Investor Registration Rights Agreement or any other certificate, instrument
      or
      document contemplated hereby or thereby, or (c) any cause of action, suit or
      claim brought or made against such Indemnitee and arising out of or resulting
      from the execution, delivery, performance or enforcement of this Agreement
      or
      any other instrument, document or agreement executed pursuant hereto by any
      of
      the Indemnities, any transaction financed or to be financed in whole or in
      part,
      directly or indirectly, with the proceeds of the issuance of the Convertible
      Debentures or the status of the Buyer or holder of the Convertible Debentures
      the Conversion Shares, as a Buyer of Convertible Debentures in the Company.
      To
      the extent that the foregoing undertaking by the Company may be unenforceable
      for any reason, the Company shall make the maximum contribution to the payment
      and satisfaction of each of the Indemnified Liabilities, which is permissible
      under applicable law.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    (b) In
      consideration of the Company’s execution and delivery of this Agreement, and in
      addition to all of the Buyer’s other obligations under this Agreement, the Buyer
      shall defend, protect, indemnify and hold harmless the Company and all of its
      officers, directors, employees and agents (including, without limitation, those
      retained in connection with the transactions contemplated by this Agreement)
      (collectively, the “Company
      Indemnitees”)
      from
      and against any and all Indemnified Liabilities incurred by the Indemnitees
      or
      any of them as a result of, or arising out of, or relating to (a) any
      misrepresentation or breach of any representation or warranty made by the
      Buyer(s) in this Agreement, , instrument or document contemplated hereby or
      thereby executed by the Buyer, (b) any breach of any covenant, agreement or
      obligation of the Buyer(s) contained in this Agreement, the Investor
      Registration Rights Agreement or any other certificate, instrument or document
      contemplated hereby or thereby executed by the Buyer, or (c) any cause of
      action, suit or claim brought or made against such Company Indemnitee based
      on
      material misrepresentations or due to a material breach and arising out of
      or
      resulting from the execution, delivery, performance or enforcement of this
      Agreement, the Investor Registration Rights Agreement or any other instrument,
      document or agreement executed pursuant hereto by any of the Company
      Indemnities. To the extent that the foregoing undertaking by each Buyer may
      be
      unenforceable for any reason, each Buyer shall make the maximum contribution
      to
      the payment and satisfaction of each of the Indemnified Liabilities, which
      is
      permissible under applicable law.

     

    9. GOVERNING
      LAW: MISCELLANEOUS.

     

    (a) Governing
      Law.
      This
      Agreement shall be governed by and interpreted in accordance with the laws
      of
      the State of New Jersey without regard to the principles of conflict of laws.
      The parties further agree that any action between them shall be heard
      exclusively in Hudson County, New Jersey, and expressly consent to the
      jurisdiction and venue of the Superior Court of New Jersey, sitting in Hudson
      County and the United States District Court for the District of New Jersey
      sitting in Newark, New Jersey for the adjudication of any civil action asserted
      pursuant to this Paragraph.

     

    (b) Counterparts.
      This
      Agreement may be executed in two or more identical counterparts, all of which
      shall be considered one and the same agreement and shall become effective when
      counterparts have been signed by each party and delivered to the other party.
      In
      the event any signature page is delivered by facsimile transmission, the party
      using such means of delivery shall cause four (4) additional original executed
      signature pages to be physically delivered to the other party within five (5)
      days of the execution and delivery hereof.

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    (c) Headings.
      The
      headings of this Agreement are for convenience of reference and shall not form
      part of, or affect the interpretation of, this Agreement.

     

    (d) Severability.
      If any
      provision of this Agreement shall be invalid or unenforceable in any
      jurisdiction, such invalidity or unenforceability shall not affect the validity
      or enforceability of the remainder of this Agreement in that jurisdiction or
      the
      validity or enforceability of any provision of this Agreement in any other
      jurisdiction.

     

    (e) Entire
      Agreement, Amendments.
      This
      Agreement supersedes all other prior oral or written agreements between the
      Buyer(s), the Company, their affiliates and persons acting on their behalf
      with
      respect to the matters discussed herein, and this Agreement and the instruments
      referenced herein contain the entire understanding of the parties with respect
      to the matters covered herein and therein and, except as specifically set forth
      herein or therein, neither the Company nor any Buyer makes any representation,
      warranty, covenant or undertaking with respect to such matters. No provision
      of
      this Agreement may be waived or amended other than by an instrument in writing
      signed by the party to be charged with enforcement.

     

    (f) Notices.
      Any
      notices, consents, waivers, or other communications required or permitted to
      be
      given under the terms of this Agreement must be in writing and will be deemed
      to
      have been delivered (i) upon receipt, when delivered personally; (ii) upon
      confirmation of receipt, when sent by facsimile; (iii) three (3) days after
      being sent by U.S. certified mail, return receipt requested, or (iv) one (1)
      day
      after deposit with a nationally recognized overnight delivery service, in each
      case properly addressed to the party to receive the same. The addresses and
      facsimile numbers for such communications shall be:

     

    

    If
      to the
      Company,
      to:                  
Texas
      Prototypes, Inc.

    1299
      Commerce Drive

    Richardson,
      Texas 75081

    Attention: Michael
      C. Shores

    President

    Telephone: (214)
      575-9300

    Facsimile: (214)
      575-9314

     

    With
      a
      copy
      to:                             
Schiff
      Hardin LLP

    1101
      Connecticut Avenue, N.W.

    Suite
      600

    Washington,
      D.C. 20036

    Attention:
       Ernest
      M.
      Stern

    Telephone: (202)
      778-6461

    Facsimile: 
       (202)
      778-6460

    

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

    If
      to the
      Transfer Agent, to:         SunTrust
      Bank

    Stock
      Transfer Department

    58
      Edgewood Avenue

    Room
      225

    Atlanta,
      GA 30303

    Attention:
       Bryan
      Echols

     Group
      Vice President

    Telephone: (404)
      588-7622

    Facsimile: 
       (404)
      332-3875

    

    If
      to the
      Buyer(s), to its address and facsimile number on Schedule I, with copies to
      the
      Buyer’s counsel as set forth on Schedule I. Each party shall provide five (5)
      days’ prior written notice to the other party of any change in address or
      facsimile number.

     

    (g) Successors
      and Assigns.
      This
      Agreement shall be binding upon and inure to the benefit of the parties and
      their respective successors and assigns. Neither the Company nor any Buyer
      shall
      assign this Agreement or any rights or obligations hereunder without the prior
      written consent of the other party hereto.

     

    (h) No
      Third Party Beneficiaries.
      This
      Agreement is intended for the benefit of the parties hereto and their respective
      permitted successors and assigns, and is not for the benefit of, nor may any
      provision hereof be enforced by, any other person.

     

    (i) Survival.
      Unless
      this Agreement is terminated under Section 9(l), the representations and
      warranties of the Company and the Buyer(s) contained in Sections 2 and 3, the
      agreements and covenants set forth in Sections 4, 5 and 9, and the
      indemnification provisions set forth in Section 8, shall survive the Closing
      for
      a period of two (2) years following the date on which the Convertible Debentures
      are converted in full. The Buyer(s) shall be responsible only for its own
      representations, warranties, agreements and covenants hereunder.

     

    (j) Publicity.
      The
      Company and the Buyer(s) shall have the right to approve, before issuance any
      press release or any other public statement with respect to the transactions
      contemplated hereby made by any party; provided, however, that the Company
      shall
      be entitled, without the prior approval of the Buyer(s), to issue any press
      release or other public disclosure with respect to such transactions required
      under applicable securities or other laws or regulations (the Company shall
      use
      its best efforts to consult the Buyer(s) in connection with any such press
      release or other public disclosure prior to its release and Buyer(s) shall
      be
      provided with a copy thereof upon release thereof).

     

    (k) Further
      Assurances.
      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.

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    (l) Termination.
      In the
      event that the Closing shall not have occurred with respect to the Buyers on
      or
      before five (5) business days from the date hereof due to the Company’s or the
      Buyer’s failure to satisfy the conditions set forth in Sections 6 and 7 above
      (and the non-breaching party’s failure to waive such unsatisfied condition(s)),
      the non-breaching party shall have the option to terminate this Agreement with
      respect to such breaching party at the close of business on such date without
      liability of any party to any other party.

     

    (m) No
      Strict Construction.
      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
      PAGE INTENTIONALLY LEFT BLANK]

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF,
      the
      Buyers and the Company have caused this Securities Purchase Agreement to be
      duly
      executed as of the date first written above.

     

    
      	 	
              COMPANY:

            
	 	
              TEXAS
                PROTOTYPES, INC. 

            
	 	 
	 	
              By: /s/
                Michael C. Shores  

            
	 	
              
                

              

              Name Michael
                C. Shores

            
	 	
              Title: President

            
	 	 
	 	 
	 	
              THE
                BUYER’S(S’) SIGNATURES ARE 

              CONTAINED
                ON SCHEDULE I HERETO

            

    

    

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    SCHEDULE
      I

     

    SCHEDULE
      OF BUYERS

     

    
      	
              Name

            	
               

            	
              Signature

            	
               

            	
              Address/Facsimile
                

              Number
                of Buyer

            	 	
              Amount
                of 

              Subscription

            
	 	 	 	 	 	 	 
	
              Cornell
                Capital Partners, LP

            	 	
              By: Yorkville
                Advisors, LLC

            	 	
              101
                Hudson Street - Suite 3700

            	 	
              $700,000

            
	 	 	
              
                

              

              Its: General
                Partner

            	 	
              Jersey
                City, NJ 07303

              Facsimile: (201)
                985-8266

            	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	
              By: /s/
                Mark A Angelo

            	 	
              With
                a copy to:

            	 	 
	 	 	
              
                

              

              
                Name: Mark
                  A. Angelo

              

            	 	
              Cornell
                Capital Partners, LP

              
                
                  101
                    Hudson Street, Suite 3700

                

              

            	 	 
	 	 	
              Its: Portfolio
                Manager

            	 	
              
                Jersey
                  City, NJ 07303

              

            	 	 
	 	 	 	 	
              Attention: Troy
                J. Rillo, Esq.

            	 	 
	 	 	 	 	
              Facsimile: (201)
                985-8266

            	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	
              Mobilepro
                Corp.

            	 	
              By: /s/
                Jay Wirght

            	 	
              6701
                Democracy Boulevard

            	 	
              $700,000

            
	 	 	
              
                

              

              Name: Jay
                Wright

            	 	
              Suite
                300 

              
                Bethesda,
                  MD 20817

              

            	 	 
	 	 	
              Its: President
                

            	 	
              
                Facsimile:
                  (301) 315-9040

              

            	 	 

    

    

    
      
        
        

      

      
        SCHEDULE
          I-1REGISTRATION
        RIGHTS AGREEMENT

       

      REGISTRATION
        RIGHTS AGREEMENT
        (this
“Agreement”)
        dated
        as of August 25, 2004 by and between TEXAS
        PROTOTYPES, INC.,
        a Texas
        corporation (the “Company”),
        and
CORNELL
        CAPITAL PARTNERS, LP,
        a
        Delaware limited partnership (the “Investor”).

       

      WHEREAS:

       

      A. In
        connection with the Standby Equity Distribution Agreement by and between
        the
        parties hereto of even date herewith (the “Standby
        Equity Distribution Agreement”),
        the
        Company has agreed, upon the terms and subject to the conditions of the Standby
        Equity Distribution Agreement, to issue and sell to the Investor that number
        of
        shares of the Company’s common stock, par value $0.001 per share (the
“Common
        Stock”),
        which
        can be purchased pursuant to the terms of the Standby Equity Distribution
        Agreement for an aggregate purchase price of up to Fifteen Million Dollars
        ($15,000,000). Capitalized terms not defined herein shall have the meaning
        ascribed to them in the Standby Equity Distribution Agreement.

       

      B. To
        induce
        the Investor to execute and deliver the Standby Equity Distribution 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 the Investor hereby agree as
        follows:

       

      1. DEFINITIONS.

       

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

       

      a. “Person”
means
        a
        corporation, a limited liability company, an association, a partnership,
        an
        organization, a business, an individual, a governmental or political subdivision
        thereof or a governmental agency.

       

      b. “Register,”
        “registered,”
and
        “registration”
refer
        to a registration effected by preparing and filing one or more Registration
        Statements (as defined below) 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 or delayed basis (“Rule
        415”),
        and
        the declaration or ordering of effectiveness of such Registration Statement(s)
        by the United States Securities and Exchange Commission (the “SEC”).

       

      c. “Registrable
        Securities”
means
        the shares of Common Stock issuable to Investor pursuant to the Standby Equity
        Distribution Agreement, including, without limitation, the Investor’s Shares (as
        defined in Section 12.4 of the Standby Equity Distribution
        Agreement).

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      d. “Registration
        Statement”
means
        a
        registration statement under the 1933 Act which covers the Registrable
        Securities.

       

      2. REGISTRATION.

       

      a. Mandatory
        Registration.
        The
        Company shall prepare and file with the SEC a Registration Statement on Form
        S-1, SB-2 or on such other form as is available. The Company shall cause
        such
        Registration Statement to be declared effective by the SEC prior to the first
        sale to the Investor of the Company’s Common Stock pursuant to the Standby
        Equity Distribution Agreement.

       

      b. Sufficient
        Number of Shares Registered.
        In the
        event the number of shares available under a Registration Statement filed
        pursuant to Section 2(a) is insufficient to cover all of the Registrable
        Securities which the Investor has purchased pursuant to the Standby Equity
        Distribution Agreement, the Company shall amend the Registration Statement,
        or
        file a new Registration Statement (on the short form available therefore,
        if
        applicable), or both, so as to cover all of such Registrable Securities which
        the Investor has purchased pursuant to the Standby Equity Distribution Agreement
        as soon as practicable, but in any event not later than fifteen (15) days
        after
        the necessity therefore arises. The Company shall use it best efforts to
        cause
        such amendment and/or new Registration Statement to become effective as soon
        as
        practicable following the filing thereof. For purposes of the foregoing
        provision, the number of shares available under a Registration Statement
        shall
        be deemed “insufficient to cover all of the Registrable Securities” if at any
        time the number of Registrable Securities issuable on an Advance Notice Date
        is
        greater than the number of shares available for resale under such Registration
        Statement.

       

      3. RELATED
        OBLIGATIONS.

       

      a. The
        Company shall keep the Registration Statement effective pursuant to Rule
        415 at
        all times until the date on which the Investor shall have sold all the
        Registrable Securities covered by such Registration Statement (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, in light of the circumstances in
        which
        they were made, not misleading.

       

      b. The
        Company shall prepare and file with the SEC such amendments (including
        post-effective amendments) and supplements to a Registration Statement and
        the
        prospectus used in connection with such Registration Statement, which prospectus
        is to be filed pursuant to Rule 424 promulgated under the 1933 Act, as may
        be
        necessary to keep such Registration Statement 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 such Registration Statement until such time as all of
        such
        Registrable Securities shall have been disposed of in accordance with the
        intended methods of disposition by the seller or sellers thereof as set forth
        in
        such Registration Statement. In the case of amendments and supplements to
        a
        Registration Statement which are required to be filed pursuant to this Agreement
        (including pursuant to this Section 3(b)) by reason of the Company’s filing a
        report on Form 10-KSB, Form 10-QSB or Form 8-K or any analogous report under
        the
        Securities Exchange Act of 1934, as amended (the “1934
        Act”),
        the
        Company shall have incorporated such report by reference into the Registration
        Statement, if applicable, or shall file such amendments or supplements with
        the
        SEC on the same day on which the 1934 Act report is filed which created the
        requirement for the Company to amend or supplement the Registration
        Statement.

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

       

      c. The
        Company shall furnish to the Investor without charge, (i) at least one copy
        of
        such Registration Statement as declared effective by the SEC and any
        amendment(s) thereto, including financial statements and schedules, all
        documents incorporated therein by reference, all exhibits and each preliminary
        prospectus, (ii) ten (10) copies of the final prospectus included in such
        Registration Statement and all amendments and supplements thereto (or such
        other
        number of copies as such Investor may reasonably request) and (iii) such
        other
        documents as such Investor may reasonably request from time to time in order
        to
        facilitate the disposition of the Registrable Securities owned by such
        Investor.

       

      d. The
        Company shall use its best efforts to (i) register and qualify the Registrable
        Securities covered by a Registration Statement under such other securities
        or
“blue
        sky”
laws
        of
        such jurisdictions in the United States as the Investor reasonably requests,
        (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 such other actions as may be necessary
        to
        maintain such registrations and qualifications in effect at all times during
        the
        Registration Period, and (iv) take all other actions reasonably necessary
        or
        advisable to 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 (w) make any change to its certificate
        of
        incorporation or by-laws, (x) qualify to do business in any jurisdiction
        where
        it would not otherwise be required to qualify but for this Section 3(d),
        (y)
        subject itself to general taxation in any such jurisdiction, or (z) file
        a
        general consent to service of process in any such jurisdiction. The Company
        shall promptly notify the Investor of the receipt by the Company of any
        notification with respect to the suspension of the registration or qualification
        of any of the Registrable Securities for sale under the securities or
“blue
        sky”
laws
        of
        any jurisdiction in the United States or its receipt of actual notice of
        the
        initiation or threat of any proceeding for such purpose.

       

      e. As
        promptly as practicable after becoming aware of such event or development,
        the
        Company shall notify the Investor in writing of the happening of any event
        as a
        result of which the prospectus included in a 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, in light of the circumstances under which they were made, not
        misleading (provided that in no event shall such notice contain any material,
        nonpublic information), and promptly prepare a supplement or amendment to
        such
        Registration Statement to correct such untrue statement or omission, and
        deliver
        ten (10) copies of such supplement or amendment to each Investor. The Company
        shall also promptly notify the Investor in writing (i) when a prospectus
        or any
        prospectus supplement or post-effective amendment has been filed, and when
        a
        Registration Statement or any post-effective amendment has become effective
        (notification of such effectiveness shall be delivered to the Investor by
        facsimile on the same day of such effectiveness), (ii) of any request by
        the SEC
        for amendments or supplements to a Registration Statement or related prospectus
        or related information, and (iii) of the Company’s reasonable determination
        that a post-effective amendment to a Registration Statement would be
        appropriate. 

       

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

       

      f. The
        Company shall use its best efforts to prevent the issuance of any stop order
        or
        other suspension of effectiveness of a Registration Statement, or the suspension
        of the qualification of any of the Registrable Securities for sale in any
        jurisdiction within the United States of America and, if such an order or
        suspension is issued, to obtain the withdrawal of such order or suspension
        at
        the earliest possible moment and to notify the Investor of the issuance of
        such
        order and the resolution thereof or its receipt of actual notice of the
        initiation or threat of any proceeding for such purpose.

       

      g. At
        the
        reasonable request of the Investor, the Company shall furnish to the Investor,
        on the date of the effectiveness of the Registration Statement and thereafter
        from time to time on such dates as the Investor may reasonably request (i)
        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,
        and (ii) an opinion, dated as of such date, of 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
        Investor.

       

      h. The
        Company shall make available for inspection by (i) the Investor and (ii)
        one
        firm of accountants or other agents retained by the Investor (collectively,
        the
“Inspectors”)
        all
        pertinent financial and other records, and pertinent corporate documents
        and
        properties of the Company (collectively, the “Records”),
        as
        shall be reasonably deemed necessary by each Inspector, and cause the Company’s
        officers, directors and employees to supply all information which any Inspector
        may reasonably request; provided, however, that each Inspector shall agree,
        and
        the Investor hereby agrees, to hold in strict confidence and shall not make
        any
        disclosure (except to an Investor) or use 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 or is otherwise required under the 1933 Act, (b) the
        release of such Records is ordered pursuant to a final, non-appealable subpoena
        or 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 of which
        the Inspector and the Investor has knowledge. The 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.

       

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

       

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

       

      j. The
        Company shall use its best efforts either to cause all the Registrable
        Securities covered by a Registration Statement (i) to be listed on each
        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 (ii) to
        secure the inclusion for quotation on the National Association of Securities
        Dealers, Inc. OTC Bulletin Board for such Registrable Securities. The Company
        shall pay all fees and expenses in connection with satisfying its obligation
        under this Section 3(j).

       

      k. The
        Company shall cooperate with the Investor to the extent applicable, to
        facilitate the timely preparation and delivery of certificates (not bearing
        any
        restrictive legend) representing the 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 Investor may reasonably
        request and registered in such names as the Investor may request.

       

      l. The
        Company shall use its best efforts to cause the Registrable Securities covered
        by the applicable Registration Statement to be registered with or approved
        by
        such other governmental agencies or authorities as may be necessary to
        consummate the disposition of such Registrable Securities.

       

      m. The
        Company shall make generally available to its security holders as soon as
        practical, but not later than ninety (90) 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.

       

      n. The
        Company shall otherwise use its best efforts to comply with all applicable
        rules
        and regulations of the SEC in connection with any registration
        hereunder.

       

      o. Within
        two (2) business days after a Registration Statement which covers Registrable
        Securities is ordered effective by the SEC, the Company shall deliver, and
        shall
        cause legal counsel for the Company to deliver, to the transfer agent for
        such
        Registrable Securities (with copies to the Investor) confirmation that such
        Registration Statement has been declared effective by the SEC in the form
        attached hereto as Exhibit
        A.

       

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

       

      
        
           

        

        
          5

          
            

          

        

        
           

        

      

       

      4. OBLIGATIONS
        OF THE INVESTOR.

       

      The
        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 the first
        sentence of 3(e), the Investor will immediately discontinue disposition of
        Registrable Securities pursuant to any Registration Statement(s) covering
        such
        Registrable Securities until the Investor’s receipt of the copies of the
        supplemented or amended prospectus contemplated by Section 3(e) or receipt
        of
        notice that no supplement or amendment is required. Notwithstanding anything
        to
        the contrary, the Company shall cause its transfer agent to deliver unlegended
        certificates for shares of Common Stock to a transferee of the Investor in
        accordance with the terms of the Standby Equity Distribution Agreement in
        connection with any sale of Registrable Securities with respect to which
        the
        Investor has entered into a contract for sale prior to the Investor’s receipt of
        a notice from the Company of the happening of any event of the kind described
        in
        Section 3(f) or the first sentence of 3(e) and for which the Investor has
        not
        yet settled.

       

      5. EXPENSES
        OF REGISTRATION.

       

      All
        expenses incurred in connection with registrations, filings or qualifications
        pursuant to Sections 2 and 3, including, without limitation, all registration,
        listing and qualifications fees, printers, legal and accounting fees shall
        be
        paid by the Company. 

       

      6. INDEMNIFICATION.

       

      With
        respect to Registrable Securities which are included in a Registration Statement
        under this Agreement:

       

      a. To
        the
        fullest extent permitted by law, the Company will, and hereby does, indemnify,
        hold harmless and defend the Investor, the directors, officers, partners,
        attorneys, employees, agents, representatives of, and each Person, if any,
        who
        controls the Investor within the meaning of the 1933 Act or the 1934 Act
        (each,
        an “Indemnified
        Person”),
        against any losses, claims, damages, liabilities, judgments, fines, penalties,
        charges, costs, reasonable attorneys’ fees, amounts paid in settlement or
        expenses, joint or several (collectively, “Claims”)
        incurred in investigating, preparing or defending any action, claim, suit,
        inquiry, proceeding, investigation or appeal taken from the foregoing by
        or
        before any court or governmental, administrative or other regulatory agency,
        body or the SEC, whether pending or threatened, whether or not an indemnified
        party is or may be a party thereto (“Indemnified
        Damages”),
        to
        which any of them may become subject insofar as such Claims (or actions or
        proceedings, whether commenced or threatened, in respect thereof) arise out
        of
        or are based upon: (i) any untrue statement or alleged untrue statement of
        a
        material fact in a Registration Statement or any post-effective amendment
        thereto or in any filing made in connection with the qualification of the
        offering under the securities or other “blue
        sky”
laws
        of
        any jurisdiction in which Registrable Securities are offered (“Blue
        Sky Filing”),
        or
        the omission or alleged omission to state a material fact required to be
        stated
        therein or necessary to make the statements therein not misleading;
        (ii) any untrue statement or alleged untrue statement of a material fact
        contained in any 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 there under relating to the offer or sale of the Registrable
        Securities pursuant to a Registration Statement (the matters in the foregoing
        clauses (i) through (iii) being, collectively, “Violations”).
        The
        Company shall reimburse each Indemnified Person and each such controlling
        person
        promptly as such expenses are incurred and are due and payable, for any
        reasonable legal fees or disbursements 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): (x) shall not apply to a Claim
        by an
        Indemnified Person 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 such Indemnified Person solely as it relates to such Indemnified
        person if expressly for use in connection with the preparation of the
        Registration Statement or any such amendment thereof or supplement thereto;
        (y)
        shall not be available to the extent such Claim is based on a failure of
        the
        Investor to deliver or to cause to be delivered the prospectus made available
        by
        the Company, if such prospectus was timely made available by the Company
        pursuant to Section 3(e); and (z) 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. Notwithstanding
        anything to the contrary herein or in any other agreement entered into between
        the Company and the Investor, the Company acknowledges and agrees that it
        is
        solely responsible and shall indemnify each Indemnified Person for the contents
        of any registration statement, prospectus or other filing made with the SEC
        or
        otherwise used in the offering of the Company’s securities (except as such
        disclosure relates solely to the Investor and then only to the extent that
        such
        disclosure conforms with information furnished in writing by the Investor
        to the
        Company), even if the Investor or its agents as an accommodation to the Company
        participate or assist in the preparation of such registration statement,
        prospectus or other SEC filing. The Company shall retain its own legal counsel
        to review, edit, confirm and do all things such counsel deems necessary or
        desirable to such registration statement, prospectus or other SEC filing
        to
        ensure that it does not contain an untrue statement or alleged untrue statement
        of material fact or omit or alleged to omit a material fact necessary to
        make
        the statements made therein, in light of the circumstances under which the
        statements were made, not misleading. Such indemnity shall remain in full
        force
        and effect regardless of any investigation made by or on behalf of the
        Indemnified Person.

       

      
        
           

        

        
          6

          
            

          

        

        
           

        

      

       

      b. In
        connection with a Registration Statement, the Investor agrees to indemnify,
        hold
        harmless and defend, to the same extent and in the same manner as is set
        forth
        in Section 6(a), the Company, each of its directors, each of its officers
        who signs the Registration Statement and each Person, if any, who controls
        the
        Company within the meaning of the 1933 Act or the 1934 Act (each an
“Indemnified
        Party”),
        against any Claim or Indemnified Damages to which any of them may become
        subject, under the 1933 Act, the 1934 Act or otherwise, insofar as such Claim
        or
        Indemnified Damages arise out of or is based upon any Violation, in each
        case to
        the extent, and only to the extent, that such Violation solely relates to
        the
        Investor and occurs in reliance upon and in conformity with written information
        furnished to the Company by the Investor expressly for use in connection
        with
        such Registration Statement; and, subject to Section 6(d), the Investor will
        reimburse any legal or other expenses 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) and the agreement with
        respect to contribution contained in Section 7 shall not apply to amounts
        paid
        in settlement of any Claim if such settlement is effected without the prior
        written consent of the Investor, which consent shall not be unreasonably
        withheld; provided, further, however, that the Investor shall be liable under
        this Section 6(b) for only that amount of a Claim or Indemnified Damages
        as does
        not exceed the net proceeds to the 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. Notwithstanding anything to the contrary
        contained herein, the indemnification agreement contained in this Section
        6(b)
        with respect to any prospectus shall not inure to the benefit of any Indemnified
        Party if the untrue statement or omission of material fact contained in the
        prospectus was corrected and such new prospectus was delivered to the Investor
        prior to the Investor’s use of the prospectus to which the Claim
        relates.

       

      
        
           

        

        
          7

          
            

          

        

        
           

        

      

       

      c. Promptly
        after receipt by an Indemnified Person or Indemnified Party under this Section
        6
        of notice of the commencement of any action or proceeding (including any
        governmental action or proceeding) involving a Claim, 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
        of not
        more than one counsel for such Indemnified Person or Indemnified Party 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 Indemnified Party or Indemnified Person shall
        cooperate fully with the indemnifying party in connection with any negotiation
        or defense of any such action or claim by the indemnifying party and shall
        furnish to the indemnifying party all information reasonably available to
        the
        Indemnified Party or Indemnified Person which relates to such action or claim.
        The indemnifying party shall keep the Indemnified Party or Indemnified Person
        fully apprised at all times as to the status of the defense or any settlement
        negotiations with respect thereto. No indemnifying party shall be liable
        for any
        settlement of any action, claim or proceeding effected without its prior
        written
        consent, provided, however, that the indemnifying party shall not unreasonably
        withhold, delay or condition its consent. No indemnifying party shall, without
        the prior written consent of the Indemnified Party or Indemnified Person,
        consent to entry of any judgment or enter into any settlement or other
        compromise which does not include as an unconditional term thereof the giving
        by
        the claimant or plaintiff to such Indemnified Party or Indemnified Person
        of a
        release from all liability in respect to such claim or litigation. Following
        indemnification as provided for hereunder, the indemnifying party shall be
        subrogated to all rights of the Indemnified Party or Indemnified Person with
        respect to all third parties, firms or corporations relating to the matter
        for
        which indemnification has been made. 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 prejudiced in its ability to defend
        such
        action.

       

      
        
           

        

        
          8

          
            

          

        

        
           

        

      

       

      d. 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
        and
        when bills are received or Indemnified Damages are incurred.

       

      e. The
        indemnity agreements contained herein shall be in addition to (i) any cause
        of
        action or similar right of the Indemnified Party or Indemnified Person against
        the indemnifying party or others, and (ii) any liabilities the indemnifying
        party may be subject to pursuant to the law.

       

      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: (i) 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 fraudulent
        misrepresentation; and (ii) contribution 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 Investor the benefits of Rule 144 promulgated
        under the 1933 Act or any 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 6.3 of the Standby Equity
        Distribution Agreement) and the filing of such reports and other documents
        is
        required for the applicable provisions of Rule 144; and

       

      c. furnish
        to the Investor so long as the 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 Investor to sell such securities
        pursuant to Rule 144 without registration.

       

      
        
           

        

        
          9

          
            

          

        

        
           

        

      

       

      9. 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 by a written agreement between the Company and the
        Investor. Any amendment or waiver effected in accordance with this Section
        9
        shall be binding upon the Investor and the Company. No consideration shall
        be
        offered or paid to any Person to amend or consent to a waiver or modification
        of
        any provision of any of this Agreement unless the same consideration also
        is
        offered to all of the parties to this Agreement.

       

      10. MISCELLANEOUS.

       

      a. A
        Person
        is deemed to be a holder of Registrable Securities whenever such Person owns
        or
        is deemed to own of record such Registrable Securities. If the Company receives
        conflicting instructions, notices or elections from two or more Persons 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, consents, waivers or other communications required or permitted
        to be
        given under the terms of this Agreement must be in writing and will be deemed
        to
        have been delivered: (i) upon receipt, when delivered personally; (ii) upon
        receipt, when sent by facsimile (provided confirmation of transmission is
        mechanically or electronically generated and kept on file by the sending
        party);
        or (iii) one business day after deposit with a nationally recognized overnight
        delivery service, in each case properly addressed to the party to receive
        the
        same. The addresses and facsimile numbers for such communications shall
        be:

       

      
        	
                If
                  to the Company, to:

              	
                Texas
                  Prototypes, Inc.

              
	 	
                1299
                  Commerce Drive

              
	 	
                Richardson,
                  Texas 75081

              
	 	
                Attention: Michael
                  C. Shores, President

              
	 	
                Telephone: (214)
                  575-9300

              
	 	
                Facsimile: (214)
                  575-9314

              
	 	 
	
                With
                  a copy to:

              	
                Schiff
                  Hardin LLP

              
	 	
                1101
                  Connecticut Avenue, N.W.

                Suite
                  600

              
	 	
                Washington,
                  D.C. 20036

                Attention:
                  Ernest M. Stern, Esq.

              
	 	
                Telephone: (202)
                  778-6461

              
	 	
                Facsimile: (202)
                  778-6460

              

      

       

      
        
           

        

        
          10

          
            

          

        

        
           

        

      

       

      
        	
                If
                  to the Investor, to:

              	
                Cornell
                  Capital Partners, LP

              
	 	
                101
                  Hudson Street - Suite 3700

              
	 	
                Jersey
                  City, New Jersey 07302

              
	 	
                Attention: Mark
                  Angelo

              
	 	
                Portfolio
                  Manager

              
	 	
                Telephone: (201)
                  985-8300

              
	 	
                Facsimile: (201)
                  985-8266

              
	 	 
	
                With
                  a copy to:

              	
                Cornell
                  Capital Partners, LP

              
	 	
                101
                  Hudson Street - Suite 3700

              
	 	
                Jersey
                  City, New Jersey 07302

              
	 	
                Attention: Troy
                  J. Rillo, Esq.

              
	 	
                Telephone: (201)
                  985-8300

              
	 	
                Facsimile: (201)
                  985-8266

              

      

       

      Any
        party
        may change its address by providing written notice to the other parties hereto
        at least five days prior to the effectiveness of such change. Written
        confirmation of receipt (A) given by the recipient of such notice, consent,
        waiver or other communication, (B) mechanically or electronically generated
        by
        the sender’s facsimile machine containing the time, date, recipient facsimile
        number and an image of the first page of such transmission or (C) provided
        by a
        courier or overnight courier service shall be rebuttable evidence of personal
        service, receipt by facsimile or receipt from a nationally recognized overnight
        delivery service in accordance with clause (i), (ii) or (iii) above,
        respectively.

       

      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. The
        corporate laws of the State of New Jersey shall govern all issues concerning
        the
        relative rights of the Company and the Investor. All other questions concerning
        the construction, validity, enforcement and interpretation of this Agreement
        shall be governed by the internal laws of the State of New Jersey, without
        giving effect to any choice of law or conflict of law provision or rule (whether
        of the State of New Jersey or any other jurisdiction) that would cause the
        application of the laws of any jurisdiction other than the State of New Jersey.
        Each party hereby irrevocably submits to the exclusive jurisdiction of the
        Superior Courts of the State of New Jersey, sitting in Hudson County, New
        Jersey
        and the Federal District Court for the District of New Jersey sitting in
        Newark,
        New Jersey, for the adjudication of any dispute hereunder or in connection
        herewith or with any transaction contemplated hereby or discussed herein,
        and
        hereby irrevocably waives, and agrees not to assert in any suit, action or
        proceeding, any claim that it is not personally subject to the jurisdiction
        of
        any such court, that such suit, action or proceeding is brought in an
        inconvenient forum or that the venue of such suit, action or proceeding is
        improper. Each party hereby irrevocably waives personal service of process
        and
        consents to process being served in any such suit, action or proceeding by
        mailing a copy thereof to such party at the address for such notices to it
        under
        this Agreement and agrees that such service shall constitute good and sufficient
        service of process and notice thereof. Nothing contained herein shall be
        deemed
        to limit in any way any right to serve process in any manner permitted by
        law.
        If any provision of this Agreement shall be invalid or unenforceable in any
        jurisdiction, such invalidity or unenforceability shall not affect the validity
        or enforceability of the remainder of this Agreement in that jurisdiction
        or the
        validity or enforceability of any provision of this Agreement in any other
        jurisdiction. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE,
        AND
        AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE
        HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY
        TRANSACTION CONTEMPLATED HEREBY.

       

      
        
           

        

        
          11

          
            

          

        

        
           

        

      

       

      e. This
        Agreement, the Standby Equity Distribution Agreement, the Escrow Agreement,
        and
        the Placement Agent Agreement 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, the Standby Equity
        Distribution Agreement, the Escrow Agreement, and the Placement Agent Agreement
        supersede all prior agreements and understandings among the parties hereto
        with
        respect to the subject matter hereof and thereof.

       

      f. This
        Agreement shall inure to the benefit of and be binding upon the permitted
        successors and assigns of each of the parties hereto.

       

      g. The
        headings in this Agreement are for convenience of reference only and shall
        not
        limit or otherwise affect the meaning hereof.

       

      h. This
        Agreement may be executed in identical counterparts, each of which shall
        be
        deemed an original but all of which shall constitute one and the same agreement.
        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.

       

      i. 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.

       

      j. 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.

       

      k. This
        Agreement is intended for the benefit of the parties hereto and their respective
        permitted successors and assigns, and is not for the benefit of, nor may
        any
        provision hereof be enforced by, any other Person.

       

      [REMAINDER
        OF PAGE INTENTIONALLY LEFT BLANK]

       

      
        
           

        

        
          12

          
            

          

        

         

      

      

      IN
        WITNESS WHEREOF,
        the
        parties have caused this Registration Rights Agreement to be duly executed
        as of
        day and year first above written.

       

      
        	 	 
	 	
                COMPANY:

              
	 	
                TEXAS
                  PROTOTYPES, INC. 

              
	 	 
	 	
                By: /s/
                  Michael C. Shores  

              
	 	
                
                  

                

                Name: Michael
                  C. Shores

              
	 	
                Title: President

              
	 	 
	 	 
	 	
                INVESTOR:

              
	 	
                CORNELL
                  CAPITAL PARTNERS, LP

              
	 	 
	 	
                By: Yorkville
                  Advisors, LLC

              
	 	
                Its: General
                  Partner

              
	 	 
	 	
                By:
                  /s/
                  Mark Angelo

              
	 	
                
                  

                

                Name: Mark
                  Angelo

              
	 	
                Title: Portfolio
                  Manager

              

      

       

      
        
           

        

        
          13

          
            

          

        

         

      

       

      EXHIBIT
        A

       

      FORM
        OF NOTICE OF EFFECTIVENESS

      OF
        REGISTRATION STATEMENT

       

      INSERT

      

      Attention:
        

      

      Re: TEXAS
        PROTOTYPES, INC.

      

      Ladies
        and Gentlemen:

      

      We
        are
        counsel to Texas Prototypes, Inc., a Texas corporation (the “Company”),
        and
        have represented the Company in connection with that certain Standby Equity
        Distribution Agreement (the “Standby
        Equity Distribution Agreement”)
        entered into by and between the Company and Cornell Capital Partners, LP
        (the
“Investor”)
        pursuant to which the Company issued to the Investor shares of its Common
        Stock,
        par value $0.001 per share (the “Common
        Stock”).
        Pursuant to the Standby Equity Distribution Agreement, the Company also has
        entered into a Registration Rights Agreement with the Investor (the
“Registration
        Rights Agreement”)
        pursuant to which the Company agreed, among other things, to register the
        Registrable Securities (as defined in the Registration Rights Agreement)
        under the Securities Act of 1933, as amended (the “1933
        Act”).
        In
        connection with the Company’s obligations under the Registration Rights
        Agreement, on ____________ ____, the Company filed a Registration Statement
        on
        Form ________ (File No. 333-_____________) (the “Registration
        Statement”)
        with
        the Securities and Exchange Commission (the “SEC”)
        relating to the Registrable Securities which names the Investor as a selling
        stockholder thereunder.

       

      In
        connection with the foregoing, we advise you that a member of the SEC’s staff
        has advised us by telephone that the SEC has entered an order declaring the
        Registration Statement effective under the 1933 Act at [ENTER
        TIME OF EFFECTIVENESS]
        on
[ENTER
        DATE OF EFFECTIVENESS]
        and we
        have no knowledge, after telephonic inquiry of a member of the SEC’s staff, that
        any stop order suspending its effectiveness has been issued or that any
        proceedings for that purpose are pending before, or threatened by, the SEC
        and
        the Registrable Securities are available for resale under the 1933 Act pursuant
        to the Registration Statement.

       

      
        	 	 	 
	 	
                Very
                  truly yours,

              
	 
 	 
 	 
 
	
              	By:  	
              
	 	
                

              

      

      cc: Cornell
        Capital Partners, LP

      

      
        
           

        

        
          14

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