ASSET PURCHASE AGREEMENT

ASSET PURCHASE AGREEMENT

between

PERMIAN ENERGY SERVICES, L.P.

as Seller

and

FEDERAL SECURITY PROTECTION SERVICES, INC.

as Purchaser

<page>

TABLE OF CONTENTS

1. Purchase and Sale of Assets. 1

1.1. Purchased Assets 1

1.2. Excluded Assets 2

1.3. Purchase Price for Assets: Allocations 3

1.4. Inventory 3

1.5. Payment of Aggregate Price 3

2. Liabilities of Permian 3

3. Creditor Matters 3

4. Assembly of Purchased Assets 3

5. Customer and Supplier Lists and Records 3

6. Adjustment of Purchase Price 3

7. Approvals, Permits, Licenses and Authorizations 3

8. Brokerage Commissions 3

9. Representations and Warranties 4

9.1. Representations and Warranties of Permian and Clark 4

9.1.1. Ownership of Permian 4

9.1.2. Due Organization; Name and Address;

Good Standing, Authority of Permian 4

9.1.3. Authorization and Validity of Agreements 4

9.1.4. Agreement Not in Conflict with Other

Instruments; Required Approvals Obtained 4

9.1.5. Disclaimer of Fraudulent Intent 5

9.1.6 Unencumbered Title to Purchased Assets 5

9.2 Representations and Warranties of the Federal 5

9.2.1. Due Organization; Good Standing; Power 5

9.2.2. Authorization and Validity of Documents 5

10. Particular Covenants 5

10.1. Risk of Loss 5

10.2. Full Access 5

10.3. Furnishing of Certain Information 6

11. Closing 6

11.1. Time, Date and Place 6

11.2. Permian's Conditions to Close 6

11.3. Federal's Conditions to Close 6

11.4. Actions to Be Taken at the Closing 7

11.5. Contemporaneous Transfer 7

11.6. Operation of TPU Business 7

i

<page>

12. Indemnification by Permian to Federal 8

12.1. Indemnification by Permian and R. J. Clark 8

12.2 Survival of Obligation to Indemnify 8

12.3 Notice and Procedure 8

13. Expenses of Transactions 9

14. Miscellaneous 9

14.1. Survival of Representations, Warranties and Agreements 9

14.2. Notices 9

14.3. Entire Agreement 10

14.4. Assignability 10

14.5. Binding Effect; Benefit 10

14.6. Severability 10

14.7. Amendment; Waiver 10

14.8. Section Headings 10

14.9. Counterparts and Facsimile Signatures 10

14.10. Applicable Law; Jurisdiction and Venue;

Service of Process 11

14.11. Legal Expenses 11

14.12. Remedies 11

14.13. Further Assurances 11

14.14. Use of Genders 11

SCHEDULES

1.1.2 - Assumed Contracts

1.1.4 - Intangible Property Rights

1.1.5 - Patents, Patents Pending, Patentable Technology,

Copyrights, Trade Names and Service Marks

1.1.7 - Computer Software Programs

1.1.8 - Actions by Permian Against Third Parties

1.2 - Excluded Assets

2.1 - Liabilities of Permian

ii

<page>

ASSET PURCHASE AGREEMENT

THIS ASSET PURCHASE AGREEMENT (the "Agreement") is made and entered

into and effective as of March 11, 2005, by and among Permian Energy

Services, L.P., a Texas limited partnership ("Permian"), R. J. Clark,

Managing Partner of Permian ("Clark") and Federal Security Protection

Services, Inc., a Delaware corporation ("Federal").

EXPLANATORY STATEMENT

A. Permian markets various patented thermal pulse units ("TPU") to the oil

and gas industry through a licensing and distribution agreement with Bi-Comp,

L.L.C. and markets the patented "Penney Pump" to the oil and gas industry

through a licensing, use and distribution agreement with Penney Resources,

LLC and has various other ventures also in the oil and gas industry.

B. Federal desires to purchase and Permian desires to sell and transfer

to Federal, substantially all of the assets of Permian related to the

marketing of the TPU and "Penney Pump" (collectively, the "TPU Business") on

the terms and conditions stated herein.

NOW THEREFORE, for and in consideration of the Explanatory Statement that

shall be deemed a substantive part of this Agreement, and the mutual

covenants, promises, agreements, representations and warranties contained

herein, and other good and valuable consideration the receipt and sufficiency

of which is hereby acknowledged by the parties, the parties hereto agree,

represent and warrant as follows:

1. Purchase and Sale of Assets.

1.1. Purchased Assets. Except as and to the extent otherwise provided in

Section 1.2 below, Federal agrees to purchase from Permian, and

Permian agrees to sell, transfer and assign to Federal, all of the

assets, wherever located, which are owned by Permian, or in which

Permian has any rights, title or interest (to the extent of such right,

title or interest), and used in connection with the TPU Business

(collectively referred to herein as the "Purchased Assets"). The Purchased

Assets shall include, but shall not be limited to, all of Permian's right,

title and interest in the following:

1.1.1. All of the rights, tangible and intangible, and leasehold interests

in personal or real property of Permian existing under any of the

contracts, agreements, leases, licenses, instruments or commitments

that are listed in Schedule 1.1.2 attached hereto, and under any

contracts, agreements, leases, licenses, instruments and commitments

which are entered into by Permian in connection with the TPU Business

after the date hereof and prior to the "Closing" (as defined below)

with the prior written consent of Federal (collectively, the "Personal

Property Contracts" or collectively referred to as the "Assumed

Contracts");

1.1.2. All rights in and to any governmental and private permits, licenses,

certificates of occupancy, franchises and authorizations, to the extent

assignable, used in connection with the TPU Business;

1.1.3. All raw materials, work-in progress and finished-goods inventories,

and all repair and replacement parts and materials, and all other parts

and materials, used in the TPU Business (collectively, the "Inventory");

Page 1

<page>

1.1.4. All rights in and to any requirements, processes, formulations,

methods, technology, know-how, formulae, trade secrets, designs,

inventions and other proprietary rights and all documentation embodying,

representing or otherwise describing any of the foregoing, owned or held

by Permian in connection with the TPU Business, which are more fully

described in Schedule 1.1.4 (the assets described in Sections 1.1.4

through 1.1.7 are referred to as the "Intangible Property Rights");

1.1.5. All patents, patents pending, patentable technology, copyrights,

trade names and service marks of Permian used in or related to the

TPU Business, all of which are set forth in Schedule 1.1.5, and all

applications therefor, and all documentation embodying, representing

or otherwise describing any of the foregoing;

1.1.6. All rights in and to the customer lists, promotion lists, supplier

lists, marketing data and other complications of names and data developed

in connection with the TPU Business, and which shall be delivered by or

on behalf of Permian to Federal at or prior to the Closing;

1.1.7. All of Permian's rights in and to the computer software programs

(including software licensed to Permian) used in connection with the

TPU Business or developed or under development by, or on behalf of,

Permian in connection with the TPU Business or developed or under

development by, or on behalf of, Permian in connection with the TPU

Business and identified on Schedule 1.1.7, including the source code,

object code and documentation for such software, in each case to the

extent that Permian possesses and has a right to possess and transfer the

same (provided, however, that copies of all financial data and

information, and any software necessary to access or process it, shall be

provided or made available to Permian following the Closing);

1.1.8. All causes of action, claims, suits, proceedings, judgments or

demands, of or held by Permian against third parties which are listed on

Schedule 1.1.8 attached hereto;

1.1.9. All accounts and notes receivable pertaining exclusively to

Permian's conduct of the TPU Business existing as of the Closing Date;

1.1.10. Copies of all account lists, files, books and records, including

personnel records, publications, and other records and data used in

connection with the TPU Business;

1.1.11. All goodwill associated with the TPU Business and the Purchased

Assets, including the Intangible Property Rights;

1.1.12. All deposits and all other funds held by or on behalf of Permian

for the delivery of TPU products; and

1.1.13. All assets of any kind, nature or description owned by Permian not

otherwise described in this Section 1.1 which are used exclusively in

connection with the TPU Business and which are not Excluded Assets (as

hereinafter defined).

1.2. Excluded Assets. Set forth in Schedule 1.2 is a list and description of

assets owned by Permian and used in connection with the TPU Business which

shall not be sold, but shall be retained by Permian (the "Excluded

Assets"). Notwithstanding anything to the contrary set forth in

Section 1.1, the Purchased Assets shall not include any of the Excluded

Assets.

Page 2

<page>

1.3. Purchase Price for Assets: Allocations. The purchase price for the

Purchased Assets shall be the transfer to Permian of 2,250,000 restricted

shares of $.001 par value common stock of Federal together with a

promissory note in the principal amount of $250,000 with interest at 6% per

annum and with accrued interest due one (1) year from the date of the note

and all principal and accrued but unpaid interest due two (2) years from

the date of the note (the "Purchase Price"). The Purchase Price shall be

allocated to the Purchased Assets as determined by Federal in Federal's

sole discretion.

1.4. Inventory. All inventory of Permian relating to the TPU Business is

included in the Purchase Price and shall be conveyed to Federal at Closing.

1.5. Payment of Aggregate Price. On the terms and subject to the conditions

of this Agreement, at Closing Federal shall pay the Purchase Price to

Permian by the issuance of the shares of Federal common stock representing

the Purchase Price.

2. Liabilities of Permian. Federal assumes and shall be solely liable and

responsible for all debts, obligations, duties, and liabilities of Permian

as listed on Schedule 2 incurred prior to Closing and shall indemnify and

hold Permian harmless therefrom.

3. Creditor Matters. The transactions contemplated by this Agreement are

intended by the parties to be a contemporaneous exchange between Permian and

Federal and will be accomplished at Closing. The transactions contemplated

by this Agreement represent a regularly conducted, noncollusive sale, and

have been negotiated by the parties in an arm's length manner with due

regard for the respective obligations of the parties and value of the assets

transferred.

4. Assembly of Purchased Assets. Permian shall assemble all of the Purchased

Assets at the Premises for delivery to Federal at Closing.

5. Customer and Supplier Lists and Records. Prior to or at the Closing

Permian shall furnish Federal with all of Permian's Customer and Supplier

Lists, which shall include a complete and correct list of all of Permian's

customers and suppliers and their addresses, telephone numbers and such

other and further information as Federal may reasonably request in respect

of the TPU Business.

6. Adjustment of Purchase Price. The Purchase Price set forth in Section 1.3

above will not be adjusted at Closing for any prorations.

7. Approvals, Permits, Licenses and Authorizations. Promptly after the

execution of this Agreement, Permian and Federal shall use their best

efforts to obtain such approvals, consents, permits, licenses and

authorizations, if any, of all Governments and Governmental Agencies (as

hereinafter defined) as may be required to complete lawfully the

transactions contemplated hereby and to enable Federal to acquire the

Purchased Assets and operate the TPU Business as operated by Permian and

in full compliance with any and all applicable laws, rules and regulations.

Permian agrees to cooperate fully, execute, acknowledge, swear to and

deliver such instruments and documents and take all such other and further

actions as may be necessary or desirable in order to obtain such approvals,

consents, permits, licenses and authorizations.

8. Brokerage Commissions. Each party hereto represents to the other party

that it has not incurred any obligation or liability, contingent or

otherwise, for brokerage fees, finder's fees, agent's commissions, or the

like in connection with this Agreement or the transactions reflected hereby.

<page>

9. Representations and Warranties.

9.1. Representations and Warranties of Permian and Clark. Permian and Clark,

jointly and severally, represent and warrant to Federal as of the date

hereof and as of the Closing on the Closing Date that:

9.1.1. Ownership of Permian. Permian has the power and authority to sell,

assign, transfer and deliver the Purchased Assets to Federal in accordance

with the terms of this Agreement, to consummate the transactions

contemplated hereby and to enter into the Agreement.

9.1.2. Due Organization; Name and Address; Good Standing, Authority of

Permian. Permian is a limited partnership duly organized, validly

existing and in good standing under the laws of the State of Texas.

Permian has full right, power and authority to own, lease and operate

its properties and assets, and to carry on its TPU Business. Permian

is duly licensed, qualified and authorized to do business in each

jurisdiction in which the properties and assets owned by it or the

nature of the business conducted by it make such licensing, qualification

and authorization legally necessary. Permian is not in breach or violation

of, and the execution, delivery and performance of this Agreement will

not result in a breach or violation of, any of the provisions of Permian's

Limited Partnership Agreement or any other partnership documents or

agreements, amended to the date of this Agreement ("Permian"s Corporate

Documents").

9.1.3. Authorization and Validity of Agreements. Permian has the full

right, power and authority to execute, acknowledge and deliver this

Agreement and to perform the transactions contemplated by this Agreement.

The execution, acknowledgment and delivery of this Agreement by Permian

and the performance by Permian of the transactions contemplated hereby

have been duly and validly authorized by all necessary corporate action.

This Agreement has been duly executed, acknowledged and delivered by

Permian and is the legal, valid and binding obligation of Permian,

enforceable against Permian in accordance with its terms, except in each

case as such enforceability may be limited by general principles of

equity, bankruptcy, insolvency, moratorium and similar laws relating to

creditors rights generally.

9.1.4. Agreement Not in Conflict with Other Instruments; Required Approvals

Obtained. The execution, acknowledgment, delivery, and performance of this

Agreement, and the consummation of the transactions contemplated by this

Agreement will not (a) violate or require any consent, approval, or filing

under, (i) any common law, law, statute, ordinance, rule or regulation

(collectively referred to throughout this Agreement as "Laws") of any

federal, state or local government (collectively referred to throughout

this Agreement as "Governments") or any agency, bureau, commission,

instrumentality or judicial body of any Governments (collectively referred

to throughout this Agreement as "Governmental Agencies"), or (ii) any

judgment, injunction, order, writ or decree of any court, arbitrator,

Government or Governmental Agency by which Permian (b) conflict with,

require any consent, approval, or filing under, result in the breach or

termination of any provision of, constitute a default under, or result in

the creation of any claim, security interest, lien, charge, or encumbrance

upon any of the Purchased Assets pursuant to, (i) Permian's Corporate

Documents, (ii) any indenture, mortgage, deed of trust, license, permit,

approval, consent, franchise, lease, contract, or other instrument,

document or agreement to which Permian is a party or by which Permian or

any of the Purchased Assets is bound, or (iii) any judgment, injunction,

order, writ or decree of any court, arbitrator, Government or Governmental

Agency by which Permian or any of the Purchased Assets is bound; and all

permits, licenses and authorizations of any Government or Governmental

Agency required to be obtained prior to the Closing, shall have been

obtained and shall be in full force and effect as of the Closing Date.

Page 3

<page>

9.1.5. Disclaimer of Fraudulent Intent. The transactions described in this

Agreement have been undertaken by Permian in good faith, considering

their obligations to any person or entity to whom Permian owes a right

to payment, whether or not the right is reduced to judgment, liquidated,

unliquidated, fixed, contingent, matured, unmatured, claims are

called "Creditors" under this paragraph), and have undertaken these

transactions without any intent to hinder, delay or defraud any such

Creditors, and either have disclosed in the ordinary