X0202 4 2004-12-01 0 0001069778 NETWORK INSTALLATION CORP NWKI 0001304009 Dutchess Private Equities Fund, LP 312 STUART ST BOSTON MA 02116 0 0 0 1 See Note (1) December 2004 101 Debenture 0 2004-12-01 4 J 0 540000 0 A 2005-12-01 2009-12-01 Common 540000 1338600 I See Note Decemeber 2004 101 Warrant 1.73 2004-12-01 4 J 0 540000 0 A 2009-12-01 2009-12-01 Common 540000 1338600 I See Note Two of our directors, Michael Novielli, who is also our Interim Chief Financial Officer, and Douglas Leighton, are the Managing Members of Dutchess Capital Management, LLC which is the General Partner to Dutchess Private Equities Fund, LP. Dutchess Private Equities Fund, LP purchased the Debenture The Debenture is convertible into common shares priced at the lower of 75% of the lowest closing bid of the common stock in the 15 trading says prior to conversion or 100% of the average closing bid prices of the common stock in the 15 trading days prior to closing. The warrant is excercisable upon an effective registration statement. The warrant was issued as an inducement for an investment. /s/ Douglas Leighton 2004-12-03