Chapeau, Inc. Completes Financing Transactions

Chapeau, Inc. ("Chapeau” or the "Company”) (OTCBB:CPEU) announced today it has received $925,000 in bridge financing from the Gordon V. and Helen C. Smith Foundation (the "Foundation”) in connection with the second and final purchase of shares under a Stock Purchase Agreement dated August 22, 2008 (the "Foundation Financing Agreement”). In a Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission (the "Commission”) on September 21, 2008, Chapeau previously reported that it had been informed that the Foundation did not intend to complete the second purchase of shares contemplated in the Foundation Financing Agreement. However, following conversations between the parties, the Foundation agreed to satisfy its obligation under the Foundation Financing Agreement. Chapeau issued to the Foundation 2,565,880 shares of Chapeau common stock, par value $0.001 per share (the "Common Stock”), at a purchase price of $0.3605 per share, which price per share is equal to 70% of the average of the closing price of the Common Stock on the Over The Counter Bulletin Board for the four trading days including and immediately preceding August 22, 2008, the date of the Foundation Financing Agreement. Chapeau agreed to release the Foundation from damages, if any, resulting from the delay in funding the second purchase of shares contemplated by the Foundation Financing Agreement.

Also on September 23, 2008, Chapeau received $575,000 in bridge financing from TEFCO, LLC, a Virginia limited liability company ("TEFCO”), and its senior secured creditor with a blanket lien over all of Chapeau’s assets (the "TEFCO Financing Agreement”). At a meeting of Chapeau’s Board of Directors (the "Board”) held on September 23, 2008, the Board received advice from its financial advisor that Chapeau’s equity had no value at that date in the absence of a significant capital infusion. The pricing of the shares in the TEFCO transaction was based on this valuation advice, among other factors. Pursuant to the TEFCO Financing Agreement, Chapeau issued to TEFCO 57.5 million shares of Common Stock at a purchase price of $0.01 per share. Chapeau also agreed to a four-week period commencing on the date of the TEFCO Financing Agreement for the exclusive negotiation of an additional financing transaction. The final two weeks of the foregoing exclusivity period are subject to the exercise of the Board’s fiduciary obligation to consider any alternative financing transactions that may be available.

The aggregate funds received pursuant to the above noted TEFCO transaction and the Foundation Financing Agreement do not represent or satisfy the significant capital infusion referenced by the Company’s financial advisor. While the Company continues to seek sources of significant capital infusion, including in connection with the previously mentioned exclusivity arrangement with TEFCO, there can be no assurances that such additional capital infusion could or would be achieved or, if achieved, would be on terms favorable to Chapeau.

On September 23, 2008, Chapeau received a "Shareholders’ Consent to Fill Directors Vacancy and New Directors’ Directive to Halt Pending Actions Taken Without Authority” (the "Consent”) from Patrick Imeson and Eric Altman, purporting to represent a majority of the outstanding shares of Chapeau. The Consent seeks to amend the bylaws, declare the board vacant, elect new directors and to give several directives to Chapeau’s management. Based on its consultation with counsel and review of the record, the Board has determined that this Consent does not comply with the requirements of applicable law, Chapeau’s Articles of Incorporation or By-Laws, and is accordingly invalid. Chapeau continues to review this matter with its legal advisors.

As previously disclosed in a Current Report on Form 8-K filed with the Commission on August 26, 2008, the Board has set a meeting date and time of 1:00 p.m. Pacific on October 6, 2008 for a special meeting of shareholders of record on September 25, 2008. Chapeau intends to send a notice of the special meeting to shareholders of record as soon as practicable after the record date.

The foregoing is news relating to Chapeau, Inc. (the "Company”) and may contain forward-looking statements, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. The Company’s actual results, performance or achievements could differ materially from the results expressed in, or implied by these forward-looking statements. The Company undertakes no obligation to revise or publicly release any revision to these forward-looking statements. This does not constitute an offer to buy or sell securities by the Company, its subsidiaries or any associated party and is meant purely for informational purposes.