Texture Problems

[superlou]

I know this should be a very basic problem, but I just want to run my setup by someone to see if i'm doing something really dumb. I can't get my textures to show up in the HLMV, just pink/black checkers. The directory of my mod is:

D:\Program Files\valve\Steam\SteamApps\SourceMods\TestMod

The compiled mdl and related files are in:

D:\Program Files\valve\Steam\SteamApps\SourceMods\TestMod\models

My .qc file for compiling medbox.smd (the model in quesiton) is:

$modelname 	"medbox.mdl"
$scale		1.0
$body		"Body"		medbox.smd
$sequence	idle		"medbox"	fps 15 ACT_IDLE 1
$surfaceprop	"metal"
$cdmaterials	"models/medbox"
$collisionmodel "medbox.smd" {
	$mass	2.0
	}

My materials files (.vtf/.vmt) are in the following folder:

D:\Program Files\valve\Steam\SteamApps\SourceMods\TestMod\materials\models\medbox

The vtf is medbox.vtf and the medbox.vmt file contains:

"LightmappedGeneric"
{
	"$basetexture"	"models/medbox/medbox"
	"$model"	1
}

I have read all of the related wiki articles and have been searching for 5 days now how to fix this. I think the texture is not being found.

I use XSI EXP and I applied the texture using a UV unwrap and then in the render menu used get -> material -> phong then selected the appropriate clip.

I would really appreciate any help.

Thanks,
Louis