Security SPAsec Agreement

SECURITY SPASEC AGREEMENT

This Security SPAsec Agreement (the Agreement) is made as of Date: by and between Grantor Name: , with principal address: , and Secured Party Name: , with principal address: . Each of Grantor and Secured Party may be referred to herein as a Party and collectively as the Parties.

RECITALS

WHEREAS, Grantor and Secured Party have entered into or will enter into a separate share purchase agreement, loan agreement or other agreement identified as the Underlying Agreement pursuant to which Grantor has certain payment and performance obligations (the Obligations);

WHEREAS, as material inducement to Secured Party to extend credit or otherwise accept the Undertaking under the Underlying Agreement, Grantor desires to grant, assign and convey to Secured Party a continuing security interest in the Collateral (as defined below) to secure the prompt and complete performance of the Obligations; and

WHEREAS, the Parties intend that this Agreement create a valid, enforceable and perfected security interest in the Collateral to the maximum extent permitted by applicable law.

NOW, THEREFORE

In consideration of the mutual covenants and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

1. DEFINITIONS

1.1 Collateral means all right, title and interest of Grantor in and to the property described in Section 2 below and all proceeds, products, accessions, substitutions and replacements thereof, whether now owned or hereafter acquired, together with all fixtures, accounts, inventory, equipment, instruments, chattel paper, general intangibles, payment intangibles, contract rights, inventory and any intellectual property specified below.

2. GRANT OF SECURITY INTEREST; DESCRIPTION OF COLLATERAL

2.1 Grant. To secure payment and performance of the Obligations, Grantor hereby grants to Secured Party a continuing security interest in, lien on, and right of setoff against all Collateral.

2.2 Types of Collateral. Without limiting the foregoing, the Collateral includes the following categories (check all that apply): Inventory Accounts Receivable Equipment Intellectual Property

3. SECURED OBLIGATIONS

3.1 Obligations Secured. The security interest granted hereunder secures all present and future Obligations of Grantor to Secured Party, whether now existing or hereafter arising, including principal, interest, fees, expenses, indemnities and other amounts owing under the Underlying Agreement.

3.2 Maturity. The Obligations shall mature and become due in accordance with the Underlying Agreement. The date by which all Obligations are to be finally satisfied is: .

4. REPRESENTATIONS AND WARRANTIES

Grantor represents and warrants to Secured Party that, as of the date of this Agreement and except as otherwise disclosed in writing: (a) Grantor is the sole legal and beneficial owner of the Collateral free and clear of any liens or encumbrances other than Permitted Encumbrances; (b) Grantor has full power and authority to enter into and perform this Agreement; and (c) execution, delivery and performance of this Agreement will not violate any law, contract, judgment or order binding on Grantor.

5. COVENANTS

5.1 Preservation of Collateral. Grantor shall at all times keep the Collateral in good condition and repair and shall not sell, assign, transfer, lease, license or otherwise dispose of any Collateral except in the ordinary course of business and in compliance with the Underlying Agreement.

5.2 Further Assurances. Upon request by Secured Party and at Grantor's expense, Grantor shall execute and deliver to Secured Party financing statements, assignments, powers of attorney, and other documents reasonably requested by Secured Party to perfect, preserve, protect, and enforce the security interest created by this Agreement.

6. DEFAULT; REMEDIES

6.1 Events of Default. Each of the following shall constitute an Event of Default: (a) failure by Grantor to pay any monetary Obligation when due; (b) breach of any representation, warranty or covenant contained in this Agreement that is not cured within any applicable cure period; (c) insolvency, assignment for the benefit of creditors, or commencement of bankruptcy proceedings by or against Grantor.

6.2 Remedies. Upon an Event of Default, Secured Party shall have all rights and remedies of a secured party under applicable law, including without limitation the right to take possession of the Collateral, to sell, lease or otherwise dispose of the Collateral at public or private sale, and to apply proceeds to the Obligations after giving such notices as required by law. Remedies are cumulative and in addition to all other rights and remedies available at law or in equity.

7. PERFECTION; PRIORITY

Grantor authorizes Secured Party to file one or more financing statements and continuation statements and any other instruments required to perfect and maintain the security interest granted hereby. Grantor shall execute such further instruments as Secured Party may reasonably request to evidence, perfect or protect Secured Party's interest in the Collateral.

8. NOTICES

All notices, requests, demands and other communications required or permitted under this Agreement shall be in writing and delivered personally, sent by nationally recognized overnight courier, or mailed by certified mail, return receipt requested, to the addresses set forth below or to such other address as either Party may designate by notice to the other Party in accordance with this Section.

9. MISCELLANEOUS

9.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of: , without regard to conflict of law principles.

9.2 Entire Agreement. This Agreement, together with the Underlying Agreement and any schedules or exhibits hereto, constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior agreements and understandings.

9.3 Severability. If any provision of this Agreement is determined to be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions shall not be affected or impaired thereby.

9.4 Amendments; Waiver. Any amendment or modification of this Agreement must be in writing and signed by both Parties. No failure or delay by a Party in exercising any right shall operate as a waiver of that right.

9.5 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. Signed copies transmitted by facsimile or electronic image shall be binding as originals.

AUTHORIZATIONS AND CERTIFICATIONS

Grantor certifies that the individual signing below is authorized to enter into this Agreement on behalf of Grantor and that no consent, approval, authorization or other action by any third party or governmental authority is required for Grantor's execution, delivery or performance of this Agreement, other than as disclosed in writing to Secured Party.

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