EXECUTIVE COPY
 
WINWIN GAMING, INC.
 
SECURITY AGREEMENT
 
This Security Agreement is entered into as of April 21, 2006 (the “Agreement”),
by and among WinWin Gaming, Inc., a Delaware corporation (“Borrower”), the
parties listed on Exhibit A hereto (the “Secured Parties”) with reference to the
following facts:
 
A.  Concurrently herewith, Borrower is selling secured convertible notes and
warrants pursuant to the terms of a Secured Convertible Note and Warrant
Purchase Agreement dated of even date herewith (the “Purchase Agreement”) by and
among Borrower and the Secured Parties.
 
B.  As an inducement to the Secured Parties to enter into the Purchase Agreement
and to acquire the secured convertible promissory notes provided for thereunder
(the “Notes”), Borrower agreed to secure the repayment of the Notes with a
security interest in certain assets of Borrower.
 
C.  The parties hereto desire that the all of the Secured Parties be pari passu
with one another as to the debt represented by the Notes and the security
interest securing the repayment thereof on the terms and conditions set forth
herein.
 
AGREEMENT
 
Borrower and the Secured Parties hereby agree as follows:
 
1.  Certain Definitions. For purposes of this Agreement, capitalized terms used
herein which are not defined herein shall have the meanings set forth in the
Purchase Agreement. All terms used herein which are defined in Division 1 or
Division 9 of the UCC (as defined below) shall have the meanings given therein
unless otherwise defined in this Agreement or the Purchase Agreement; provided,
however, that if a term is defined in Division 9 of the UCC differently than in
another Article of the UCC, the term has the meaning specified in Division 9. In
addition, the following terms shall have the following meanings:
 
(a)  “Borrower’s Books” means all of Borrower’s books and records including
ledgers, records indicating, summarizing, or evidencing such Borrower’s
properties or assets or liabilities, all information relating to Borrower’s
business operations or financial condition, and all computer programs, disc or
tape files, printouts, runs, or other computer prepared information, and the
equipment containing such information.
 
(b)  “Collateral” shall mean the property described on Exhibit B annexed hereto
and made a part hereof to this Agreement.
 
(c)  “Copyrights” means all copyrights and applications for copyright, domestic
or foreign, together with the underlying works of authorship (including titles),
whether or not the underlying works of authorship have been published and
whether said copyrights are statutory or arise under the common law, and all
other rights and works of authorship, all rights, claims, and demands in any way
relating to any such copyrights or works, including royalties and rights to sue
for past, present, or future infringement, and all rights of renewal and
extension of copyright, including, but not limited to, those described on
Exhibit C annexed hereto and made a part hereof; and the right to sue for past,
present and future infringements of any of the foregoing.
 

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(d)  “Debt” means (a) indebtedness or liability for borrowed money; (b)
obligations evidenced by bonds, debentures, notes, or other similar instruments;
(c) obligations for the deferred purchase price of property or services
(including trade obligations); (d) obligations as lessee under capital leases;
(e) current liabilities in respect of unfunded vested benefits under Plans
covered by ERISA; (f) obligations under letters of credit; (g) obligations under
acceptance facilities; (h) all contingent obligations to purchase, to provide
funds for payment, to supply funds to invest in any Person or entity, or
otherwise to assure a creditor against loss; and (i) obligations secured by any
Liens, whether or not the obligations have been assumed.
 
(e)  “Intellectual Property Collateral” means the following properties and
assets owned or held by Borrower or in which Borrower otherwise has any
interest, now existing or hereafter acquired or arising: (a) all Patents; (b)
all Copyrights; (c) all Trademarks; (d) all trade secrets, confidential
information, customer lists, license rights, advertising materials, operating
manuals, methods, processes, know how, sales literature, drawings,
specifications, blue prints, descriptions, inventions, name plates, and
catalogs; and (e) all licenses of any Patents, Trademarks or Copyrights; and (f)
the entire goodwill of or associated with the businesses now or hereafter
conducted by Borrower connected with and symbolized by any of the aforementioned
properties and assets.
 
(f)  “Lien” means, with respect to any asset: (a) any mortgage, lien, charge,
security interest, or encumbrance of any kind in respect of such asset (or any
agreement to give any of the foregoing, whether or not contingent on the
occurrence of any future event); or (b) any undertaking (whether or not
contingent) by a Person to grant any mortgage, lien, pledge, charge, security
interest, or encumbrance to another Person on such asset.
 
(g)  “Obligations” means (a) all obligations of Borrower under the Purchase
Agreement and each of the Notes, whether for payment of principal, interest
(including, without limitation, interest accruing after the commencement of any
case, proceeding or other action relating to the bankruptcy, insolvency or
reorganization of Borrower), fees, breakage costs, indemnities, expenses or
otherwise; (b) the performance of all obligations of Borrower under the Purchase
Agreement and each of the Notes, whether for payment of principal, interest
(including, without limitation, interest accruing after the commencement of any
case, proceeding or other action relating to the bankruptcy, insolvency or
reorganization of Borrower), fees, breakage costs, indemnities, expenses or
otherwise; (c) all loans, advances, indebtedness, and other obligations owed by
Borrower to Secured Parties of every description whether now existing or
hereafter arising (including those owed by Borrower to others and acquired by
Secured Parties by purchase, assignment, or otherwise), whether or not for the
payment of money, whether or not evidenced by any note or other instrument,
whether direct or indirect, absolute or contingent, due or to become due, joint
or several, primary or secondary, liquidated or unliquidated, secured or
unsecured, original or renewed or extended, whether arising before, during or
after the commencement of any insolvency proceeding in which Borrower is a
debtor, any obligations arising pursuant to any letter of credit transactions
and any other financial accommodations, obligations to perform or forbear from
performing acts; (d) all obligations of Borrower under this Agreement; (e) the
repayment of (i) any amounts that Secured Parties may advance or spend for the
maintenance or preservation of the Collateral; and (ii) any other expenditures
that Secured Parties may make under the provisions of this Agreement or for the
benefit of Borrower; (f) all amounts owed under any modifications, renewals or
extensions of any of the foregoing obligations; (g) all other amounts now or in
the future owed by Borrower to Secured Parties whether or not of the same kind
or class as the other obligations owed by Borrower to Secured Parties; and (h)
any of the foregoing that arises after the filing of a petition by or against
Borrower under the Bankruptcy Code, even if the obligations do not accrue
because of the automatic stay under Bankruptcy Code §362 or otherwise.
 
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(h)  “Patents” means all patents and patent applications, domestic or foreign,
all licenses relating to any of the foregoing, and all income and royalties with
respect to any licenses, all rights to sue for past, present or future
infringement thereof, all rights arising therefrom and pertaining thereto and
all reissues, divisions, continuations, renewals, extensions, and continuations
in part thereof including, but not limited to, those described on Exhibit D
annexed hereto and made a part hereof; and the right to sue for past, present
and future infringements of any of the foregoing.
 
(i)  “Permitted Liens” means: (i) Liens imposed by law, such as carriers’,
warehousemen’s, materialmen’s and mechanics’ liens, or Liens arising out of
judgments or awards against Borrower with respect to which Borrower at the time
shall currently be prosecuting an appeal or proceedings for review; (ii) Liens
for taxes not yet subject to penalties for nonpayment and Liens for taxes the
payment of which is being contested in good faith and by appropriate proceedings
and for which, to the extent required by generally accepted accounting
principles then in effect, proper and adequate book reserves relating thereto
are established by Borrower; (iii) Liens (a) upon or in any equipment acquired,
licensed, leased or held by Borrower to secure the purchase price of such
equipment or indebtedness incurred solely for the purpose of financing the
acquisition of such equipment, or (b) existing on such equipment at the time of
its acquisition, provided that the Lien is confined solely to the property so
acquired and improvements thereon, and the proceeds of such equipment and other
equipment financed by the holder of such Lien; (iv) Liens consisting of leases
or subleases and licenses and sublicenses granted to others in the ordinary
course of Borrower’s business not interfering in any material respect with the
business of Borrower and any interest or title of a lessor or licensor under any
lease or license, as applicable; (v) Liens incurred or deposits made in the
ordinary course of the Borrower’s business in connection with worker’s
compensation, unemployment insurance, social security and other like laws;
(vi) Liens to which the holders of a majority of the outstanding principal
amount due and owing under the Notes (the “Majority Note Holders”) have
expressly consented in writing; and (ix) Liens incurred in connection with the
extension, renewal or refinancing of the indebtedness secured by the Liens
described in clauses (i) through (iii) hereof provided that any extension,
renewal or replacement lien shall be limited to the property encumbered by the
existing Lien and the principal amount of the indebtedness being extended,
renewed or replaced does not increase.
 
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(j)  “Person” means an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated association,
joint venture, or governmental authority.
 
(k)  “Trademarks” means all state (including common law), federal and foreign
trademarks, service marks, and trade names, and applications for registration of
such trademarks, service marks and trade names, all of the goodwill of the
business connected with the use of, and symbolized by, each trademark; all
licenses relating to any of the foregoing and all income and royalties with
respect to any licenses, whether registered or unregistered and wherever
registered, all rights to sue for past, present, or future infringement or
unconsented use thereof, all rights arising therefrom and pertaining thereto and
all reissues, extensions and renewals thereof, including, but not limited to,
those described on Exhibit E annexed hereto and made a part hereof; and the
right to sue for past, present and future infringements of any of the foregoing.
 
(l)  “UCC” means the Uniform Commercial Code as in effect in the State of New
York, as the same may be amended from time to time.
 
2.  Security Agreement.
 
(a)  Grant. In order to secure the payment, performance and observance of the
Obligations in accordance with the terms thereof, Borrower hereby grants to
Secured Parties, for the benefit of the Secured Parties, a continuing security
interest in, and a right of set off against, as applicable, all right, title and
interest of Borrower in all personal property of Borrower, whether now owned or
existing or hereafter acquired or arising and regardless of where located
including, without limitation, the Collateral.
 
(b)  Relative Priorities. The security interests of the Secured Parties in the
Collateral shall rank pari passu with one another as to all Obligations as
defined below.
 
(c)  Borrower Remains Liable. Anything herein to the contrary notwithstanding,
(i) Borrower shall remain liable under any contracts, agreements and other
documents included in the Collateral, to the extent set forth therein, to
perform all of its duties and obligations thereunder to the same extent as if
this Agreement had not been executed, (ii) the exercise by the Secured Parties
of any of the rights hereunder shall not release Borrower from any of its duties
or obligations under such contracts, agreements and other documents included in
the Collateral, and (iii) no Secured Party shall have any obligation or
liability under any contracts, agreements and other documents included in the
Collateral by reason of this Agreement, nor shall any Secured Party be obligated
to perform any of the obligations or duties of Borrower thereunder or to take
any action to collect or enforce any such contract, agreement or other document
included in the Collateral.
 
(d)  Continuing Security Interest. Borrower agrees that this Agreement shall
create a continuing security interest in the Collateral which shall remain in
effect until the indefeasible payment and performance in full of all of the
Obligations or the conversion of the principal and accrued interest under the
Notes into equity securities as described in the Notes.
 
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(e)  Other Actions as to Any and All Collateral. Borrower further agrees, at the
request and option of Secured Parties, to take any and all other actions Secured
Parties may determine to be necessary or useful for the attachment, perfection
and priority of, and the ability of Secured Parties to enforce, Secured Parties’
security interest in any and all of the Collateral, including, without
limitation, (a) executing, delivering and, where appropriate, filing financing
statements and amendments relating thereto under the UCC, to the extent, if any,
that Borrower’s signature thereon is required therefor; (b) causing Secured
Parties’ name to be noted as secured party on any certificate of title for a
titled good if such notation is a condition to attachment, perfection or
priority of, or ability of Secured Parties to enforce, Secured Parties’ security
interest in such Collateral; (c) complying with any provision of any statute,
regulation or treaty of the United States as to any Collateral if compliance
with such provision is a condition to attachment, perfection or priority of, or
ability of Secured Parties to enforce, Secured Parties’ security interest in
such Collateral; (d) obtaining governmental and other third party waivers,
consents and approvals in form and substance satisfactory to Secured Parties,
including, without limitation, any consent of any licensor, lessor or other
person obligated on Collateral; (e) obtaining waivers from mortgagees and
landlords in form and substance satisfactory to Secured Parties; and (f) taking
all actions under any earlier versions of the UCC or under any other law, as
reasonably determined by Secured Parties to be applicable in any relevant
Uniform Commercial Code or other jurisdiction, including any foreign
jurisdiction.
 
(f)  Right to Inspect. Secured Parties (through any of its officers, employees,
or agents) shall have the right, upon reasonable prior notice, from time to time
during Borrower’s usual business hours, to inspect Borrower’s Books and to make
copies thereof and to check, test, and appraise the Collateral in order to
verify Borrower’s financial condition or the amount, condition of, or any other
matter relating to, the Collateral.
 
(g)  Discharge Liens. In order to protect or perfect any security interest which
Secured Parties is granted hereunder, Secured Parties may, upon an Event of
Default, in its sole discretion, discharge any lien or encumbrance or bond or
the same, pay any insurance, maintain guards, warehousemen, or any personnel to
protect the Collateral, pay any service bureau, or, obtain any records, and all
costs for the same shall be added to the Secured Obligations and shall be
payable on demand.
 
3.  Borrower’s Representations, Warranties and Covenants. Borrower hereby
represents, warrants and covenants to the Secured Parties that:
 
(a)  Location. Borrower’s principal place of business is the address set forth
on the signature page to this Agreement, and Borrower keeps its records
concerning accounts, contract rights and other property at that location.
Borrower will promptly notify the Secured Parties in writing of the
establishment of any new place of business where any of the Collateral is kept.
Borrower is a corporation organized under the laws of the State of Delaware.
 
(b)  Books and Records. Borrower will at all times keep accurate and complete
records of the Collateral and will keep such Collateral insured to the extent
similarly situated companies insure their assets of a like type or nature.
 
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(c)  Ownership and Liens. Borrower has title to, or valid leasehold interests
in, all of its properties and assets, real and personal, including the
Collateral and properties and assets and leasehold interests reflected in the
financial statements delivered to Secured Parties pursuant to the Purchase
Agreement (other than any properties or assets disposed of in the ordinary
course of business), and none of the properties and assets, real and personal,
including the Collateral owned by Borrower and none of its leasehold interests
is subject to any Lien, except for Permitted Liens and Liens set forth in
Schedule 1.3 to the Purchase Agreement.
 
(d)  Other Financing Statements. Other than financing statements, security
agreements, equipment leases and related filings, chattel mortgages,
assignments, copyright security agreements or collateral assignments, patent or
trademark security agreements or collateral assignments, fixture filings and
other agreements or instruments executed, delivered, filed or recorded for the
purpose of granting or perfecting any Lien or executed, delivered, filed or
recorded in connection with the Notes (collectively, “Financing Statements”), no
effective Financing Statement naming Borrower as debtor, assignor, grantor,
mortgagor, pledgor or the like and covering all or any part of the Collateral is
currently on file in any filing or recording office in any jurisdiction, except
for Financing Statements relating to the Liens set forth in Schedule 1.3 to the
Purchase Agreement.
 
(e)  Notices, Reports and Information. Borrower will notify the Secured Parties
of any material claim made or asserted against the Collateral by any person or
entity and of any change in the composition of the Collateral or other event
which could materially adversely affect the value of the Collateral or the
Secured Parties’ Lien thereon.
 
(f)  Separate Obligations and Liens. Borrower acknowledges and agrees that
(i) the Obligations represent separate and distinct indebtedness, obligations
and liabilities of Borrower to each of the Secured Parties, which Borrower is
separately obligated to each Secured Party to pay and perform, in each case
regardless of whether or not any indebtedness, obligation or liability to any
other Secured Party or any other person or entity, or any agreement, instrument
or guaranty that evidences any such other indebtedness, liability or obligation,
or any provision thereof, shall for any reason be or become void, voidable,
unenforceable or discharged, whether by payment, performance, avoidance or
otherwise; (ii) the Lien that secures each of the Secured Parties’ respective
Obligations (a) is separate and distinct from any and all other Liens on the
Collateral, and (b) is enforceable without regard to whether or not any other
Lien shall be or become void, voidable or unenforceable or the indebtedness,
obligations or liabilities secured by any such other Lien shall be discharged,
whether by payment, performance, avoidance or otherwise.
 
(g)  Other Agreements. Except for agreements that the Borrower has entered into
with Solidus Networks, Inc., the Borrower is not a party to any indenture, loan,
or credit agreement, or to any lease or other agreement or instrument or subject
to any charter or corporate restriction which could have a material adverse
effect on the business, properties, assets, operations, or conditions, financial
or otherwise, of Borrower, or the ability of Borrower to carry out its
obligations under this Agreement, the Purchase Agreement, or any other agreement
by and between Secured Parties and Borrower. Borrower is not in default in any
respect in the performance, observance, or fulfillment of any of the
obligations, covenants, or conditions contained in any agreement or instrument
material to its business to which it is a party.
 
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(h)  Powers. Borrower has the right and full power and authority to enter into
this Agreement and to perform its obligations in accordance with the terms of
this Agreement, without the consent or approval of any other Person, except as
already obtained. This Agreement is enforceable against Borrower in accordance
with its terms, except as may be limited by applicable bankruptcy insolvency,
moratorium, reorganization, or other laws affecting creditor’s rights and
remedies generally.
 
(i)  No Violation. Neither the execution, delivery nor performance by Borrower
of this Agreement violates any provision of law or Borrower’s Certificate of
Incorporation or Bylaws, each as amended to date, or results in a breach of or
constitutes a default under any contract, obligation, indenture or other
instrument to which Borrower is a party or by which Borrower may be bound.
 
(j)  Insurance. Borrower shall maintain insurance relating to Borrower’s
ownership and use of the Collateral in amounts and of a type that are reasonable
and customary to businesses similar to Borrower’s.
 
4.  Negative Covenants. Borrower covenants and agrees that, until the
indefeasible payment and performance in full of the outstanding Obligations,
Borrower will not do any of the following without the prior written consent of
the Majority Note Holders, unless required to do so pursuant to the provisions
of any senior debt existing as of the date hereof:
 
(a)  Sell, lease, assign, transfer, or otherwise dispose of, any of its now
owned or hereafter acquired material assets (including, without limitation,
shares of stock and indebtedness of subsidiaries, accounts, and leasehold
interests), except: (1) inventory disposed of in the ordinary course of
business; (2) the sale or other disposition of assets no longer used or useful
in the conduct of its business; or (3) that any subsidiary may sell, lease,
assign, or otherwise transfer its assets to Borrower;
 
(b)  Wind up, liquidate or dissolve itself, reorganize, merge or consolidate
with or into, or convey, sell, assign, transfer, lease, or otherwise dispose of
(whether in one transaction or in a series of transactions) all or substantially
all of its assets (whether now owned or hereafter acquired) to any Person, or
acquire all of substantially all of the assets or the business of any Person, or
permit any subsidiary to do so, except that (1) any subsidiary may merge into or
transfer assets to Borrower; and (2) any subsidiary may merge into or
consolidate with or transfer assets to any other subsidiary;
 
(c)  Create, incur, assume or be or remain liable with respect to any Debt,
other than (1) Debt of Borrower in favor of Secured Parties arising under any
agreement by and between Borrower and Secured Parties; (2) accounts payable to
trade creditors for goods or services incurred in the ordinary course of
business, as presently conducted, and paid within the specified time, unless
contested in good faith and by appropriate proceedings; (3) Debt of Borrower
secured by Permitted Liens; and (4) Debt set forth on Schedule 1.3 of the
Purchase Agreement;
 
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(d)  Create, incur, assume or suffer to exist any Lien with respect to any of
its assets, or assign or otherwise convey any right to receive income, including
the sale of any accounts, except for Permitted Liens; and
 
(e)  Assume, guarantee, endorse, or otherwise be or become directly or
contingently responsible or liable, (including, but not limited to, an agreement
to purchase any obligation, stock, assets, goods, or services, or to supply or
advance any funds, assets, goods, or services, or an agreement to maintain or
cause such Person to maintain a minimum working capital or net worth or
otherwise to assure the creditors of any Person against loss), for obligations
of any Person, except guaranties by endorsement of negotiable instruments for
deposit or collection or similar transactions in the ordinary course of
business.
 
5.  Financing Statements. Borrower authorizes the Secured Parties to file a
financing statement describing the Collateral. Borrower shall cooperate with
Secured Parties in obtaining control with respect to Collateral consisting of:
(a) deposit accounts; (b) investment property; (c) letter of credit rights; and
(d) electronic chattel paper.
 
6.  Borrower’s Rights Until Default. So long as an Event of Default does not
exist, Borrower shall have the right to possess the Collateral, manage its
property, operate its business and sell its inventory in the ordinary course of
business.
 
7.  Event of Default. An Event of Default, as defined in the Notes, shall be
deemed to be an Event of Default hereunder.
 
8.  Rights and Remedies on Event of Default.
 
(a)  After any Event of Default shall have occurred and while such Event of
Default is continuing, the Majority Note Holders, acting on behalf of the
Secured Parties, shall have the right to any or all of the Collateral, by any
available judicial procedure, or without judicial process (provided, however,
that it is in compliance with the UCC), to exercise any and all rights afforded
to a secured party under the UCC or other applicable law. Without limiting the
generality of the foregoing, the Majority Note Holders, acting on behalf of the
Secured Parties, shall have the right to sell or otherwise dispose of the
Collateral (subject to applicable state and federal securities laws), either at
public or private sale, in lots or in bulk, for cash or for credit, with or
without warranties or representations, and upon such terms and conditions, all
as Secured Parties, in their sole discretion (as determined by holders of a
majority of the outstanding principal amount under the Notes), may deem
advisable, and Secured Parties shall have the right to purchase all or any part
of the Collateral at any such sale; provided that the Majority Note Holders,
acting on behalf of the Secured Parties, shall give Borrower ten (10) days
advance notice of such sale. The proceeds of any such sale, or other Collateral
disposition shall be applied, first to the expenses of retaking, holding,
storing, processing and preparing for sale, selling, and the like, and to
reasonable attorneys’ fees and legal expenses for one attorney representing
Secured Parties, and then to the Obligations and to the payment of any other
amounts required by applicable law, after which Secured Parties shall account to
Borrower for any surplus proceeds.
 
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(b)  All of the Secured Parties’ rights and remedies with respect to the
Collateral, whether established hereby or by any other agreements, instruments
or documents or by law shall be cumulative and may be exercised singly or
concurrently.
 
(c)  If there are insufficient funds to pay in full in cash each of the Notes,
funds available therefor shall be distributed and paid among the Secured Parties
in a manner so that each Secured Party receives his or its Pro Rata Share (as
hereinafter defined; provided, however, that the foregoing shall in no way
offset the conversion of the Notes in accordance with their terms, which Notes
may be converted without regard to conversion of any other Notes) thereof. For
purposes hereof, “Pro Rata Share” shall mean, as to any Secured Party, the
aggregate unpaid principal amount, plus accrued but unpaid interest, under all
Notes held by such Secured Party as compared to the aggregate unpaid principal
amount, plus accrued but unpaid interest, under all Notes held by the Secured
Parties. If any Secured Party receives any payment under or with respect to such
Secured Party’s Notes in excess in trust of an amount equal to his or its Pro
Rata Share, such Secured Party shall be deemed to hold such excess for the
benefit of the other Secured Parties and shall promptly remit such amount to and
among the Secured Parties so as to ensure all Secured Parties receive their full
Pro Rata Share of all cash payments, under or with respect to the Notes.
 
(d)  Borrower hereby assigns, transfers and conveys to Secured Parties,
effective upon the occurrence and continuance of an Event of Default if Secured
Parties so elect, and in any event upon the acceleration of the Obligations, all
Intellectual Property Collateral together with any goodwill associated
therewith, all to the extent necessary to enable Secured Parties to realize on
the Collateral and any successor or assign to enjoy the benefits of the
Collateral. This right and assignment shall inure to the benefit of all
successors, assigns and transferees of Secured Parties and its successors,
assigns and transferees, whether by voluntary conveyance, operation of law,
assignment, transfer, foreclosure, deed in lieu of foreclosure or otherwise.
Such right and assignment is and is to be granted free of charge, without
requirement that any monetary payment whatsoever (including, without limitation,
any royalty or license fee) be made to Borrower or any other person by Secured
Parties (except that if Secured Parties shall receive proceeds from the
disposition of any such Collateral, such proceeds shall be applied to the
Obligations in accordance with the UCC.
 
(e)  Upon the exercise by Secured Parties of any power, right, privilege, or
remedy pursuant to this Agreement which requires any consent, approval,
registration, qualification, or authorization of any governmental authority,
Borrower agrees to execute and deliver, or will cause the execution and delivery
of, all applications, certificates, instruments, assignments, and other
documents and papers that Secured Parties or any purchaser of the Collateral may
be required to obtain for such governmental consent, approval, registration,
qualification, or authorization.
 
9.  No Waivers by Secured Parties. No failure to exercise and no delay in
exercising any right, power, or remedy hereunder shall impair any right, power,
or remedy which Secured Parties may have, nor shall any such delay be construed
to be a waiver of any of such rights, powers, or remedies, or any acquiescence
in any breach or default hereunder; nor shall any waiver by Secured Parties of
any breach or default by Borrower hereunder be deemed a waiver of any default or
breach subsequently occurring. All rights and remedies granted to Secured
Parties hereunder shall remain in full force and effect notwithstanding any
single or partial exercise of, or any discontinuance of action begun to enforce,
any such right or remedy. The rights and remedies specified herein are
cumulative and not exclusive of each other or of any rights or remedies which
Secured Parties would otherwise have.
 
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10.  Indemnification. Borrower hereby agrees to indemnify Secured Parties, any
affiliate thereof, and its directors, officers, employees, agents, counsel, and
other advisors (each an “Indemnified Person”) against, and hold each of them
harmless from, any and all liabilities, obligations, losses, claims, damages,
penalties, actions, judgments, suits, costs, expenses, or disbursements of any
kind or nature whatsoever, including the reasonable fees and disbursements of
counsel to an Indemnified Person (including allocated costs of internal
counsel), which may be imposed on, incurred by, or asserted against any
Indemnified Person, in any way relating to or arising out of this Agreement or
the transactions contemplated hereby or any action taken or omitted to be taken
by it hereunder (the “Indemnified Liabilities”); provided that Borrower shall
not be liable to any Indemnified Person for any portion of such Indemnified
Liabilities to the extent they are found by a final decision of a court of
competent jurisdiction to have resulted from such Indemnified Person’s gross
negligence or willful misconduct. If and to the extent that the foregoing
indemnification is for any reason held unenforceable, Borrower agrees to make
the maximum contribution to the payment and satisfaction of each of the
Indemnified Liabilities which is permissible under applicable law.
 
11.  Certain Waivers. Borrower waives, to the fullest extent permitted by law,
(a) any right of redemption with respect to the Collateral, whether before or
after sale hereunder; (b) all rights, if any, of marshalling of the Collateral
or other collateral or security for the Obligations; (c) any right to require
Secured Parties (i) to proceed against any Person; (ii) to exhaust any other
collateral or security for any of the Obligations; (iii) to pursue any remedy in
Secured Parties’ power; or (iv) to make or give any presentments, demands for
performance, notices of nonperformance, protests, notices of protests, or
notices of dishonor in connection with any of the Collateral; (d) all claims,
damages, and demands against Secured Parties arising out of the repossession,
retention, sale, or application of the proceeds of any sale of the Collateral;
and (e) demand, protest, notice of protest, notice of default or dishonor,
notice of payment and nonpayment, notice of any default, nonpayment at maturity,
release, compromise, settlement, extension, or renewal of accounts, documents,
instruments, chattel paper, and guarantees at any time held by Secured Parties
on which Borrower may in any way be liable.
 
12.  General Provisions.
 
(a)  Amendment and Waiver. Neither this Agreement nor any provisions hereof may
be changed, waived, discharged or terminated, nor may any consent to the
departure from the terms hereof be given, orally (even if supported by new
consideration), but only by an instrument in writing signed by the Majority Note
Holders and by Borrower. Any waiver or consent so given shall be effective only
in the specific instance and for the specific purpose for which given.
 
(b)   Action by Majority Note Holders. All action required or permitted to be
taken by the Majority Note Holders, shall be taken by approval, consent, vote or
resolution authorized by the holders of the Notes representing at least a
majority of the principal amount of all then outstanding Notes.
 
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(c)  Notices. Any notice required or permitted under this Agreement shall be
given in writing and in accordance with Section 9.6 of the Purchase Agreement
(for purposes of which the term “Purchasers” shall mean the Secured Parties
hereunder), except as otherwise expressly provided in this Agreement, to a
Secured Party’s address for notice specified on such Secured Party’s signature
page hereto.
 
(d)  Entire Agreement. This Agreement, together with the Purchase Agreement, the
Stock Pledge Agreement, Investor Rights Agreement, the Notes and the Warrants
(as defined in the Purchase Agreement), constitutes the entire contract between
the Secured Parties and Borrower relative to the subject matter hereof. Any
previous agreement between the Secured Parties and Borrower with respect to the
subject matter hereof is superceded by this Agreement, the Purchase Agreement,
the Stock Pledge Agreement, Investor Rights Agreement, the Notes and the
Warrants. If and to the extent of any conflicts between the terms hereof and the
provisions in the Notes regarding the security interest therein granted, the
terms of this Agreement shall control.
 
(e)  Successors and Assigns. Except as otherwise expressly provided in this
Agreement, the provisions of this Agreement shall inure to the benefit of, and
be binding upon, the respective successors and assigns of the parties hereto.
Nothing in this Agreement, express or implied, is intended to confer upon any
party other than the parties hereto or their respective successors and assigns
any rights, remedies, obligations or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement.
 
(f)  Interpretation. This Agreement and all agreements relating to the subject
matter hereof are the product of negotiation and preparation by and among each
party and its respective attorneys, and shall be construed accordingly.
 
(g)  Governing Law. This Agreement and all transactions contemplated hereunder
and/or evidenced hereby shall be governed by, construed under, and enforced in
accordance with the internal laws of the State of New York, without regard to
its conflicts of laws principles.
 
(h)  Choice of Venue; Waiver of Right to Jury Trial.
 
(i)  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE DEEMED MADE, EXECUTED, PERFORMED AND CONSTRUED IN ACCORDANCE WITH AND
BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK. ANY LEGAL ACTION OR PROCEEDING
WITH RESPECT TO THIS AGREEMENT OR ANY OTHER DOCUMENT MAY BE BROUGHT IN THE
COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN
DISTRICT OF NEW YORK, IN EACH CASE WHICH ARE LOCATED IN THE COUNTY OF NEW YORK,
AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH PARTY HEREBY IRREVOCABLY
ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS. EACH
PARTY HEREBY FURTHER IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUCH COURTS LACK
PERSONAL JURISDICTION OVER SUCH PARTY, AND AGREES NOT TO PLEAD OR CLAIM IN ANY
LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER DOCUMENT
BROUGHT IN ANY OF THE AFORESAID COURTS THAT ANY SUCH COURT LACKS PERSONAL
JURISDICTION OVER SUCH PARTY. EACH PARTY FURTHER IRREVOCABLY CONSENTS TO THE
SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR
PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL,
POSTAGE PREPAID, TO ANY SUCH PARTY AT ITS ADDRESS FOR NOTICES AS PROVIDED
HEREIN, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER SUCH MAILING. EACH PARTY
HEREBY IRREVOCABLY WAIVES ANY OBJECTION TO SUCH SERVICE OF PROCESS AND FURTHER
IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY ACTION OR PROCEEDING
COMMENCED HEREUNDER OR UNDER ANY OTHER DOCUMENT THAT SUCH SERVICE OF PROCESS WAS
IN ANY WAY INVALID OR INEFFECTIVE. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE
PARTY UNDER THIS AGREEMENT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW
OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY PARTY IN ANY
OTHER JURISDICTION.
 
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(ii)  EACH PARTY HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR
PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER
DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (i) ABOVE AND HEREBY
FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT
THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN
AN INCONVENIENT FORUM.
 
(iii)  EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT
TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR
RELATING TO THIS AGREEMENT, THE OTHER DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY.
 
(i)  Counterparts. This Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if all signatures
were upon the same instrument. Delivery of an executed counterpart of the
signature page to this Agreement by facsimile shall be effective as delivery of
a manually executed counterpart of this Agreement, and any party delivering such
an executed counterpart of the signature page to this Agreement by facsimile to
any other party shall thereafter also promptly deliver a manually executed
counterpart of this Agreement to such other party, provided that the failure to
deliver such manually executed counterpart shall not affect the validity,
enforceability, or binding effect of this Agreement.
 
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(j)  Titles and Subtitles. The titles and subtitles used in this Agreement are
used for convenience only and are not to be considered in construing or
interpreting this Agreement.
 
(k)  Severability. In the event any one or more of the provisions contained in
this Agreement is held to be invalid, illegal or unenforceable in any respect,
then such provision shall be ineffective only to the extent of such prohibition
or invalidity, and the validity, legality, and enforceability of the remaining
provisions contained herein shall not in any way be affected or impaired
thereby.
 
(l)  Further Acts. Borrower shall, on a continuing basis, make, execute,
acknowledge and deliver, and file and record in the proper filing and recording
places, all such Financing Statements and take all such action as may be
necessary or advisable or may be requested by the Secured Parties to carry out
the intent and purposes of this Agreement.
 

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
 
 
 
 
 
 
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IN WITNESS WHEREOF, this Security Agreement has been executed by the parties
hereto as of the date first above written.
 

        WINWIN GAMING, INC.  
   
   
    By:   /s/ Patrick Rogers  

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Name: Patrick Rogers   Title: President & CEO

       
Address for Notice: 

8687 West Sahara, Suite 201
Las Vegas, Nevada 89117
Attn: Patrick Rogers
       

 
SIGNATURE PAGE TO SECURITY AGREEMENT

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SECURED PARTY
COUNTERPART SIGNATURE PAGE TO
SECURITY AGREEMENT
 

        SECURED PARTY:  
   
   
    By:   /s/ Stephen Rasch    

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    Print Name: Patriot Capital Limited    

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    Address:
12/E Novel Industrial Building
850-870 Lai Chi Kok Road
Cheung Sha Wan, Kowloon
Hong Kong
 

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SECURED PARTY
COUNTERPART SIGNATURE PAGE TO
SECURITY AGREEMENT
 

        SECURED PARTY:  
   
   
    By:   /s/ Mark Tunnery    

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    Print Name: MLA Capital, Inc.    

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    Address:
11111 Santa Monica Blvd.
Suite 1122
Los Angeles, CA 90025
 

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SECURED PARTY
COUNTERPART SIGNATURE PAGE TO
SECURITY AGREEMENT
 

        SECURED PARTY:  
   
   
    By:   /s/ N.J. Fiore    

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    Print Name: Ridgewood Ltd.    

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    Address:
763 Oppen Road
Ridgewood, NJ 07450
 

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SECURED PARTY
COUNTERPART SIGNATURE PAGE TO
SECURITY AGREEMENT
 

        SECURED PARTY:  
   
   
    By:   /s/ Trevor Colby    

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    Print Name: Trevor Colby    

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    Address:
1512 Montana Avenue
Santa Monica, CA 90403
 

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SECURED PARTY
COUNTERPART SIGNATURE PAGE TO
SECURITY AGREEMENT
 

        SECURED PARTY:  
   
   
    By:   /s/ Michael Clofine    

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    Print Name: Calico Capital Group    

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    Address:
280 Park Avenue
5th Floor Bast.
New York, NY 10017
 

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