CREDIT AND SECURITY AGREEMENT
 
THIS CREDIT AND SECURITY AGREEMENT ("Agreement") is made as of October 29, 2007,
by ISECURETRAC CORP., a Delaware corporation ("Debtor"), whose principal place
of business and chief executive office (as those terms are used in the Code) is
located at 5078 S. 111th Street, Omaha, Nebraska 68137, and whose federal
taxpayer identification number is 87-0347787, and whose organizational number
issued by the appropriate authority of the State of Delaware is 2096427, in
favor of CRESTPARK LP, INC. ("Secured Party"), whose address is c/o Sammons
Corporation, 5949 Sherry Lane, Suite 1900, Dallas, Texas 75225.
 
Debtor is executing a Promissory Note in the original principal amount of
$8,491,863.90 of even date herewith in favor of the Secured Party. As security
for the indebtedness represented thereunder, Debtor hereby agrees with Secured
Party as follows:
 
1.  Definitions. As used in this Agreement, the following terms shall have the
meanings indicated below:
 
(a)  "Code" means the Delaware Uniform Commercial Code as in effect in the State
of Delaware on the date of this Agreement or as it may hereafter be amended from
time to time.
 
(b)  "Collateral" means all of the personal property of Debtor, including but
not limited to, wherever located, and now owned or hereafter acquired:
 
(i)  All "accounts", as defined in the Code (including all contractual rights to
receive commissions), together with any and all books of account, and agent
lists, and in any case where an account arises from the sale of goods, the
interest of Debtor in such goods.
 
(ii)  All "inventory" as defined in the Code.
 
(iii)  All "commodity accounts" as defined in the Code.
 
(iv)  All cash and cash accounts.
 
(v)  All "chattel paper" as defined in the Code.
 
(vi)  All "equipment" as defined in the Code, of whatsoever kind and character
now or hereafter possessed, held, acquired, leased or owned by Debtor and used
or usable in Debtor's business, and in any event shall include, but shall not be
limited to, all machinery, tools, computer software, office equipment,
furniture, appliances, furnishings, fixtures, vehicles, motor vehicles, together
with all replacements, accessories, additions, substitutions and accessions to
all of the foregoing, and all manuals and instructions. To the extent that the
foregoing property is located on, attached to, annexed to, related to, or used
in connection with, or otherwise made a part of, and is or shall become fixtures
upon, real property, such real property and the record owner thereof (if other
than Debtor) is described on Schedule 1 attached hereto and made a part hereof.
 
 
 

--------------------------------------------------------------------------------

 
 
(vii)  All "fixtures" as defined in the Code.
 
(viii)  All "instruments" as defined in the Code (including promissory notes).
 
(ix)  All "investment property" as defined in the Code.
 
(x)  All "documents" as defined in the Code.
 
(xi)  All "deposit accounts" as defined in the Code.
 
(xii)  All "commercial tort claims" as defined in the Code, including but not
limited to all commercial tort claims described on Schedule 5.
 
(xiii)  All "letters of credit" and "letter of credit rights" as defined in the
Code.
 
(xiv)  All "general intangibles" as defined in the Code, including all rights in
all royalty payments, payment intangibles, permits, regulatory approvals,
copyrights, patents, trademarks, service marks, trade names, mask works,
goodwill, licenses and all other intellectual property owned by Debtor or used
in Debtor's business.
 
(xv)  All "supporting obligations" as defined in the Code.
 
(xvi)  All Patents, Trademarks, Copyrights, and IP Licenses.
 
(xvii)  all "software" as defined in the Code (for purposes of this Agreement
"Software" also consists of all (A) computer programs and supporting information
provided in connection with a transaction relating to the program, and
(B) computer programs embedded in goods and any supporting information provided
in connection with a transaction relating to the program whether or not the
program is associated with the goods in such a manner that it customarily is
considered part of the goods, and whether or not, by becoming the owner of the
goods, a person acquires a right to use the program in connection with the
goods, and whether or not the program is embedded in goods that consist solely
of the medium in which the program is embedded).
 
(xviii)  All records relating in any way to the foregoing and following
(including, without limitation, any computer software, whether on tape, disk,
card, strip, cartridge or any other form).
 
(xix)  All royalty payments.
 
 
2

--------------------------------------------------------------------------------

 
 
(xx)  All securities, including all Pledged Equity Interests.
 
(xxi)  Collateral also includes all PRODUCTS and PROCEEDS of all of the
foregoing (including without limitation, insurance payable by reason of loss or
damage to the foregoing property) and any property, securities, guaranties or
monies of Debtor which may at any time come into the possession of Secured
Party. The designation of proceeds does not authorize Debtor to sell, transfer
or otherwise convey any of the foregoing property except as otherwise provided
herein or in the other Loan Documents.
 
(c)  "Copyright License" means any agreement, now or hereafter in effect,
granting any right to any third party under any Copyright now or hereafter owned
by Debtor or which Debtor otherwise has the right to license, or granting any
right to Debtor under any Copyright now or hereafter owned by any third party,
and all rights of Debtor under any such agreement.
 
(d)  "Copyrights" means (i) all copyright rights in any work subject to the
copyright laws of any governmental authority, whether as author, assignee,
transferee, or otherwise, (ii) all registrations and applications for
registration of any such copyright in any governmental authority, including
registrations, recordings, supplemental registrations, and pending applications
for registration in any jurisdiction, and (iii) all rights to use and/or sell
any of the foregoing.
 
(e)  "Debtor Relief Laws" means the Bankruptcy Code of the United States of
America and all other liquidation, conservatorship, bankruptcy, assignment for
the benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief laws of the United States or other
applicable jurisdictions from time to time in effect and affecting the rights of
creditors generally.
 
(f)  "Indebtedness" means (i) all indebtedness, obligations and liabilities of
Debtor to Secured Party of any kind or character, now existing or hereafter
arising, whether direct, indirect, related, unrelated, fixed, contingent,
liquidated, unliquidated, joint, several or joint and several (excluding only
indebtedness originally payable to or in favor of a person other than Secured
Party and subsequently acquired by Secured Party), including without limitation
all indebtedness, obligations and liabilities of Debtor to Secured Party now
existing or hereafter arising by note, draft, acceptance, guaranty, endorsement,
letter of credit, assignment, purchase, overdraft, discount, indemnity agreement
or otherwise, (ii) all obligations now or hereafter existing of Debtor under the
Note and each other Loan Document (including, but not limited to, the
Obligations), (iii) all accrued but unpaid interest (including all interest that
would accrue but for the existence of a proceeding under any Debtor Relief Laws)
on any of the indebtedness described in this definition of "Indebtedness,"
(iv) all obligations of Debtor to Secured Party under any documents evidencing,
securing, governing and/or pertaining to all or any part of the indebtedness
described in this definition of "Indebtedness," (v) all costs and expenses
incurred by Secured Party in connection with the collection and administration
of all or any part of the indebtedness and obligations described in this
definition of "Indebtedness" or the protection or preservation of, or
realization upon, the collateral securing all or any part of such indebtedness
and obligations, including without limitation all reasonable attorneys' fees,
and (vi) all renewals, extensions, modifications and rearrangements of the
indebtedness and obligations described in this definition of "Indebtedness".
 
 
3

--------------------------------------------------------------------------------

 
 
(g)  "IP License" means any Patent License, Trademark License, Copyright
License, or other similar license or sublicense.
 
(h)  "Loan Documents" means all documents executed in connection with the Note,
as each may be amended, restated or modified.
 
(i)  "Note" means that certain Promissory Note executed by Debtor in favor of
Secured Party dated as of even date herewith in the original principal amount of
$8,491,863.90, as it may be amended, restated or modified.
 
(j)  "Patent License" means any agreement, now or hereafter in effect, granting
to any third party any right to make, use or sell any invention on which a
Patent, now or hereafter owned by Debtor or which Debtor otherwise has the right
to license, is in existence, or granting to Debtor any right to make, use or
sell any invention on which a Patent, now or hereafter owned by any third party,
is in existence, and all rights of Debtor under any such agreement.
 
(k)  "Patents" means (i) all letters patent of any governmental authority, all
registrations and recordings thereof, and all applications for letters patent of
any governmental authority, and (ii) all reissues, continuations, divisions,
continuations-in-part, renewals, or extensions thereof, and the inventions
disclosed or claimed therein, including the right to make, use and/or sell the
inventions disclosed or claimed therein.
 
(l)  "Permitted Liens" means liens covering certain of the Debtor's assets as
set forth on Schedule 10 hereto.
 
(m)  "Pledged Equity Interests" shall mean all Pledged Stock, Pledged LLC
Interests and Pledged Partnership Interests.
 
(n)  "Pledged LLC Interests" shall mean all interests of the Debtor in any
limited liability company and the certificates, if any, representing such
limited liability company interests and any interest of the Debtor on the books
and records of such limited liability company or on the books and records of any
Securities Intermediary pertaining to such interest and all dividends,
distributions, cash, warrants, rights, options, instruments, securities and
other property or proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of such limited
liability company interests.
 
(o)  "Pledged Partnership Interests" shall mean all interests of the Debtor in
any general partnership, limited partnership, limited liability partnership or
other partnership and the certificates, if any, representing such partnership
interests and any interest of the Debtor on the books and records of such
partnership or on the books and records of any Securities Intermediary
pertaining to such interest and all dividends, distributions, cash, warrants,
rights, options, instruments, securities and other property or proceeds from
time to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of such partnership interests.
 
 
4

--------------------------------------------------------------------------------

 
 
(p)  "Pledged Stock" shall mean all shares of capital stock owned by the Debtor
and the certificates, if any, representing such shares and any interest of the
Debtor in the entries on the books of the issuer of such shares or on the books
of any Securities Intermediary pertaining to such shares, and all dividends,
distributions, cash, warrants, rights, options, instruments, securities and
other property or proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of such shares.
 
(q)  "Securities Intermediary" means (a) a clearing corporation, or (b) a
person, including a bank or broker, that in the ordinary course of its business
maintains securities accounts for others and is acting in that capacity.
 
(r)  "Security" means all right, title, and interest of the Debtor (in each case
whether now or hereafter existing, owned, arising, or acquired) in and to any
obligations of an issuer or any shares, participations or other interests in an
issuer or in property or an enterprise of an issuer which (a) are represented by
a certificate representing a security in bearer or registered form, or the
transfer of which may be registered upon books maintained for that purpose by or
on behalf of the issuer, (b) are one of a class or series or by its terms is
divisible into a class or series of shares, participations, interests or
obligations, and (c)(i) are, or are of a type, dealt with or traded on
securities exchanges or securities markets or (ii) are a medium for investment
and by their terms expressly provide that they are a security governed by
Chapter 8 of the UCC.
 
(s)  "Trademark License" means any agreement, now or hereafter in effect,
granting to any third party any right to use any Trademark now or hereafter
owned by Debtor or which Debtor otherwise has the right to license, or granting
to Debtor any right to use any Trademark now or hereafter owned by any third
party, and all rights of Debtor under any such agreement.
 
(t)  "Trademarks" means (i) all trademarks, service marks, trade names,
corporate names, company names, business names, fictitious business names, trade
styles, trade dress, logos, other source or business identifiers, designs and
general intangibles of like nature, all registrations and recordings thereof,
and all registration and recording applications filed with any governmental
authority in connection therewith, and all extensions or renewals thereof,
(ii) all goodwill associated therewith or symbolized thereby, (iii) all other
assets, rights and interests that uniquely reflect or embody such goodwill, and
(iv) all rights to use and/or sell any of the foregoing.
 
All words and phrases used herein which are expressly defined in Section 1.201
or Article 9 of the Code shall have the meaning provided for therein. Other
words and phrases defined elsewhere in the Code shall have the meaning specified
therein except to the extent such meaning is inconsistent with a definition in
Section 1.201 or Article 9 of the Code.
 
 
5

--------------------------------------------------------------------------------

 
 
2.  Security Interest. As security for the Indebtedness, Debtor, for value
received, hereby pledges and grants to Secured Party a continuing security
interest in the Collateral.
 
3.  Representations and Warranties. In addition to any representations and
warranties of Debtor set forth in the Loan Documents, which are incorporated
herein by this reference, Debtor hereby represents and warrants the following to
Secured Party:
 
(a)  Authority. The execution, delivery and performance of this Agreement and
all of the other Loan Documents by Debtor have been duly authorized by all
necessary corporate action of Debtor.
 
(b)  Accuracy of Information. All information contained herein with respect to
the Collateral is true and correct in all material respects. The exact legal
name and federal taxpayer identification number of Debtor are correctly shown in
the first paragraph hereof.
 
(c)  Enforceability. This Agreement and the other Loan Documents constitute
legal, valid and binding obligations of Debtor, enforceable in accordance with
their respective terms, except as limited as to enforcement of remedies by
Debtor Relief Laws and except to the extent specific remedies may generally be
limited by equitable principles.
 
(d)  Ownership and Liens. Debtor has good and marketable title to the Collateral
free and clear of all liens or adverse claims, except for Permitted Liens. No
dispute, right of setoff, counterclaim or defense exists with respect to all or
any part of the Collateral. Debtor has not executed any other security agreement
currently affecting the Collateral and no effective financing statement or other
instrument similar in effect covering all or any part of the Collateral is on
file in any recording office except as may have been executed or filed in favor
of Secured Party or except with respect to Permitted Liens. Debtor has not been
a party to a securitization or similar transaction involving assets of Debtor
during the preceding two years.
 
(e)  No Conflicts or Consents. Neither the ownership, the intended use of the
Collateral by Debtor, the grant of the security interest by Debtor to Secured
Party herein nor the exercise by Secured Party of its rights or remedies
hereunder, will (i) conflict with any provision of (A) any material law, (B) the
articles or certificate of incorporation or bylaws of Debtor, or (C) any
material agreement, judgment, license, order or permit applicable to or binding
upon Debtor, or (ii) result in or require the creation of any lien upon any
assets or properties of Debtor or of any person except as may be expressly
contemplated in the Loan Documents. Except as expressly contemplated in the Loan
Documents, no consent, approval, authorization or order of, and no notice to or
filing with, any governmental authority or other person is required in
connection with the grant by Debtor of the security interest herein or the
exercise by Secured Party of its rights and remedies hereunder.
 
 
6

--------------------------------------------------------------------------------

 
 
(f)  Security Interest. Debtor has and will have at all times full right, power
and authority to grant a security interest in the Collateral to Secured Party in
the manner provided herein, free and clear of any lien or other charge or
encumbrance (other than Permitted Liens). This Agreement creates a legal, valid
and binding security interest in favor of Secured Party in the Collateral
securing the Indebtedness. To the extent permitted in the Code, possession by
Secured Party of all certificates, instruments and cash constituting Collateral
from time to time and/or the filing of the financing statements delivered prior
hereto and/or concurrently herewith by Debtor to Secured Party will perfect and
establish the first priority of Secured Party's security interest hereunder in
the Collateral, except with respect to those assets covered by Permitted Liens.
Upon the filing of a financing statement describing the Collateral with the
Uniform Commercial Code central filing officer of the jurisdiction of Debtor's
location, the security interest granted pursuant to this Agreement shall be
perfected and prior to all other liens (other than Permitted Liens) therein (to
the extent such security interest can be perfected by the filing of a financing
statement).
 
(g)  Location/Identity. Debtor's principal place of business and chief executive
office (as those terms are used in the Code), as the case may be, is located at
the address set forth on the first page hereof. Except as specified elsewhere
herein, all Collateral and records concerning the Collateral shall be kept at
such address. Debtor's entity type, state of organization, and organizational
identification number issued by the appropriate authority of the State of
Delaware (the "Organizational Information") are as set forth in the first page
hereof. Debtor is not organized in more than one jurisdiction. Except as
provided herein, the Organizational Information shall not change. During the
preceding three years, Debtor has not had or operated under any name other than
its name as stated on the signature page of this Agreement, has not been
organized under the laws of any jurisdiction other than Delaware, has not been
organized as any type of entity other than a corporation and the chief executive
office of Debtor has not been located at any address other than as set forth on
the first page hereof.
 
(h)  Creditors. Debtor is not entering into this Agreement or any other Loan
Document to which Debtor is a party or its property is subject with the intent
of hindering, delaying or defrauding any creditor.
 
(i)  Compliance with Environmental Laws.  Debtor is conducting Debtor's
businesses in material compliance with all applicable federal, state and local
laws, orders, determinations and court decisions, including all environmental
laws.
 
(j)  Inventory. The security interest in the inventory shall continue through
all stages of manufacture and shall, without further action, attach to the
accounts or other proceeds resulting from the sale or other disposition thereof
and to all such inventory as may be returned to Debtor by its account debtors.
 
(k)  Accounts. Each account represents the valid and legally binding
indebtedness of a bona fide account debtor arising from the sale or lease by
Debtor of goods or the rendition by Debtor of services and is not subject to
contra accounts, setoffs, defenses or counterclaims by or available to account
debtors obligated on the accounts except as disclosed by Debtor to Secured Party
from time to time in writing. The amount shown as to each account on Debtor's
books is the true and undisputed amount owing and unpaid thereon, subject only
to discounts, allowances, rebates, credits and adjustments to which the account
debtor has a right and which have been disclosed to Secured Party in writing.
 
 
7

--------------------------------------------------------------------------------

 
 
(l)  Chattel Paper, Documents and Instruments. The chattel paper, documents and
instruments of Debtor pledged hereunder have only one original counterpart and
no party other than Debtor or Secured Party is in actual or constructive
possession of any such chattel paper, documents or instruments. No chattel paper
is electronic chattel paper.
 
(m)  Patents. Schedule 2 includes a complete and correct list of each Patent in
which Debtor has any interest (whether as owner, licensee, or otherwise),
including the name of the registered owner, the nature of Debtor's interest, the
Patent registration number, the date of Patent issuance, and the country issuing
the Patent.
 
(n)  Patent Applications. Schedule 2 also includes a complete and correct list
of each Patent application in which Debtor has any interest (whether as owner,
licensee, or otherwise), including the name of the person applying to be the
registered owner, the nature of Debtor's interest, the Patent application
number, the date of Patent filing, and the country with which the Patent
application was filed.
 
(o)  Trademarks. Schedule 3 is a complete and correct list of each Trademark in
which Debtor has any interest (whether as owner, licensee, or otherwise),
including the name of the registered owner, the nature of Debtor's interest, the
registered Trademark, the Trademark registration number, the international class
covered, the goods and services covered, the date of Trademark registration, and
the country registering the Trademark.
 
(p)  Trademark Applications. Schedule 3 also includes a complete and correct
list of each Trademark application in which Debtor has any interest (whether as
owner, licensee, or otherwise), including the name of the person applying to be
the registered owner, the nature of Debtor's interest, the Trademark the subject
of the application, the Trademark application serial number, the international
class covered, the goods and services covered, the date of Trademark application
filing, and the country with which the Trademark application was filed.
 
(q)  Copyrights. Schedule 4 includes a complete and correct list of each
Copyright in which Debtor has any interest (whether as owner, licensee, or
otherwise), including the name of the registered owner, the nature of Debtor's
interest, the registered Copyright, the date of Copyright issuance, and the
country issuing the Copyright.
 
(r)  Copyright Applications. Schedule 4 also includes a complete and correct
list of each Copyright application in which Debtor has any interest (whether as
owner, licensee, or otherwise), including the name of the person applying to be
the registered owner, the nature of Debtor's interest, the Copyright the subject
of the application, the date of Copyright application filing, and the country
with which the Copyright application was filed.
 
 
8

--------------------------------------------------------------------------------

 
 
(s)  Commercial Tort Claims. Schedule 5 is a complete and correct list of all
commercial tort claims in which Debtor has any interest, including the complete
case name or style, the case number, and the court or other governmental
authority in which the case is pending.
 
(t)  Deposit Accounts. Schedule 6 is a complete and correct list of all deposit
accounts maintained by or in which Debtor has any interest and correctly
describes the bank in which such account is maintained (including the specific
branch), the street address (including the specific branch) and ABA number of
such bank, the account number, and account type.
 
(u)  Commodity Accounts. Schedule 7 includes a complete and correct list of all
commodity accounts in which Debtor has any interest, including the complete name
and identification number of the account, a description of the governing
agreement, and the name and street address of the commodity intermediary
maintaining the account.
 
(v)  Securities Accounts. Schedule 7 also includes a complete and correct list
of all securities accounts in which Debtor has any interest, including the
complete name and identification number of the account, a description of the
governing agreement, and the name and street address of the securities
intermediary maintaining the account.
 
(w)  Letters of Credit. Schedule 8 is a complete and correct list of all letters
of credit in which Debtor has any interest (other than solely as an applicant)
and correctly describes the bank which issued the letter of credit, and the
letter of credit's number, issue date, expiry, and face amount.
 
(x)  Equity Interests. Schedule 9 is a complete and correct list of all the
issued and outstanding stock, partnership interests, limited liability company
membership interests, or other equity interest owned by the Debtor and the
record and beneficial owners of such stock, partnership interests, membership
interests or other equity interests. All of the Pledged Equity Interests have
been duly and validly issued, and the Pledged Stock is fully paid and
nonassessable. All of the Pledged Equity Interests consisting of certificated
securities have been delivered to the Secured Party. Other than Pledged
Partnership Interests and Pledged LLC Interests constituting general
intangibles, there are no Pledged Equity Interests other than that represented
by certificated securities in the possession of the Secured Party. There are no
restrictions in any organization document governing any Pledged Equity Interest
or any other document related thereto which would limit or restrict (i) the
grant of a lien in the Pledged Equity Interests, (ii) the perfection of such
lien or (iii) the exercise of remedies in respect of such perfected lien in the
Pledged Equity Interests as contemplated by this Agreement. Upon the exercise of
remedies in respect of Pledged Partnership Interests and Pledged LLC Interests,
a transferee or assignee of a partnership interests or membership interest, as
the case may be, of such partnership or limited liability company, as the case
may be, shall become a partner or member, as the case may be, of such
partnership or limited liability company, as the case may be, entitled to
participate in the management thereof and, upon the transfer of the entire
interest of the Debtor, the Debtor ceases to be a partner or member, as the case
may be.
 
 
9

--------------------------------------------------------------------------------

 
 
4.  Affirmative Covenants. In addition to all covenants and agreements of Debtor
set forth in the Loan Documents, which are incorporated herein by this
reference, Debtor will comply with the covenants contained in this Section 4 at
all times during the period of time this Agreement is effective unless Secured
Party shall otherwise consent in writing.
 
(a)  Ownership and Liens. Debtor will maintain good and marketable title to all
Collateral free and clear of all liens or adverse claims, except for the
security interest created by this Agreement and the security interests and other
encumbrances expressly permitted herein or by the other Loan Documents
(including any Permitted Liens). Debtor will not permit any dispute, right of
setoff, counterclaim or defense to exist with respect to all or any part of the
Collateral. Debtor will cause any financing statement or other security
instrument with respect to the Collateral to be terminated, except as may exist
or as may have been filed in favor of Secured Party or as permitted under this
Agreement. Debtor hereby irrevocably appoints Secured Party as Debtor's
attorney-in-fact, such power of attorney being coupled with an interest, with
full authority in the place and stead of Debtor and in the name of Debtor or
otherwise, for the purpose of terminating any financing statements currently
filed with respect to the Collateral except with respect to Permitted Liens.
Debtor will defend at its expense Secured Party's right, title and security
interest in and to the Collateral against the claims of any third party.
 
(b)  Further Assurances. Debtor will from time to time at its expense promptly
execute and deliver all further instruments and documents and take all further
action necessary or appropriate or that Secured Party may request in order (i)
to perfect and protect the security interest created or purported to be created
hereby and the first priority of such security interest, (ii) to enable Secured
Party to exercise and enforce its rights and remedies hereunder in respect of
the Collateral, and (iii) to otherwise effect the purposes of this Agreement,
including without limitation: (A) executing (if requested) and filing such
financing or continuation statements, or amendments thereto; and (B) furnishing
(if requested) to Secured Party from time to time statements and schedules
further identifying and describing the Collateral and such other reports in
connection with the Collateral, all in reasonable detail satisfactory to Secured
Party.
 
(c)  Inspection of Collateral. Debtor will keep adequate records concerning the
Collateral. Debtor will permit Secured Party and all representatives and agents
appointed by Secured Party to inspect any of the Collateral and the books and
records of or relating to the Collateral at any time.
 
(d)  Payment of Taxes; Claims. Debtor will timely pay all property and other
taxes, assessments and governmental charges or levies and all other claims
imposed upon the Collateral or any part thereof. Notwithstanding any other
provision contained in this subsection, Secured Party may at its discretion
exercise its rights under subsection 6(c) of this Agreement at any time to pay
such taxes, assessments, governmental charges, interest, costs and penalties.
 
(e)  Mortgagee's and Landlord's Waivers. If required by the Secured Party,
Debtor shall use its best efforts to cause each mortgagee of real property owned
by Debtor and each landlord of real property leased by Debtor to execute and
deliver agreements satisfactory in form and substance to Secured Party by which
such mortgagee or landlord waives or subordinates any rights it may have in the
Collateral.
 
 
10

--------------------------------------------------------------------------------

 
 
(f)  Control Agreements. Debtor will cooperate with Secured Party in obtaining a
control agreement in form and substance satisfactory to Secured Party with
respect to Collateral consisting of:
 
(i)  Deposit accounts;
 
(ii)  Investment property;
 
(iii)  Letter-of-credit rights; and
 
(iv)  Electronic chattel paper.
 
(g)  Condition of Goods. Debtor will maintain, preserve, protect and keep all
Collateral which constitutes goods in good condition, repair and working order
and will cause such Collateral to be used and operated in good and workmanlike
manner, in accordance with applicable laws and in a manner which will not make
void or cancelable any insurance with respect to any material portion of such
Collateral. Debtor will promptly make or cause to be made all repairs,
replacements and other improvements to or in connection with the Collateral
which Secured Party may reasonably request from time to time.
 
(h)  Insurance. Debtor will, at its own expense, maintain insurance with respect
to all Collateral in a manner in which similarly situated entities maintain
insurance. If requested by Secured Party, each policy for property damage
insurance shall provide for all losses to be paid directly to Secured Party. If
requested by Secured Party, each policy of insurance maintained by Debtor shall
(i) name Debtor and Secured Party as insured parties thereunder (without any
representation or warranty by or obligation upon Secured Party) as their
interests may appear, (ii) contain the agreement by the insurer that any loss
thereunder shall be payable to Secured Party notwithstanding any action,
inaction or breach of representation or warranty by Debtor, (iii) provide that
there shall be no recourse against Secured Party for payment of premiums or
other amounts with respect thereto, and (iv) provide that at least thirty (30)
days prior written notice of cancellation or of lapse shall be given to Secured
Party by the insurer. Debtor will, if requested by Secured Party, deliver to
Secured Party original or duplicate policies of such insurance and, as often as
Secured Party may reasonably request, a report of a reputable insurance broker
with respect to such insurance. Debtor will also, at the request of Secured
Party, duly execute and deliver instruments of assignment of such insurance
policies and cause the respective insurers to acknowledge notice of such
assignment. All insurance payments in respect of loss of or damage to any
Collateral shall be paid to Secured Party.
 
(i)  Accounts and General Intangibles. Debtor will, except as otherwise provided
in subsection 6(e) of this Agreement, collect, at Debtor's own expense, all
amounts due or to become due under each of the accounts and general intangibles.
In connection with such collections, Debtor may and, at Secured Party's
direction, will take such action not otherwise forbidden by subsection 5(e) of
this Agreement as Debtor or Secured Party may reasonably deem necessary or
advisable to enforce collection or performance of each of the accounts and
general intangibles. Debtor will also duly perform and cause to be performed all
of its obligations with respect to the goods or services, the sale or lease or
rendition of which gave rise or will give rise to each account and all of its
obligations to be performed under or with respect to the general intangibles.
Debtor also covenants and agrees to take any action and/or execute any documents
that Secured Party may reasonably request in order to comply with the Federal
Assignment of Claims Act, as amended.
 
 
11

--------------------------------------------------------------------------------

 
 
(j)  Chattel Paper, Documents and Instruments. Debtor will take such action as
may be requested by Secured Party in order to cause any chattel paper, documents
or instruments to be valid and enforceable and will cause all chattel paper to
have only one original counterpart. Upon request by Secured Party, Debtor will
deliver to Secured Party all originals of chattel paper, documents or
instruments and will mark all chattel paper with a legend indicating that such
chattel paper is subject to the security interest granted hereunder.
 
(k)  Delivery of Security Collateral. All certificates constituting or
evidencing the Collateral shall be delivered to and held by or on behalf of the
Secured Party pursuant hereto and shall be in suitable form for transfer by
delivery, or shall be accompanied by undated and duly executed instruments of
transfer or assignment in blank, all in form and substance reasonably
satisfactory to the Secured Party. If an Event of Default exists, the Secured
Party has the right, without notice to the Debtor, to transfer to or to register
in the name of the Secured Party or any of its nominees any or all of such
Collateral. In addition, the Secured Party has the right at any time, with the
consent of the Debtor prior to an Event of Default, to exchange certificates or
instruments representing or evidencing Collateral for certificates or
instruments of smaller or larger denominations.
 
(l)  Patents, Trademarks, and Copyrights.
 
(i)  Debtor shall use commercially reasonable means to cause fully executed
security agreements in the form of this Agreement and containing a description
of all Collateral consisting of Patents, Trademarks, Copyrights, and IP Licenses
to be recorded by the United States Patent and Trademark Office within three
months after the execution of this Agreement with respect to United States
Patents and Trademarks and by the United States Copyright Office within one
month after the execution of this Agreement with respect to United States
registered Copyrights, and otherwise as may be required pursuant to the laws of
any other necessary jurisdiction, to protect the validity of and to establish a
legal, valid, and perfected security interest in favor of Secured Party in
respect of all Collateral consisting of Patents, Trademarks, Copyrights, and
IP Licenses in which a security interest may be perfected by filing, recording,
or registration in the United States and its territories and possessions, or in
any other necessary jurisdiction, and no further or subsequent filing, refiling,
recording, rerecording, registration, or reregistration is necessary (other than
such actions as are necessary to perfect the security interest with respect to
any Collateral consisting of Patents, Trademarks, Copyrights, and IP Licenses
(or registration or application for registration thereof) acquired or developed
after the date hereof).
 
 
12

--------------------------------------------------------------------------------

 
 
(ii)  Debtor (either itself or through licensees or sublicensees) will not do
any act, or omit to do any act, whereby any Patent which is material to the
conduct of Debtor's business may become invalidated or dedicated to the public,
and shall continue to mark any products covered by a Patent with the relevant
patent number as necessary and sufficient to establish and preserve its maximum
rights under applicable laws.
 
(iii)  Debtor (either itself or through licensees or sublicensees) will, for
each Trademark material to the conduct of Debtor's business, (A) maintain such
Trademark in full force free from any claim of abandonment or invalidity for
non-use, (B) maintain the quality of products and services offered under such
Trademark, (C) display such Trademark with notice of United States federal or
foreign registration to the extent necessary and sufficient to establish and
preserve its maximum rights under applicable law, and (D) not use or permit the
use of such Trademark in violation of any third party rights.
 
(iv)  Debtor (either itself or through licensees or sublicensees) will, for each
work covered by a Copyright material to the conduct of Debtor's business,
continue to publish, reproduce, display, adopt, and distribute the work with
appropriate copyright notice as necessary and sufficient to establish and
preserve its maximum rights under applicable laws.
 
(v)  In no event shall Debtor, either itself or through any agent, employee,
licensee, or designee, file an application for any Patent, Trademark, or
Copyright (or for the registration of any Patent, Trademark or Copyright) with
the United States Patent and Trademark Office, United States Copyright Office,
or any governmental authority in any jurisdiction, unless it promptly informs
Secured Party, and, upon request of Secured Party, executes and delivers any and
all agreements, instruments, documents, and papers as Secured Party may
reasonably request to evidence Secured Party's security interest in such Patent,
Trademark, or Copyright, and Debtor hereby appoints Secured Party as its
attorney-in-fact to execute and file such writings for the foregoing purposes.
 
(m)  Legal Opinion. Contemporaneously with the execution of this Agreement, the
Debtor's counsel shall provide an opinion in a form acceptable to the Secured
Party and its counsel that each of the Loan Documents have been duly authorized,
are valid and binding instruments enforceable against the Debtor in accordance
with their respective terms, except as may be limited by applicable bankruptcy,
insolvency, reorganization, arrangement, moratorium or other similar laws
affecting creditors' rights generally, and subject to general equity principles
and principles of public policy.
 
5.  Negative Covenants. Debtor will comply with the covenants contained in this
Section 5 at all times during the period of time this Agreement is effective,
unless Secured Party shall otherwise consent in writing.
 
 
13

--------------------------------------------------------------------------------

 
 
(a)  Transfer or Encumbrance. Except in the ordinary course of the Debtor's
business, Debtor will not (i) sell, assign (by operation of law or otherwise),
transfer, exchange, lease or otherwise dispose of any of the Collateral,
(ii) grant a lien or security interest in or execute, authorize, file or record
any financing statement or other security instrument with respect to the
Collateral to any party other than Secured Party, or (iii) deliver actual or
constructive possession of any of the Collateral to any party other than Secured
Party.
 
(b)  Impairment of Security Interest. Debtor will not take or fail to take any
action which would in any manner impair the value or enforceability of Secured
Party's security interest in any Collateral.
 
(c)  Possession of Collateral. Debtor will not cause or permit the removal of
any Collateral from its possession, control and risk of loss, nor will Debtor
cause or permit the removal of any Collateral (or records concerning the
Collateral) from the address on the first page hereof other than (i) as
permitted by Subsection 5(a), or (ii) in connection with the possession of any
Collateral by Secured Party or by its bailee. Upon the Secured Party's request,
if any Collateral is in the possession of a third party, Debtor will join with
Secured Party in notifying the third party of Secured Party's security interest
therein and obtaining an acknowledgment from the third party that it is holding
the Collateral for the benefit of Secured Party.
 
(d)  Goods. Debtor will not permit any Collateral which constitutes goods to at
any time (i) be covered by any document except documents in the possession of
the Secured Party, (ii) become so related to, attached to or used in connection
with any particular real property so as to become a fixture upon such real
property, or (iii) be installed in or affixed to other goods so as to become an
accession to such other goods unless such other goods are subject to a perfected
first priority security interest under this Agreement.
 
(e)  Compromise of Collateral. Debtor will not adjust, settle, compromise, amend
or modify any Collateral, except an adjustment, settlement, compromise,
amendment or modification in good faith and in the ordinary course of business;
provided, however, this exception shall automatically terminate if an Event of
Default exists or upon Secured Party's written request. Debtor shall provide to
Secured Party such information concerning (i) any adjustment, settlement,
compromise, amendment or modification of any Collateral, and (ii) any claim
asserted by any account debtor for credit, allowance, adjustment, dispute,
setoff or counterclaim, as Secured Party may request from time to time.
 
(f)  Financing Statement Filings. Debtor recognizes that financing statements
pertaining to the Collateral have been or may be filed in one or more of the
following jurisdictions: the location of Debtor's principal place of business,
the location of Debtor's chief executive office, or other such place as the
Debtor may be "located" under the provisions of the Code or where Debtor
maintains any Collateral, or has its records concerning any Collateral, as the
case may be. Without limitation of any other covenant herein, Debtor will
neither cause or permit any change in the location of (i) any Collateral,
(ii) any records concerning any Collateral, or (iii) Debtor's principal place of
business, or the location of Debtor's chief executive office, as the case may
be, to a jurisdiction other than as represented in subsection 3(g) of this
Agreement, nor will Debtor change its name or the Organizational Information as
represented in subsection 3(g) of this Agreement, unless Debtor shall have
notified Secured Party in writing of such change at least thirty (30) days prior
to the effective date of such change, and shall have first taken all actions
required by Secured Party for the purpose of further perfecting or protecting
the security interest in favor of Secured Party in the Collateral. In any
written notice furnished pursuant to this subsection, Debtor will expressly
state that the notice is required by this Agreement and contains facts that may
require additional filings of financing statements or other notices for the
purpose of continuing perfection of Secured Party's security interest in the
Collateral.
 
 
14

--------------------------------------------------------------------------------

 
 
(g)  Marking of Chattel Paper. Debtor will not create any chattel paper without
placing a legend on the chattel paper acceptable to Secured Party indicating
that Secured Party has a security interest in the chattel Paper. Debtor will not
permit any chattel paper to be electronic chattel paper.
 
(h)  Deposit Accounts, Investment Property. Debtor shall not establish or
maintain, or have any interest in, any (i) deposit account not listed on
Schedule 6, (ii) commodity account not listed on Schedule 7, or (iii) securities
account not listed on Schedule 7.
 
6.  Rights of Secured Party. Secured Party shall have the rights contained in
this Section 6 at all times during the period of time this Agreement is
effective.
 
(a)  Additional Financing Statements Filings. Debtor hereby authorizes Secured
Party to file, without the signature or further authentication of Debtor, one or
more financing or continuation statements, and amendments thereto, relating to
the Collateral. Debtor further agrees that a carbon, photographic or other
reproduction of this Security Agreement or any financing statement describing
any Collateral is sufficient as a financing statement and may be filed in any
jurisdiction Secured Party may deem appropriate.
 
(b)  Power of Attorney. Debtor hereby irrevocably appoints Secured Party as
Debtor's attorney-in-fact, such power of attorney being coupled with an
interest, with full authority in the place and stead of Debtor and in the name
of Debtor or otherwise, exercisable if an Event of Default exists, to take any
action and to execute any instrument which Secured Party may deem necessary or
appropriate to accomplish the purposes of this Agreement, including without
limitation: (i) to obtain and adjust insurance required by Secured Party
hereunder; (ii) to demand, collect, sue for, recover, compound, receive and give
acquittance and receipts for moneys due and to become due under or in respect of
the Collateral; (iii) to receive, endorse and collect any drafts or other
instruments, documents and chattel paper in connection with clause (i) or (ii)
above; and (iv) to file any claims or take any action or institute any
proceedings which Secured Party may deem necessary or appropriate for the
collection and/or preservation of the Collateral or otherwise to enforce the
rights of Secured Party with respect to the Collateral.
 
 
15

--------------------------------------------------------------------------------

 
 
(c)  Performance by Secured Party. If Debtor fails to perform any agreement or
obligation provided herein, Secured Party may itself perform, or cause
performance of, such agreement or obligation, and the expenses of Secured Party
incurred in connection therewith shall be a part of the Indebtedness, secured by
the Collateral and payable by Debtor on demand.
 
(d)  Debtor's Receipt of Proceeds. All amounts and proceeds (including
instruments and writings) received by Debtor in respect of accounts or general
intangibles shall be received in trust for the benefit of Secured Party
hereunder and, upon request of Secured Party upon an Event Default, shall be
segregated from other property of Debtor and shall be forthwith delivered to
Secured Party in the same form as so received (with any necessary endorsement).
 
(e)  Notification of Account Debtors. Secured Party may at its discretion from
time to time, upon an Event of Default, notify any or all obligors under any
accounts or general intangibles (i) of Secured Party's security interest in such
accounts or general intangibles and direct such obligors to make payment of all
amounts due or to become due to Debtor thereunder directly to Secured Party, and
(ii) to verify the accounts or general intangibles with such obligors. Upon an
Event of Default, Secured Party shall have the right, at the expense of Debtor,
to enforce collection of any such accounts or general intangibles and adjust,
settle or compromise the amount or payment thereof, in the same manner and to
the same extent as Debtor.
 
(f)  Licenses. For purposes of enabling Secured Party to exercise rights and
remedies under this Agreement, Debtor grants to Secured Party an irrevocable,
nonexclusive license (exercisable without payment of royalty or other
compensation to Debtor or any other person, provided, that if the license
granted to Secured Party is a sublicense, Debtor shall be solely responsible
for, and indemnify Secured Party against, any royalty or other compensation
payable to Debtor's licensor or other person) to use all of Debtor's software,
and including in such license reasonable access to all media in which any of the
licensed items may be recorded and all related manuals. For the purpose of
enabling Secured Party to exercise rights and remedies under this Agreement,
Debtor grants to Secured Party an irrevocable, nonexclusive license (exercisable
without payment of royalty or other compensation to Debtor or any other person)
to use, license, or sub-license any of the Collateral consisting of Patents,
Trademarks, Copyrights, and IP Licenses and wherever the same may be located,
and including in such license reasonable access to all media in which any of the
licensed items may be recorded or stored and to all software used for the use,
compilation, or printout thereof. The use of such license by Secured Party shall
be exercised, at the option of Secured Party, if an Event of Default exists;
provided that any license, sub-license, or other transaction entered into by
Secured Party in accordance herewith shall be binding upon Debtor
notwithstanding any subsequent cure of an Event of Default.
 
 
16

--------------------------------------------------------------------------------

 
 
7.  Events of Default. Each of the following constitutes an "Event of Default"
under this Agreement:
 
(a)  Default Under Note or Agreement. Any failure to timely make any payment
required to be made under this Agreement or under the Note, or the occurrence of
a default or breach of any term or condition of the Note; or
 
(b)  Default Under This Agreement. Any failure of Debtor to comply with, or any
breach by Debtor of, any term of Article 5 of this Agreement, or any failure of
Debtor to comply with, or any breach by Debtor of, any other term of this
Agreement or any term of any other Loan Document that has occurred and has
continued for 20 days after actual notice thereof by any executive officer of
Debtor (except with respect to payment defaults which are covered by subsection
(a) above); or
 
(c)  False Representation. Any representation of Debtor contained herein is not
true and correct in any material respect on or as of the date made; or
 
(d)  Execution on Property. If Debtor fails to have discharged within a period
of sixty (60) days any attachment, sequestration or similar writ levied upon any
property of Debtor having a value of or greater than $50,000 (either as to a
single asset or cumulatively as to separate assets), or any property of Debtor
having a value of or greater than $50,000 (either as to a single asset or
cumulatively as to separate assets) is taken on execution or other process of
law in any action against Debtor; or any attachment, sequestration or similar
writ is levied upon any property of Debtor having a value of or greater than
$50,000 (either as to a single asset or cumulatively as to separate assets); or
 
(e)  Abandonment. Debtor abandons any Collateral having a value of or greater
than $50,000 (either as to a single asset or cumulatively as to separate
assets), other than Collateral that is obsolete or no longer useful in the
Debtor's business; or
 
(f)  Action by Other Lienholder. The holder of any lien on the Collateral
(without hereby implying the consent of Secured Party to the existence or
creation of any such lien on the Collateral) or any other asset of Debtor having
a value of $50,000 or greater declares a default thereunder or institutes
foreclosure or other proceedings for the enforcement of its remedies thereunder;
or
 
(g)  Search Report; Opinion. Secured Party shall receive at any time following
the execution of this Agreement a search report or an opinion of counsel
indicating that Secured Party's security interest is not prior to all other
liens or security interests (other than Permitted Liens) reflected in the report
or opinion.
 
8.  Remedies and Related Rights. If an Event of Default shall have occurred, and
without limiting any other rights and remedies provided herein, under any of the
other Loan Documents or otherwise available to Secured Party, Secured Party may
exercise one or more of the rights and remedies provided in this Section.
 
 
17

--------------------------------------------------------------------------------

 
 
(a)  Remedies. Secured Party may from time to time at its discretion, without
limitation and without notice except as expressly provided in any of the Loan
Documents:
 
(i)  exercise in respect of the Collateral all the rights and remedies of a
secured party under the Code (whether or not the Code applies to the affected
Collateral);
 
(ii)  require Debtor to, and Debtor hereby agrees that it will at its expense
and upon request of Secured Party, assemble the Collateral as directed by
Secured Party and make it available to Secured Party at a place to be designated
by Secured Party which is reasonably convenient to both parties;
 
(iii)  reduce its claim to judgment or foreclose or otherwise enforce, in whole
or in part, the security interest granted hereunder by any available judicial
procedure;
 
(iv)  sell or otherwise dispose of, at its office, on the premises of Debtor or
elsewhere, the Collateral, as a unit or in parcels, by public or private
proceedings, and by way of one or more contracts (it being agreed that the sale
or other disposition of any part of the Collateral shall not exhaust Secured
Party's power of sale, but sales or other dispositions may be made from time to
time until all of the Collateral has been sold or disposed of or until the
Indebtedness has been paid and performed in full), and at any such sale or other
disposition it shall not be necessary to exhibit any of the Collateral;
 
(v)  buy the Collateral, or any portion thereof, at any public sale;
 
(vi)  buy the Collateral, or any portion thereof, at any private sale if the
Collateral is of a type customarily sold in a recognized market or is of a type
which is the subject of widely distributed standard price quotations;
 
(vii)  apply for the appointment of a receiver for the Collateral, and Debtor
hereby consents to any such appointment; and
 
(viii)  at its option, retain the Collateral in satisfaction of the Indebtedness
whenever the circumstances are such that Secured Party is entitled to do so
under the Code or otherwise, to the full extent permitted by the Code, Secured
Party shall be permitted to elect whether such retention shall be in full or
partial satisfaction of the Indebtedness.
 
In connection with the exercise by Secured Party of rights under this Agreement
that effects the disposition of or use of any Collateral, it may be necessary to
obtain the prior consent or approval of governmental authorities and other
persons, to a transfer or assignment of Collateral. If an Event of Default
exists, Debtor shall execute, deliver, and file, and hereby appoints (to the
extent not prohibited by applicable law) Secured Party as its attorney, to
execute, deliver, and file on Debtor's behalf and in Debtor's name, all
applications, certificates, filings, instruments, and other documents (including
without limitation any application for an assignment or transfer of control or
ownership) that may be necessary or appropriate, in Secured Party's opinion, to
obtain such consents or approvals. Debtor shall use its best efforts to obtain
such consents or approvals if an Event of Default exists. Debtor acknowledges
that there is no adequate remedy at law for failure by it to comply with the
provisions of this Section and that such failure would not be adequately
compensable in damages, and therefore agrees that this Section may be
specifically enforced.
 
 
18

--------------------------------------------------------------------------------

 
 
In the event Secured Party shall elect to sell the Collateral, Secured Party may
sell the Collateral without giving any warranties and shall be permitted to
specifically disclaim any warranties of title or the like. Further, if Secured
Party sells any of the Collateral on credit, Debtor will be credited only with
payments actually made by the purchaser, received by Secured Party and applied
to the Indebtedness. In the event the purchaser fails to pay for the Collateral,
Secured Party may resell the Collateral and Debtor shall be credited with the
proceeds of the sale. Debtor agrees that in the event Debtor is entitled to
receive any notice under the Uniform Commercial Code, as it exists in the state
governing any such notice, of the sale or other disposition of any Collateral,
reasonable notice shall be deemed given when such notice is deposited in a
depository receptacle under the care and custody of the United States Postal
Service, postage prepaid, at such party's address set forth on the first page
hereof, ten (10) days prior to the date of any public sale, or after which a
private sale, of any of such Collateral is to be held. Secured Party shall not
be obligated to make any sale of Collateral regardless of notice of sale having
been given. Secured Party may adjourn any public or private sale from time to
time by announcement at the time and place fixed therefor, and such sale may,
without further notice, be made at the time and place to which it was so
adjourned.
 
(b)  Private Sale; Further Approvals.
 
(i)  Debtor recognizes that Secured Party may be unable to effect a public sale
of all or any part of the Collateral because of restrictions in applicable laws
and contractual restrictions and that Secured Party may, therefore, determine to
make one or more private sales of any such Collateral to a restricted group of
purchasers who will be obligated to agree, among other things, to acquire such
Collateral subject to applicable laws and contractual restrictions. Debtor
acknowledges that any such private sale may be at prices and other terms less
favorable than what might have been obtained at a public sale and,
notwithstanding the foregoing, agrees that each such private sale shall be
deemed to have been made in a commercially reasonable manner.
 
(ii)  In connection with the exercise by Secured Party of its rights hereunder
that effects the disposition of or use of any Collateral, it may be necessary to
obtain the prior consent or approval of governmental authorities and other
persons to a transfer or assignment of Collateral.
 
(iii)  Debtor agrees, if an Event of Default exists, to execute, deliver, and
file, and authorizes Secured Party pursuant to the power of attorney herein
granted, to execute, deliver, and file on Debtor's behalf and in Debtor's name,
all applications, certificates, filings, instruments, and other documents
(including without limitation any application for an assignment or transfer of
control or ownership) that may be necessary or appropriate, in Secured Party's
opinion, and to obtain such consents, waivers, and approvals under applicable
laws and agreements prior to an Event of Default. Debtor acknowledges that there
is no adequate remedy at law for failure by it to comply with the provisions of
this Section and that such failure would not be adequately compensable in
damages, and therefore agrees that this Section may be specifically enforced.
 
 
19

--------------------------------------------------------------------------------

 
 
(c)  Application of Proceeds. Secured Party shall apply or use any cash held by
Secured Party as Collateral, and any cash proceeds received by Secured Party in
respect of any sale or other disposition of, collection from, or other
realization upon, all or any part of the Collateral as follows:
 
(i)  to the repayment or reimbursement of the costs and expenses (including,
without limitation, attorneys' fees and expenses) incurred by Secured Party in
connection with (A) the custody, preservation, use or operation of, or the sale
of, collection from, or other realization upon, the Collateral, and (B) the
exercise or enforcement of any of the rights and remedies of Secured Party
hereunder; and
 
(ii)  to the payment of any other amounts required by applicable law (including
without limitation, Section 9-615(a)(3) of the Code or any other applicable
statutory provision).
 
(d)  Deficiency. In the event that the proceeds of any sale of, collection from,
or other realization upon, all or any part of the Collateral by Secured Party
are insufficient to pay all amounts to which Secured Party is legally entitled,
Debtor shall be liable for the deficiency, together with interest thereon as
provided in the Loan Documents, to the full extent not prohibited by law.
 
(e)  Non-Judicial Remedies. In granting to Secured Party the power to enforce
its rights hereunder without prior judicial process or judicial hearing, Debtor
expressly waives, renounces and knowingly relinquishes any legal right which
might otherwise require Secured Party to enforce its rights by judicial process.
Debtor recognizes and concedes that non-judicial remedies are consistent with
the usage of trade, are responsive to commercial necessity and are the result of
a bargain at arm's length. Nothing herein is intended to prevent Secured Party
or Debtor from resorting to judicial process at either party's option.
 
(f)  Other Recourse. Debtor waives any right to require Secured Party to proceed
against any third party, exhaust any Collateral or other security for the
Indebtedness, or to have any third party joined with Debtor in any suit arising
out of the Indebtedness or any of the Loan Documents, or pursue any other remedy
available to Secured Party. Debtor further waives any and all notice of
acceptance of this Agreement and of the creation, modification, rearrangement,
renewal or extension of the Indebtedness. Debtor further waives any defense
arising by reason of any disability or other defense of any third party or by
reason of the cessation from any cause whatsoever of the liability of any third
party. Until all of the Indebtedness shall have been paid in full, Debtor shall
have no right of subrogation and Debtor waives the right to enforce any remedy
which Secured Party has or may hereafter have against any third party, and
waives any benefit of and any right to participate in any other security
whatsoever now or hereafter held by Secured Party. Debtor authorizes Secured
Party, and without notice or demand and without any reservation of rights
against Debtor and without affecting Debtor's liability hereunder or on the
Indebtedness to (if an Event of Default exists) (i) take or hold any other
property of any type from any third party as security for the Indebtedness, and
exchange, enforce, waive and release any or all of such other property, (ii)
apply such other property and direct the order or manner of sale thereof as
Secured Party may in its discretion determine, (iii) renew, extend, accelerate,
modify, compromise, settle or release any of the Indebtedness or other security
for the Indebtedness, (iv) waive, enforce or modify any of the provisions of any
of the Loan Documents executed by any third party, and (v) release or substitute
any third party.
 
 
20

--------------------------------------------------------------------------------

 
 
(g)  Rights to Dividends and Distributions. With respect to any Securities
constituting a part of the Collateral, the Secured Party shall have authority if
an Event of Default exists and is continuing, either to have the same registered
in the Secured Party's name or in the name of a nominee, and, with or without
such registration, to demand of the issuer thereof, and to receive and receipt
for, any and all dividends (including any stock or similar dividend or
distribution) payable in respect thereof, whether they be ordinary or
extraordinary. The Secured Party shall send to the Debtor notice of the Secured
Party's election to take any action described in the preceding sentence;
provided any failure of the Debtor to receive any such notice shall not
invalidate any action taken by the Secured Party or impair any of its rights. If
the Debtor shall become entitled to receive or shall receive any interest in or
certificate (including, without limitation, any interest in or certificate
representing a dividend or a distribution in connection with any
reclassification, increase, or reduction of capital, or issued in connection
with any reorganization), or any option or rights arising from or relating to
any of the Collateral, whether as an addition to, in substitution of, as a
conversion of, or in exchange for any of the Collateral, or otherwise, the
Debtor agrees to accept the same as the Secured Party's agent and to hold the
same in trust on behalf of and for the benefit of the Secured Party, and to
deliver the same immediately to the Secured Party in the exact form received,
with appropriate undated stock or similar powers, duly executed in blank, to be
held by the Secured Party, subject to the terms hereof, as Collateral. Unless an
Event of Default exists, the Debtor shall be entitled to receive all cash
dividends and distributions paid in respect of any of the Collateral (subject to
the restrictions of any other Loan Document). The Secured Party shall be
entitled to all dividends and distributions, and to any sums paid upon or in
respect of any Collateral, upon the liquidation, dissolution, or reorganization
of the issuer thereof which shall be paid to the Secured Party to be held by it
as additional collateral security for and application to the Secured Obligations
at the discretion of the Secured Party. All dividends paid or distributed in
respect of the Collateral which are received by the Debtor in violation of this
Agreement shall, until paid or delivered to the Secured Party, be held by the
Debtor in trust as additional Collateral for the Secured Obligations.
 
(h)  Right of the Secured Party to Notify Issuers. If an Event of Default exists
and is continuing and at such other times as the Secured Party is entitled to
receive dividends and other property in respect of or consisting of any
Collateral which is or represents an equity or ownership interest in any person
("Securities Collateral"), the Secured Party may notify issuers of the
Securities Collateral to make payments of all dividends and distributions
directly to the Secured Party and the Secured Party may take control of all
Proceeds of any Securities Collateral. Until the Secured Party elects to
exercise such rights, if an Event of Default exists, the Debtor, as agent of the
Secured Party, shall collect and segregate all dividends and other amounts paid
or distributed with respect to the Securities Collateral.
 
 
21

--------------------------------------------------------------------------------

 
 
(i)  Securities Act. Because of the Securities Act of 1933, as amended
("Securities Act"), and other laws, including without limitation state "blue
sky" laws, or contractual restrictions or agreements, there may be legal
restrictions or limitations affecting the Secured Party in any attempts to
dispose of the Collateral and the enforcement of rights under this Agreement.
For these reasons, the Secured Party is authorized by the Debtor, but not
obligated, if any Event of Default exists, to sell or otherwise dispose of any
of the Collateral at private sale, subject to an investment letter, or in any
other manner which will not require the Collateral, or any part thereof, to be
registered in accordance with the Securities Act, or any other law. The Secured
Party is also hereby authorized by the Debtor, but not obligated, to take such
actions, give such notices, obtain such consents, and do such other things as
the Secured Party may deem required or appropriate under the Securities Act or
other securities laws or other laws or contractual restrictions or agreements in
the event of a sale or disposition of any Collateral. The Debtor understands
that the Secured Party may in its discretion approach a restricted number of
potential purchasers and that a sale under such circumstances may yield a lower
price for the Collateral than would otherwise be obtainable if same were
registered and/or sold in the open market. No sale so made in good faith by the
Secured Party shall be deemed to be not "commercially reasonable" because so
made. The Debtor agrees that if an Event of Default exists, and the Secured
Party sells the Collateral or any portion thereof at any private sale or sales,
the Secured Party shall have the right to rely upon the advice and opinion of
appraisers and other persons, which appraisers and other persons are acceptable
to the Secured Party, as to the best price reasonably obtainable upon such a
private sale thereof. In the absence of bad faith or gross negligence, such
reliance shall be prima facie evidence that the Secured Party handled such
matter in a commercially reasonable manner under applicable law.
 
9.  Indemnity. DEBTOR HEREBY INDEMNIFIES AND AGREES TO HOLD HARMLESS SECURED
PARTY, AND ITS OFFICERS, DIRECTORS, EMPLOYEES, AGENTS AND REPRESENTATIVES (EACH
AN "INDEMNIFIED PERSON") FROM AND AGAINST ANY AND ALL LIABILITIES, OBLIGATIONS,
CLAIMS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES
OR DISBURSEMENTS OF ANY KIND OR NATURE (COLLECTIVELY, THE "CLAIMS") WHICH MAY BE
IMPOSED ON, INCURRED BY, OR ASSERTED AGAINST, ANY INDEMNIFIED PERSON ARISING IN
CONNECTION WITH THE LOAN DOCUMENTS, THE INDEBTEDNESS OR THE COLLATERAL
(INCLUDING WITHOUT LIMITATION, THE ENFORCEMENT OF THE LOAN DOCUMENTS AND THE
DEFENSE OF ANY INDEMNIFIED PERSON'S ACTIONS AND/OR INACTIONS IN CONNECTION WITH
THE LOAN DOCUMENTS), IN ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING, IN WHOLE
OR IN PART, OUT OF THE NEGLIGENCE OF THE INDEMNITEE; OTHER THAN ANY CLAIM
ARISING AS A RESULT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF ANY
INDEMNIFIED PERSON, AS FINALLY DETERMINED BY A COURT OF COMPETENT JURISDICTION.
THE INDEMNIFICATION PROVIDED FOR IN THIS SECTION SHALL SURVIVE THE TERMINATION
OF THIS AGREEMENT AND SHALL EXTEND AND CONTINUE TO BENEFIT EACH INDIVIDUAL OR
ENTITY WHO IS OR HAS AT ANY TIME BEEN AN INDEMNIFIED PERSON HEREUNDER.
 
 
22

--------------------------------------------------------------------------------

 
 
10.  Miscellaneous.
 
(a)  Amendment. No modification, consent or amendment of any provision of this
Agreement or any of the other Loan Documents shall be valid or effective unless
the same is authenticated by the party against whom it is sought to be enforced,
except to the extent of amendments specifically permitted by the Code without
authentication by the Debtor.
 
(b)  Actions by Secured Party. The lien and other security rights of Secured
Party hereunder shall not be impaired by (i) any renewal, extension, increase or
modification with respect to the Indebtedness, (ii) any surrender, compromise,
release, renewal, extension, exchange or substitution which Secured Party may
grant with respect to the Collateral, or (iii) any release or indulgence granted
to the Debtor or any endorser, guarantor or surety of the Indebtedness. The
taking of additional security by Secured Party shall not release or impair the
lien, security interest or other security rights of Secured Party hereunder or
affect the obligations of Debtor hereunder.
 
(c)  Waiver by Secured Party. Secured Party may waive any Event of Default
without waiving any other prior or subsequent Event of Default. Secured Party
may remedy any default without waiving the Event of Default remedied. Neither
the failure by Secured Party to exercise, nor the delay by Secured Party in
exercising, any right or remedy upon any Event of Default shall be construed as
a waiver of such Event of Default or as a waiver of the right to exercise any
such right or remedy at a later date. No single or partial exercise by Secured
Party of any right or remedy hereunder shall exhaust the same or shall preclude
any other or further exercise thereof, and every such right or remedy hereunder
may be exercised at any time. No waiver of any provision hereof or consent to
any departure by Debtor therefrom shall be effective unless the same shall be in
writing and signed by Secured Party and then such waiver or consent shall be
effective only in the specific instances, for the purpose for which given and to
the extent therein specified. No notice to or demand on Debtor in any case shall
of itself entitle Debtor to any other or further notice or demand in similar or
other circumstances.
 
(d)  Costs and Expenses. Debtor will upon demand pay to Secured Party the amount
of any and all reasonable costs and expenses (including without limitation,
attorneys' fees and expenses), which Secured Party may incur in connection with
(i) the custody, preservation, use or operation of, or the sale of, collection
from, or other realization upon, the Collateral, (ii) the exercise or
enforcement of any of the rights of Secured Party under the Loan Documents, or
(iii) the failure by Debtor to perform or observe any of the provisions hereof.
 
 
23

--------------------------------------------------------------------------------

 
 
(e)  GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND APPLICABLE FEDERAL LAWS,
EXCEPT TO THE EXTENT PERFECTION AND THE EFFECT OF PERFECTION OR NON-PERFECTION
OF THE SECURITY INTEREST GRANTED HEREUNDER, IN RESPECT OF ANY PARTICULAR
COLLATERAL, ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF
TEXAS.
 
(f)  Venue. This Agreement has been entered into in the county in Texas where
Secured Party's address for notice purposes is located, and it shall be
performable for all purposes in such county. Courts within the State of Texas
shall have jurisdiction over any and all disputes arising under or pertaining to
this Agreement and venue for any such disputes shall be in the county or
judicial district where this Agreement has been executed and delivered.
 
(g)  Severability. If any provision of this Agreement is held by a court of
competent jurisdiction to be illegal, invalid or unenforceable under present or
future laws, such provision shall be fully severable, shall not impair or
invalidate the remainder of this Agreement and the effect thereof shall be
confined to the provision held to be illegal, invalid or unenforceable.
 
(h)  Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original (including electronic copies), but all
of which together shall constitute one and the same instrument.
 
(i)  No Obligation. Nothing contained herein shall be construed as an obligation
on the part of Secured Party to extend or continue to extend credit to Debtor.
 
(j)  Notices. All notices, requests, demands or other communications required or
permitted to be given pursuant to this Agreement shall be in writing and given
by telecopy, or in writing and telecopied, mailed by certified mail return
receipt requested, or delivered to the intended recipient at the address
specified in this Agreement; or, as to any party at such other address as shall
be designated by such party in a notice to the other party given in accordance
with this Section. Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given when transmitted by
telecopy, subject to telephone confirmation of receipt, or when personally
delivered or, in the case of a mailed notice, five business days after being
duly deposited in the mails, in each case given or addressed as aforesaid.
 
(k)  Binding Effect and Assignment. This Agreement (i) creates a continuing
security interest in the Collateral, (ii) shall be binding on Debtor and the
heirs, executors, administrators, personal representatives, successors and
assigns of Debtor, and (iii) shall inure to the benefit of Secured Party and its
successors and assigns. Without limiting the generality of the foregoing,
Secured Party may pledge, assign or otherwise transfer the Indebtedness and its
rights under this Agreement and any of the other Loan Documents to any other
party. Debtor's rights and obligations hereunder may not be assigned or
otherwise transferred without the prior written consent of Secured Party.
 
 
24

--------------------------------------------------------------------------------

 
 
(l)  Cumulative Rights. All rights and remedies of Secured Party hereunder are
cumulative of each other and of every other right or remedy which Secured Party
may otherwise have at law or in equity or under any of the other Loan Documents,
and the exercise of one or more of such rights or remedies shall not prejudice
or impair the concurrent or subsequent exercise of any other rights or remedies.
Further, except as specifically noted as a waiver herein, no provision of this
Agreement is intended by the parties to this Agreement to waive any rights,
benefits or protection afforded to Secured Party under the Code.
 
(m)  Gender and Number. Within this Agreement, words of any gender shall be held
and construed to include the other gender, and words in the singular number
shall be held and construed to include the plural and words in the plural number
shall be held and construed to include the singular, unless in each instance the
context requires otherwise.
 
(n)  Descriptive Headings. The headings in this Agreement are for convenience
only and shall in no way enlarge, limit or define the scope or meaning of the
various and several provisions hereof.
 
(o)  Release. The Debtor hereby unconditionally and irrevocably remises,
acquits, and fully and forever releases and discharges the Secured Party and all
respective affiliates and subsidiaries of the Secured Party, its officers,
servants, employees, agents, predecessors, attorneys, advisors, parents,
subsidiaries, equity interest holders, loan participants, principals, directors
and shareholders, and its heirs, legal representatives, successors and assigns
(collectively, the "Released Lender Parties") from any and all claims, demands,
causes of action, obligations, remedies, suits, damages and liabilities
(collectively, the "Debtor Claims") of any nature whatsoever, whether now known,
suspected or claimed, whether arising under common law, in equity or under
statute, which the Debtor ever had or now has against the Released Lender
Parties which may have arisen at any time on or prior to the date of this
Agreement and which were in any manner related to any of the Loan Documents or
the enforcement or attempted enforcement by the Secured Party of rights,
remedies or recourses related thereto. The Debtor covenants and agree never to
commence, voluntarily aid in any way, prosecute or cause to be commenced or
prosecuted against any of the Released Lender Parties any action or other
proceeding based upon any of the Debtor Claims which may have arisen at any time
on or prior to the date of this Agreement and were in any manner related to any
of the Loan Documents.
 
 
25

--------------------------------------------------------------------------------

 
 
(P)  ENTIRE AGREEMENT. THIS AGREEMENT CONTAINS THE ENTIRE AGREEMENT OF SECURED
PARTY AND DEBTOR WITH RESPECT TO THE COLLATERAL. IF THE PARTIES HERETO ARE
PARTIES TO ANY PRIOR AGREEMENT, EITHER WRITTEN OR ORAL, RELATING TO THE
COLLATERAL, THE TERMS OF THIS AGREEMENT SHALL AMEND AND SUPERSEDE THE TERMS OF
SUCH PRIOR AGREEMENTS AS TO TRANSACTIONS ON OR AFTER THE EFFECTIVE DATE OF THIS
AGREEMENT, BUT ALL SECURITY AGREEMENTS, FINANCING STATEMENTS, GUARANTIES, OTHER
CONTRACTS AND NOTICES FOR THE BENEFIT OF SECURED PARTY SHALL CONTINUE IN FULL
FORCE AND EFFECT TO SECURE THE INDEBTEDNESS UNLESS SECURED PARTY SPECIFICALLY
RELEASES ITS RIGHTS THEREUNDER BY SEPARATE RELEASE.
 

The Remainder of This Page Is Intentionally Left Blank.

26

--------------------------------------------------------------------------------

 
EXECUTED as of the date first written above.

 
DEBTOR:
           
ISECURETRAC CORP.
                   
By:
    

 
Printed Name:
      
Printed Title:
    

 
 

 
SECURED PARTY:
           
CRESTPARK LP, INC.
                   
By:
    

 
Printed Name:
      
Printed Title:
    

 
 

Signature Page to Credit and Security Agreement
 

--------------------------------------------------------------------------------

 
Schedule 1
Real Property
  

 
 
Schedule 1 - page 1

--------------------------------------------------------------------------------

Schedule 2
Registered Patents

 
Registered Owner
Nature of Debtor’s Interest
(e.g. owner, licensee)
 
Registered Patent No.
 
Issue Date
 
Country of Issue

          

 

Schedule 2
Patent Applications

 
Registered Owner
Nature of Debtor's
Interest
(e.g. owner, licensee)
 
Serial No.
 
Filing Date
 
Country of Issue

  

 
 
Schedule 2 - page 1

--------------------------------------------------------------------------------

 

Schedule 3
Registered Trademarks
 
Registered Owner
Nature of Debtor's Interest
(e.g. owner, licensee)
 
Registered Trademark
 
Registration
No.
 
Int'l Class
Covered
 
Goods or
Services
Covered
 
Date
Registered
 
Country of Registration
 

 
 
Schedule 3
Trademark Applications
 
Registered Owner
Nature of Debtor's Interest
(e.g. owner, licensee)
Trademark
Application relates to following Trademark
 
Serial
No.
 
Int'l Class
Covered
 
Goods or
Services
Covered
 
Date
of
Application
 
Country
of
Application
 

 
 
Schedule 3 - page 1

--------------------------------------------------------------------------------

Schedule 4
Registered Copyrights
 
Registered Owner
Nature of Debtor's Interest
(e.g. owner, licensee)
 
Serial No.
 
Copyright
 
Issue Date
 
Country of Issue
  

 

Schedule 4
Copyright Applications
 
Registered Owner
Nature of Debtor's Interest
(e.g. owner, licensee)
 
Registration No.
 
Copyright
 
Application Date
 
Country of
Application
  

 
 
Schedule 4 - page 1

--------------------------------------------------------------------------------

 

Schedule 5
Commercial Tort Claims

 
Case Name or Style
 
 
Case Number
 
Court in Which Pending

   

 
Schedule 5 - page 1

--------------------------------------------------------------------------------

 
 

Schedule 6
Deposit Accounts
 
Bank
Branch Name,
Street Address
 
ABA No.
 
Account No.
 
Account Name
 
Account Type
                          

 
Schedule 6 - page 1

--------------------------------------------------------------------------------

Schedule 7
Commodity Accounts

Commodity
Intermediary
 
Street Address
 
Account Name
 
Account Number
Commodity Contract
Description

    

Schedule 7
Securities Accounts

Securities
Intermediary
 
Street Address
 
Account Name
 
Account Number
Securities Contract
Description

    

 
 
Schedule 7 - page 1

--------------------------------------------------------------------------------

 
 
Schedule 8
Letters of Credit
 
Bank Issuer
Branch Name,
Street Address
 
Letter of Credit No.
 
Issue Date
 
Expiry
 
Face Amount
   

 
 
Schedule 8 - page 1

--------------------------------------------------------------------------------

Schedule 9
Equity Interests
Owner
Interest
Certificate Number
Number of Shares
             

 
Schedule 9 - page 1

--------------------------------------------------------------------------------

 

Schedule 10
Permitted Liens
   

 
Schedule 10 - page 1

--------------------------------------------------------------------------------