Exhibit 10.26
 
SECURITY AGREEMENT

THIS SECURITY AGREEMENT (this “Security Agreement”), dated June 1, 2012, by and
between SwissINSO Holding Inc. a Delaware corporation (“SwissINSO”), with an
address at PSE – Parc Scientifique de l’EPFL, Route J.D. Colladon, Building D –
3rd floor, 1015 Lausanne, Switzerland, and InsOglass Holding SA, a Swiss
corporation (the “Secured Party”), with an address at Fornache 8, 1029
Villars-Ste-Croix, Switzerland.

W I T N E S S E T H:

WHEREAS, SwissINSO has issued to the Secured Party a secured promissory note
(the “Note”), in the maximum principal amount of $1,000,000;

WHEREAS,  as security for the prompt and complete payment and performance in
full by SwissINSO of the Note and the other Secured Obligations (as herein
defined), SwissINSO has agreed to enter into this Security Agreement assigning,
pledging, conveying, hypothecating, transferring, granting and delivering to the
Secured Party a security interest in and to the Collateral (as defined herein).

NOW, THEREFORE, in consideration of the mutual promises contained herein and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, it is hereby agreed as follows:

1.           SECURITY INTEREST.

1.1           Grant of Security.   As security for the prompt and complete
payment and performance in full by SwissINSO of the indebtedness, together with
all fees and other charges, arising under the Note and including any of its
remedies under the Note (the “Secured Obligations”), SwissINSO hereby grants,
assigns, conveys, mortgages, pledges, hypothecates and transfers to the Secured
Party a lien on and security interest in, all of SwissINSO’s right, title and
interest in, to and under, all of the property and assets currently owned by or
owing to, or hereafter acquired by or arising in favor of, SwissINSO, wherever
located, including, but not limited to, all accounts, deposit accounts, chattel
paper, instruments, documents, securities, contract rights, receivables,
equipment, goods, inventory, investment property, goodwill, general intangibles,
intellectual property, patents, patent applications, trademarks, trademark
applications, trade names, copyrights, copyright applications, Internet domain
names, service marks, trade secrets, know-how, technology, software, hardware,
commercial tort claims, warranties and guarantees, as any of the foregoing terms
may be defined in the UCC, and including any products, proceeds (including
insurance proceeds) or income derived therefrom, whether by disposition or
otherwise (all of the above, collectively, the “Collateral”).  The lien on and
security interest in the Collateral shall be subordinate to that of the holders
of the 9% Secured Convertible Notes of SwissINSO.   Notwithstanding the
foregoing, in the event that SwissINSO obtains commercial or equipment financing
for the purchase of water purification units, machinery and other similar
equipment in connection with its business and the lender requires a first
priority lien on and security interest in such property, the Secured Party
agrees that its lien on such property will also be subordinate to that of the
lender.
 
 
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1.2           Continuing Agreement.  This Security Agreement shall create a
continuing security interest in the Collateral and shall remain in full force
and effect until performance in full of the Secured Obligations.
 
1.3           Termination. Upon satisfaction of the Secured Obligations, whether
by payment or conversion into shares of the Common Stock of the Issuer pursuant
to the terms and provisions of the Note, this Agreement shall automatically be
null and void and have no further  force and effect without any action on the
part of any party.

2.           PERFECTION OF SECURITY INTEREST.

2.1           Authorization to File Financing Statements.  SwissINSO agrees to
execute all such financing statements pursuant to the Uniform Commercial Code or
similar filings as in effect from time to time in Switzerland or other foreign
jurisdictions (the “UCC”) or other notices appropriate under applicable law.
 
2.2           Collateral Covenants.  To further insure the attachment,
perfection and  priority of, and the ability of the Secured Party to enforce the
Secured Party’s security interest in the Collateral, SwissINSO agrees to take
any and all other actions as the Secured Party may determine to be necessary or
useful for the attachment, perfection, and priority of, and the ability of the
Secured Party to enforce, the Secured Party’s security interest in 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 SwissINSO's signature is required therefor,
(b) complying with any provision of any statute, regulation or treaty of the
United States or any foreign country as to the Collateral if compliance with
such provision is a condition to attachment, perfection or priority of, or
ability of the Secured Party to enforce, the Secured Party’s security interest
in such Collateral, (c) obtaining governmental and other third party waivers,
consents, and approvals in form and substance satisfactory to the Secured Party,
and (d) taking all actions under any other law, as reasonably determined by the
Secured Party to be applicable.

3.           EVENTS OF DEFAULT.

3.1           Event of Default.  An Event of Default, as defined in the Note,
shall constitute an automatic default hereunder.
 
3.2           Rights upon Event of Default.  Upon an Event of Default, the
Secured Party shall have all the rights and remedies of a secured party under
the UCC or with respect to the Collateral.

 
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4.           REPRESENTATIONS AND WARRANTIES.

4.1           Validity. The security interest in the Collateral granted to the
Secured Party hereunder constitutes and shall continue to constitute a legal,
valid and, upon the filing of a UCC financing statement, or similar statement in
any foreign jurisdiction applicable to the Collateral, fully perfected, security
interest in the Collateral.
 
4.2           No Other Liens.  Except for the liens granted hereunder and those
granted to the holders of SwissINSO’s 9% Secured Convertible Notes, SwissINSO
owns and, as to all Collateral whether now existing or hereafter acquired, will
continue to own, the Collateral free and clear of any and all liens, rights or
claims, encumbrances, limitations or restrictions of all other persons or
entities; provided however that the foregoing restriction shall not prohibit
SwissINSO from obtaining a bank loan, revolving line of credit or similar
arrangements pursuant to which a security interest is customarily granted in the
ordinary course of business if, in connection therewith, the Secured Party and
the new lender agree to an intercreditor agreement acceptable to the Secured
Party and such new lender and provided further that the foregoing restriction
shall not prohibit SwissINSO from obtaining commercial or equipment financing as
contemplated in the last sentence of Section 1.1 hereof.
 
4.3           Corporate Representations.  SwissINSO (i) is a duly organized and
validly existing corporation in good standing under the laws of Delaware, (ii)
has the corporate power and authority to own its property and assets and to
transact the business in which it is engaged or presently proposes to engage and
(iii) has duly qualified and is authorized to do business and is in good
standing in every jurisdiction in which it owns or leases real property or in
which the nature of its business requires it to be so qualified.  SwissINSO has
the corporate power and authority to execute, deliver and carry out the terms
and provisions of this Security Agreement and has taken all necessary corporate
action to authorize the execution, delivery and performance and filing of this
Security Agreement and any UCC financing or continuation statements, or
amendments thereto, and related agreements, instruments, endorsements, powers of
attorney or notices.  SwissINSO has duly executed and delivered this Security
Agreement, and this Security Agreement constitutes the legal, valid and binding
obligation of SwissINSO, enforceable in accordance with its terms.

5.           MISCELLANEOUS.

5.1           Waiver.  No course of dealing or usage of trade, and no oral or
written representations or agreement, between SwissINSO and the Secured Party,
whether or not relied on or acted upon, and no act, delay or omission by Secured
in exercising any right or remedy hereunder or with respect to any Obligations
shall operate as a waiver thereof or of any other right or remedy, and no single
or partial exercise thereof shall preclude any other or further exercise thereof
or the exercise of any other right or remedy.  The giving of notice or a demand
by the Secured Party at any time shall not operate as a waiver in the future of
the Secured Party’s right to exercise any right or remedy without notice or
demand.  The Secured Party may remedy any default by SwissINSO in any reasonable
manner, without waiving the default remedied, and without waiving any other
prior or subsequent default by SwissINSO.
 
 
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5.2           Amendment.  This Agreement may be amended or modified only by a
writing signed by the parties hereto and any provision hereof may be waived only
by a writing signed by the Secured Party.
 
5.3           Severability.  The provisions of this Security Agreement are
severable, and if any clause or provision shall be held invalid or unenforceable
in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect only such clause or provision, or part thereof, in
such jurisdiction and shall not in any manner affect such clause or provision in
any other jurisdiction, or any other clause or provision of this Security
Agreement in any jurisdiction.
 
5.4           Assignment.  The benefits of this Security Agreement shall inure
to the benefit of the successors and assigns of the Secured Party.  The rights
and obligations of SwissINSO under this Security Agreement shall not be assigned
or delegated, by operation of law or otherwise, without the prior consent of the
Secured Party, and any such assignment or attempted assignment shall be void, of
no force or effect, and shall constitute a material default by SwissINSO.
 
5.5           Headings.  The headings contained herein shall be for convenience
of reference only and shall not have any bearing in the meaning of the
provisions contained herein.
 
5.6           CHOICE OF LAW.  THIS SECURITY AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF NEW YORK.
 
5.7           WAIVER OF ANY AND ALL RIGHTS TO A TRIAL BY JURY.  SWISSINSO AND
SECURED PARTY UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVE ALL RIGHTS TO
TRIAL BY JURY IN ANY ACTION, PROCEEDING, SUIT, COUNTERCLAIM, OR CROSS-CLAIMS
ARISING DIRECTLY OR INDIRECTLY IN ANY MATTER (WHETHER SOUNDING IN TORT,
CONTRACT, OR OTHERWISE) IN ANY WAY ARISING OUT OF OR OTHERWISE RELATING TO THIS
AGREEMENT OR TRANSACTIONS OR THE  RELATIONSHIPS ESTABLISHED THEREUNDER.  BOTH
PARTIES CONFIRM THAT THE FOREGOING WAIVER OF A TRIAL BY JURY IS INFORMED AND
FREELY MADE.

 
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IN WITNESS WHEREOF, the undersigned have executed this Security Agreement on the
date first set forth above.
 

 
SWISSINSO HOLDING INC.
           
By:
     
Name:
      Title:              
INSOGLASS HOLDING SA
            By:       Name:      
Title:
   

 
 
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