Exhibit 10.4

 
SECURITY AGREEMENT
 
 
(Patent)
 
THIS SECURITY AGREEMENT (PATENT) (“Agreement”), is entered into and made
effective as of January 3, 2008, by and between IR BIOSCIENCES HOLDINGS, INC., a
Delaware corporation with its principal place of business located at 8767 E. Via
De Ventura, Suite 190, Scottsdale, AZ 85258 (the “Parent”), and the each
subsidiary of the Parent listed on Schedule I attached hereto (each a
“Subsidiary,” and collectively and together with the Parent, the “Company”), in
favor of the YA GLOBAL INVESTMENTS, L.P. (the “Secured Party”).
 
 
WITNESETH:
 
WHEREAS, in connection with the Securities Purchase Agreement by and among the
Parent and the Secured Party of even date herewith (the “Securities Purchase
Agreement”), the Parent has agreed, upon the terms and subject to the conditions
of the Securities Purchase Agreement, to issue to the Secured Party (i) an
aggregate original principal amount of up to $3,000,000 of senior secured
convertible debentures (the “Convertible Debentures”), which shall be
convertible into shares of the Parent’s Common Stock (the “Conversion Shares”);
and (ii) warrants (the “Warrants”) to be exercisable to acquire additional
shares of Common Stock (the “Warrants Shares”) initially in that number of
shares of Common Stock set forth in the Securities Purchase Agreement;
 
WHEREAS, to induce the Secured Party to purchase the Convertible Debentures and
enter into the Securities Purchase Agreement and the documents entered into in
connection therewith, (collectively referred to as the “Transaction Documents”),
each Company hereby grants to the Secured Party a security interest, in and to
the Patent Collateral (as defined below) to secure all of the Obligations (as
defined below).
 
WHEREAS, in connection with the Securities Purchase Agreement, each Company has
agreed to provide the Secured Party a general security interest in the Pledged
Property (as this term is defined in the Security Agreement by and between each
Company and the Secured Party, dated January 3, 2008 (together with all
amendments, supplements, restatements and other modifications, if any, from time
to time made thereto, the “Security Agreement”);
 
WHEREAS, each Company has duly authorized the execution, delivery and
performance of this Agreement;
 
NOW THEREFORE, for good and valuable consideration, the receipt of which is
hereby acknowledged, the Company agrees as follows:
 
SECTION 1. Definitions.  Unless otherwise defined herein otherwise requires,
terms used in this Agreement, including its preamble and recitals, have the
meanings provided in the Securities Purchase Agreement.
 
(a) “Obligations” shall have the meaning assigned to it in the Security
Agreement.
 
SECTION 2. Grant of Security Interest.  For good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, to secure the payment
and performance of all of the Obligations of the Company, the Company does
hereby mortgage, pledge and hypothecate to the Secured Party and grant to the
Secured Party a security interest in all of the following property (the “Patent
Collateral”), now owned and existing:
 
(a) all letters patent and applications for letters patent throughout the world,
including all patent applications in preparation for filing anywhere in the
world and including each patent and patent application referred to in Schedule A
hereto;
 

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(b) all reissues, divisions, continuations, continuations-in-part, extensions,
renewals and reexaminations of any of the items described in clause (a);
 
(c) all patent licenses and other agreements providing the Company with the
right to use any of the items of the type referred to in clauses (a) and (b),
including each patent license referred to in Schedule A hereto;
 
(d) the right to sue third parties for past, present or future infringements of
any Patent Collateral described in clauses (a) and (b) and, to the extent
applicable, clause (c); and
 
(e) all proceeds of, and rights associated with, the foregoing, (including
license royalties and proceeds of infringement suits), and all rights
corresponding thereto throughout the world.
 
SECTION 3. Security Agreement.  This Agreement has been executed and delivered
by each Company for the purpose of recording the security interest of the
Secured Party in the Patent Collateral relating to patents referred to in
Schedule A with the United States Patent and Trade Marks Office, to the extent
it may be so registered therein.  The security interest granted hereby has been
granted as a supplement to, and not in limitation of, the security interest
granted to the Secured Party under the Security Agreement.  The Security
Agreement (and all rights and remedies of the Secured Party thereunder) shall
remain in full force and effect in accordance with its terms.
 
SECTION 4. Release of Security Interest.  Upon payment in full of all
Obligations the Secured Party shall, at the Company’s expense, execute and
deliver to the Company all instruments and other documents as may be necessary
or proper to release the lien on any security interest in the Patent Collateral
which has been granted hereunder.
 
SECTION 5. Acknowledgement.  The Company does hereby further acknowledge and
affirm that the rights and remedies of the Secured Party with respect to the
security interest in the Patent Collateral granted hereby are more fully set
forth in the Security Agreement, the terms and provisions of which (including
the remedies provided for therein) are incorporated by references herein as if
fully set forth herein.
 
SECTION 6. Securities Purchase Agreement.  Notwithstanding any other term or
provision hereof, in the event that any provisions hereof contradict and are
incapable of being construed in conjunction with the provisions of the
Securities Purchase Agreement, the provisions of the Securities Purchase
Agreement shall take precedence over those contained herein and, in particular,
if any act of the Company is expressly permitted under the Securities Purchase
Agreement but is prohibited hereunder, any such act shall be permitted hereunder
and any encumbrance expressly permitted under the Securities Purchase Agreement
to exist or to remain outstanding shall be permitted hereunder and thereunder.
This instrument, document or agreement may be sold, assigned or transferred by
the Agent in accordance with the terms of the Securities Purchase Agreement.
 
SECTION 7. Counterparts.  This Agreement may be executed by the parties hereto
in several counterparts, each of which shall be deemed to be an original and all
of which shall constitute together but one and the same agreement.
 

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IN WITNESS WHEREOF, the parties hereto have executed this Security Agreement as
of the date first above written
 

 
IR Biosciences Holdings, Inc.
     
By:      /s/ Michael Wilhelm                                                
 
Name:       Michael Wilhelm
 
Title:         President and Chief Executive Officer
       

STATE OF ____________________)
) SS:
COUNTY OF __________________)

BEFORE ME, a Notary Public in and for said County and State, personally appeared
the above-named Michael Wilhelm who acknowledged that he/she did sign the
foregoing agreement and that the same is his/her free act and deed.
 
IN TESTIMONY WHEREOF, I have hereunto set my hand an official seal at
__________________, ____________________, this ___ day of __________, 2007.
 

  /s/ Michelle R. Laroche                                                      
Notary Public

 

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IN WITNESS WHEREOF, the parties hereto have executed this Security Agreement as
of the date first above written.
 

 
COMPANY:
 
ImmuneRegen BioSciences, Inc.
     
By:     /s/ Michael Wilhelm                                  
 
Name:      Michael Wilhelm
 
Title:        President and Chief Executive Officer
   

 
STATE OF ____________________)
) SS:
COUNTY OF __________________)

BEFORE ME, a Notary Public in and for said County and State, personally appeared
the above-named Michael Wilhelm who acknowledged that he/she did sign the
foregoing agreement and that the same is his/her free act and deed.
 
IN TESTIMONY WHEREOF, I have hereunto set my hand an official seal at
__________________, ____________________, this ___ day of __________, 2007.
 

  /s/ Michelle R. Laroche                          
Notary Public

 

 

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 IN WITNESS WHEREOF, the parties hereto have executed this Security Agreement as
of the date first above written.
 

     
SECURED PARTY:
 
YA GLOBAL INVESTMENTS, L.P.
     
By:      Yorkville Advisors, LLC
 
Its:       Investment Manager
     
By:       /s/ Mark Angelo                                            
 
Name:        Mark Angelo
 
Title:          Portfolio Manager
   

 

 

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SCHEDULE I
LEGAL NAMES; ORGANIZATIONAL IDENTIFICATION NUMBERS; STATES OF ORGANIZATION
 
 Company’s Name
State of Organization
Employer ID
Organizational ID
IR Biosciences Holdings, Inc.
Delaware
13-3301889 

ImmuneRegen BioSciences, Inc.
Delaware
11-3666487
 

 

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SCHEDULE A

US PATENTS AND APPLICATIONS

TITLE
COUNTRY
FILING DATE
APPLICATION NUMBER
DATE ISSUED
PATENT NUMBER 

Substance P Treatment for Immunostimulation
United States of America
23-Feb-98
09/028003
7-Dec-99
5998376
Substance P Treatment for Immunostimulation
United States of America
28-Mar-97
08/829445
31-Aug-99
5945508
Substance P Treatment for Immunostimulation
Australia
8-Jul-97
40464/97
22-Nov-01
737201
Substance P Treatment for Immunostimulation
Canada
8-Jul-97
2261885
   
Substance P Treatment for Immunostimulation
Switzerland
8-Jul-97
97938049
24-Mar-04
957930
Substance P Treatment for Immunostimulation
Germany
8-Jul-97
97938049
24-Mar-04
957930
Substance P Treatment for Immunostimulation
France
8-Jul-97
97938049
24-Mar-04
957930
Substance P Treatment for Immunostimulation
Spain
8-Jul-97
97938049
24-Mar-04
957930
Substance P Treatment for Immunostimulation
United Kingdom
8-Jul-97
97938049
24-Mar-04
957930
Substance P Treatment for Immunostimulation
Ireland
8-Jul-97
97938049
24-Mar-04
957930
Substance P Treatment for Immunostimulation
Italy
8-Jul-97
97938049
24-Mar-04
957930
Substance P Treatment for Immunostimulation
Liechtenstein
8-Jul-97
97938049
24-Mar-04
957930
Substance P Treatment for Immunostimulation
Monaco
8-Jul-97
97938049
24-Mar-04
957930
Amelioration of Effects of Cigarette Smoke
United States of America
22-Aug-03
10/645,839
   
Amelioration of Effects of Cigarette Smoke
Singapore
22-Aug-03
200501072-3
   
Amelioration of Effects of Cigarette Smoke
China
22-Aug-03
3820184.4
   
Amelioration of Effects of Cigarette Smoke
Japan
22-Aug-03
2004-532943
   
Amelioration of Effects of Cigarette Smoke
European Patent Office
22-Aug-03
3791722.6
   
Amelioration of Effects of Cigarette Smoke
Canada
22-Aug-03
2496447
   
Amelioration of Effects of Cigarette Smoke
Vietnam
22-Aug-03
1-2005-00215
   
Acute Respiratory Syndromes
Hong Kong
22-Jun-06
6107144.4
   
Acute Respiratory Syndromes
European Patent Office
14-Apr-04
4759500.4
   
Acute Respiratory Syndromes
United States of America
14-Oct-05
10/553,232
   
Acute Respiratory Syndromes
Singapore
14-Apr-04
200507608-8
   
Use of Substance P or its Analogs for the Manufacture of Medicaments for
Treating or Protecting SARS or ARDS
Vietnam
14-Apr-04
1-2005-01560
   
Prevention of Respiratory Infections in Fowl
European Patent Office
23-Nov-05
5849894
   
Prevention of Respiratory Infections in Fowl
Singapore
27-Jan-05
200500467-6
   
Prevention of Respiratory Infections in Fowl
Thailand
11-Feb-05
97659
   
Prevention of Respiratory Infections in Fowl
Patent Cooperation Treaty
23-Nov-05
PCT/US05/42601
   
Prevention of Respiratory Infections in Fowl
United States of America
3-July-07
11/795,044
   
Prevention of Respiratory Infections in Fowl
Australia
23-Nov-05
2005323304
   
Prevention of Respiratory Infections in Fowl
Japan
23-Nov-05
2007-549376
   
Prevention of Respiratory Infections in Fowl
Canada
23-Nov-05
2,593,232
   
Prevention of Respiratory Infections in Fowl
Vietnam
5-May-05
1-2005-00599
   
Treatment of Skin Diseases
European Patent Office
15-Dec-05
5854144.2
   
Treatment of Skin Diseases
Singapore
27-Jan-05
200500466-8
   
Treatment of Skin Diseases
Vietnam
5-May-05
1-2005-00598
   
Treatment of Skin Diseases
Thailand
25-Feb-05
98080
   
Treatment of Skin Diseases
Canada
15-Dec-05
2594517
   
Treatment of Skin Diseases
Australia
15-Dec-05
2005324417
   
Treatment of Skin Diseases
Patent Cooperation Treaty
15-Dec-05
PCT/US05/45369
   
Method to Promote Wound Healing
European Patent Office
25-Oct-05
5813067.5
   

 
 
 

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Method to Promote Wound Healing
Australia
25-Oct-05
2005299341
   
Method to Promote Wound Healing
Japan
25-Oct-05
2007-539081
   
Method to Promote Wound Healing
Canada
25-Oct-05
2585265
   
Method to Promote Wound Healing
Patent Cooperation Treaty
25-Oct-05
PCT/US05/38646
   
Method to Promote Wound Healing
United States of America
27-Apr-07
11/666,474
   
Treatment for Asthma
Patent Cooperation Treaty
31-Mar-06
PCT/US06/011833
   
Treatment for Asthma
European Patent Office
31-Mar-06
6748998.9
   
Treatment for Asthma
Japan
31-Mar-06
tba
   
Treatment for Asthma
Australia
31-Mar-06
tba
   
Treatment for Asthma
Canada
31-Mar-06
tba
   
Treatment for Asthma
Singapore
24-Jun-05
200504104-1
   
Treatment for Asthma
United States of America
25-Sep-07
11/887,105
   
Stimulation of Hair Growth
United States of America
20-Jun-05
10/539,734
   
Stimulation of Hair Growth
Patent Cooperation Treaty
18-Dec-03
PCT/US03/40259
   
Inducing and Maintaining Hair Color
United States of America
25-Oct-06
11/587,594
   
Inducing and Maintaining Hair Color
Patent Cooperation Treaty
18-Apr-05
PCT/US05/13112
   
Anti-Aging Effects of Substance P
Patent Cooperation Treaty
18-Apr-05
PCT/US05/13113
   
Anti-Aging Effects of Substance P
Japan
18-Apr-05
2007-509540
   
Anti-Aging Effects of Substance P
Canada
18-Apr-05
tba
   
Anti-Aging Effects of Substance P
United States of America
25-Oct-06
PCT/US05/13113
   
Anti-Aging Effects of Substance P
European Patent Office
18-Apr-05
5755488.3
   
Anti-Aging Effects of Substance P
China
18-Apr-05
2005-80016786.5
   
Anti-Aging Effects of Substance P
Australia
18-Apr-05
2005240026
   
Method to Reduce the Risk and/or Severity of Anthrax Infection
Patent Cooperation Treaty
6-Mar-07

PCT/US07/05668

   
Method to Reduce the Risk and/or Severity of Anthrax Infection
United States of America

2-Feb 07
60/889,035
   
Prophylactic and Therapeutic Treatment of Mammals for Avian InfluenzaVirus
Infection
Patent Cooperation Treaty
14-Aug-07

PCT/US07/017953

   
Prophylactic and Therapeutic Treatment of Mammals for Avian InfluenzaVirus
Infection
United States of America

1-May-07
60/915,373
   
Prophylactic and Therapeutic Treatment of Mammals for Avian InfluenzaVirus
Infection
United States of America

15-Aug-06
60/837,635
   
Prophylactic and Therapeutic Treatment of Mammals for Avian InfluenzaVirus
Infection
United States of America

9-Oct-06
60/828,728
   
Prophylactic and Therapeutic Treatment of Mammals for Avian InfluenzaVirus
Infection
United States of America

22-Nov-06
60/866,901
   
Method to Treat Blood Cell Depletion
Patent Cooperation Treaty
30-May-07
PCT/US tba
   
Method to Treat Blood Cell Depletion, In Conditions Such as MDS
United States of America

27-Jul-07
60/952,394
   
Method to Stimulates Blood Cells Regeneration Following Non-Lethal Radiation
Exposure
United States of America

30-Jul-07
0/952,691
 
   
Substance P and Analogs Thereofas aVaccine  Adjuvant
United States of America
18-Jan-07
60/885,562
   
Substance P as an Adjuvant
United States of America
14-Aug-07
60/955,712
   
Use of Homspera (substance P analog) as an Adjuvant
United States of America
1-May-07
60/915,358
   
Methods of Using Substance P and Analogs for Ameliorating Adverse Effects of
Drugs
United States of America
20-Aug-07

60/965,580

   
Substance P Analogs as PARP Inhibitors
United States of America

29-Aug-07

60/966,948
   
Substance P Analogs to Promote Cell Differentiation
United States of America

2-Oct-07

60/997,314
   
Methods of Stimulating the Proliferation and/or Differentiation of Stem Cells
withSubstance P, or an
Analog
United States of America

26-Oct-07
60/983,012

   
Substance P Analogs to Stimulate Fibroblast Growth
United States of America

12-Oct-07

60/979,769

   
Methods and Compositions for Improving the Texture or Appearance of Skin with
Substance P or an Analog Thereof
United States of America

21-Dec-07
61/016,245
   
ELISA for Substance P Analogs
United States of America

tba