Exhibit 10.3

 

 

Execution Copy

 

THIS SECURITY AGREEMENT (THIS "SECURITY AGREEMENT") IS SUBJECT TO THE
SUBORDINATION AGREEMENT DATED AUGUST 29, 2013, BY AND AMONG THE DEBTOR AND THE
SECURED PARTY AND GREGGORY S. HAUGEN (AS THE SAME MAY BE AMENDED, MODIFIED, AND
RESTATED FROM TIME TO TIME, THE "SUBORDINATION AGREEMENT"). ANY ASSIGNMENT OF
THIS SECURITY AGREEMENT SHALL BE SUBJECT TO THE SUBORDINATION AGREEMENT. IN THE
EVENT OF ANY INCONSISTENCY BETWEEN THIS SECURITY AGREEMENT AND THE SUBORDINATION
AGREEMENT, THE TERMS OF THE SUBORDINATION AGREEMENT SHALL CONTROL.

 

SECURITY AGREEMENT

 

This Security Agreement (“Agreement”), dated as of August 29, 2013, is made by
and among Location Based Technologies, Inc., a Nevada corporation (the “Debtor”)
and David Meyers, a resident of Nevada (the “Secured Party”).

 

Pursuant to the terms of a Promissory Note (the “Note”) between Debtor and
Secured Party in the amount of Five Hundred Thousand Dollars ($500,000) dated
August 29, 2013, the Secured. As a condition to extending financial
accommodations to the Debtor, the Secured Party has required the execution and
delivery of this Security Agreement by the Debtor.

 

ACCORDINGLY, in consideration of the mutual covenants contained herein, the
parties hereby agree as follows:

 

1.     Definitions. All terms defined in the recitals hereto that are not
otherwise defined herein shall have the meanings given them in the recitals. All
terms defined in the UCC and not otherwise defined herein shall have the
meanings given to them in the UCC, provided that to the extent any term is
defined in more than one Article or Division of the UCC, the definition of such
term contained in Article or Division 9 shall govern. In addition, the following
terms have the meanings set forth below or in the referenced Sections of this
Agreement:

 

“Accounts” means all of the Debtor’s accounts, as such term is defined in the
UCC, including each and every right of the Debtor to the payment of money,
whether such right to payment now exists or hereafter arises, whether such right
to payment arises out of a sale, lease or other disposition of goods or other
property, out of a rendering of services, out of a loan, out of the overpayment
of taxes or other liabilities, or otherwise arises under any contract or
agreement, whether such right to payment is created, generated or earned by the
Debtor or by some other person who subsequently transfers such person’s interest
to the Debtor, whether such right to payment is or is not already earned by
performance, and howsoever such right to payment may be evidenced, together with
all other rights and interests (including all Liens) which the Debtor may at any
time have by law or agreement against any account debtor or other obligor
obligated to make any such payment or against any property of such account
debtor or other obligor; all including, but not limited to, all present and
future accounts, contract rights, loans and obligations receivable, credit card
receivables, chattel papers, bonds, notes and other debt instruments, tax
refunds and rights to payment in the nature of general intangibles.

 

 
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“Collateral” means all of the Debtor’s Accounts, commercial tort claims, chattel
paper, financial assets, contract rights or rights to payment of money, letter
of credit rights, securities, leases, license agreements, franchise agreements,
deposit accounts, documents, Intellectual Property, Equipment, General
Intangibles, goods, instruments, and Inventory, together with (i) all
substitutions and replacements for and products of any of the foregoing; (ii) in
the case of all goods, all accessions; (iii) all accessories, attachments,
parts, equipment and repairs now or hereafter attached or affixed to or used in
connection with any goods; (iv) all warehouse receipts, bills of lading and
other documents of title now or hereafter covering such goods; (v) any money or
other assets of the Debtor that now or hereafter come into the possession,
custody, or control of any of the Secured Party; (vi) all supporting
obligations; (vii) all books and records related to the foregoing; and
(viii) proceeds and products of any and all of the foregoing, including
insurance proceeds, all whether now owned or hereafter acquired and wherever
located.

 

“Equipment” means all of the Debtor’s equipment, as such term is defined in the
UCC, whether now owned or hereafter acquired, including, but not limited to, all
present and future machinery, vehicles, furniture, fixtures, manufacturing
equipment, shop equipment, office and recordkeeping equipment, parts, tools, and
supplies.

 

“Event of Default” has the meaning given in Section 6.

 

“General Intangibles” means all of the Debtor’s general intangibles, as such
term is defined in the UCC, whether now owned or hereafter acquired, including
all present and future payment intangibles, customer or supplier lists and
contracts, contract rights which are assignable to the Secured Party, manuals,
operating instructions, permits, franchises, internet domain names, the right to
use the Debtor’s name, the goodwill of the Debtor’s business and the Debtor’s
Intellectual Property.

 

“Intellectual Property” means all of the Debtor’s past, present and future
(i) trade secrets and other proprietary information; (ii) trademarks, service
marks, business names, Internet domain names, designs, logos, trade dress,
slogans, indicia and other source and/or business identifiers, and the goodwill
of the business relating thereto and all registrations or applications for
registrations which have heretofore been or may hereafter be issued thereon
throughout the world; (iii) copyrights (including copyrights for the Debtor’s
computer programs and software) and copyright registrations or applications for
registrations which have heretofore been or may hereafter be issued throughout
the world and all tangible property embodying the copyrights; (iv) unpatented
inventions (whether or not patentable), patent applications (including the
entire right, title and interest in and to said invention, said application and
the issued letter patent that may or shall issue), patents, industrial designs,
industrial design applications and registered industrial designs; (v) license
agreements related to any of the foregoing and income therefrom; (vi) books,
records, writings, computer tapes or disks, flow diagrams, specification sheets,
source codes, object codes and other physical manifestations, embodiments or
incorporations of any of the foregoing; (vii) the right to sue for all past,
present and future infringements of any of the foregoing; and (viii) all common
law and other rights throughout the world in and to all of the foregoing.

 

 
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“Inventory” means all of the Debtor’s inventory, as such term is defined in the
UCC, whether now owned or hereafter acquired, whether consisting of whole goods,
spare parts or components, supplies or materials, whether acquired, held or
furnished for sale, for lease or under service contracts or for manufacture or
processing, and wherever located.

 

“Lien” means any security interest, mortgage, deed of trust, pledge, lien,
charge, encumbrance, title retention agreement or analogous instrument or
device, including the interest of each lessor under any capitalized lease and
the interest of any bondsman under any payment or performance bond, in, of or on
any assets or properties of a person, whether now owned or hereafter acquired
and whether arising by agreement or operation of law.

 

“Obligations” means each and every debt, liability and obligation of every type
and description that the Debtor may now or at any time hereafter owe to the
Secured Party, including but not limited to the Reimbursement Obligation, under
any promissory notes given by Debtor to Secured Party, and any amounts due
hereunder, whether such debt, liability or obligation now exists or is hereafter
created or incurred and whether it is or may be direct or indirect, due or to
become due, or absolute or contingent.

 

“Permitted Liens” means (i) the Security Interest, (ii) covenants, restrictions,
rights, easements and minor irregularities in title that do not materially
interfere with the Debtor’s business or operations as presently conducted and
(iii) Liens in existence on the date hereof and described on Exhibit A.

 

“Security Interest” has the meaning given in Section 2.

 

“Subordination Agreement” means that certain Subordination Agreement of even
date herewith among the Secured Party and the Bank, which sets forth the
respective rights of the Secured Party and the Bank to collateral securing the
Debtor’s obligations to each of them and certain obligations of the Debtor to
Secured Party.

 

“UCC” means the Uniform Commercial Code as in effect from time to time in the
State of California.

 

2.     Security Interest.

 

(a)     The Debtor hereby grants the Secured Party a security interest (the
“Security Interest”) in the Collateral to secure payment of the Obligations.

 

 
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(b)     The Security Interest granted herein and the rights of the Secured Party
to the Collateral are subject to the terms of the Subordination Agreement

 

3.     Representations, Warranties and Agreements. The Debtor hereby represents,
warrants and agrees as follows:

 

(a)     Title. The Debtor (i) has absolute title to each item of Collateral in
existence on the date hereof, free and clear of all Liens except the Permitted
Liens, (ii) will have, at the time the Debtor acquires any rights in the
Collateral hereafter arising, absolute title to, or valid leasehold interests
in, each such item of the Collateral, free and clear of all Liens except the
Permitted Liens, (iii) will keep all of the Collateral free and clear of all
Liens except the Permitted Liens, and (iv) will defend the Collateral against
all claims or demands of all persons other than the Secured Party. The Debtor
will not sell or otherwise dispose of the Collateral or any interest therein,
outside the ordinary course of business, without the prior written consent of
the Secured Party, or as permitted by the Subordination Agreement.

 

(b)     Chief Executive Office; Identification Number. The Debtor’s chief
executive office and principal place of business is located at the address set
forth under its signature below. The Debtor’s federal employer identification
number and organizational identification number is correctly set forth under its
signature below.

 

(c)     Location of the Collateral. The Debtor will not permit any tangible
Collateral to be located in any state (and, if county filing is required, in any
county) in which a financing statement covering such Collateral is required to
be, but has not in fact been, filed in order to perfect the Security Interest.

 

(d)     Changes in Name, Constituent Documents, Location. The Debtor
will promptly notify the Secured Party of any change to its name, certificate of
incorporation or jurisdiction of incorporation. The Debtor will not change its
business address without giving prior written notice to the Secured Party.

 

(e)     Fixtures. The Debtor will not permit any tangible Collateral not already
so affixed to become part of or to be affixed to any real property without first
assuring to the reasonable satisfaction of the Secured Party that the Security
Interest will be prior and senior to any Lien then held or thereafter acquired
by any mortgagee of such real property or the owner or purchaser of any interest
therein.

 

(f)     Rights to Payment. Each right to payment and each instrument, document,
chattel paper and other agreement constituting or evidencing the Collateral is
(or will be when arising, issued or assigned to the Secured Party) the valid,
genuine and legally enforceable obligation, subject to no defense, setoff or
counterclaim (other than those arising in the ordinary course of business), of
the account debtor or other obligor named therein or in the Debtor’s records
pertaining thereto as being obligated to pay such obligation. The Debtor will
neither agree to any material modification or amendment nor agree to any
forbearance, release or cancellation of any such obligation, and will not
subordinate any such right to payment to claims of other creditors of such
account debtor or other obligor.

 

(g)     Commercial Tort Claims. Promptly upon knowledge thereof, the Debtor will
deliver to the Secured Party notice of any commercial tort claims it may bring
against any person, including the name and address of each defendant, a summary
of the facts, an estimate of the Debtor’s damages, copies of any complaint or
demand letter submitted by the Debtor, and such other information as the Secured
Party may reasonably request.

 

 
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(h)     Miscellaneous Covenants. The Debtor will:

 

(i)     keep all tangible Collateral in good repair, working order and
condition, normal depreciation excepted, and will, from time to time, replace
any worn, broken or defective parts thereof;

 

(ii)     promptly pay all taxes and other governmental charges levied or
assessed upon or against any Collateral or upon or against the creation,
perfection or continuance of the Security Interest;

 

(iii)     at all reasonable times, permit the Secured Party or his
representatives to examine or inspect any Collateral, wherever located, and to
examine, inspect and copy the Debtor’s books and records pertaining to the
Collateral and its business and financial condition and to send and discuss with
account debtors and other obligors requests for verifications of amounts owed to
the Debtor;

 

(iv)     keep accurate and complete records pertaining to the Collateral and
pertaining to the Debtor’s business and financial condition and submit to the
Secured Party such periodic reports concerning the Collateral and the Debtor’s
business and financial condition as the Secured Party may from time to time
reasonably request;

 

(v)     promptly notify the Secured Party of any material loss of or material
damage to any Collateral, any material adverse change known to the Debtor
pertaining to the prospect of payment of any sums due on or under any
instrument, chattel paper, or account constituting the Collateral, or any
material adverse change known to the Debtor pertaining to Debtor’s ownership of
the Collateral;

 

(vi)     if the Secured Party at any time so requests (after the occurrence and
during the continuation of an Event of Default), promptly deliver to the Secured
Party any instrument, document or chattel paper constituting the Collateral,
duly endorsed or assigned by the Debtor;

 

(vii)     at all times keep all tangible Collateral insured against risks of
fire (including so-called extended coverage), theft, collision (in case of the
Collateral consisting of motor vehicles) and such other risks and in such
amounts as the Secured Party may reasonably request, with any such policies
containing a lender loss payable endorsement acceptable to the Secured Party;

 

(viii)     from time to time execute and deliver, as applicable, such documents
and agreements as the Secured Party may reasonably require in order to perfect
the Security Interest (including, without limitation, any filings with the
United States Patent and Trademark Office, Copyright or other Intellectual
Property filings and any filings of financing or continuation statements under
the UCC) in order to create, preserve, upgrade in rank (to the extent required
hereby), perfect, confirm or validate the Security Interest or to enable the
Secured Party to obtain the full benefits of this Agreement, or to enable the
Secured Party to exercise and enforce any of its rights, powers and remedies
hereunder with respect to any of the Collateral and, if any Collateral consists
of a motor vehicle or any other titled property, execute such documents as may
be required to have the Security Interest properly noted on a certificate of
title;

 

 
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(ix)     pay when due or reimburse the Secured Party on demand for all costs of
collection of any of the Obligations and all other out-of-pocket expenses
(including, in each case, all reasonable attorneys’ fees) incurred by the
Secured Party in connection with the creation, perfection, satisfaction,
protection, defense or enforcement of the Security Interest or the creation,
continuance, protection, defense or enforcement of this Agreement, or any or all
of the Obligations, including expenses incurred in any litigation or bankruptcy
or insolvency proceedings;

 

(x)     not use or keep any Collateral, or permit it to be used or kept, for any
unlawful purpose or in violation of any federal, state or local law, statute or
ordinance;

 

(i)     The Secured Party’s Right to Take Action. The Debtor authorizes the
Secured Party to file from time to time where permitted by law, such financing
statements against the Collateral described as “all of the Debtor’s personal
property” as the Secured Party deems necessary or useful to perfect the Security
Interest. The Debtor will not amend any financing statements in favor of the
Secured Party, except as permitted by law. Further, if the Debtor at any time
fails to perform or observe any agreement contained in Section 3(h), and if such
failure continues for a period of ten (10) days after the Secured Party give the
Debtor written notice thereof (or, in the case of the agreements contained in
clauses (vii) and (viii) of Section 3(h), immediately upon the occurrence of
such failure, without notice or lapse of time), the Secured Party may (but need
not) perform or observe such agreement on behalf and in the name, place and
stead of the Debtor (or, at the Secured Party’s option, in the Secured Party’s
own name) and may (but need not) take any and all other actions which the
Secured Party may reasonably deem necessary to cure or correct such failure
(including, without limitation, the payment of taxes, the satisfaction of
security interests, liens, or encumbrances, the performance of obligations under
contracts or agreements with account debtors or other obligors, the procurement
and maintenance of insurance, the endorsement of instruments, and the
procurement of repairs or transportation); and, except to the extent that the
effect of such payment would be to render any loan or forbearance of money
usurious or otherwise illegal under any applicable law, the Debtor shall
thereupon pay the Secured Party on demand the amount of all moneys expended and
all costs and expenses (including reasonable attorneys’ fees) incurred by the
Secured Party in connection with or as a result of the Secured Party’s
performance or observation of such agreements or any actions taken thereunder,
together with interest thereon from the date expended or incurred by the Secured
Party at the highest rate then applicable to any of the Obligations. To
facilitate the performance or observance by the Secured Party of such agreements
of the Debtor, the Debtor hereby irrevocably appoints (which appointment is
coupled with an interest) the Secured Party, or his delegate, as the
attorney-in-fact of the Debtor with the right (but not the duty) from time to
time to create, prepare, complete, execute, deliver, endorse or file, in the
name and on behalf of the Debtor, any and all instruments, documents, financing
statements, applications for insurance and other agreements and writings
required to be obtained, executed, delivered or endorsed by the Debtor under
this Section 3 and Section 4. The Debtor shall pay the costs of, or incidental
to, any recording or filing of any financing statements, financing statement
amendments or continuation statements concerning the Collateral.

 

 
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4.     Rights of the Secured Party.

 

(a)     Account Verification. At any time and from time to time, whether before
or after an Event of Default, the Secured Party may send or require the Debtor
to send requests for verification of Accounts to account debtors and other
obligors. The Secured Party may also at any time and from time to time telephone
account debtors and other obligors to verify accounts.

 

(b)     Direct Collection. At any time after the occurrence and during the
continuation of an Event of Default, subject to the terms of the Subordination
Agreement, the Secured Party may notify any account debtor, or any other person
obligated to pay any amount due, that such chattel paper, Account, or other
right to payment has been assigned or transferred to the Secured Party for
security and shall be paid directly to the Secured Party. At any time after the
Secured Party or the Debtor gives such notice to an account debtor or other
obligor, the Secured Party may (but need not), in his own name or in the
Debtor’s name, demand, sue for, collect or receive any money or property at any
time payable or receivable on account of, or securing, any such chattel paper,
Account, or other right to payment, or grant any extension to, make any
compromise or settlement with or otherwise agree to waive, modify, amend or
change the obligations (including collateral obligations) of any such account
debtor or other obligor.

 

5.     Assignment of Insurance. Subject to the terms of the Subordination
Agreement, the Debtor hereby assigns to the Secured Party, as additional
security for the payment of the Obligations, any and all moneys (including, but
not limited to, proceeds of insurance and refunds of unearned premiums) due or
to become due under, and all other rights of the Debtor under or with respect to
any and all policies of insurance covering the Collateral, and the Debtor hereby
agrees to direct the issuer of any such policy to pay any such moneys directly
to the Secured Party. After the occurrence and during the continuation of an
Event of Default, the Secured Party may (but need not), in his own name or in
the Debtor’s name, execute and deliver proofs of claim, receive all such moneys,
endorse checks and other instruments representing payment of such moneys, and
adjust, litigate, compromise or release any claim against the issuer of any such
policy.

 

6.     Events of Default. Each of the following occurrences shall constitute an
event of default under this Agreement (herein called an “Event of Default”): (i)
an event of default occurring under the Debtors Permitted Liens or (ii) the
Debtor shall fail to pay any or all of the Obligations when due, or (if payable
on demand) on demand; or (iii) the Debtor shall fail to observe or perform any
covenant or agreement contained in this Agreement.

 

 
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7.     Remedies upon an Event of Default. Upon the occurrence of an Event of
Default and at any time thereafter during the continuance of an Event of
Default, the Secured Party may exercise any one or more of the following rights
and remedies: (i) declare all unmatured Obligations to be immediately due and
payable, and the same shall thereupon be immediately due and payable, without
presentment or other notice or demand; (ii) exercise and enforce any or all
rights and remedies available upon default to a secured party under the UCC,
including, but not limited to, the right to take possession of any Collateral,
proceeding without judicial process or by judicial process (without a prior
hearing or notice thereof, which the Debtor hereby expressly waives), and the
right to sell, lease or otherwise dispose of any or all of the Collateral, and
in connection therewith, the Secured Party may require the Debtor to make the
Collateral available to the Secured Party at a place to be designated by the
Secured Party which is reasonably convenient to such parties, and if notice to
the Debtor of any intended disposition of the Collateral or any other intended
action is required by law in a particular instance, such notice shall be deemed
commercially reasonable if given (in the manner specified in Section 9) at least
ten (10) days prior to the date of intended disposition or other action; and
(iii) exercise or enforce any or all other rights or remedies available to the
Secured Party by law or agreement against the Collateral, against the Debtor or
against any other person or property.

 

8.     Other Personal Property. Unless at the time the Secured Party takes
possession of any tangible Collateral, or within seven (7) days thereafter, the
Debtor gives written notice to the Secured Party of the existence of any goods,
papers or other property of the Debtor, not affixed to or constituting a part of
such Collateral, but which are located or found upon or within such Collateral
and describes such property, the Secured Party shall not be responsible or
liable to the Debtor for any action taken or omitted by or on behalf of the
Secured Party with respect to such property.

 

9.     Notices; Requests for Accounting. All notices and other communications
hereunder shall be in writing and shall be (a) personally delivered, (b) sent by
first class United States mail, or (c) sent by overnight courier of national
reputation in each case addressed to the party to whom notice is being given at
its address as set forth below its signature or, as to each party, at such other
address as may hereafter be designated by such party in a written notice to the
other party complying as to delivery with the terms of this Section. All such
notices, requests, demands and other communications shall be deemed to have been
given on (i) the date received if personally delivered, (ii) when deposited in
the mail if delivered by mail, or (iii) the date sent if sent by overnight
courier. All requests under Section 9-210 of the UCC (i) shall be made in a
writing signed by an authorized person, (ii) shall be personally delivered, sent
by registered or certified mail, return receipt requested, or by overnight
courier of national reputation, (iii) shall be deemed to be sent when received
by the Secured Party, and (iv) shall otherwise comply with the requirements of
Section 9-210 of the UCC. The Debtor requests that the Secured Party respond to
all such requests which on their face appear to come from an authorized
individual and releases the Secured Party from any liability for so responding.
The Debtor shall pay the Secured Party the maximum amount allowed by law for
responding to such requests.

 

 
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10.     Miscellaneous. This Agreement has been duly and validly authorized by
all necessary corporate action. This Agreement does not contemplate a sale of
accounts, or chattel paper. This Agreement can be waived, modified, amended,
terminated or discharged, and the Security Interest can be released, only
explicitly in a writing signed by the Secured Party, and, in the case of
amendment or modification, in a writing also signed by the Debtor. A waiver
signed by the Secured Party shall be effective only in the specific instance and
for the specific purpose given. The mere delay or failure to act shall not
preclude the exercise or enforcement of any of the Secured Party’s rights or
remedies. All rights and remedies of the Secured Party shall be cumulative and
may be exercised singularly or concurrently, at the Secured Party’s option, and
the exercise or enforcement of any one such right or remedy shall neither be a
condition to nor bar the exercise or enforcement of any other. The Secured
Party’s duty of care with respect to the Collateral in his possession (as
imposed by law) shall be deemed fulfilled if the Secured Party exercises
reasonable care in physically safekeeping such Collateral or, in the case of any
Collateral in the custody or possession of a bailee or other third person,
exercises reasonable care in the selection of the bailee or other third person,
and the Secured Party need not otherwise preserve, protect, insure or care for
any Collateral. The Secured Party shall not be obligated to preserve any rights
the Debtor may have against prior parties, to realize on the Collateral at all
or in any particular manner or order, or to apply any cash proceeds of
Collateral in any particular order of application. This Agreement shall be
binding upon and inure to the benefit of the Debtor and the Secured Party and
their respective successors and assigns and shall take effect when signed by the
Debtor and delivered to the Secured Party, and the Debtor waives notice of the
Secured Party’s acceptance hereof. This Agreement is subject to the terms of the
Subordination Agreement and, so long as the Subordination Agreement is in
effect, the Subordination Agreement shall control in the event of a conflict
between it and this Agreement. The Secured Party may execute this Agreement if
appropriate for the purpose of filing, but the failure of the Secured Party to
execute this Agreement shall not affect or impair the validity or effectiveness
of this Agreement. An electronic, photographic or other reproduction of this
Agreement signed by the Debtor shall have the same force and effect as the
original for all purposes. This Agreement shall be governed by and construed in
accordance with the substantive laws (other than conflict laws) of the State of
California. If any provision or application of this Agreement is held unlawful
or unenforceable in any respect, such illegality or unenforceability shall not
affect other provisions or applications which can be given effect and this
Agreement shall be construed as if the unlawful or unenforceable provision or
application had never been contained herein or prescribed hereby. All
representations and warranties contained in this Agreement shall survive the
execution, delivery and performance of this Agreement and the creation and
payment of the Obligations. The parties hereto hereby (i) consent to the
personal jurisdiction of the state and federal courts located in California in
connection with any controversy related to this Agreement; (ii) waive any
argument that venue in any such forum is not convenient; (iii) agree that any
litigation initiated by the Secured Party or the Debtor in connection with this
Agreement or the Secured Notes may be venued in either the state or federal
courts located in Orange County, California; and (iv) agree that a final
judgment in any such suit, action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.

 

THE PARTIES WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED
ON OR PERTAINING TO THIS AGREEMENT.

 

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

 

 

 

THE DEBTOR:

LOCATION BASED TECHNOLOGIES, INC.

By: ______________________________

Name: ____________________________

Its: ______________________________

 

Address:       49 Discovery Ste. 260

Irvine, California 92618

Attn: David Morse

 

Employer identification number: 23-4854758

 

Organizational identification number: E0306182006-9

   

THE SECURED PARTY:

DAVID MEYERS

 

______________________________

 

 

  

 

 

 
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EXHIBIT A

 

 

PERMITTED LIENS

 

 

 

1.

A lien in favor of Silicon Valley Bank in the amount of One Million Dollars
($1,000,000) secured by all of the assets of the Company except for Registered
US Patent Number: 7598855.

 

 

2.

A lien in favor of Greggory Haugen in the amount of One Million Dollars
($1,000,000) secured by all of the assets of the Company except for Registered
US Patent Number: 7598855

 

 

3.

A lien in favor of Greggory Haugen in the amount of Seven Hundred Thousand
Dollars ($900,000)

 

 

4.

A lien in favor of Bridge Group, LLC in the amount of One Million Dollars
($1,000,000) secured only by Registered US Patent Number: 7598855

 

 

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