EXHIBIT
10.3


 


SECURITY
AGREEMENT


 


This
SECURITY AGREEMENT, dated as of June 22, 2015 (this “Agreement”), is among MELA Sciences, Inc., a Delaware
corporation (the “Company”), any Additional Debtors (as such term is defined herein and, together with the
Company, the “Debtors”), and Broadfin Capital, LLC, as agent (the “Agent”) for the holders
(collectively, the “Purchasers”) of the Debt Securities (as defined in the Purchase Agreement (as defined below)).


 


WITNESSETH:


 


WHEREAS,
pursuant to that certain Securities Purchase Agreement dated June 22, 2015 (the “Purchase Agreement”) the Purchasers
have severally agreed to extend the loans to the Company evidenced by the Company’s 2.25% Senior Secured Convertible Debentures
due June 22, 2015 (the “Debentures”) and by the Notes (as defined in the Purchase Agreement and, the Notes
together with the Debentures, the “Debt Securities”); and


 


WHEREAS,
in order to induce the Purchasers to extend the loans evidenced by the Debt Securities, each Debtor has agreed to execute and
deliver this Agreement and to grant the Agent, for the ratable benefit of the Purchasers, a security interest in certain property
of such Debtor to secure the prompt payment, performance and discharge in full of all of the Company’s obligations under
the Debt Securities and the obligations of any Additional Debtors under the Guarantee.


 


NOW,
THEREFORE, in consideration of the agreements herein contained and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:


 


1.          Certain
Definitions. As used in this Agreement, the following terms shall have the meanings set forth in this Section 1. Terms used
but not otherwise defined in this Agreement that are defined in Article 9 of the UCC (such as “account”, “chattel
paper”, “commercial tort claim”, “deposit account”, “document”, “equipment”,
“fixtures”, “general intangibles”, “goods”, “instruments”, “inventory”,
“investment property”, “letter-of-credit rights”, “proceeds” and “supporting obligations”)
shall have the respective meanings given such terms in Article 9 of the UCC.


 


(a)          “Collateral”
means the collateral in which the Agent is granted a security interest by this Agreement and includes the following personal property
of the Debtors, whether presently owned or existing or hereafter acquired or coming into existence, wherever situated, and all
additions and accessions thereto and all substitutions and replacements thereof, and all proceeds, products and accounts thereof,
including, without limitation, all proceeds from the sale or transfer of the Collateral and of insurance covering the same and
of any tort claims in connection therewith, and all dividends, interest, cash, notes, securities, equity interest or other property
at any time and from time to time acquired, receivable or otherwise distributed in respect of, or in exchange for, any or all
of the Pledged Securities (as defined below):


 




    	 



    	 



    

 


(i)          All
goods, including, without limitation, (A) all machinery, equipment, computers, motor vehicles, trucks, tanks, boats, ships, appliances,
furniture, special and general tools, fixtures, test and quality control devices and other equipment of every kind and nature
and wherever situated, together with all documents of title and documents representing the same, all additions and accessions
thereto, replacements therefor, all parts therefor, and all substitutes for any of the foregoing and all other items used and
useful in connection with any Debtor’s businesses and all improvements thereto; and (B) all inventory;


 


(ii)         All
contract rights and other general intangibles, including, without limitation, all partnership interests, membership interests,
stock or other securities, other than Excluded Property, rights under any of the Organizational Documents, agreements related
to the Pledged Securities, licenses, distribution and other agreements, computer software (whether “off-the-shelf”,
licensed from any third party or developed by any Debtor), computer software development rights, leases, franchises, customer
lists, quality control procedures, grants and rights, goodwill, Intellectual Property and income tax refunds;


 


(iii)        All
accounts, together with all instruments, all documents of title representing any of the foregoing, all rights in any merchandising,
goods, equipment, motor vehicles and trucks which any of the same may represent, and all right, title, security and guaranties
with respect to each account, including any right of stoppage in transit;


 


(iv)        All
documents, letter-of-credit rights, instruments and chattel paper;


 


(v)         All
commercial tort claims;


 


(vi)        All
deposit accounts and all cash (whether or not deposited in such deposit accounts);


 


(vii)       All
investment property and all ownership and/or other equity interests in each Subsidiary, including, without limitation, the Subsidiary
Equity Interests, and, in each case, all certificates representing such shares and/or equity interests and, in each case, all
rights, options, warrants, stock, other securities and/or equity interests that may hereafter be received, receivable or distributed
in respect of, or exchanged for, any of the foregoing and all rights arising thereunder or in connection therewith, including,
but not limited to, all dividends, interest and cash, other than Excluded Property (collectively, the “Pledged Securities”);


 


(viii)      All
supporting obligations; and


 


(ix)         All
files, records, books of account, business papers, and computer programs; and


 


(x)          the
products and proceeds of all of the foregoing.


 




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Notwithstanding
the foregoing, (A) nothing herein shall be deemed to constitute the grant of a security interest in, or an assignment of,
any asset (i) in which a security interest or assignment is void by operation of applicable law, or is otherwise prohibited by
applicable law (in each case to the extent that such applicable law is not overridden by Sections 9-406, 9-407 and/or 9-408 of
the UCC or other similar applicable law), or (ii) subject to any governmental permit, approval or license not related to Intellectual
Property, if and to the extent that a security interest therein, or assignment thereof, is prohibited by or in violation of (x)
any applicable law, or (y) a term, provision or condition of any such governmental permit, approval or license (unless in each
case, such applicable law, term, provision or condition would be rendered ineffective with respect to the creation of such security
interest pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC); provided, however, that to the extent permitted
by applicable law, this Agreement shall create a valid security interest in such asset and, to the extent permitted by applicable
law, this Agreement shall create a valid security interest in the proceeds of such asset and (B) the Collateral does not
include any Excluded Property.


 


(b)          “Event
of Default” has the meaning ascribed to such term in the Debentures.


 


(c)          “Excluded
Property” means 35% of the equity interests in any Subsidiary organized in a jurisdiction outside of the United States.


 


(d)          “Intellectual
Property” means the collective reference to all rights, priorities and privileges relating to intellectual property,
whether arising under United States, multinational or foreign laws or otherwise, including, without limitation, (i) all copyrights
arising under the laws of the United States, any other country or any political subdivision thereof, whether registered or unregistered
and whether published or unpublished, all registrations and recordings thereof, and all applications in connection therewith,
including, without limitation, all registrations, recordings and applications in the United States Copyright Office, (ii) all
letters patent of the United States, any other country or any political subdivision thereof, all reissues and extensions thereof,
and all applications for letters patent of the United States or any other country and all divisions, continuations and continuations-in-part
thereof, (iii) all trademarks, trade names, corporate names, company names, business names, fictitious business names, trade dress,
service marks, logos, domain names and other source or business identifiers, and all goodwill associated therewith, now existing
or hereafter adopted or acquired, all registrations and recordings thereof, and all applications in connection therewith, whether
in the United States Patent and Trademark Office or in any similar office or agency of the United States, any State thereof or
any other country or any political subdivision thereof, or otherwise, and all common law rights related thereto, (iv) all trade
secrets arising under the laws of the United States, any other country or any political subdivision thereof, (v) all rights to
obtain any reissues, renewals or extensions of the foregoing, (vi) all licenses for any of the foregoing, and (vii) all causes
of action for infringement of the foregoing.


 


(e)          “Liens”
has the meaning ascribed to such term in the Purchase Agreement.


 




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(f)          “Majority
in Interest” means, at any time of determination, the majority in interest (based on then-outstanding principal amounts
of Debt Securities at the time of such determination) of the Purchasers.


 


(g)          “Necessary
Endorsement” means undated stock powers endorsed in blank or other proper instruments of assignment duly executed and
such other instruments or documents as the Agent may reasonably request.


 


(h)          “Obligations”
means all of the liabilities and obligations (primary, secondary, direct, contingent, sole, joint or several) due or to become
due, or that are now or may be hereafter contracted or acquired, or owing to, of any Debtor to the Purchasers, under this Agreement,
the Debt Securities, the Subsidiary Guarantee (to be entered into pursuant to the terms of the Purchase Agreement by any Additional
Debtors) (the “Guarantee”) and any other instruments, agreements or other documents executed and/or delivered
in connection herewith or therewith, in each case, whether now or hereafter existing, voluntary or involuntary, direct or indirect,
absolute or contingent, liquidated or unliquidated, whether or not jointly owed with others, and whether or not from time to time
decreased or extinguished and later increased, created or incurred, and all or any portion of such obligations or liabilities
that are paid, to the extent all or any part of such payment is avoided or recovered directly or indirectly from any of the Purchasers
as a preference, fraudulent transfer or otherwise as such obligations may be amended, supplemented, converted, extended or modified
from time to time. Without limiting the generality of the foregoing, the term “Obligations” shall include, without
limitation: (i) principal of, and interest on the Debt Securities and the loans extended pursuant thereto; (ii) any and all other
fees, indemnities, costs, obligations and liabilities of the Debtors from time to time under or in connection with this Agreement,
the Debt Securities, the Guarantee and any other instruments, agreements or other documents executed and/or delivered in connection
herewith or therewith; and (iii) all amounts (including but not limited to post-petition interest) in respect of the foregoing
that would be payable but for the fact that the obligations to pay such amounts are unenforceable or not allowable due to the
existence of a bankruptcy, reorganization or similar proceeding involving any Debtor.


 


(i)          “Organizational
Documents” means with respect to any Debtor, the documents by which such Debtor was organized (such as a certificate
of incorporation, certificate of limited partnership or articles of organization, and including, without limitation, any certificates
of designation for preferred stock or other forms of preferred equity) and which relate to the internal governance of such Debtor
(such as bylaws, a partnership agreement or an operating, limited liability or members agreement).


 


(j)          “Permitted
Liens” has the meaning ascribed to such term in the Debentures.


 


(k)          “Pledged
Interests” has the meaning ascribed to such term in Section 4(j).


 




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(l)          “Pledged
Securities” has the meaning ascribed to such term in Section 1(a).


 


(m)          “UCC”
means the Uniform Commercial Code of the State of New York and or any other applicable law of any state or states which has jurisdiction
with respect to all, or any portion of, the Collateral or this Agreement, from time to time.


 


2.          Grant
of Security Interest in Collateral. As an inducement for the Purchasers to extend the loans evidenced by the Debt Securities
and to secure the complete and timely payment, performance and discharge in full, as the case may be, of all of the Obligations,
each Debtor hereby unconditionally and irrevocably pledges, grants and hypothecates to the Agent, for the ratable benefit of the
Purchasers, a security interest in and to, a lien upon and a right of set-off against all of their respective right, title and
interest of whatsoever kind and nature in and to, the Collateral (a “Security Interest” and, collectively,
the “Security Interests”).


 


3.          Delivery
of Certain Collateral. Contemporaneously or prior to the execution of this Agreement, each Debtor shall
deliver or cause to be delivered to the Agent any and all certificates and other instruments or documents representing any of
the Collateral, together with all Necessary Endorsements. If and when the Collateral includes Pledged Securities, each Debtor
shall deliver or cause to be delivered to the Agent any and all certificates and other instruments representing or evidencing
such Pledged Securities, together with all Necessary Endorsements and each Organizational Document governing such Pledged Securities.


 


4.          Representations,
Warranties, Covenants and Agreements of the Debtors. Except as set forth under the corresponding section of the disclosure
schedules delivered to the Agent concurrently herewith (the “Disclosure Schedules”), which Disclosure Schedules
shall be deemed a part hereof, each Debtor represents and warrants to, and covenants and agrees with, the Agent and the Purchasers
as follows:


 


(a)          Each
Debtor has the requisite corporate, partnership, limited liability company or other entity power and authority to enter into this
Agreement and otherwise to carry out its obligations hereunder. The execution, delivery and performance by each Debtor of this
Agreement and the filings contemplated herein have been duly authorized by all necessary action on the part of such Debtor and
no further action is required by such Debtor. This Agreement has been duly executed by each Debtor. This Agreement constitutes
the legal, valid and binding obligation of each Debtor, enforceable against each Debtor in accordance with its terms except as
such enforceability may be limited by applicable bankruptcy, insolvency, reorganization and similar laws of general application
relating to or affecting the rights and remedies of creditors and by general principles of equity.


 


(b)          The
Debtors have no place of business or offices where their respective books of account and records are kept (other than temporarily
at the offices of its attorneys or accountants) or places where Collateral is stored or located, except as set forth on Schedule
4.(b) attached hereto. Except as disclosed on Schedule 4.(b), (i) no Debtor owns any real property and (ii) none of
the Collateral is in the possession of any consignee, bailee, warehouseman, agent or processor.


 




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(c)          Except
for Permitted Liens, each of the Debtors is the sole owner of the Collateral it purports to own (except for non-exclusive licenses
granted by any Debtor in the ordinary course of business), free and clear of any Liens and is fully authorized to grant the Security
Interests. Except as set forth on Schedule 4.(c) attached hereto, there is not on file in any governmental or regulatory
authority, agency or recording office an effective financing statement, security agreement, license or transfer or any notice
of any of the foregoing (other than those that will be filed in favor of the Agent pursuant to this Agreement) covering or affecting
any of the Collateral. Except as set forth on Schedule 4.(c) attached hereto and except pursuant to this Agreement, as
long as this Agreement shall be in effect, the Debtors shall not execute and shall not knowingly permit to be on file in any such
office or agency any other financing statement or other document or instrument (except to the extent filed or recorded in favor
of the Agent pursuant to the terms of this Agreement).


 


(d)          No
written claim has been received that any material portion of Collateral or any Debtor's use of any material portion of Collateral
violates the rights of any third party. There has been no adverse decision to any Debtor's claim of ownership rights in or exclusive
rights to use the Collateral in any jurisdiction or to any Debtor's right to keep and maintain such Collateral in full force and
effect, and there is no legal proceeding involving said rights pending or, to the best knowledge of any Debtor, threatened in
writing before any court, judicial body, administrative or regulatory agency, arbitrator or other governmental authority.


 


(e)          Each
Debtor shall at all times maintain its books of account and records relating to the Collateral at its principal place of business
and its Collateral at the locations set forth on Schedule 4.(b) attached hereto and may not relocate such books of account
and records or tangible Collateral unless it delivers to the Agent at least 10 days prior to such relocation (i) written
notice of such relocation and the new location thereof (which must be within the United States) and (ii) evidence that appropriate
financing statements under the UCC and other necessary documents have been filed and recorded and other steps have been taken
to perfect the Security Interests to create in favor of the Agent, for the ratable benefit of the Purchasers, a valid, perfected
and continuing perfected first priority lien in the Collateral, subject to Permitted Liens.


 




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(f)          This
Agreement creates in favor of the Agent, for the ratable benefit of the Purchasers, a valid security interest in the Collateral
located in the United States, subject only to Permitted Liens, securing the payment and performance of the Obligations. Upon making
the filings described in this Agreement, all security interests created hereunder in any Collateral located in the United States
which may be perfected by filing Uniform Commercial Code financing statements will have been duly perfected. Except for the filing
of the Uniform Commercial Code financing statements referred to in the immediately following paragraph, the recordation of the
Intellectual Property Security Agreement (as defined in Section 4(p) hereof) with respect to copyrights and copyright applications
in the United States Copyright Office referred to in paragraph (m), the execution and delivery of deposit account control agreements
satisfying the requirements of Section 9-104(a)(2) of the UCC with respect to each deposit account of the Debtors,
and the delivery of the certificates and other instruments provided in Section 3, no action is necessary to create,
perfect or protect the security interests created hereunder in Collateral located in the United States. Without limiting the generality
of the foregoing, except for the filing of said financing statements, the recordation of said Intellectual Property Security Agreement
and the execution and delivery of said deposit account control agreements, no consent of any third parties and no authorization,
approval or other action by, and no notice to or filing with, any governmental authority or regulatory body is required for (i)
the execution, delivery and performance of this Agreement, (ii) the creation or perfection of the Security Interests created hereunder
in the Collateral located in the United States or (iii) the enforcement of the rights of the Agent and the Purchasers hereunder,
other than consents from holders of Permitted Liens obtained in writing and delivered to the Agent prior to the date of this Agreement.


 


(g)          Each
Debtor hereby authorizes the Agent to file one or more financing statements under the UCC, with respect to the Security Interests,
with the proper filing and recording agencies in any jurisdiction deemed proper by it.


 


(h)          The
execution, delivery and performance of this Agreement by the Debtors does not (i) violate any of the provisions of any Organizational
Documents of any Debtor or any judgment, decree, order or award of any court, governmental body or arbitrator or any applicable
law, rule or regulation applicable to any Debtor or (ii) conflict with, or constitute a default (or an event that with notice
or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or
cancellation (with or without notice, lapse of time or both) of, any material agreement, or credit facility, to which any Debtor
is a party or by which any property or asset of any Debtor is bound or affected. If any, all required consents (including, without
limitation, from stockholders or creditors of any Debtor) necessary for any Debtor to enter into and perform its obligations hereunder
have been obtained.


 


(i)          The
capital stock and other equity interests listed on Schedule 4.(i) hereto (the “Subsidiary Equity Interests”)
represent all of the capital stock and other equity interests of the Subsidiaries, and represent all capital stock and other equity
interests owned, directly or indirectly, by the Debtors. All of the Subsidiary Equity Interests are validly issued, fully paid
and nonassessable. Each Debtor that is indicated on Schedule 4.(i) to be the owner of Subsidiary Equity Interests is the
legal and beneficial owner of such Subsidiary Equity Interests, free and clear of any lien, security interest or other encumbrance
except for the security interests created by this Agreement and other Permitted Liens.



 


(j)          The
ownership and other equity interests in partnerships and limited liability companies (if any) included in the Collateral (the
“Pledged Interests”) by their express terms do not provide that they are securities governed by Article 8 of
the UCC and are not held in a securities account or by any financial intermediary.


 




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(k)          Except
for Permitted Liens, each Debtor shall at all times maintain the liens and Security Interests provided for hereunder as valid
and perfected first priority liens and security interests in the Collateral located in the United States in favor of the Agent
until this Agreement and the Security Interest hereunder shall be terminated pursuant to Section 14 hereof. Each Debtor hereby
agrees to defend the same against the claims of any and all persons and entities. Each Debtor shall safeguard and protect all
Collateral for the account of the Agent. At the request of the Agent, each Debtor will authorize the Agent at any time or from
time to time as reasonably necessary one or more financing statements pursuant to the UCC in form reasonably satisfactory to the
Agent and will pay the cost of filing the same in all public offices wherever filing is, or is deemed by the Agent to be, necessary
to effect the rights and obligations provided for herein. Without limiting the generality of the foregoing, each Debtor shall
pay all fees, taxes and other amounts necessary to maintain the Collateral and the Security Interests hereunder, and each Debtor
shall obtain and furnish to the Agent from time to time, upon reasonable request, such releases and/or subordinations of claims
and liens which may be required to maintain the priority of the Security Interests hereunder.


 


(l)          No
Debtor will transfer, pledge, hypothecate, encumber, license, sell or otherwise dispose of any of the Collateral (except for non-exclusive
licenses granted by a Debtor in its ordinary course of business, sales of inventory by a Debtor in its ordinary course of business
and other Collateral which is no longer useful or material to a Debtor’s business) without the prior written consent of
a Majority in Interest.


 


(m)          Each
Debtor shall keep and preserve its equipment, inventory and other tangible Collateral in good condition, repair and order, subject
to ordinary wear and tear, and shall not operate or locate any such Collateral (or cause to be operated or located) in any area
excluded from insurance coverage.


 


(n)          Each
Debtor shall maintain with financially sound and reputable insurers, insurance with respect to the Collateral, including Collateral
hereafter acquired, against loss or damage of the kinds and in the amounts customarily insured against by entities of established
reputation having similar properties similarly situated and in such amounts as are customarily carried under similar circumstances
by other such entities and otherwise as is prudent for entities engaged in similar businesses but in any event sufficient to cover
the full replacement cost thereof. Each Debtor shall cause each insurance policy issued in connection herewith to provide, and
the insurer issuing such policy to certify to the Agent, that (a) the Agent will be named as lender loss payee and additional
insured under each such insurance policy; (b) if such insurance be proposed to be cancelled or materially changed for any reason
whatsoever, such insurer will promptly notify the Agent and such cancellation or material change shall not be effective as to
the Agent for at least thirty (30) days after receipt by the Agent of such notice, unless the effect of such change is to extend
or increase coverage under the policy; and (c) the Agent will have the right (but no obligation) at its election to remedy any
default in the payment of premiums within thirty (30) days of notice from the insurer of such default. If no Event of Default
exists and if the aggregate insurance policy proceeds arising out of any claim or series of related claims do not exceed $100,000,
loss payments in each instance will be applied by the Debtors to the repair and/or replacement of property with respect to which
the loss was incurred to the extent reasonably feasible, and any loss payments or the balance thereof remaining, to the extent
not so applied, shall be payable to the Debtors; provided, however, that payments received by the Debtors after
an Event of Default occurs and is continuing or in excess of $100,000 for any occurrence or series of related occurrences shall
be paid to the Agent and, if received by the Debtors, shall be held in trust for the Purchasers and immediately paid over to the
Agent unless otherwise directed in writing by the Agent. Copies of such policies or the related certificates, in each case, naming
the Agent as lender loss payee and additional insured shall be delivered to the Agent at least annually and at the time any new
policy of insurance is issued.


 




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(o)          Each
Debtor shall, within ten (10) days of obtaining knowledge thereof, advise the Agent promptly, in sufficient detail, of any material
adverse change in the Collateral as a whole, and of the occurrence of any event which would have a material adverse effect on
the value of the Collateral as a whole or on the Agent’s security interest therein.


 


(p)          Each
Debtor shall promptly execute and deliver to the Agent such further deeds, mortgages, assignments, security agreements, financing
statements or other instruments, documents, certificates and assurances and take such further action as the Agent may from time
to time reasonably request to perfect, protect or enforce the Agent’s security interest in the Collateral including, without
limitation, if applicable, the execution and delivery of a separate security agreement with respect to each Debtor’s Intellectual
Property (“Intellectual Property Security Agreement”) in which the Agent has been granted a security interest
hereunder, substantially in a form reasonably acceptable to the Agent, which Intellectual Property Security Agreement, other than
as stated therein, shall be subject to all of the terms and conditions hereof.


 


(q)          Each
Debtor shall permit the Agent and its representatives and agents to inspect the Collateral during normal business hours and upon
at least two (2) Business Day’s prior notice, and to make copies of records pertaining to the Collateral as may be reasonably
requested by the Agent from time to time.


 


(r)          Each
Debtor shall take all steps reasonably necessary to diligently pursue and seek to preserve, enforce and collect any rights, claims,
causes of action and accounts receivable in respect of the Collateral.


 


(s)          Each
Debtor shall promptly notify the Agent in sufficient detail upon becoming aware of any attachment, garnishment, execution or other
legal process levied against any Collateral and of any other information received by such Debtor that may reasonably be expected
to materially and adversely affect the value of the Collateral as a whole, the Security Interest or the rights and remedies of
the Agent and the Purchasers hereunder.




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(t)          All
information heretofore, herein or hereafter supplied to the Agent or the Purchasers by or on behalf of any Debtor with respect
to the Collateral is accurate and complete in all material respects as of the date furnished.


 


(u)          The
Debtors shall at all times preserve and keep in full force and effect their respective valid existence and good standing and any
rights and franchises material to its business.


 


(v)         No
Debtor will change its name, type of organization, jurisdiction of organization, organizational identification number (if it has
one), legal or corporate structure, or identity, unless it provides at least 10 days prior written notice to the Agent of such
change and, at the time of such written notification, such Debtor provides any financing statements or fixture filing necessary
to perfect and continue the perfection of the Security Interests granted and evidenced by this Agreement.


 


(w)          Except
in the ordinary course of business, no Debtor will consign any of its inventory or sell any of its inventory on bill and hold,
sale or return, sale on approval, or other conditional terms of sale without the consent of the Agent, which consent shall not
be unreasonably withheld.


 


(x)          No
Debtor will relocate its chief executive office to a new location without (i) providing 30 days prior written notification thereof
to the Agent and (ii) providing any financing statements or fixture filings necessary to perfect and continue the perfection of
the Security Interests granted and evidenced by this Agreement.


 


(y)          Each
Debtor was organized and remains organized solely under the laws of the state set forth next to such Debtor’s name in Schedule
4.(y) attached hereto, which Schedule 4.(y) sets forth each Debtor’s organizational identification number or,
if any Debtor does not have one, states that one does not exist.


 


(z)          
(i) The actual name of each Debtor is the name set forth in Schedule 4.(y) attached hereto; (ii) no Debtor has any trade
names except as set forth on Schedule 4.(z) attached hereto; (iii) no Debtor has used any name other than that stated in
the preamble hereto or as set forth on Schedule 4.(z) for the preceding five years; and (iv) no entity has merged into
any Debtor or been acquired by any Debtor within the past five years except as set forth on Schedule 4.(z).


 


(aa)         At
any time and from time to time that any Collateral consists of instruments, certificated securities or other items that require
or permit possession by the secured party to perfect the security interest created hereby, the applicable Debtor shall deliver
such Collateral to the Agent.


 


(bb)         Each
Debtor, in its capacity as issuer, shall comply with any and all orders and instructions of Agent regarding the Pledged Interests
consistent with the terms of this Agreement without the further consent of any Debtor as contemplated by Section 8-106 (or any
successor section) of the UCC. Further, no Debtor shall enter into any agreement with any person or entity other than Agent that
would confer “control”, within the meaning of Article 8 of the UCC, of any Pledged Interests.


 




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(cc)         Each
Debtor shall cause all tangible chattel paper constituting Collateral to be delivered to the Agent, or, if such delivery is not
possible, then to cause such tangible chattel paper to contain a legend noting that it is subject to the security interest created
by this Agreement. To the extent that any Collateral consists of electronic chattel paper, the applicable Debtor shall cause the
underlying chattel paper to be “marked” within the meaning of Section 9-105 of the UCC (or successor section thereto).


 


(dd)         If
there is any investment property or deposit account included as Collateral that (i) can be perfected by “control”
through an account control agreement, and (ii) at any time has a balance (in either cash or value of investment property,
or both) exceeding $25,000, the applicable Debtor shall cause such an account control agreement, in form and substance in each
case satisfactory to the Agent, to be entered into and delivered to the Agent for the ratable benefit of the Purchasers, unless
the Major Investors waive the foregoing requirement with respect to any such investment property or deposit account otherwise
constituting Collateral; provided, that (x) as of the date of this Agreement, Debtor is not required to provide an account control
agreement over the account maintained by Debtor with J.P. Morgan in Germany as of the date of this Agreement (the “Germany
Account”), (y) Debtor shall notify the Agent at any time that the Germany Account has a balance (in either cash or value
of investment property, or both) exceeding $1,000,000 (a “Germany Account Notice”), and (z) Debtor shall cause
an account control agreement, in form and substance satisfactory to the Agent, to be entered into and delivered to the Agent for
the ratable benefit of the Purchasers in respect of the Germany Account upon instructions from the Agent to do so given by the
Agent to Debtor at any time after Debtor is obligated to deliver a Germany Account Notice pursuant to the preceding clause (y).


 


(ee)         To
the extent that any Collateral consists of letter-of-credit rights, the applicable Debtor shall cause the issuer of each underlying
letter of credit to consent to an assignment of the proceeds thereof to the Agent, for the ratable benefit of the Purchasers.


 


(ff)         To
the extent that any Collateral is in the possession of any third party, the applicable Debtor shall join with the Agent in notifying
such third party of the Agent’s security interest in such Collateral and shall use commercially reasonable efforts to obtain
an acknowledgement and agreement from such third party with respect to the Collateral, in form and substance reasonably satisfactory
to the Agent.


 


(gg)         If
any Debtor shall at any time hold or acquire a commercial tort claim, such Debtor shall promptly notify the Agent in a writing
signed by such Debtor of the particulars thereof and grant to the Agent, for the ratable benefit of the Purchasers, in such writing
a security interest therein and in the proceeds thereof, all upon the terms of this Agreement, with such writing to be in form
and substance satisfactory to the Agent.


 




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(hh)         Each
Debtor shall immediately provide written notice to the Agent of any and all accounts which arise out of contracts with any governmental
authority and, to the extent necessary to perfect or continue the perfected status of the Security Interests in such accounts
and proceeds thereof, shall execute and deliver to the Agent an assignment of claims for such accounts and cooperate with the
Agent in taking any other steps required, in its judgment, under the Federal Assignment of Claims Act or any similar federal,
state or local statute or rule to perfect or continue the perfected status of the Security Interests in such accounts and proceeds
thereof.


 


(ii)          Each
Debtor shall cause each wholly-owned Subsidiary that is organized in a jurisdiction within the United States to promptly become
a party hereto (an “Additional Debtor”), by executing and delivering an Additional Debtor Joinder in substantially
the form of Annex A attached hereto and comply with the provisions hereof applicable to the Debtors. Concurrent therewith,
the Additional Debtor shall deliver replacement schedules for, or supplements to all other Schedules to (or referred to in) this
Agreement, as applicable, which replacement schedules shall supersede, or supplements shall modify, the Schedules then in effect.
The Additional Debtor shall also deliver such opinions of counsel, authorizing resolutions, good standing certificates, incumbency
certificates, organizational documents, financing statements and other information and documentation as the Agent may reasonably
request. Upon delivery of the foregoing to the Agent, the Additional Debtor shall be and become a party to this Agreement with
the same rights and obligations as the Debtors, for all purposes hereof as fully and to the same extent as if it were an original
signatory hereto and shall be deemed to have made the representations, warranties and covenants set forth herein as of the date
of execution and delivery of such Additional Debtor Joinder, and all references herein to the “Debtors” shall be deemed
to include each Additional Debtor.


 


(jj)           Each
Debtor shall vote the Pledged Securities to comply with the covenants and agreements set forth herein and in the Debt Securities.


 


(kk)         Each
Debtor shall register the pledge of the applicable Pledged Securities on the books of such Debtor. Each Debtor shall notify each
issuer of Pledged Securities to register the pledge of the applicable Pledged Securities in the name of the Agent on the books
of such issuer. Further, except with respect to certificated securities delivered to the Agent, the applicable Debtor shall deliver
to Agent an acknowledgement of pledge (which, where appropriate, shall comply with the requirements of the relevant UCC with respect
to perfection by registration) signed by the issuer of the applicable Pledged Securities, which acknowledgement shall confirm
that: (a) it has registered the pledge on its books and records; and (b) at any time directed by Agent during the continuation
of an Event of Default, such issuer will transfer the record ownership of such Pledged Securities into the name of any designee
of Agent, will take such steps as may be necessary to effect the transfer, and will comply with all other instructions of Agent
regarding such Pledged Securities without the further consent of the applicable Debtor.


 




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(ll)         In
the event that, upon an occurrence of an Event of Default, Agent shall sell all or any of the Pledged Securities to another party
or parties (herein called the “Transferee”) or shall purchase or retain all or any of the Pledged Securities,
each Debtor shall, to the extent applicable: (i) deliver to Agent or the Transferee, as the case may be, the articles of
incorporation, bylaws, minute books, stock certificate books, corporate seals, deeds, leases, indentures, agreements, evidences
of indebtedness, books of account, financial records and all other Organizational Documents and records of the Debtors and their
direct and indirect subsidiaries; (ii) use its best efforts to obtain resignations of the persons then serving as officers and
directors of the Debtors and their direct and indirect subsidiaries, if so requested; and (iii) use its best efforts to obtain
any approvals that are required by any governmental or regulatory body in order to permit the sale of the Pledged Securities to
the Transferee or the purchase or retention of the Pledged Securities by Agent and allow the Transferee or Agent to continue the
business of the Debtors and their direct and indirect subsidiaries.


 


(mm)         Without
limiting the generality of the other obligations of the Debtors hereunder, each Debtor shall promptly (i) cause to be registered
at the United States Copyright Office all of its material copyrights, (ii) cause the security interest contemplated hereby
with respect to all Intellectual Property registered at the United States Copyright Office or United States Patent and Trademark
Office to be duly recorded at the applicable office, and (iii) give the Agent notice whenever it acquires (whether absolutely
or by license) or creates any additional material Intellectual Property on a quarterly basis.


 


(nn)         Each
Debtor will from time to time, at the joint and several expense of the Debtors, promptly execute and deliver all such further
instruments and documents, and take all such further action as the Agent may reasonably request, in order to perfect and protect
any security interest granted or purported to be granted hereby or to enable the Agent and the Purchasers to exercise and enforce
their rights and remedies hereunder and with respect to any Collateral or to otherwise carry out the purposes of this Agreement.


 


(oo)         Schedule
4.(oo) attached hereto lists all of the patents, patent applications, trademarks, trademark applications, registered copyrights,
and domain names owned by any of the Debtors as of the date hereof. Schedule 4.(oo) lists all material licenses in favor
of any Debtor for the use of any patents, trademarks, copyrights and domain names as of the date hereof. All United States material
patents and trademarks of the Debtors have been duly recorded at the United States Patent and Trademark Office and all material
copyrights of the Debtors have been duly recorded at the United States Copyright Office.


 


(pp)         Except
as set forth on Schedule 4.(pp) attached hereto, none of the account debtors or other persons or entities obligated on
any of the Collateral is a governmental authority covered by the Federal Assignment of Claims Act or any similar federal, state
or local statute or rule in respect of such Collateral.


 


(qq)         Until
the Obligations shall have been paid and performed in full (other than inchoate indemnification obligations), the Company covenants
that it shall promptly cause any Additional Debtor to enter into a Subsidiary Guarantee in favor of the Agent, for the ratable
benefit of the Purchasers, in the form of Exhibit F to the Purchase Agreement.




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5.           Effect
of Pledge on Certain Rights. The parties hereto agree that, if any of the Collateral subject to this Agreement consists of
nonvoting equity or ownership interests (regardless of class, designation, preference or rights) that may be converted into voting
equity or ownership interests upon the occurrence of certain events (including, without limitation, upon the transfer of all or
any of the other stock or assets of the issuer), the pledge of such equity or ownership interests pursuant to this Agreement or
the enforcement of any of Agent’s rights hereunder shall not be deemed to be the type of event which would trigger such
conversion rights, notwithstanding any provisions in the Organizational Documents or agreements to which any Debtor is subject
or to which any Debtor is party.


 


6.           Defaults.
The following events shall be “Events of Default”:


 


(a)          The
occurrence of an Event of Default under the Debt Securities;


 


(b)          Any
representation or warranty of any Debtor in this Agreement shall prove to have been incorrect in any material respect when made;


 


(c)          The
failure by any Debtor to observe or perform any of its obligations hereunder for ten (10) days after delivery to such Debtor of
notice of such failure by the Agent unless such default is capable of cure but cannot be cured within such time frame and such
Debtor is all commercially reasonable efforts to cure same in a timely fashion; or


 


(d)          Any
provision of this Agreement is at any time for any reason declared to be null and void, any Debtor contests the validity or enforceability
of this Agreement, any Debtor governmental authority having jurisdiction over any Debtor commences any proceeding seeking to establish
the invalidity or unenforceability of this Agreement, or any Debtor denies that any Debtor has any liability or obligation purported
to be created under this Agreement.


 


7.           Duty
To Hold In Trust.


 


(a)          Upon
the occurrence of any Event of Default and at any time thereafter that such Event of Default remains continuing, each Debtor shall,
upon receipt of any revenue, income, dividend, interest or other sums subject to the Security Interests, whether payable pursuant
to the Debt Securities or otherwise, or of any check, draft, note, trade acceptance or other instrument evidencing an obligation
to pay any such sum, hold the same in trust for the Purchasers and shall forthwith endorse and transfer any such sums or instruments,
or both, to the Agent, for the ratable benefit of the Purchasers, for application to the satisfaction of the Obligations (and
if any Debt Securities are not outstanding, pro-rata in proportion to the initial purchases of the remaining Debt Securities).




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(b)          If
any Debtor shall become entitled to receive or shall receive any securities or other property (including, without limitation,
shares of Pledged Securities or instruments representing Pledged Securities acquired after the date hereof, or any options, warrants,
rights or other similar property or certificates representing a dividend, or any distribution in connection with any recapitalization,
reclassification or increase or reduction of capital, or issued in connection with any reorganization of such Debtor or any of
its direct or indirect subsidiaries) in respect of the Pledged Securities (whether as an addition to, in substitution of, or in
exchange for, such Pledged Securities or otherwise), such Debtor agrees to (i) accept the same as the agent of the Purchasers;
(ii) hold the same in trust on behalf of and for the benefit of the Purchasers; and (iii) to deliver any and all certificates
or instruments evidencing the same to Agent on or before the close of business on the fifth business day following the receipt
thereof by such Debtor, in the exact form received together with the Necessary Endorsements, to be held by Agent subject to the
terms of this Agreement as Collateral.


 


8.           Rights
and Remedies Upon Default.


 


(a)          Upon
the occurrence of any Event of Default and at any time thereafter that such Event of Default remains continuing, the Purchasers,
acting through the Agent, shall have the right to exercise all of the remedies conferred hereunder and under the Debt Securities,
and the Purchasers, acting through the Agent, shall have all the rights and remedies of a secured party under the UCC. Without
limitation, the Agent, for the benefit of the Purchasers, shall have the following rights and powers:


 


(i)         The Agent shall have the right to take possession of the Collateral and, for that purpose, enter, with the aid and assistance
of any person, any premises where the Collateral, or any part thereof, is or may be placed and remove the same, and each Debtor
shall assemble the Collateral and make it available to the Agent at places which the Agent shall reasonably select, whether at
such Debtor's premises or elsewhere, and make available to the Agent, without rent, all of such Debtor’s respective premises
and facilities for the purpose of the Agent taking possession of, removing or putting the Collateral in saleable or disposable
form.


 


(ii)         Upon
notice to the Debtors by Agent, all rights of each Debtor to exercise the voting and other consensual rights which it would otherwise
be entitled to exercise and all rights of each Debtor to receive the dividends and interest which it would otherwise be authorized
to receive and retain, shall cease. Upon such notice, Agent shall have the right to receive, for the ratable benefit of the Purchasers,
any interest, cash dividends or other payments on the Collateral and, at the option of Agent, to exercise in such Agent’s
discretion all voting rights pertaining thereto. Without limiting the generality of the foregoing, Agent shall have the right
(but not the obligation) to exercise all rights with respect to the Collateral as it were the sole and absolute owner thereof,
including, without limitation, to vote and/or to exchange, at its sole discretion, any or all of the Collateral in connection
with a merger, reorganization, consolidation, recapitalization or other readjustment concerning or involving the Collateral or
any Debtor or any of its direct or indirect subsidiaries.


 




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(iii)         The Agent shall have the right to use the Collateral and shall have the right to assign, sell, lease or otherwise dispose of and
deliver all or any part of the Collateral, at public or private sale or otherwise, either with or without special conditions or
stipulations, for cash or on credit or for future delivery, in such parcel or parcels and at such time or times and at such place
or places, and upon such terms and conditions as the Agent may deem commercially reasonable, all without (except as shall be required
by applicable statute and cannot be waived) advertisement or demand upon or notice to any Debtor or right of redemption of a Debtor,
which are hereby expressly waived. Upon each such sale, lease, assignment or other transfer of Collateral, the Agent, for the
ratable benefit of the Purchasers, may, unless prohibited by applicable law which cannot be waived, purchase all or any part of
the Collateral being sold, free from and discharged of all trusts, claims, right of redemption and equities of any Debtor, which
are hereby waived and released.


 


(iv)        The
Agent shall have the right (but not the obligation) to notify any account debtors and any obligors under instruments or accounts
to make payments directly to the Agent, on behalf of the Purchasers, and to enforce the Debtors’ rights against such account
debtors and obligors.


 


(v)         The
Agent, for the ratable benefit of the Purchasers, may (but is not obligated to) direct any financial intermediary or any other
person or entity holding any investment property to transfer the same to the Agent, on behalf of the Purchasers, or its designee.


 


(vi)        The
Agent may (but is not obligated to) transfer any or all Intellectual Property registered in the name of any Debtor at the United
States Patent and Trademark Office and/or Copyright Office into the name of the Purchasers or any designee or any purchaser of
any Collateral.


 


(b)          The
Agent shall comply with any applicable law in connection with a disposition of Collateral and such compliance will not be considered
adversely to affect the commercial reasonableness of any sale of the Collateral. The Agent may sell the Collateral without giving
any warranties and may specifically disclaim such warranties. If the Agent sells any of the Collateral on credit, the Debtors
will only be credited with payments actually made by the purchaser. In addition, each Debtor waives any and all rights that it
may have to a judicial hearing in advance of the enforcement of any of the Agent’s rights and remedies hereunder, including,
without limitation, its right following an Event of Default to take immediate possession of the Collateral and to exercise its
rights and remedies with respect thereto.


 




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(c)          For
the purpose of enabling the Agent to further exercise rights and remedies under this Section 8 or elsewhere provided by agreement
or applicable law, each Debtor hereby grants to the Agent, for the ratable benefit of the Purchasers an irrevocable, nonexclusive
license (exercisable without payment of royalty or other compensation to such Debtor) to use, license or sublicense following
an Event of Default, any Intellectual Property now owned or hereafter acquired by such Debtor, and wherever the same may be located,
and including in such license access to all media in which any of the licensed items may be recorded or stored and to all computer
software and programs used for the compilation or printout thereof.


 


9.          Applications
of Proceeds. The proceeds of any such sale, lease or other disposition of the Collateral hereunder or from payments made on
account of any insurance policy insuring any portion of the Collateral shall be applied first, to the expenses of retaking, holding,
storing, processing and preparing for sale, selling, and the like (including, without limitation, any taxes, fees and other costs
incurred in connection therewith) of the Collateral, to the reasonable attorneys’ fees and expenses incurred by the Agent
in enforcing its and the Purchasers’ rights hereunder and in connection with collecting, storing and disposing of the Collateral,
and then to satisfaction of the Obligations pro rata among the Purchasers (based on then-outstanding principal amounts of Debt
Securities at the time of any such determination), and to the payment of any other amounts required by applicable law, after which
the Purchasers shall pay to the applicable Debtor any surplus proceeds. If, upon the sale, license or other disposition of the
Collateral, the proceeds thereof are insufficient to pay all amounts to which the Agent and the Purchasers are legally entitled,
the Debtors will be liable for the deficiency, together with interest thereon, at the rate of 12% per annum or the lesser amount
permitted by applicable law (the “Default Rate”), and the reasonable fees of any attorneys employed by the
Agent and the Purchasers to collect such deficiency. To the extent permitted by applicable law, each Debtor waives all claims,
damages and demands against the Agent and the Purchasers arising out of the repossession, removal, retention or sale of the Collateral,
unless due solely to the gross negligence or willful misconduct of the Agent and the Purchasers as determined by a final judgment
(not subject to further appeal) of a court of competent jurisdiction.


 


10.         Securities
Law Provision. Each Debtor recognizes that Agent may be limited in its ability to effect a sale to the public of all or part
of the Pledged Securities by reason of certain prohibitions in the Securities Act of 1933, as amended, or other federal or state
securities laws (collectively, the “Securities Laws”), and may be compelled to resort to one or more sales
to a restricted group of purchasers who may be required to agree to acquire the Pledged Securities for their own account, for
investment and not with a view to the distribution or resale thereof. Each Debtor agrees that sales so made may be at prices and
on terms less favorable than if the Pledged Securities were sold to the public, and that Agent has no obligation to delay the
sale of any Pledged Securities for the period of time necessary to register the Pledged Securities for sale to the public under
the Securities Laws. Each Debtor shall cooperate with Agent in its attempt to satisfy any requirements under the Securities Laws
(including, without limitation, registration thereunder if requested by Agent) applicable to the sale of the Pledged Securities
by Agent.


 




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11.         Costs
and Expenses. Each Debtor agrees to pay all reasonable out-of-pocket fees, costs and expenses incurred in connection with
any filing required hereunder, including without limitation, any financing statements pursuant to the UCC, continuation statements,
partial releases and/or termination statements related thereto or any expenses of any searches reasonably required by the Agent.
The Debtors will also, upon demand, pay to the Agent the amount of any and all reasonable expenses, including the reasonable fees
and expenses of its counsel, which the Agent, for the benefit of the Purchasers, may incur in connection with the creation, perfection,
protection, foreclosure, collection or enforcement of the Security Interest and the preparation, administration, continuance,
amendment or enforcement of this Agreement and pay to the Agent the amount of any and all reasonable expenses, including the reasonable
fees and expenses of its counsel, which the Agent, for the benefit of the Purchasers, and the Purchasers may incur in connection
with (i) the enforcement of this Agreement, (ii) the custody or preservation of, or the sale of, collection from, or other realization
upon, any of the Collateral, or (iii) the exercise or enforcement of any of the rights of the Purchasers under the Debt Securities.
Until so paid, any fees payable hereunder shall be added to the principal amount of the Debt Securities and shall bear interest
at the Default Rate.


 


12.         Responsibility
for Collateral. The Debtors assume all liabilities and responsibility in connection with all Collateral, and the Obligations
shall in no way be affected or diminished by reason of the loss, destruction, damage or theft of any of the Collateral or its
unavailability for any reason. Without limiting the generality of the foregoing, (a) neither the Agent nor any Purchaser (i) has
any duty (either before or after an Event of Default) to collect any amounts in respect of the Collateral or to preserve any rights
relating to the Collateral, or (ii) has any obligation to clean-up or otherwise prepare the Collateral for sale, and (b) each
Debtor shall remain obligated and liable under each contract or agreement included in the Collateral to be observed or performed
by such Debtor thereunder. Neither the Agent nor any Purchaser shall have any obligation or liability under any such contract
or agreement by reason of or arising out of this Agreement or the receipt by the Agent or any Purchaser of any payment relating
to any of the Collateral, nor shall the Agent or any Purchaser be obligated in any manner to perform any of the obligations of
any Debtor under or pursuant to any such contract or agreement, to make inquiry as to the nature or sufficiency of any payment
received by the Agent or any Purchaser in respect of the Collateral or as to the sufficiency of any performance by any party under
any such contract or agreement, to present or file any claim, to take any action to enforce any performance or to collect the
payment of any amounts which may have been assigned to the Agent or to which the Agent or any Purchaser may be entitled at any
time or times.


 


13.         Security
Interests Absolute. All rights of the Agent and the Purchasers and all of the Obligations are absolute and unconditional,
irrespective of: (a) any lack of validity or enforceability of this Agreement, the Debt Securities or any agreement entered into
in connection with the foregoing, or any portion hereof or thereof; (b) any change in the time, manner or place of payment or
performance of, or in any other term of, all or any of the Obligations, or any other amendment or waiver of or any consent to
any departure from the Debt Securities or any other agreement entered into in connection with the foregoing; (c) any exchange,
release or nonperfection of any of the Collateral, or any release or amendment or waiver of or consent to departure from any other
collateral for, or any guarantee, or any other security, for all or any of the Obligations; (d) any action by the Agent and the
Purchasers to obtain, adjust, settle and cancel in its sole discretion any insurance claims or matters made or arising in connection
with the Collateral; or (e) any other circumstance which might otherwise constitute any legal or equitable defense available to
a Debtor, or a discharge of all or any part of the Security Interests granted hereby. Until the Obligations shall have been paid
and performed in full (other than inchoate indemnification obligations), the rights of the Agent and the Purchasers shall continue
even if the Obligations are barred for any reason, including, without limitation, the running of the statute of limitations or
bankruptcy. Each Debtor expressly waives presentment, protest, notice of protest, demand, notice of nonpayment and demand for
performance. In the event that at any time any transfer of any Collateral or any payment received by the Agent and the Purchasers
hereunder shall be deemed by final order of a court of competent jurisdiction to have been a voidable preference or fraudulent
conveyance under the bankruptcy or insolvency laws of the United States, or shall be deemed to be otherwise due to any party other
than the Agent and the Purchasers, then, in any such event, each Debtor’s obligations hereunder shall survive cancellation
of this Agreement, and shall not be discharged or satisfied by any prior payment thereof and/or cancellation of this Agreement,
but shall remain a valid and binding obligation enforceable in accordance with the terms and provisions hereof. Each Debtor waives
all right to require the Agent and the Purchasers to proceed against any other person or entity or to apply any Collateral which
the Agent and the Purchasers may hold at any time, or to marshal assets, or to pursue any other remedy.


 




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14.         Term
of Agreement. This Agreement and the Security Interests shall terminate on the date on which all payments under the Debt Securities
have been paid in full and all other Obligations have been paid or discharged (other than inchoate indemnification obligations);
provided, however, that all indemnities of the Debtors contained in this Agreement shall survive and remain operative
and in full force and effect regardless of the termination of this Agreement.


 


15.         Power
of Attorney; Further Assurances.


 


(a)          Each
Debtor authorizes the Agent, and does hereby make, constitute and appoint the Agent and its officers, agents, successors or assigns
with full power of substitution, as such Debtor’s true and lawful attorney-in-fact, with power, in the name of the Agent
or such Debtor, to, after the occurrence and during the continuance of an Event of Default, (i) endorse any note, checks, drafts,
money orders or other instruments of payment (including payments payable under or in respect of any policy of insurance) in respect
of the Collateral that may come into possession of the Agent; (ii) to sign and endorse any financing statement pursuant to the
UCC or any invoice, freight or express bill, bill of lading, storage or warehouse receipts, drafts against debtors, assignments,
verifications and notices in connection with accounts, and other documents relating to the Collateral; (iii) to pay or discharge
taxes, liens, security interests or other encumbrances at any time levied or placed on or threatened against the Collateral; (iv)
to demand, collect, receipt for, compromise, settle and sue for monies due in respect of the Collateral; (v) to transfer any Intellectual
Property or provide licenses respecting any Intellectual Property; and (vi) generally, at the option of the Agent, and at the
expense of the Debtors, at any time, or from time to time, to execute and deliver any and all documents and instruments and to
do all acts and things which the Agent deems necessary to protect, preserve and realize upon the Collateral and the Security Interests
granted therein in order to effect the intent of this Agreement and the Debt Securities all as fully and effectually as the Debtors
might or could do; and each Debtor hereby ratifies all that said attorney shall lawfully do or cause to be done by virtue hereof.
This power of attorney is coupled with an interest and shall be irrevocable for the term of this Agreement and thereafter as long
as any of the Obligations (other than inchoate indemnification obligations) shall be outstanding. The designation set forth herein
shall be deemed to amend and supersede any inconsistent provision in the Organizational Documents or other documents or agreements
to which any Debtor is subject or to which any Debtor is a party. Without limiting the generality of the foregoing, after the
occurrence and during the continuance of an Event of Default, each Purchaser is specifically authorized to execute and file any
applications for or instruments of transfer and assignment of any patents, trademarks, copyrights or other Intellectual Property
with the United States Patent and Trademark Office and the United States Copyright Office.


 




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(b)          On
a continuing basis, each Debtor will make, execute, acknowledge, deliver, file and record, as the case may be, with the proper
filing and recording agencies in any jurisdiction, including, without limitation, the jurisdictions indicated on Schedule 4.(y)
attached hereto, all such instruments, and take all such action as may reasonably be requested by the Agent, to perfect the
Security Interests granted hereunder and otherwise to carry out the intent and purposes of this Agreement, or for assuring and
confirming to the Agent the grant or perfection of a perfected security interest in all the Collateral under the UCC.


 


(c)          Each
Debtor hereby irrevocably appoints the Agent as such Debtor’s attorney-in-fact, with full authority in the place and instead
of such Debtor and in the name of such Debtor, from time to time in the Agent’s discretion, to take any action and to execute
any instrument which the Agent may deem necessary or advisable to accomplish the purposes of this Agreement, including the filing,
in its sole discretion, of one or more financing or continuation statements and amendments thereto, relative to any of the Collateral
without the signature of such Debtor where permitted by law, which financing statements may (but need not) describe the Collateral
as “all assets” or “all personal property” or words of like import, and ratifies all such actions taken
by the Agent. This power of attorney is coupled with an interest and shall be irrevocable for the term of this Agreement and thereafter
as long as any of the Obligations shall be outstanding.


 


16.         Notices.
All notices, requests, demands and other communications hereunder shall be subject to the notice provision of the Purchase Agreement.


 


17.         Other
Security. To the extent that the Obligations are now or hereafter secured by property other than the Collateral or by the
guarantee, endorsement or property of any other person, firm, corporation or other entity, then the Agent shall have the right,
in its sole discretion, to pursue, relinquish, subordinate, modify or take any other action with respect thereto, without in any
way modifying or affecting any of the Purchasers’ rights and remedies hereunder.


 


18.         [Reserved]


 




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19.         Miscellaneous.


 


(a)          No
course of dealing between the Debtors, on the one hand, and the Agent and the Purchasers, on the other hand, nor any failure to
exercise, nor any delay in exercising, on the part of the Agent or any of the Purchasers, any right, power or privilege hereunder
or under the Debt Securities shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder or thereunder preclude any other or further exercise thereof or the exercise of any other right, power or
privilege.


 


(b)          All
of the rights and remedies of the Agent and the Purchasers with respect to the Collateral, whether established hereby or by the
Debt Securities or by any other agreements, instruments or documents or by law shall be cumulative and may be exercised singly
or concurrently.


 


(c)          This
Agreement, together with the exhibits and schedules hereto, contain the entire understanding of the parties with respect to the
subject matter hereof and supersede all prior agreements and understandings, oral or written, with respect to such matters, which
the parties acknowledge have been merged into this Agreement and the exhibits and schedules hereto. No provision of this Agreement
may be waived, modified, supplemented or amended except in a written instrument signed, in the case of an amendment, by the Debtors
and the Purchasers holding 67% or more of the principal amount of Debt Securities then outstanding, or, in the case of a waiver,
by the party against whom enforcement of any such waived provision is sought; provided, however, unanimous consent
shall be required for any amendment that would adversely affect any Purchaser.


 


(d)          If
any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full
force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially
reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that
they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.


 


(e)          No
waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing
waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof,
nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right.


 


(f)          This
Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns. No Debtor
may assign this Agreement or any rights or obligations hereunder without the prior written consent of each Purchaser (other than
by merger). The Purchasers are third-party beneficiaries of this Agreement. Any Purchaser may assign any or all of its rights
under this Agreement to any Person (as defined in the Purchase Agreement) to whom such Purchaser assigns or transfers any Obligations,
provided such transferee agrees in writing to be bound, with respect to the transferred Obligations, by the provisions of this
Agreement that apply to the “Purchasers.”


 




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(g)          Each
party shall take such further action and execute and deliver such further documents as may be necessary or appropriate in order
to carry out the provisions and purposes of this Agreement.


 


(h)
        Except to the extent mandatorily governed by the jurisdiction or situs where the Collateral is located, all questions concerning
the construction, validity, enforcement and interpretation of this Agreement shall be governed by and construed and enforced in
accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Except
to the extent mandatorily governed by the jurisdiction or situs where the Collateral is located, each Debtor agrees that all proceedings
concerning the interpretations, enforcement and defense of the transactions contemplated by this Agreement and the Debt Securities
(whether brought against a party hereto or its respective affiliates, directors, officers, shareholders, partners, members, employees
or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York, Borough of Manhattan.
Except to the extent mandatorily governed by the jurisdiction or situs where the Collateral is located, each Debtor hereby irrevocably
submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan for
the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein,
and hereby irrevocably waives, and agrees not to assert in any proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such proceeding is improper. Each party hereto hereby irrevocably waives personal service
of process and consents to process being served in any such proceeding by mailing a copy thereof via registered or certified mail
or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement
and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in any manner permitted by law. Each party hereto hereby irrevocably
waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising
out of or relating to this Agreement or the transactions contemplated hereby.


 


(i)          This
Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and,
all of which taken together shall constitute one and the same Agreement. In the event that any signature is delivered by facsimile
transmission, such signature shall create a valid binding obligation of the party executing (or on whose behalf such signature
is executed) the same with the same force and effect as if such facsimile signature were the original thereof.


 


(j)          All
Debtors shall jointly and severally be liable for the obligations of each Debtor to the Agent and the Purchasers hereunder.


 




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(k)          Each
Debtor shall indemnify, reimburse and hold harmless the Agent and the Purchasers and their respective partners, members, shareholders,
officers, directors, employees and agents (and any other persons with other titles that have similar functions) (collectively,
“Indemnitees”) from and against any and all losses, claims, liabilities, damages, penalties, suits, costs and
expenses, of any kind or nature, (including fees relating to the cost of investigating and defending any of the foregoing) imposed
on, incurred by or asserted against such Indemnitee in any way related to or arising from or alleged to arise from this Agreement
or the Collateral, except any such losses, claims, liabilities, damages, penalties, suits, costs and expenses which result from
the gross negligence or willful misconduct of the Indemnitee as determined by a final, nonappealable decision of a court of competent
jurisdiction. This indemnification provision is in addition to, and not in limitation of, any other indemnification provision
in the Debt Securities, the Purchase Agreement or any other agreement, instrument or other document executed or delivered in connection
herewith or therewith.


 


(l)          Nothing
in this Agreement shall be construed to subject Agent or any Purchaser to liability as a partner in any Debtor or any of its direct
or indirect subsidiaries that is a partnership or as a member in any Debtor or any of its direct or indirect subsidiaries that
is a limited liability company, nor shall Agent or any Purchaser be deemed to have assumed any obligations under any partnership
agreement or limited liability company agreement, as applicable, of any such Debtor or any of its direct or indirect subsidiaries
or otherwise, unless and until the Agent or any such Purchaser exercises its right to be substituted for such Debtor as a partner
or member, as applicable, pursuant hereto.


 


(m)          To
the extent that the grant of the security interest in the Collateral and the enforcement of the terms hereof require the consent,
approval or action of any partner or member, as applicable, of any Debtor or any direct or indirect subsidiary of any Debtor or
compliance with any provisions of any of the Organizational Documents, the Debtors hereby grant such consent and approval and
waive any such noncompliance with the terms of said documents.


 


[SIGNATURE
PAGE FOLLOWS]


 




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EXHIBIT
10.3


 


IN
WITNESS WHEREOF, the parties hereto have caused this Security Agreement to be duly executed on the day and year first above written.


 


	 	MELA SCIENCES, INC.
	 	 	 
	 	By:	 
	 	 	Michael R. Stewart
	 	 	Chief Executive Officer
	 	 	 
	 	agent:
	 	 
	 	BROADFIN CAPITAL, LLC
	 	 	 
	 	By:	 
	 	 	Name:


 




    	 



    	 



    

 


ANNEX A


to


SECURITY


AGREEMENT


 


FORM
OF ADDITIONAL DEBTOR JOINDER


 


to that certain
Security Agreement dated as of June 22, 2015 made by MELA Sciences, Inc. (the “Company”) and its subsidiaries
party thereto from time to time, as Debtors, to and in favor of the Agent identified therein (the “Security Agreement”),
relating to the Company’s 2.25% Senior Secured Convertible Debentures due June 22, 2020 and 9% Senior Secured Notes


 


Reference
is made to the Security Agreement as defined above; capitalized terms used herein and not otherwise defined herein shall have
the meanings given to such terms in, or by reference in, the Security Agreement.


 


The
undersigned hereby agrees that upon delivery of this Additional Debtor Joinder to the Agent referred to above, the undersigned
shall (a) be an Additional Debtor under the Security Agreement, (b) have all the rights and obligations of the Debtors under the
Security Agreement as fully and to the same extent as if the undersigned was an original signatory thereto and (c) be deemed to
have made the representations and warranties set forth therein as of the date of execution and delivery of this Additional Debtor
Joinder. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, THE UNDERSIGNED SPECIFICALLY GRANTS TO THE AGENT, FOR THE RATABLE BENEFIT
OF THE PURCHASERS, A SECURITY INTEREST IN THE COLLATERAL AS MORE FULLY SET FORTH IN THE SECURITY AGREEMENT AND ACKNOWLEDGES AND
AGREES TO THE WAIVER OF JURY TRIAL PROVISIONS SET FORTH THEREIN.


 


Attached
hereto are supplemental and/or replacement Schedules to the Security Agreement, as applicable.


 


The
undersigned shall deliver an executed copy of this Joinder to the Agent, and the Agent may rely on the matters set forth herein
on or after the date hereof. This Joinder shall not be modified, amended or terminated without the prior written consent of the
Agent.


 




    	 



    	 



    

 


IN
WITNESS WHEREOF, the undersigned has caused this Joinder to be executed in the name and on behalf of the undersigned.


 


	 	[INSERT NAMES OF ADDITIONAL DEBTORS]
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:
	 	 	 
	 	Dated:  ______ __, 20__