EXHIBIT 10.3

                           GENERAL SECURITY AGREEMENT

      THIS GENERAL SECURITY  AGREEMENT (as amended,  modified,  supplemented and
restated from time to time,  the "Security  Agreement") is made and entered into
as of  January  28,  2005  by  and  between  GIGABEAM  CORPORATION,  a  Delaware
corporation  (the  "Borrower"),  having its principal  office at 470  Springpark
Place, Herndon, Virginia 20170, in favor of Edward S. Gutman, in his capacity as
collateral  agent for the ratable  benefit of the  Noteholders,  as  hereinafter
defined (in such capacity,  the "Agent"),  having an office at 888 Third Avenue,
New York, NY 10106.

      WHEREAS,  on the terms and  subject to the  conditions  contained  in that
certain Securities Purchase Agreement, dated as of January 28, 2005 by and among
the Borrower and the Noteholders (as amended, modified, supplemented or restated
from time to time, the "Securities Purchase Agreement"), the Borrower will issue
for purchase by various  purchasers (each a "Noteholder" and  collectively,  the
"Noteholders")  its  8%  Senior  Convertible  Notes  Due  2008  in an  aggregate
principal  amount of up to $2,500,000  (each,  a "Note," and  collectively,  the
"Notes"), together with warrants to purchase a specified number of shares of its
common stock; and

      WHEREAS,  the Notes will be ratably  secured  by a  perfected  lien on and
first priority security interest in substantially all of the Borrower's personal
property,   subject  to  certain  exclusions  and  permitted  encumbrances,   as
hereinafter described; and

      WHEREAS,  the initial Noteholders have required,  as a condition precedent
to their  willingness  to enter into the  Securities  Purchase  Agreement and to
consummate the  transactions  contemplated to occur thereunder that the Borrower
(i) grant to the Agent, for the ratable benefit of the  Noteholders,  a security
interest in and to the Collateral (as hereinafter  defined) and (ii) execute and
deliver this Security  Agreement in order to secure the payment and  performance
by the Borrower of the Obligations (as hereinafter defined).

      NOW, THEREFORE,  in consideration of the mutual promises contained herein,
and for other good and valuable  consideration,  the receipt and  sufficiency of
which are hereby acknowledged, the Borrower hereby agrees as follows:
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            SECTION 1.  CREATION  OF  SECURITY  INTEREST.  The  Borrower  hereby
pledges,  assigns  and  grants to the  Agent,  for the  ratable  benefit  of the
Noteholders,  a continuing perfected lien on and security interest in all of the
Borrower's right,  title and interest in and to the personal property  described
in Section 2(a) hereof  (collectively  the  "Collateral") in order to secure the
payment and  performance of the Notes (the  "Obligations").  The Borrower hereby
authorizes the Agent to record,  without the Borrower's  signature,  any and all
financing  statements  deemed  necessary  or  appropriate  by the  Agent  to the
perfection of its security interest in the Collateral.

            SECTION 2. COLLATERAL.

                  (a) Personal  Property.  The Collateral is and consists of all
      of the kinds and types of property  described in  subsections  (i) through
      (xiv) hereof, whether now owned or hereafter at any time arising, acquired
      or  created  by the  Borrower  and  wherever  located,  and  includes  all
      replacements,  additions, accessions, substitutions, and repairs, relating
      thereto or  therefrom,  but excludes  the  personal  property set forth on
      Schedule  A  hereto  (the  "Excluded  Property")  and  that  described  in
      paragraph (b) below,  none of which  personal  property  shall  constitute
      "Collateral"  or be subject to the Agent's  security  interest  granted in
      Section 1, except as otherwise specifically provided in such paragraph (b)
      (all of the capitalized  terms used in the following  subsections,  unless
      otherwise  defined herein,  shall have the meanings ascribed to such terms
      under the Uniform  Commercial Code as in effect in the State of New York):
      (i) Accounts;  (ii) Payment  Intangibles;  (iii) Letter of Credit  Rights;
      (iv) Documents and Instruments; (v) Goods; (vi) Fixtures; (vii) Inventory;
      (viii) Equipment; (ix) General Intangibles;  (x) Investment Property; (xi)
      Deposit  Accounts;  (xii) all cash and other  monies and  property  in the
      possession or under the control of the Agent;  (xiii) all books,  records,
      ledger cards, files,  correspondence,  computer programs, tapes, disks and
      related  data  processing  software  that at any time  evidence or contain
      information  relating  to any  of  the  property  described  above  or are
      otherwise  necessary or helpful in the  collection  thereof or realization
      thereon; and (xiv) proceeds of all or any of the property described above,
      including,  without  limitation,  the proceeds of any  insurance  policies
      covering any of the above described property.

                  (b)  Excluded  Collateral.  Notwithstanding  anything  to  the
      contrary  contained herein,  the term  "Collateral"  shall not include any
      personal  property  consisting  of  Equipment  or  Fixtures  now  owned or
      hereafter  acquired,  to the extent that (x) any such Equipment or Fixture
      is  or  shall  be  subject  to  a  capitalized  lease  or  purchase  money
      arrangement and (y) the terms of such arrangement restrict or prohibit the
      Borrower  from granting a security  interest in such  Equipment or Fixture
      (collectively,  with the Excluded  Property,  the "Excluded  Collateral"),
      provided,  however,  that  in the  event  that  any  such  restriction  or
      prohibition is terminated or expires,  whether because such arrangement is
      no longer in effect, or otherwise,  then, in such event, automatically and
      without any further action, the Borrower shall be deemed to have granted a
      security  interest to the Agent for the ratable benefit of the Noteholders
      in and to the personal  property  which  previously  constituted  Excluded
      Collateral,   and  such  personal  property  shall  thereupon   constitute
      Collateral.


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            SECTION 3. THE BORROWER'S REPRESENTATIONS AND WARRANTIES.

                  (a)  Place  of  Business.  The  Borrower's  primary  place  of
      business is located at 470 Springpark Place, Herndon, Virginia 20170.

                  (b) Location of  Collateral.  The Collateral is located at the
      Borrower's  primary  place of  business  or at other  locations  leased or
      licensed by the Borrower in the ordinary course of its business.

                  (c) Restrictions on Asset Disposition.  Unless the Agent shall
      have given its prior  consent  thereto in writing (and  provided  that the
      requisite  number of Noteholders  shall have first authorized the Agent to
      give such consent, as set forth in the Securities Purchase Agreement), the
      Borrower shall not sell,  transfer or otherwise dispose of any Collateral,
      other than (i) sales or leases of Inventory made in the ordinary course of
      business,  (ii)  dispositions of assets deemed by the Borrower obsolete or
      no longer useful in its business,  (iii)  replacements  of certain  assets
      useful in the  Borrower's  business  with other  assets  acquired for such
      purpose,  (iv)  pursuant to sale,  leaseback  arrangements,  capital lease
      transactions  or similar  transactions,  (v) the sale or  financing of the
      Borrower's  Accounts  arising  from  the sale of  goods  or  rendition  of
      services,  (vi) intercompany transfers of assets, and (vii) the license or
      lease of Equipment made in the ordinary course of business.

                  (d) Due Organization,  Etc. The Borrower is a corporation duly
      organized,  validly  existing and in good  standing  under the laws of the
      State of Delaware  and has all  requisite  power and  authority  to own or
      lease and  operate  its  properties  and to carry on its  business  as now
      conducted and as proposed to be conducted.  The Borrower is duly qualified
      or licensed to do business  as a foreign  corporation  or other  entity in
      good standing in all  jurisdictions in which it owns or leases property or
      in which the  conduct  of its  business  requires  it to so  qualify or be
      licensed,  except  where the failure to be so  qualified  would not have a
      material  adverse  effect  on  the  business,   condition   (financial  or
      otherwise),  operations,  properties  or  performance  of the  Borrower (a
      "Material Adverse Effect").

                  (e) Due  Authorization  and  Execution,  Etc.  The  execution,
      delivery and  performance  by the Borrower of this Security  Agreement are
      within the Borrower's  corporate powers,  have been duly authorized by all
      necessary corporate action and do not and will not (i) require any consent
      or approval of the  stockholders  or any creditors of the  Borrower,  (ii)
      contravene (A) the Borrower's charter or by-laws, or (B) to the Borrower's
      knowledge any material law, rule or regulation, applicable to the Borrower
      or any  material  contractual  restriction  binding  on or  affecting  the
      Borrower or any of its material properties, (iii) result in or require the
      creation or  imposition  of any  mortgage,  deed of trust,  pledge,  lien,
      security interest or other charge or encumbrance of any nature (other than
      pursuant hereto) upon or with respect to any of the Borrower's properties,
      and (iv) to the  Borrower's  knowledge  result in a breach or violation of
      any material agreement,  instrument or document to which the Borrower is a
      party or by which  it or its  property  may be  bound.  To the  Borrower's
      knowledge,  the  Borrower is not in material  default  under any such law,
      rule or regulation,  or any such  contractual  restriction,  which default
      would have a Material Adverse Effect.


                                      -3-
<PAGE>

                  (f)  Government  Consents.  To the  Borrower's  knowledge,  no
      authorization,  consent,  approval or other action by, and no notice to or
      filing by the Borrower with, any governmental authority or regulatory body
      is required for the due execution, delivery or performance by the Borrower
      of this Security Agreement.

                  (g) Legal,  Valid and Binding Nature.  This Security Agreement
      is the legal,  valid and binding  obligation  of the Borrower  enforceable
      against  the  Borrower  in   accordance   with  its  terms,   except  that
      enforceability   thereof  may  be  limited  by   bankruptcy,   insolvency,
      reorganization,  moratorium or similar laws  affecting the  enforcement of
      creditors'  rights  generally and by general  principles of equity and the
      discretion  of the court  before  which any  proceedings  therefor  may be
      brought.

                  (h)  Absence  of  Litigation.  There  are no  actions,  suits,
      investigations,  litigation or proceedings pending or, to the knowledge of
      the  Borrower,  threatened  against  or  affecting  the  Borrower  or  the
      properties of the Borrower  before any court,  arbitrator or  governmental
      department, commission, board, bureau, agency or instrumentality, domestic
      or  foreign,  or that  purports  to  affect  any part of the  transactions
      contemplated  hereby or by the  Documents  or the  legality,  validity  or
      enforceability of this Security Agreement.

                  (i)  Absence  of  Liens.  As of  the  date  of  this  Security
      Agreement,  there  are no  liens  or  security  interests  of  any  nature
      whatsoever  on any  properties  or assets of the  Borrower,  except to the
      extent described in Section 10 hereof.

            SECTION 4. AFFIRMATIVE COVENANTS OF THE BORROWER.

      The Borrower  hereby  covenants  that so long as this  Security  Agreement
remains  in  effect,  or any amount  due  hereunder  or under the Notes  remains
outstanding and unpaid,  unless  otherwise  consented to in writing by the Agent
(which  consent  shall not be  unreasonably  withheld or delayed),  the Borrower
shall do each of the following:

                  (a) Preserve Corporate Existence.  Do all things necessary, in
      the Borrower's  commercially  reasonable judgment, to preserve and keep in
      full  force  and  effect  its  corporate  existence,   including,  without
      limitation,  all  licenses  or similar  qualifications  required  by it to
      engage in its business in each  jurisdiction in which it is at the time so
      engaged,  except where the failure to so qualify  would not be  reasonably
      likely  to have a  Material  Adverse  Effect,  and  continue  to engage in
      business of the same general type as conducted as of the date hereof,  and
      continue to conduct its  business  substantially  as now  conducted  or as
      otherwise permitted hereunder.

                  (b) Payment of Taxes and Charges.  Pay and discharge  promptly
      when due all taxes, assessments and governmental charges or levies imposed
      upon it or upon its income or profits or in respect of its property before
      the same shall become  delinquent or in default,  which, if unpaid,  could
      reasonably  be  expected  to give  rise to  liens  or  charges  upon  such
      properties  or any part  thereof,  unless,  in each case,  the validity or
      amount thereof is being contested in good faith by appropriate proceedings
      and the Borrower has maintained  adequate reserves with respect thereto in
      accordance with GAAP.


                                      -4-
<PAGE>

                  (c) Compliance with Laws. Comply in all material respects with
      all  federal,  state and local laws and  regulations,  orders,  judgments,
      decrees,    injunctions,    rules,   regulations,    permits,    licenses,
      authorizations   and   requirements   applicable   to  it   (collectively,
      "Requirements") of all governmental bodies,  departments,  commissions, or
      boards  having  jurisdiction  over the Borrower or any of its  properties,
      except where the failure to so comply could not be reasonably  expected to
      have a Material Adverse Effect;  provided,  however, that nothing provided
      herein shall  prevent the  Borrower  from  contesting  the validity or the
      application of any Requirements.

                  (d)  Retention  of Records.  Keep proper  records and books of
      account with respect to its business activities,  in which proper entries,
      reflecting all of its financial transactions,  are made in accordance with
      GAAP.  Such books and records shall be open during normal  business hours,
      on reasonable  prior written  notice from the Agent,  to inspection by the
      Agent.

                  (e)  Notification of Litigation.  Notify the Agent in writing,
      promptly  upon  learning  thereof,  of any  litigation  or  administrative
      proceeding  commenced or threatened in writing against the Borrower which,
      if adversely  determined,  would be  reasonably  likely to have a Material
      Adverse Effect.

                  (f) Physical  Maintenance of Property.  Maintain at all times,
      preserve,  protect  and  keep  such  of its  property  that  the  Borrower
      determines  to be used or useful in the  conduct of its  business  in good
      repair, working order and condition,  ordinary wear and tear excepted, and
      from  time  to  time  make  all  needful  and  proper  repairs,  renewals,
      replacements  and improvement  thereof as shall be required in the conduct
      of its  business,  as  determined  by  the  Borrower  in its  commercially
      reasonable judgment.

                  (g)  Maintenance  of  Insurance.   To  the  extent  determined
      necessary by the Borrower in its commercially  reasonable judgment for the
      operation of its business,  keep adequately  insured by financially  sound
      reputable insurers, all property of a character usually insured by similar
      businesses and carry such other insurance as is usually carried by similar
      businesses.

                  (h) No Sales or Licensing  Outside of Ordinary Course.  Except
      as otherwise provided under Section 3(c) hereof,  retain possession of the
      Collateral and not remove, sell, exchange,  assign, loan, deliver,  lease,
      license,  mortgage  or  otherwise  dispose  of same  outside of the normal
      course of business without the prior written consent of the Agent.

                  (i)  Notification of Other  Defaults.  Promptly give notice in
      writing to the Agent of the  Borrower's  receipt  of notice  that it is in
      default under any material  instrument or agreement to which it is a party
      (other than this Security Agreement).


                                      -5-
<PAGE>

                  (j) Defend  Against  Claims.  The Borrower will use reasonable
      efforts to defend the Collateral against all claims and demands of persons
      at any time claiming the same or any interest  therein unless the Borrower
      determines   that  the  claim  or  demand  is  not   material   and  that,
      consequently,  such defense  would not be  consistent  with good  business
      judgment.  The  Borrower  will not permit any lien notices with respect to
      the Collateral or any portion thereof to exist or be on file in any public
      office except for Permitted Liens.

                  (k) Change in Name, Collateral Location. The Borrower will not
      (i) change its corporate name or  jurisdiction  of  incorporation  or (ii)
      change the location of its chief executive  office unless in each case the
      Borrower  shall  have  given the  Agent at least  thirty  (30) days  prior
      written notice thereof.

                  (l)  Additional  Financing  Statements.  Upon  the  reasonable
      request of the Agent,  the  Borrower  will  execute and deliver or use its
      reasonable  efforts to procure any document,  give any notices,  authorize
      the filing of any financing statements,  mortgages or other documents, all
      in form and  substance  reasonably  satisfactory  to the  Agent,  mark any
      chattel  paper,  deliver any chattel paper or instruments to the Agent and
      take any other actions that are necessary or, in the reasonable opinion of
      the Agent,  desirable to perfect or continue the perfection of the Agent's
      security interest in the Collateral, to protect the Collateral against the
      rights,  claims, or interests of third persons,  or to effect the purposes
      of  this  Security  Agreement.   The  Borrower  will  pay  all  reasonable
      out-of-pocket costs incurred in connection with any of the foregoing.

                  (m)  Additional  Liens;  Transfers.  Without the prior written
      consent of the Agent,  the  Borrower  will not in any way  hypothecate  or
      create  or  permit  to  exist  any  lien,  security  interest,  charge  or
      encumbrance on or other interest in the  Collateral,  except for Permitted
      Liens.  If the  Collateral,  or any part  thereof,  is sold,  transferred,
      assigned,  exchanged,  or  otherwise  disposed  of in  violation  of these
      provisions,  the  security  interest of the Agent  shall  continue in such
      Collateral   or  part  thereof   notwithstanding   such  sale,   transfer,
      assignment,  exchange or other disposition, and the Borrower will hold the
      proceeds thereof for the benefit of the Agent, and promptly  transfer such
      proceeds to the Agent in kind.

                  (n) Contractual Obligations.  The Borrower will not enter into
      any contractual  obligations  which restrict or inhibit the Agent's rights
      or ability to sell or  otherwise  dispose  of the  Collateral  or any part
      thereof after the  occurrence  and during the  continuance  of an Event of
      Default, as hereinafter defined.

                  (o) Agent's Right to Protect  Collateral.  Upon the occurrence
      and continuance of an Acceleration  Event,  the Agent shall have the right
      at any time to make any  payments and do any other acts the Agent may deem
      reasonably  necessary to protect its security interests in the Collateral,
      including,  without  limitation,  the rights to pay, purchase,  contest or
      compromise  any  encumbrance,  charge  or lien  which,  in the  reasonable
      judgment of the Agent,  appears to be prior to or superior to the security
      interests  granted  hereunder,  and  appear in and  defend  any  action or
      proceeding  purporting  to affect its security  interests  in,  and/or the
      value of, the  Collateral.  The Borrower  hereby  agrees to reimburse  the
      Agent  for all  reasonable  payments  made  and  reasonable  out-of-pocket
      expenses  incurred  under this Security  Agreement,  including  reasonable
      fees,  expenses  and  disbursements  of  attorneys  acting  for the Agent,
      including any of the foregoing  payments  under,  or acts taken to protect
      its security interests in, the Collateral,  which amounts shall be secured
      under this Security Agreement, and agrees it shall be bound by any payment
      made  or act  taken  by the  Agent  hereunder  absent  the  Agent's  gross
      negligence  or willful  misconduct.  The Agent shall have no obligation to
      make any of the foregoing payments or perform any of the foregoing acts.


                                      -6-
<PAGE>

            SECTION 5. NEGATIVE COVENANTS OF THE BORROWER.

      The Borrower  hereby  covenants  that so long as this  Security  Agreement
remains  in  effect,  or any amount  due  hereunder  or under the Notes  remains
outstanding and unpaid,  unless  otherwise  consented to in writing by the Agent
(which  consent  shall not be  unreasonably  withheld or delayed),  the Borrower
shall not do any of the following:

                  (a) Restrictions on  Indebtedness.  Create,  incur,  assume or
      suffer to exist,  any indebtedness  for borrowed money  (institutional  or
      otherwise)  except (i) indebtedness in existence on the date hereof,  (ii)
      indebtedness  under the Notes,  (iii) indebtedness which is subordinate in
      right of  payment  to the  Notes  and (iv)  "Permitted  Indebtedness",  as
      defined in the Notes.

                  (b) Restrictions on  Encumbrances.  Create,  incur,  assume or
      suffer to exist,  any  encumbrance  upon any of its property  (tangible or
      intangible) or assets,  income or profits secured  hereunder,  whether now
      owned or hereafter  acquired,  except for Permitted  Liens and liens,  the
      enforcement of which, singly or in the aggregate,  would not be reasonably
      expected to have a Material Adverse Effect.

                  (c) Restrictions on Guarantees. Guarantee, assume or otherwise
      become  responsible  for (directly or  indirectly)  the  indebtedness  for
      borrowed funds, performance,  obligations, of any person, or the agreement
      by the  Borrower or any of its  subsidiaries  to do any of the  foregoing,
      except (i) any such  contingent  liability  or  agreement  incurred  or in
      effect on the date hereof,  (ii) guarantees made in the ordinary course of
      business up to an aggregate amount of $100,000,  and (iii) endorsements of
      checks  and  other  negotiable  instruments  in  the  ordinary  course  of
      business.

                  (d)  Restrictions  on  Dividends.  Except  for the  Borrower's
      existing  obligations with respect to its outstanding classes of preferred
      stock,  declare or pay, directly or indirectly,  any dividends or make any
      distributions,  whether in cash,  property  (other  than  securities,  the
      distribution of which shall not be restricted  hereunder) or a combination
      thereof,  with respect to (whether by  reduction of capital or  otherwise)
      any shares of its capital stock, except for dividends payable in shares of
      common stock or preferred stock.

                  (e)  Restrictions  on  Investments.  Purchase  or acquire  any
      stock,  obligations,  assets or securities of, or any interest in, or make
      any capital  contribution or loan or advance of money,  credit or property
      to,  any other  person  (excluding,  for the  purposes  hereof,  customary
      advances made to the Borrower's officers,  director and employees to cover
      business expenses and loans or advances made in the ordinary course of its
      business to subsidiaries or  affiliates,),  or make any other  investments
      (excluding for the purposes  hereof,  investments  made in connection with
      strategic alliances that the Borrower's Board of Directors  reasonably and
      in good faith believes will  strategically  benefit the Borrow and enhance
      its  business or  operations),  except that the  Borrower  may purchase or
      acquire (i) all or a substantial portion of any other business, whether by
      asset or stock  acquisition  or  merger;  (ii)  existing  subsidiaries  or
      subsidiaries  formed for the  purposes  of  facilitating  acquisitions  or
      carrying out the ordinary business of the Borrower;  (iii) certificates of
      deposits of any commercial banks registered to do business in any state of
      the United  States  having  capital and surplus in excess of  $50,000,000;
      (iv)  readily   marketable,   direct  obligations  of  the  United  States
      government  or any agency  thereof  which are backed by the full faith and
      credit of the  United  States;  and (v)  investments  in prime  commercial
      paper;  provided,  however,  that in each case mentioned in (iii), (iv) or
      (v) above,  such obligations  shall mature not more than 180 days from the
      date of acquisition thereof.


                                      -7-
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                  (f)  Restrictions  on  Transfer  of  Claims.  Sell,  transfer,
      discount or otherwise dispose of any claim or debt owing to it, including,
      without  limitation,  any notes,  accounts  receivable  or other rights to
      receive payment, except for consideration determined by the Borrower to be
      reasonable, and in the ordinary course of Borrower's business.

            SECTION 6. EVENTS OF DEFAULT.

                  (a) Events of Default.  The occurrence of any of the following
      events shall constitute an Event of Default hereunder:

                        (i) (A) the  Borrower  shall  fail to pay  when  due and
            payable any scheduled installment of interest on or principal of the
            Notes (and such  failure  shall not have been  cured  within 20 days
            after written notice thereof by the Agent to the Borrower) or (B) an
            event of default shall occur and be continuing under indebtedness of
            the Borrower  for borrowed  money,  the unpaid  principal  amount of
            which is more than  $100,000  (other than the Notes) and the holders
            of such  indebtedness  have declared the  outstanding  principal and
            accrued interest thereon to be immediately due and payable; or

                        (ii) if the Borrower shall:

                              (1)  admit in  writing  its  inability  to pay its
                  debts generally as they become due;

                              (2)   file   a   petition   or   answer    seeking
                  reorganization  or  arrangement  under the Federal  bankruptcy
                  laws or any other  applicable  law or  statute  of the  United
                  States of America or any State, district or territory thereof;


                                      -8-
<PAGE>

                              (3)  make  an   assignment   for  the  benefit  of
                  creditors;

                              (4)  consent to the  appointment  of a receiver of
                  the whole or any substantial part of its assets;

                              (5) have a petition in  bankruptcy  filed  against
                  it, and such petition shall not have been dismissed within 120
                  days after the filing thereof;

                              (6) if a court  of  competent  jurisdiction  shall
                  enter an order,  judgment,  or decree appointing,  without the
                  consent  of the  Borrower,  a  receiver  of the  whole  or any
                  substantial  part of the  Borrower's  assets,  and such order,
                  judgment or decree shall not be vacated or set aside or stayed
                  within 120 days from the date of entry thereof;

                              (7) if, under the  provisions of any other law for
                  the  relief  or  aid  of  debtors,   any  court  of  competent
                  jurisdiction  shall assume  custody or control of the whole or
                  any substantial part of Borrower's  assets and such custody or
                  control  shall not be terminated or stayed within 90 days from
                  the date of assumption of such custody or control; or

                              (8) except as otherwise  provided in paragraph (a)
                  (i) (A) hereof,  the Borrower shall default in the performance
                  of any  material  covenant  contained in this  Agreement,  the
                  Notes or the Securities Purchase  Agreement,  and such default
                  shall continue without cure for thirty (30) days or more after
                  written  notice  thereof by the Agent to the  Borrower  or any
                  material   representation   or  warranty   contained  in  this
                  Agreement,  the Securities  Purchase Agreement the Notes shall
                  be false or incorrect in any material respect when made.

                  (b)  Acceleration.  In addition to any other remedies provided
      by the Notes or below in  Section  7, upon the  occurrence  and during the
      continuance  of an Event of Default,  the  Noteholders,  by the  requisite
      number provided in the Securities  Purchase  Agreement and/or the Agent on
      behalf of such  Noteholders  may,  by notice to the  Borrower  declare the
      principal of and any accrued  interest and all other amounts payable under
      the Notes to be due and payable, whereupon the same shall become forthwith
      due and payable without  presentment,  demand,  protest or other notice of
      any kind,  all of which are hereby waived by the Borrower.  In addition to
      any other remedies provided by the Notes, upon the occurrence of the Event
      of Default  specified in paragraph  (a) (ii) (2) without  prejudice to the
      rights and remedies  specified above,  the Notes and other  obligations of
      the Borrower  pursuant to this Security  Agreement shall  automatically be
      immediately due and payable with interest and other fees, if any,  thereon
      without notice, demand or any other act by the Agent or any Noteholder.


                                      -9-
<PAGE>

            SECTION 7. REMEDIES.

                  (a) Obtaining the Collateral Upon  Acceleration.  If any Event
      of Default  shall have  occurred and be  continuing  and as a  consequence
      thereof the Noteholders,  by the requisite number,  shall have accelerated
      the maturity of the Notes and shall not have rescinded  such  acceleration
      (an  "Acceleration  Event"),  then and in every such case,  subject to any
      mandatory  requirements  of applicable law then in effect,  the Agent,  in
      addition to any rights now or hereafter  existing  under  applicable  law,
      shall have all rights as a secured  creditor under the Uniform  Commercial
      Code in all relevant jurisdictions and may:

                              (1)   personally,   or  by  agents  or  attorneys,
                  immediately  retake  possession of the  Collateral or any part
                  thereof,  from the  Borrower or any other  person who then has
                  possession  of any part  thereof,  with or  without  notice or
                  process  of law,  and for  that  purpose  may  enter  upon the
                  Borrower's premises where any of the Collateral is located and
                  remove the same and use in  connection  with such  removal any
                  and all services,  supplies,  aids and other facilities of the
                  Borrower;

                              (2)  instruct  the  obligor  or  obligors  on  any
                  agreement,  instrument or other obligation (including, without
                  limitation,  the Accounts) constituting the Collateral to make
                  any  payment  required  by the  terms  of such  instrument  or
                  agreement directly to the Agent;

                              (3)   withdraw   all   monies,    securities   and
                  instruments  held  pursuant  to  any  pledge  arrangement  for
                  application to the Obligations;

                              (4) sell, assign or otherwise liquidate, or direct
                  the Borrower to sell,  assign or otherwise  liquidate,  any or
                  all of the Collateral or any part thereof, and take possession
                  of the proceeds of any such sale or liquidation; and

                              (5) take  possession of the Collateral or any part
                  thereof,  by directing  the Borrower in writing to deliver the
                  same to the  Agent at any place or  places  designated  by the
                  Agent, in which event the Borrower shall at its own expense:

                        (A) forthwith cause the same to be moved to the place or
            places so designated by the Agent and there delivered to the Agent,

                        (B) store and keep any  Collateral  so  delivered to the
            Agent at such place or places pending further action by the Agent as
            provided in subsection (b) below, and

                        (C) while the  Collateral  shall be so stored  and kept,
            provide such guards and  maintenance  services as shall be necessary
            to protect the same and to preserve and maintain the  Collateral  in
            good condition.


                                      -10-
<PAGE>

                  (b) Disposition of the Collateral.  Any Collateral repossessed
      by the  Agent  under or  pursuant  to  subsection  (a) above and any other
      Collateral  (and the  proceeds of all such  Collateral)  whether or not so
      repossessed by the Agent,  shall be applied against the Obligations first,
      to the costs and  expenses  incurred by the Agent in  connection  with any
      such  disposition,  second,  ratably,  to the accrued and unpaid  interest
      thereon,  until paid in full,  third,  ratably,  to the  unpaid  principal
      balance thereof, until paid in full, and finally, to the Borrower, or as a
      court of competent  jurisdiction may otherwise direct.  All Collateral may
      be sold, assigned, leased or otherwise disposed of in any manner permitted
      under the Uniform  Commercial  Code,  under one or more contracts or as an
      entirety,  and without the necessity of gathering at the place of sale the
      property to be sold, and in general in such manner, at such time or times,
      at such place or places and on such terms as the Agent may, in  compliance
      with  any  mandatory  requirements  of  applicable  law,  determine  to be
      commercially  reasonable.  Any of the  Collateral  may be sold,  leased or
      otherwise  disposed  of, in the  condition  in which the same existed when
      taken by the Agent or after any  overhaul or repair  which the Agent shall
      determine to be commercially reasonable.  Any such disposition which shall
      be  a  private  sale  or  other  private  proceedings  permitted  by  such
      requirements  shall be made upon not less than 20 days' written  notice to
      the Borrower  specifying the time at which such  disposition is to be made
      and the intended sale price or other consideration  therefor, and shall be
      subject,  for the 20 days after the giving of such notice, to the right of
      the  Borrower  or any nominee of the  Borrower  to acquire the  Collateral
      involved at a price or for such other  consideration at least equal to the
      intended  sale  price  or  other  consideration  so  specified.  Any  such
      disposition  which shall be a public sale  permitted by such  requirements
      shall be made upon not less than 20 days'  written  notice to the Borrower
      specifying  the time  and  place  of such  sale  and,  in the  absence  of
      applicable  requirements of law, shall be by public auction (which may, at
      the option of the Agent,  be subject to  reserve),  after  publication  of
      notice  of  such  auction  not  less  than 20 days  prior  thereto  in two
      newspapers  in general  circulation  in the City of New York, as the Agent
      may determine. To the extent permitted by any such requirement of law, the
      Agent may bid for and become the  purchaser of the  Collateral or any item
      thereof,  offered  for sale in  accordance  with  this  Section,  but with
      accountability to the Borrower.

                  (c)  Power  of  Attorney.   The  Borrower  hereby  irrevocably
      authorizes  and appoints the Agent,  or any person or entity the Agent may
      designate, as the Borrower's attorney-in-fact,  at the Borrower's cost and
      expense,  to  exercise  all of the  following  powers upon and at any time
      after the occurrence and during the continuance of an Acceleration  Event,
      which powers,  being coupled with an interest,  shall be irrevocable until
      all of the Obligations shall have been paid in satisfied in full:

                              (1)  accelerate  or  extend  the time of  payment,
                  compromise,  issue  credits,  bring  suit  or  administer  and
                  otherwise collect Accounts or proceeds of any Collateral;

                              (2) give customers  indebted on Accounts notice of
                  the  Agent's  interest   therein,   and/or  to  instruct  such
                  customers  to  make  payment  directly  to the  Agent  for the
                  Borrower's account;


                                      -11-
<PAGE>

                              (3) convey any item of Collateral to any purchaser
                  thereof; and

                              (4) give any notices or record any liens.

The  Agent's  authority  under  this  subsection  (c)  shall  include,   without
limitation,  the  authority to execute and give receipt for any  certificate  of
ownership or any document,  transfer title to any item of  Collateral,  sign the
Borrower's  name on all  financing  statements  or any  other  documents  deemed
necessary or appropriate to preserve,  protect or perfect the security  interest
in the  Collateral and to file the same,  prepare,  file and sign the Borrower's
name on any  notice  of lien,  assignment  or  satisfaction  of lien or  similar
document  in  connection  with  any  Account  and  prepare,  file  and  sign the
Borrower's  name on a proof of claim in bankruptcy or similar  document  against
any  customer of the  Borrower,  and to take any other  actions  arising from or
incident  to the  rights,  powers  and  remedies  granted  to the  Agent in this
Security  Agreement.  This power of attorney is coupled  with an interest and is
irrevocable by the Borrower.

            SECTION 8. MISCELLANEOUS PROVISIONS.

                  (a)  Notices.  All  notices,  approvals,   consents  or  other
      communications  required  or  desired  to  be  given  hereunder  shall  be
      delivered  to the  respective  addresses of the Borrower and the Agent set
      forth on the signature page hereof.

                  (b) Headings.  The headings in this Security Agreement are for
      purposes  of   reference   only  and  shall  not  affect  the  meaning  or
      construction of any provision of this Security Agreement.

                  (c)  Severability.  The provisions of this Security  Agreement
      are  severable,  and if any clause or  provision  shall be held invalid or
      unenforceable  in  whole  or  in  part  in  any  jurisdiction,  then  such
      invalidity or  unenforceability  shall affect, in that jurisdiction  only,
      such clause or  provision,  or part  thereof,  and shall not in any manner
      affect such clause or  provision  in any other  jurisdiction  or any other
      clause or provision of this Security Agreement in any jurisdiction.

                  (d) Amendments,  Waivers and Consents. Any amendment or waiver
      of any  provision  of  this  Security  Agreement  and any  consent  to any
      departure by the Borrower from any  provision of this  Security  Agreement
      shall be effective only if made or given in writing signed by the Borrower
      and the Agent.

                  (e)  Interpretation  of  Agreement.  Time is of the essence in
      each provision of this Security Agreement of which time is an element. All
      terms not defined  herein  shall have the meaning set forth in the Uniform
      Commercial  Code as in effect in the State of New York.  Acceptance  of or
      acquiescence  in a course of  performance  rendered  under  this  Security
      Agreement  shall  not be  relevant  in  determining  the  meaning  of this
      Security  Agreement  even though the  accepting or  acquiescing  party had
      knowledge of the nature of the performance and opportunity for objection.

                  (f)  Continuing  Security  Interest.  This Security  Agreement
      shall create a continuing  security  interest in the  Collateral and shall
      (i) remain in full force and effect until indefeasible  payment in full of
      the Obligations, (ii) be binding upon the Borrower, and its successors and
      assigns and (iii) inure to the benefit of the Agent, and its successors.


                                      -12-
<PAGE>

                  (g) Survival of Provisions.  All  representations,  warranties
      and covenants of the Borrower contained herein shall survive the execution
      and delivery of this Security Agreement, and shall terminate only upon the
      full and final indefeasible payment and performance by the Borrower of the
      Obligations secured hereby.

                  (h)  Setoff.  The  Agent  shall  have  all  rights  of  setoff
      available at law or in equity.

                  (i) Release; Termination of Agreement. This Security Agreement
      shall terminate automatically upon full and final indefeasible payment and
      performance of all the Obligations.  At such time, the Agent shall, at the
      request of the Borrower,  promptly reassign and redeliver to the Borrower,
      and terminate and release its security  interest in, all of the Collateral
      hereunder which has not been sold, disposed of, retained or applied by the
      Agent  in  accordance  with  the  terms  hereof.   Such  reassignment  and
      redelivery shall be without  warranty by or recourse to the Agent,  except
      as to the absence of any prior assignments by the Agent of its interest in
      the Collateral, and shall be at the expense of the Borrower.

                  (j) Counterparts.  This Security  Agreement may be executed in
      one or more  counterparts,  each of which shall be deemed an original  but
      all of which shall together constitute one and the same agreement.

                  (k) Governing  Law,  etc..  This Security  Agreement  shall be
      governed  by and  construed  under  the  laws of the  State of New York as
      applied to  agreements  among New York  residents  entered  into and to be
      performed  entirely  within New York.  Each of Borrower  and the Agent (1)
      agrees  that any  legal  suit,  action  or  proceeding  arising  out of or
      relating to this Security Agreement shall be instituted exclusively in New
      York State  Supreme  Court,  County of New York,  or in the United  States
      District Court for the Southern  District of New York, and (2) irrevocably
      consents to the  jurisdiction of the New York State Supreme Court,  County
      of New  York,  and the  United  States  District  Court  for the  Southern
      District of New York in any such suit, action or proceeding.  The Borrower
      waives any  objection  which it may have now or  hereafter to the venue of
      any such suit,  action or  proceeding.  Each of the Borrower and the Agent
      further  agrees to accept and  acknowledge  service of any and all process
      which may be served in any such suit, action or proceeding in the New York
      State Supreme Court,  County of New York, or in the United States District
      Court for the  Southern  District of New York and agrees  that  service of
      process  upon the  Borrower  mailed by  certified  mail to its address set
      forth below shall be deemed in every respect  effective service of process
      upon it, in any such suit, action or proceeding.  THE PARTIES HERETO AGREE
      TO WAIVE THEIR RESPECTIVE  RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
      ACTION BASED UPON OR ARISING OUT OF THIS SECURITY AGREEMENT.


                                      -13-
<PAGE>

            SECTION 9. RELEASE OR  SUBORDINATION  OF SECURITY  INTEREST . In the
event that,  after the date of this Security  Agreement the Borrower enters into
(i) any capital and/or equipment leases with respect to any Equipment or Fixture
or  (ii)  financing  arrangement  pursuant  to  which  all or a  portion  of the
Borrower's  Accounts  are  sold  or  financed,  and,  in  any  such  case,  such
arrangement is permitted under the terms of the Securities Purchase Agreement or
the Notes,  and, in connection  therewith,  the provider of such capital  and/or
equipment lease or purchase money arrangement,  or other financing  arrangement,
as the case may be,  conditions  such  arrangement  upon  the  subordination  or
release by the Agent of its  security  interest in the  applicable  Equipment or
Fixtures,  or in the Accounts  and/or  Inventory,  as the case may be, the Agent
agrees that,  without any further inquiry on its part, and without obtaining any
specific consent or authorization  from the Noteholders,  or any one of them, it
shall promptly  deliver to the Borrower any release or subordination of security
interests as may be reasonably  necessary to effectuate the consummation of such
arrangement.

            SECTION 10.  PERMITTED  LIENS.  "Permitted  Liens"  means (i) liens,
security  interests,  charges  and other  encumbrances  securing  taxes or other
governmental charges, (ii) deposits or pledges made in connection with workman's
compensation,  social security obligations, or other similar obligations arising
under statute,  (iii) liens, security interests,  charges and other encumbrances
of landlords, licensors, carriers,  warehousemen,  mechanics and materialmen and
other similar liens, security interests,  charges and other encumbrances arising
in the ordinary course of Borrower's  business,  (iv) easements,  rights of way,
zoning  restrictions  and  similar  minor liens  which  individually  and in the
aggregate  do not have a material  adverse  effect on the  Borrower,  (v) liens,
security   interests,   charges  and  other   encumbrances   securing  Permitted
Indebtedness  (as  defined in the  Notes),  provided,  that any  Permitted  Lien
granted in connection  with  Permitted  Indebtedness  incurred after the date of
this Security  Agreement  shall attach only to the specific  assets that are the
subject of the  financing  pursuant  to which such  Permitted  Indebtedness  was
incurred and such other assets as are  customarily  the subject of financings of
that type, (vi) liens,  security  interests,  charges and other  encumbrances in
existence  on the  date  of this  Security  Agreement  and  (vii)  the  security
interests in favor of equipment  lessors or working capital lenders described in
Section 7 hereof.

                           [SIGNATURE PAGE TO FOLLOW]


                                      -14-
<PAGE>

      IN WITNESS  WHEREOF,  each of the  Borrower  and the Agent has caused this
General  Security  Agreement to be duly executed and delivered as of the day and
year first above written.

                                      BORROWER:

                                      GIGABEAM CORPORATION

                                      By: /s/ Louis S. Slaughter
                                          -----------------------
                                              Louis S. Slaughter,
                                              Chairman

                                      AGENT:

                                      /s/  Edward S. Gutman
                                      ---------------------------
                                      EDWARD S. GUTMAN


                                      -15-
<PAGE>

                                   SCHEDULE A

                                EXCLUDED PROPERTY

The FCC License held by Gigabeam  Service  Corporation  as licensee  (Call Sign:
W2BS629)  and the FCC License  held by GigaBeam  Corporation  as licensee  (Call
Sign: WQAK751)


                                      -16-