EXHIBIT 10.14

                               SECURITY AGREEMENT
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1.   Identification.

     This Security Agreement (the "Agreement"), dated April 23, 2002, is entered
into by and between ARMITEC INC., a Delaware corporation ("Debtor"), Stonestreet
Limited  Partnership,  and GALT  CAPITAL  CORPORATION  ("Shareholder")  and Owen
Naccarato,  Esq.,  as  collateral  agent [acting in the manner and to the extent
described in the Collateral  Agent  Agreement  defined  below] (the  "Collateral
Agent"),  for the benefit of the parties  identified  on Schedule A hereto being
collectively, the "Lender" and each a "Lender".

2.   Recitals.

     2.1  The Lender have made or are making loan to Debtor (the "Loan").

     2.2  The Loan is evidenced by a certain 7% Secured  Convertible  Note dated
at, about or after April 23, 2002,  described on Schedule A hereto (collectively
"Note") and executed by Debtor as the "Borrower" thereof, for the benefit of the
Lender as the "Holder"  thereof which were issued  pursuant to Convertible  Note
Purchase Agreement entered into between Debtor and the holder of the Note.

     2.3  In order to induce the Lender to make the Loan,  and as  security  for
Debtor's  performance of its obligations  under the Note and as security for the
repayment  of the Loan and any and all  other  sums due from  Debtor  to  Lender
arising  under  the  Note  issued  pursuant  to the  Convertible  Note  Purchase
Agreement,  including all of the Debtor's obligations arising under the Note and
the Convertible  Note Purchase  Agreement  relating thereto  (collectively,  the
"Obligations"), The Shareholder, for good and valuable consideration, receipt of
which is acknowledged,  has agreed to and hereby grants to the Collateral Agent,
for the benefit of the Lender,  a security  interest in the  Collateral (as such
term is hereinafter defined), on the terms and conditions hereinafter set forth.

     2.4  The Lender has appointed Owen  Naccarato as Collateral  Agent pursuant
to  that  certain  Collateral  Agent  Agreement  dated  as  of  April  23,  2002
("Collateral Agent Agreement"), among the Lender and Collateral Agent.

     Defined Terms. The following defined terms which are defined in the Uniform
Commercial  Code in effect in the State of New York on the date  hereof are used
herein as so defined:  Accounts,  Chattel Paper, Documents,  Equipment,  General
Intangibles, Instruments, Inventory and Proceeds.

3.   Grant of General Security Interest in Collateral.

     3.1  As security for the  Obligations,  the  Shareholder  hereby grants the
Collateral  Agent,  for the  benefit of the Lender,  a security  interest in the
Collateral.

     3.2  "Collateral"   shall  mean  all  of  the  following  property  of  the
Shareholder:  the common  stock of the Debtor as set forth on Schedule B hereto,
together with medallion signature  guaranteed stock powers ("Security  Shares").
Collateral shall also include all the Shareholder  right,  title and interest in
and to the Security  Shares,  together with the proceeds of any sale,  exchange,

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liquidation  or  other  disposition,   whether  voluntary  or  involuntary,  and
including but not limited to any securities,  Instruments,  and all benefits and
entitlements  evidenced by or arising out of the  Security  Shares and all other
securities,  Instruments and other property (whether real or personal,  tangible
or intangible)  issued or accepted in  substitution  for, or in addition to, the
foregoing,  and  all  dividends,  interest,  cash,  instruments,  distributions,
income, securities and any other property (whether real or personal, tangible or
intangible) at any time received, receivable or otherwise distributed in respect
of, or in exchange for, the foregoing,  whether now owned or hereafter acquired,
and any and all improvements, additions, replacements, substitutions and any and
all Proceeds arising out of or derived from the foregoing.

     3.3  Following the  occurrence  and during the  continuance  of an Event of
Default  (as  defined  herein),  the  Collateral  Agent is  hereby  specifically
authorized to transfer any Collateral into the name of the Collateral  Agent and
to take any and all action deemed  advisable to the  Collateral  Agent to remove
any transfer restrictions affecting the Collateral.

4.   Perfection of Security  Interest.  The Collateral shall be delivered to the
Collateral  Agent as security for the  Obligations.  The Collateral  Agent shall
have a perfected security interest in the Collateral.

5.   Distribution on Liquidation.

     5.1  If any sum is paid as a liquidating distribution on or with respect to
the Collateral,  The  Shareholder  shall accept same in trust for the Lender and
shall deliver same to the Collateral Agent to be applied to the Obligations then
due, in accordance with the terms of the Note.

     5.2  So long as no  Event  of  Default  (as  defined  herein)  exists,  the
Shareholder  shall be entitled to exercise all voting power pertaining to any of
the  Collateral,  provided such exercise is not contrary to the interests of the
Lender or Collateral Agent and does not impair the Collateral.

6.   Further Action By Debtor and Covenants and Warranties.

     6.1  Collateral Agent at all times shall have a perfected security interest
in the  Collateral  which  shall  be  prior to any  other  unperfected  interest
therein. Subject to the security interest described herein, The Shareholder have
and will  continue  to have full  title to the  Collateral  free from any liens,
leases,  encumbrances,  judgments or other claims.  Collateral  Agent's security
interest in the Collateral  constitutes and will continue to constitute a first,
prior and  indefeasible  security  interest in favor of  Collateral  Agent.  The
Shareholder  will do all  acts  and  things,  and  will  execute  and  file  all
instruments  (including  but  not  limited  to  security  Agreement,   financing
statements,  continuation  statements,  etc.) reasonably requested by Collateral
Agent to  establish,  maintain and continue the perfected  security  interest of
Collateral Agent in the Collateral,  and will promptly on demand,  pay all costs
and  expenses  of filing  and  recording,  including  the costs of any  searches
reasonably  deemed  necessary by Collateral Agent from time to time to establish
and determine the validity and the continuing  priority of the security interest
of  Collateral  Agent,  and also pay all other  claims and  charges  that in the
opinion of  Collateral  Agent might  prejudice,  imperil or otherwise  adversely
affect the Collateral or its security interest therein.

     6.2  The Shareholder will not sell, transfer,  assign or pledge those items
of Collateral and Debtor and The Shareholder will not allow any such items to be

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sold,  transferred,  assigned or pledged,  without the prior written  consent of
Collateral  Agent.  Although Proceeds of Collateral are covered by this Security
Agreement, this shall not be construed to mean that Collateral Agent consents to
any sale of the Collateral.

     6.3  Debtor  and The  Shareholder  will,  at all  reasonable  times,  allow
Collateral  Agent or its  representatives  free and  complete  access  to all of
Debtor  's  and  The  Shareholder'  records  which  in  any  way  relate  to the
Collateral,  for such inspection and examination as Collateral  Agent reasonably
deems necessary.

     6.4  Debtor  and the  Shareholder,  at their  sole cost and  expense,  will
protect  and defend this  Security  Agreement,  all of the rights of  Collateral
Agent hereunder,  and the Collateral against the claims and demands of all other
parties.

     6.5  Debtor and the Shareholder  will promptly notify  Collateral  Agent of
any levy,  distraint or other  seizure by legal process or otherwise of any part
of the  Collateral,  and of any threatened or filed claims or  proceedings  that
might in any way  adversely  affect or impair  any of the  rights of  Collateral
Agent under this Agreement.

     6.6  Collateral Agent may, at its option,  and without any obligation to do
so,  pay,  perform  and  discharge  any and all  amounts,  costs,  expenses  and
liabilities  herein agreed to be paid or performed by Debtor or The Shareholder,
and all amounts  expended by  Collateral  Agent in so doing shall become part of
the  Obligations  secured  hereby,  and shall be immediately  due and payable by
Debtor  and The  Shareholder  to  Collateral  Agent  upon  demand and shall bear
interest at 18% per annum from the dates of such expenditures until paid.

     6.7  Upon the request of Collateral Agent,  Debtor and the Shareholder will
furnish within five (5) days thereafter to Collateral Agent, or to any permitted
assignee  of  this  Agreement,  a  written  statement  in form  satisfactory  to
Collateral Agent, duly acknowledged,  certifying the amount of the principal and
interest  then owing  under the  Obligations,  whether  any  claims,  offsets or
defenses exist against the Obligations or against this Agreement,  or any of the
terms and provisions of any other agreement of Debtor securing the Obligations.

     6.8  The Debtor  and the  Shareholder  will,  at their own  expense,  make,
execute, endorse,  acknowledge, file and/or deliver to the Collateral Agent from
time to time  such  vouchers,  invoices,  schedules,  confirmatory  assignments,
conveyances,  financing statements,  transfer endorsements,  powers of attorney,
certificates, reports and other assurances or instruments and take further steps
relating to the  Collateral and other property or rights covered by the security
interest  hereby  granted,  as the Collateral  Agent may  reasonably  require to
protect its security interest hereunder.

     6.9  The Shareholder represents and warrants that he is the true and lawful
exclusive owner of the Collateral,  free and clear of any liens and encumbrances
and acquired the Security  Shares for purposes of calculating the holding period
for  purposes of Rule 144 under the  Securities  Act of 1933 ("Rule 144") on the
dates set forth on  Schedule  B. the  Shareholder  represents  that the  holding
period of the Security Shares held by the Shareholder  commenced for purposes of
resale  under Rule 144 on the  acquisition  date set forth on Schedule B hereto.
The  Shareholder  makes  the  foregoing  representation  to the  Lender  and any
transfer  agent of the  Company's  common  stock as if  originally  made to such
transfer agent.

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     6.10 The Shareholder hereby agrees not to divest himself of any right under
the Collateral absent prior written approval of the Collateral Agent.

     6.11 Following  the  occurrence  and  during the  existence  of an Event of
Default, Debtor and the Shareholder will cooperate and provide such certificate,
resolutions,  representations, legal opinions and all other matters necessary to
facilitate  a transfer  or sale of any part of the  Collateral  pursuant to Rule
144.  Debtor and The  Shareholder are unaware of any impediment to the resale of
the security by the Collateral  Agent upon an Event of Default  pursuant to Rule
144. Debtor and the  Shareholder  will take no action that would impede or limit
the Collateral  Agent's  ability to resell all the Security Shares upon an Event
of Default  pursuant to Rule 144. For so long as any Security Shares are subject
to this  Agreement,  the  Shareholder  will not sell any  security of the Debtor
which sale would be aggregated  with sales by the  Collateral  Agent pursuant to
Rule 144.  Debtor shall issue  instructions to its transfer agent to comply with
the foregoing  sentence.  Debtor will not permit the transfer of any security of
the Debtor if such transfer would  aggregate for purposes of Rule 144 with sales
of the  Security  Shares by the  Collateral  Agent or any sales of the  Security
Shares.  The  Shareholder  represents  and  warrants  that ha has not  sold  any
security  of the Debtor  during  the ninety  (90) days prior to the date of this
Agreement.  The Lender acknowledges that upon transfer of the Security Shares to
the Lender or Collateral Agent, the Lender' holding periods under subsection (d)
of  Rule  144  may be  "tacked"  with  the  Shareholder'  holding  periods.  The
Shareholder  further  represent  that the Note was  issued  in a bona  fide loan
transaction.

7.   Power of Attorney.

     Debtor and the Shareholder  hereby  irrevocably  constitute and appoint the
Collateral  Agent as the true and lawful attorney of Debtor and the Shareholder,
with full  power of  substitution,  in the  place  and  stead of Debtor  and the
Shareholder and in the name of Debtor and the  Shareholder or otherwise,  at any
time or times, in the discretion of the Collateral Agent, to take any action and
to execute  any  instrument  or  document  which the  Collateral  Agent may deem
necessary or advisable to accomplish the purposes of this Agreement which Debtor
or The Shareholder fail to take or fail to execute within five (5) business days
of the Collateral Agent's reasonable request therefor. This power of attorney is
coupled  with an  interest,  is  irrevocable  and shall not be  affected  by any
subsequent disability or incapacity of Debtor or The Shareholder.

8.   Performance By The Collateral Agent.

     If  Debtor  or the  Shareholder  fail to  perform  any  material  covenant,
agreement, duty or obligation of Debtor or The Shareholder under this Agreement,
the Collateral Agent may, at any time or times in its discretion, take action to
effect performance of such obligation. All reasonable expenses of the Collateral
Agent incurred in connection with the foregoing  authorization  shall be payable
by  Debtor  and The  Shareholder  as  provided  in  Paragraph  12.1  hereof.  No
discretionary  right,  remedy or power granted to the Collateral Agent under any
part of this Agreement  shall be deemed to impose any  obligation  whatsoever on
the  Collateral  Agent with respect  thereto,  such rights,  remedies and powers
being solely for the protection of the Collateral Agent.

9.   Event of Default/Waiver.  An event of default ("Event of Default") shall be
deemed to have occurred hereunder upon the occurrence of any event of default as
defined in the Note or Convertible Note Purchase  Agreement.  Upon and after any
Event of Default,  after the applicable  cure period,  if any, any or all of the
Obligations  shall  become  immediately  due and  payable  at the  option of the
Collateral  Agent, for the benefit of the Lender, or at the option of any Lender
for himself,  and the  Collateral  Agent may dispose of  Collateral  as provided

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below.  A  default  by  Debtor or The  Shareholder  of any of their  obligations
pursuant to this  Agreement  including  but not limited to the  obligations  set
forth in Section 6 of this Agreement,  or a  misrepresentation  by Debtor or The
Shareholder  of a  material  fact  stated  herein,  shall be  deemed an Event of
Default  hereunder  and an event  of  default  as  defined  in the  Obligations.
Notwithstanding  the  foregoing,  it shall not be an Event of Default under this
Agreement  if the Debtor is able to satisfy any  obligations  to the Lender with
authorized  shares of the  common  stock of Debtor  reserved  by Debtor for such
purpose.

10.  Disposition  of  Collateral.  Upon and after any Event of Default  which is
then continuing,

     10.1 The Collateral  Agent may exercise its rights with respect to each and
every component of the Collateral,  without regard to the existence of any other
security or source of payment for the  Obligations or any other component of the
Collateral.  In addition to other  rights and  remedies  provided  for herein or
otherwise available to it, the Collateral Agent shall have all of the rights and
remedies of a lender on default under the Uniform Commercial Code then in effect
in the State of New York.

     10.2 If any notice to the  Shareholder of the sale or other  disposition of
Collateral is required by then  applicable law, five (5) days' prior notice (or,
if longer,  the shortest period of time permitted by then applicable law) to The
Shareholder  of the time and place of any public  sale of  Collateral  or of the
time after which any private  sale or any other  intended  disposition  is to be
made, shall constitute reasonable notification.

     10.3 The  Collateral  Agent  is  authorized,  at  any  such  sale,  if  the
Collateral  Agent  deems it  advisable  to do so,  in order to  comply  with any
applicable securities laws, to restrict the prospective bidders or purchasers to
persons  who will  represent  and  agree,  among  other  things,  that  they are
purchasing the Collateral for their own account for  investment,  and not with a
view to the  distribution or resale thereof,  or otherwise to restrict such sale
in such other  manner as the  Collateral  Agent deems  advisable  to ensure such
compliance. Sales made subject to such restrictions shall be deemed to have been
made in a commercially reasonable manner.

     10.4 All cash proceeds  received by the Collateral Agent for the benefit of
the  Lender  in  respect  of  any  sale,  collection  or  other  enforcement  or
disposition  of  Collateral,  shall be applied  (after  deduction of any amounts
payable to the Collateral  Agent pursuant to Paragraph 12.1 hereof)  against the
Obligations pro rata among the Lender in proportion to their respective interest
in the  Obligations.  Upon payment in full of all  Obligations,  The Shareholder
shall be entitled to the return of all Collateral, including cash, which has not
been used or applied toward the payment of Obligations or used or applied to any
and all costs or expenses of the Collateral  Agent  incurred in connection  with
the  liquidation of the Collateral  (unless  another person is legally  entitled
thereto).   Any  assignment  of  Collateral  by  the  Collateral  Agent  to  The
Shareholder shall be without representation or warranty of any nature whatsoever
and wholly without recourse. Each Lender may purchase the Collateral and pay for
such purchase by offsetting any sums owed to such Lender by Debtor arising under
the Obligations or any other source.

     10.5 No exercise by the  Collateral  Agent of any right hereby given it, no
dealing  by the  Collateral  Agent with  Debtor,  the  Shareholder  or any other
person,  and no change,  impairment  or suspension of any right or remedy of the
Collateral Agent shall in any way affect any of the obligations of Debtor or The
Shareholder  hereunder or any  Collateral  furnished by the  Shareholder or give
Debtor or the Shareholder any recourse against the Collateral Agent.

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     10.6 The Security Shares shall be released to the the Shareholder  upon the
complete satisfaction of the Obligations. The Collateral Agent agrees to execute
all documents,  instruments,  UCC termination statements and releases reasonably
requested  by the  Shareholder  at such  Shareholder's  expense,  to effect  the
termination of Collateral Agent's security interest hereunder.

     10.7 Anything to the contrary herein  notwithstanding,  the Security Shares
may be released by the Collateral  Agent directly to the Lender in proportion to
their  interests  as set forth on  Schedule A hereto at any time  after  written
request,  therefore to the  Collateral  Agent by any such Lender  ("Request  for
Release"), and provided such request is made after the receipt by the Collateral
Agent in  writing,  of a notice from a Lender of the  occurrence  of an Event of
Default  and  expiration  of notice  and cure  period  provisions,  if any.  The
Collateral  Agent shall notify the Debtor and the  Shareholder of any release of
the  Security  Shares in writing  five  business  days after such  release.  The
attributed  value of the Security Shares shall be equal to the Conversion  Price
(as  defined in the Note) in effect on the date  Request for Release is given to
the  Collateral  Agent.  The  Request  for  Release  must  include  a  statement
supporting  the  determination  of the  Conversion  Price  being  employed.  The
Collateral Agent may not release at any one time an amount of Security Shares to
a Lender pursuant to any particular  Request for Release that would be in excess
of the amount of Common  Stock of the Debtor the Lender  would be  permitted  to
receive  under  Section 9.3 of the  Convertible  Note  Purchase  Agreement  upon
delivery  of a  Conversion  Notice (as  defined in the Note).  The Debtor  shall
receive a credit  against  the  Obligations  in an amount  corresponding  to the
Conversion  Price employed  multiplied by the number of Security Shares released
to a Lender.

11.  Waiver of Automatic  Stay. The Debtor and the  Shareholder  acknowledge and
agree  that  should a  proceeding  under any  bankruptcy  or  insolvency  law be
commenced  by or  against  the  Debtor  or  The  Shareholder,  or if  any of the
Collateral (as defined in the Security  Agreement)  should become the subject of
any bankruptcy or insolvency  proceeding,  then the  Collateral  Agent should be
entitled to, among other  relief to which the  Collateral  Agent may be entitled
under the Note, Security Agreement,  Convertible Note Purchase Agreement and any
other agreement to which the Debtor, the Shareholder, Lender or Collateral Agent
are parties,  (collectively  "Loan  Documents")  and/or applicable law, an order
from the court granting  immediate relief from the automatic stay pursuant to 11
U.S.C.  Section 362 to permit the Collateral Agent to exercise all of its rights
and remedies  pursuant to the Loan Documents  and/or  applicable law. THE DEBTOR
AND THE SHAREHOLDER EXPRESSLY WAIVE THE BENEFIT OF THE AUTOMATIC STAY IMPOSED BY
11 U.S.C.  SECTION 362 AS TO COLLATERAL AGENT.  FURTHERMORE,  THE DEBTOR AND THE
SHAREHOLDER  EXPRESSLY  ACKNOWLEDGE AND AGREE THAT NEITHER 11 U.S.C. SECTION 362
NOR  ANY  OTHER  SECTION  OF THE  BANKRUPTCY  CODE  OR  OTHER  STATUTE  OR  RULE
(INCLUDING,  WITHOUT LIMITATION,  11 U.S.C. SECTION 105) SHALL STAY,  INTERDICT,
CONDITION,  REDUCE OR INHIBIT IN ANY WAY THE ABILITY OF THE COLLATERAL  AGENT TO
ENFORCE  ANY  OF ITS  RIGHTS  AND  REMEDIES  UNDER  THE  LOAN  DOCUMENTS  AND/OR
APPLICABLE LAW. The Debtor and the Shareholder  hereby consent to any motion for
relief from stay which may be filed by the Collateral Agent in any bankruptcy or
insolvency  proceeding  initiated by or against the Debtor and The  Shareholder,
and further agree not to file any  opposition to any motion for relief from stay
filed by the  Collateral  Agent.  The  Debtor  and the  Shareholder  represents,
acknowledge  and agree that this provision is a specific and material  aspect of
this  Agreement,  and that the Collateral  Agent would not agree to the terms of
this Agreement if this waiver were not a part of this Agreement.  The Debtor and
the  Shareholder  further  represent,  acknowledge and agree that this waiver is
knowingly, intelligently and voluntarily made, that neither the Collateral Agent
nor  any  person  acting  on  behalf  of  the  Collateral  Agent  has  made  any
representations to induce this waiver,  that the Debtor and The Shareholder have

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been  represented  (or has had the opportunity to be represented) in the signing
of this Agreement and in the making of this waiver by independent  legal counsel
selected  by the  Debtor  and  The  Shareholder  and  that  the  Debtor  and The
Shareholder  have had the  opportunity to discuss this waiver with counsel.  The
Debtor and the  Shareholder  further  agree that any  bankruptcy  or  insolvency
proceeding  initiated by the Debtor or The  Shareholder  will only be brought in
courts  within the  geographic  boundaries  of New York  State.  Notwithstanding
anything to the contrary in this Section 11, the parties  hereto agree that this
Section shall terminate and be of no further effect after the security  interest
created hereby has terminated.

12.  Miscellaneous.

     12.1 Expenses.  Debtor  and  the  Shareholder  shall  severally  pay to the
Collateral  Agent,  on demand,  the amount of any and all  reasonable  expenses,
including,  without  limitation,  attorneys'  fees,  legal expenses and brokers'
fees,  which  the  Collateral  Agent  may  incur in  connection  with (a)  sale,
collection or other  enforcement or  disposition of Collateral;  (b) exercise or
enforcement  of any the  rights,  remedies  or  powers of the  Collateral  Agent
hereunder  or with respect to any or all of the  Obligations;  or (c) failure by
Debtor or the  Shareholder to perform and observe any Agreement of Debtor or the
Shareholder contained herein which are performed by the Collateral Agent.

     12.2  Waivers,  Amendment  and  Remedies.  No  course  of  dealing  by  the
Collateral Agent and no failure by the Collateral Agent to exercise, or delay by
the Collateral Agent in exercising,  any right,  remedy or power hereunder shall
operate as a waiver  thereof,  and no single or partial  exercise  thereof shall
preclude  any other or further  exercise  thereof or the  exercise  of any other
right,  remedy or power of the Collateral  Agent. No amendment,  modification or
waiver of any  provision of this  Agreement  and no consent to any  departure by
Debtor or the Shareholder  therefrom,  shall, in any event, be effective  unless
contained in a writing signed by the Collateral  Agent,  and then such waiver or
consent  shall be effective  only in the specific  instance and for the specific
purpose for which  given.  The  rights,  remedies  and powers of the  Collateral
Agent,  not only  hereunder,  but  also  under  any  instruments  and  Agreement
evidencing or securing the Obligations and under  applicable law are cumulative,
and may be exercised by the Collateral  Agent from time to time in such order as
the Collateral Agent may elect.

     12.3 Notices.  Any notice or other  communications  under the provisions of
this  Agreement  shall be given in writing and  delivered  to the  recipient  in
person, by reputable overnight courier or delivery service, by facsimile machine
(receipt  conformed)  with a copy  sent  by  first  class  mail  on the  date of
transmission,  or by registered or certified  mail,  return  receipt  requested,
directed  to its address set forth below (or to any new address of which a party
hereto  shall  have  informed  the other by the  giving of notice in the  manner
provided herein):

               To Debtor:





               With a copy to:


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               To The Shareholder:       To the addresses and telecopier numbers
                                         Set forth on Schedule B hereto

               To Lender:                To the addresses and telecopier numbers
                                         Set forth on Schedule A hereto

               To the Collateral Agent:  Naccarato & Associates
                                         Owen Naccarato
                                         19600 Fairchild, Suite 260
                                         Irvine, CA 92612


Any party may change  its  address by  written  notice in  accordance  with this
paragraph.

     12.4 Term;  Binding  Effect.  This Agreement shall (a) remain in full force
and effect until the 14C Information Statement of Armitec, Inc., which increases
Armitec's  common  stock is declared  effective by the  Securities  and Exchange
Commission,  or payment and satisfaction in full of all of the Obligations;  (b)
be binding upon Debtor and the  Shareholder,  and their  successors and assigns;
and (c) inure to the  benefit of the  Collateral  Agent,  for the benefit of the
Lender and their heirs, legal representatives, successors in title and permitted
assigns.

     12.5 Captions.  The captions of  Paragraphs,  Articles and Sections in this
Agreement have been included for  convenience  of reference  only, and shall not
define or limit the  provisions  hereof and have no legal or other  significance
whatsoever.

     12.6 Governing Law; Venue;  Severability.  This Agreement shall be governed
by and  construed in  accordance  with the laws of the State of New York without
regard to  principles  of conflicts or choice of law,  except to the extent that
the perfection of the security interest granted hereby in respect of any item of
Collateral may be governed by the law of another jurisdiction.  Any legal action
or  proceeding  against  the Debtor  and The  Shareholder  with  respect to this
Agreement may be brought in the courts of the State of New York or of the United
States for the Southern  District of New York, and, by execution and delivery of
this  Agreement,  each of the  Debtor  and The  Shareholder  hereby  irrevocably
accepts   for   itself  and  in  respect   of  its   property,   generally   and
unconditionally,  the jurisdiction of the aforesaid  courts.  The Debtor and The
Shareholder  hereby  irrevocably  waive  any  objection  which  they  may now or
hereafter  have to the  laying  of  venue  of any of the  aforesaid  actions  or
proceedings  arising out of or in connection with this Agreement  brought in the
aforesaid courts and hereby further  irrevocably  waives and agrees not to plead
or claim in any such court  that any such  action or  proceeding  brought in any
such court has been brought in an  inconvenient  forum. If any provision of this
Agreement,  or the application  thereof to any person or  circumstance,  is held
invalid,  such  invalidity  shall not affect any other  provisions  which can be
given effect without the invalid  provision or application,  and to this end the
provisions  hereof shall be severable and the remaining,  valid provisions shall
remain of full force and effect.

     12.7  Counterparts/Execution.  This Agreement may be executed in any number
of   counterparts   and  by  the  different   signatories   hereto  on  separate
counterparts,  each of which, when so executed, shall be deemed an original, but
all such  counterparts  shall constitute but one and the same  instrument.  This
Agreement  may be executed by  facsimile  signature  and  delivered by facsimile
transmission.



                      [THIS SPACE INTENTIONALLY LEFT BLANK]



<PAGE>

     IN WITNESS WHEREOF, the undersigned have executed and delivered this
Security Agreement, as of the date first written above.

                                    "DEBTOR"

                                    a Delaware corporation

                                    By: /s/ Bruce R. Davis
                                       ------------------------------------

                                    Its: President
                                        -----------------------------------


                                "THE SHAREHOLDER"


                                            /s/ Bruce R. Davis
-------------------------------------      -------------------------------------
                                           Authorized Agent


-------------------------------------      -------------------------------------

 /s/ Owen Naccarato
-------------------------------------
Owen Naccarato - "Collateral Agent"


APPROVED:

 /s/ Michael Finkelstein                   President
-------------------------------------      -------------------------------------


Stonestreet Limited Partnership
-------------------------------------



 This Security Agreement may be executed by facsimile signature and delivered by
                       confirmed facsimile transmission.

<PAGE>

                        SCHEDULE A TO SECURITY AGREEMENT


------------------------------------- ------------------------------------------
SUBSCRIBER                            PRINCIPAL AMOUNT OF 7% SECURED CONVERTIBLE
                                      NOTE AND ESCROWED PAYMENT
------------------------------------- ------------------------------------------



------------------------------------- ------------------------------------------



------------------------------------- ------------------------------------------



------------------------------------- ------------------------------------------
TOTAL
------------------------------------- ------------------------------------------



<PAGE>
<TABLE>
<CAPTION>

                        SCHEDULE B TO SECURITY AGREEMENT



------------------------- ----------------------------- ----------- -----------------
<S>                       <C>                           <C>         <C>
DEPOSITOR                 DEPOSITED SECURITY SHARES     STOCK       ACQUISITION DATE*
                                                        CERTIFICATE
                                                        NUMBERS
------------------------- ----------------------------- ----------- -----------------
                          5,750,000 Common Shares       AC89        Nov. 8, 2001
Galt                      Capital Corporation ($.00167
                          par value per share) of
                          Armitec, Inc.

------------------------- ----------------------------- ----------- -----------------
Galt Capital Corporation  11,890,785 Common Shares      AC98        Dec. 29,2000
                          ($.00167 par value per share)
                          of Armitec, Inc.

------------------------- ----------------------------- ----------- -----------------
                           ______ Common Shares ($.0001
                           par value per share)
                           of _________________________
------------------------- ----------------------------- ----------- -----------------
</TABLE>

* The  Depositor  represents  that each of the  deposited  Security  Shares  was
initially  issued  on  the  Acquisition  Date  and  fully  paid  for  as of  the
Acquisition Date.