exv10w1





Exhibit 10.1




FORBEARANCE AGREEMENT




THIS FORBEARANCE AGREEMENT (hereinafter, this “Agreement”) dated as of July 29, 2011 is by and
among:




YA GLOBAL INVESTMENTS, L.P., formerly known as Cornell Capital Partners, LP (the
“Lender”), a Cayman Islands exempt limited partnership with an office located at 101 Hudson
Street, Suite 3700, Jersey City, New Jersey 07302;




HOMELAND SECURITY CAPITAL CORPORATION, a Delaware corporation (the “Company”) with its
principal office located at 4601 North Fairfax Road, Suite 1200, Arlington, VA 22203;




HOMELAND SECURITY ADVISORY SERVICES, INC., a Delaware corporation (“HSAS”), with its
principal office located at 4601 North Fairfax Road, Suite 1200, Arlington, VA 22203;




CELERITY SYSTEMS, INC., a Nevada corporation (“Celerity”), with its principal office
located at 4601 North Fairfax Road, Suite 1200, Arlington, VA 22203; and




NEXUS TECHNOLOGY GROUP, INC., a Delaware corporation (“Nexus” and, collectively with
HSAS and Celerity, the “Guarantors” and each, a “Guarantor”), with its principal office
located at 7 West Cross Street, Hawthorne, NY 10532.



WITNESSETH




WHEREAS, the Lender has made loans and other financial accommodations to or for the benefit of
the Company and the Guarantors in accordance with the documents, instruments, and agreements set
forth on Exhibit A hereto (hereinafter, collectively, with all other documents, instruments, and
agreements executed in connection therewith or related thereto, the “Financing Documents”);



WHEREAS, one or more Events of Default (as defined in the Financing Documents) have occurred
and are continuing as a consequence of the Company having failed to pay, when due at maturity, all
outstanding principal and accrued and unpaid interest under the Promissory Notes (the “Existing
Defaults”);



WHEREAS, the Company has requested that the Lender forbear from exercising its rights and
remedies under the Financing Documents and applicable law in respect of the Existing Defaults, and
the Lender is willing to do so, but only on the terms and conditions set forth herein.


 


 









 





NOW THEREFORE, in consideration of the premises and for other good and valuable consideration
the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:



Definitions





	1.	 	Unless otherwise defined herein, capitalized terms used herein shall have the meanings assigned
in the Financing Documents and the following terms shall have the following meanings:









“Acquisitions” shall have the meaning ascribed thereto in that certain Waiver, Consent and
Release of Security Interests entered into as of the date hereof by and between the Company
and the Lender.




“Ecology” means Safety & Ecology Holdings Corporation, a Nevada corporation.




“Ecology Sale” means a sale of all or substantially all of the assets of Ecology or a sale
or all or substantially all of the equity interests of Ecology.




“First March 2008 Promissory Note” shall have the meaning ascribed thereto in Exhibit A.




“Forbearance Effective Date” means the first date on which the conditions precedent
specified in Section 5 of this Agreement shall have been satisfied or the satisfaction
thereof shall have been waived in accordance with the terms hereof.




“Forbearance Period” means the period beginning on the Forbearance Effective Date and ending
on the Forbearance Termination Date.




“Forbearance Termination Date” means the earlier to occur of (i) the Termination Date and
(ii) a Termination Event.




“Net Cash Proceeds” means cash proceeds received by the Company or any Guarantor from any
sale, conveyance, transfer, lease or other disposition of any of their respective assets or
any interest therein (including the sale or factoring at maturity or collection of any
accounts), net of (i) the reasonable cash costs of sale, assignment or other disposition
(ii) taxes paid or reasonably estimated to be payable as a result thereof, (iii) reserves
for post-closing adjustments in the purchase price; provided that, to the extent and
at the time any such reserves are no longer required to be maintained by the Company or any
Guarantor, such funds shall constitute Net Cash Proceeds, (iv) post-closing adjustments to
the purchase price in connection with any indemnification payments made by the Company or
any Guarantor with respect thereto and (v) up to $550,000 of proceeds from the Nexus Sale to
be used by the Company for the Acquisitions; provided, however, that
evidence of each of clauses (i), (ii), (iii) and (iv) above is provided to the Lender in
form and substance satisfactory to it in its sole and absolute discretion.




“Nexus Sale” means a sale of all or substantially all of the assets of Nexus or a sale or
all or substantially all of the equity interests of Nexus.




“November 28 Promissory Note” shall have the meaning ascribed thereto in Exhibit A.


 


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“November 26 Promissory Note” shall have the meaning ascribed thereto in Exhibit A.




“Promissory Notes” shall have the meaning ascribed thereto in Exhibit A.




“Second March 2008 Promissory Note” shall have the meaning ascribed thereto in Exhibit A.




“Security Agreement” shall have the meaning ascribed thereto in Exhibit A.




“Termination Date” means August 31, 2011.




“Termination Event” means the occurrence of an event of termination as provided in Section 3
of this Agreement.




“Third March 2008 Promissory Note” shall have the meaning ascribed thereto in Exhibit A.



Forbearance by Lender





	2.	 	Notwithstanding the occurrence and continuance of the Existing Defaults, subject to the terms
and conditions hereof, the Lender hereby agrees to forbear, during the Forbearance Period,
from the exercise of any and all rights or remedies under the Financing Documents or
applicable law solely in respect of the Existing Defaults. Notwithstanding the foregoing,
nothing contained in this Agreement shall constitute a waiver by the Lender of any default or
Event of Default, whether now existing or hereafter arising (including, without limitation,
the Existing Defaults). This Agreement shall only constitute an agreement by the Lender to
forbear from enforcing its rights and remedies upon the terms and conditions set forth herein.





Termination Events





	3.	 	The occurrence of any one or more of the following events shall constitute a termination
event under this Agreement:






	 	a.	 	The failure of the Company or any Guarantor to promptly, punctually, or
faithfully perform or comply with any term or condition of this Agreement as and when
due, it being expressly acknowledged and agreed that TIME IS OF THE ESSENCE, including,
without limitation, any agreement set forth in Sections 6 through 12 hereto;






	 	b.	 	The determination by the Lender that any warranty or representation made by the
Company or any Guarantor in connection with this Agreement was false or misleading;




 


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	 	c.	 	The occurrence of a materially adverse change in or to the collateral granted
to the Lender under the Financing Documents and/or herein, as determined by the Lender
in its sole and exclusive discretion; and






	 	d.	 	The occurrence of any default and/or Event of Default (other than the Existing
Defaults) under the Financing Documents.





Rights Upon Occurrence of a Termination Event





	4.	 	On and after the Forbearance Termination Date, the Lender’s agreement to forbear as set forth
in this Agreement shall automatically terminate without any further action of any party and
the Lender may immediately commence enforcing its rights and remedies pursuant to this
Agreement, the Financing Documents and/or otherwise under applicable law.





Conditions Precedent





	5.	 	The Lender’s agreement to forbear as contemplated herein, shall not be effective unless and
until each of the following conditions precedent have been fulfilled, all as determined by the
Lender in its sole and exclusive discretion:






	 	a.	 	All action on the part of the Company and each Guarantor necessary for the
valid execution, delivery, and performance by the Company and each Guarantor of this
Agreement shall have been duly and effectively taken, and the Lender shall have
received from the Company and each Guarantor: (i) copies, certified by a duly
authorized officer of the Company and each Guarantor to be true and complete as of the
date hereof, of each of (A) the governing documents of the Company and each Guarantor
as in effect on the date hereof, including, without limitation, the Articles of
Incorporation and the By-laws and any and all amendments thereto, (B) the resolutions
of the Company and each Guarantor authorizing the execution and delivery of this
Agreement, the other documents executed in connection herewith and the Company’s and
each Guarantor’s performance of all of the transactions contemplated hereby, and (C) an
incumbency certificate giving the name and bearing a specimen signature of each
individual who shall be so authorized; and (ii) such other evidence reasonably
satisfactory to the Lender that all such actions on the part of the Company and each
Guarantor have been duly and effectively taken; and






	 	b.	 	This Agreement shall be executed and delivered to the Lender by the Company and
each Guarantor, shall be in full force and effect and shall be in a form and substance
reasonably satisfactory to the Lender.




 


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Agreements





	6.	 	On or before August 5, 2011, the Company shall deliver to the Lender one or more certificated
securities representing one hundred percent (100%) of its equity
interest in Nexus, along with an executed but undated stock power, satisfactory to Lender in its sole
and absolute discretion.







	7.	 	On or before August 5, 2011, Fiducia Holdings LLC, a Delaware limited liability company
(“Fiducia Holdings”), shall execute and deliver a guaranty agreement in favor of Lender with a
maximum liability not to exceed $1,800,000, in form and substance reasonably satisfactory to
Lender in its sole and absolute discretion.






	8.	 	On or before August 5, 2011, Fiducia Holdings and Nexus shall execute and deliver a joinder
agreement in favor of Lender pursuant to which Fiducia Holdings and Nexus each become a
Grantor under the Security Agreement.






	9.	 	On or before August 5, 2011, the Company shall deliver to the Lender one or more certificated
securities representing one hundred percent (100%) of its equity interest in Fiducia Holdings
along with an executed and undated membership interest power, reasonably satisfactory to the
Lender in its sole and absolute discretion.






	10.	 	On or before August 5, 2011, Fiducia Holdings shall incorporate into its operating agreement
a provision pursuant to which each membership interest of Fiducia Holdings shall be deemed a
security within the meaning of Sections 8-102(15) and 8-103 of the Code (as defined in the
Security Agreement). The designation of any membership interest as a “security” under this
provision shall be solely for the purposes of the Code and shall not indicate that it is a
“security” for any other purposes under any other provision of law.






	11.	 	On or before August 5, 2011, Fiducia Holdings shall deliver to the Lender one or more
certificated securities representing one hundred percent (100%) of its equity interest in
Fiducia Real Estate Solutions, Inc., a Delaware corporation (“Fiducia Real Estate”), along
with an executed but undated stock power, reasonably satisfactory to Lender in its sole and
absolute discretion.




 


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Transfer of Equity Interests in Fiducia Holdings and Fiducia Real Estate





	12.	 	The Company hereby represents and warrants that no provision of the operating agreement or
other agreement governing the transfer of equity interests of Fiducia Holdings (the “Fiducia
Holdings Charter Documents”) or the by-laws or other agreement governing the transfer of
equity interests of Fiducia Real Estate (the “Fiducia Real Estate Charter Documents”)
restricts, directly or indirectly, the transfer of equity interests in Fiducia Holdings or
Fiducia Real Estate, respectively. The Company shall not take any action, and shall cause
Fiducia Holdings not to take any action, directly or indirectly, to amend, modify or otherwise
change the Fiducia Holdings Charter Documents or Fiducia Real Estate Charter Documents to
impose any restrictions upon the transfer of the equity interests in Fiducia Holdings or
Fiducia Real Estate.





Mandatory Prepayments in Connection with Ecology Sale and Nexus Sale





	13.	 	Notwithstanding anything in the Financing Documents to the contrary, upon receipt by the
Company or any Guarantor of Net Cash Proceeds arising from the Ecology Sale and/or Nexus Sale,
the Company shall immediately prepay the Obligations (as hereinafter defined) in an amount
equal to one hundred percent (100%) of such Net Cash Proceeds up to the amount of the
Obligations. To the extent that any portion of the purchase price paid in connection with the
Ecology Sale or Nexus Sale is paid by the purchaser issuing to the seller a debt instrument,
all payments made on account of such debt instrument shall be made to account no.
1000038719851 held by the Company at SunTrust Bank. Neither this section nor any other
provision herein shall constitute a consent by Lender to the Ecology Sale or Nexus Sale or
shall in any way constitute a release by Lender of any security interests or liens in any
assets subject to the Ecology Sale or Nexus Sale.





Acknowledgment of Indebtedness





	14.	 	The Company and each Guarantor hereby acknowledges and agrees that, in accordance with the
terms and conditions of the Financing Documents, it is jointly and severally liable to the
Lender as follows:






	 	a.	 	Due under November 28 Promissory Note as of the date hereof:





	 	 	 	 	 
	Principal
	 	$	71,345.00	 
	Interest
	 	$	26,993.82	 
	 
	 	 	 
	Total
	 	$	98,338.82	 







	 	b.	 	Due under the November 26 Promissory Note as of the date hereof:





	 	 	 	 	 
	Principal
	 	$	178,655.00	 
	Interest
	 	$	67,722.48	 
	 
	 	 	 
	Total
	 	$	246,377.48	 







	 	c.	 	Due under the First March 2008 Promissory Note as of the date hereof:





	 	 	 	 	 
	Principal
	 	$	878,923.00	 
	Interest
	 	$	0.00	 
	 
	 	 	 
	Total
	 	$	878,923.00	 







	 	d.	 	Due under the Second March 2008 Promissory Note as of the date hereof:





	 	 	 	 	 
	Principal
	 	$	6,750,000.00	 
	Interest
	 	$	3,176,568.49	 
	 
	 	 	 
	Total
	 	$	9,926,568.49	 





 


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	 	e.	 	Due under the Third March 2008 Promissory Note as of the date hereof:





	 	 	 	 	 
	Principal
	 	$	6,310,000.00	 
	Interest
	 	$	2,469,503.29	 
	 
	 	 	 
	Total
	 	$	8,779,503.29	 







	 	f.	 	For all interest accruing upon the principal balances of the Promissory Notes
from and after the date hereof, and for all fees, redemption premiums, liquidated
damages, costs, expenses, and costs of collection (including attorneys’ fees and
expenses) heretofore or hereafter accrued or incurred by the Lender in connection with
the Financing Documents.





Hereinafter all amounts due as set forth in this Section 13, and all amounts payable under
this Agreement and the Financing Documents, shall be referred to collectively as the “Obligations”.



Waiver of Claims





	15.	 	The Company and each Guarantor hereby acknowledges and agrees that it has no offsets,
defenses, claims, or counterclaims against the Lender, its general partner, and its investment
manager, and each of their respective agents, servants, attorneys, advisors, officers,
directors, employees, affiliates, representatives, investors, partners, members, managers,
predecessors, successors, and assigns (collectively, the “Lender Parties”) and that if the
Company or any Guarantor now has, or ever did have, any offsets, defenses, claims, or
counterclaims against the Lender Parties, or any one of them, whether known or unknown, at
law or in equity, from the beginning of the world through this date and through the time of
execution of this Agreement, all of them are hereby expressly WAIVED, and the Company hereby
RELEASES the Lender Parties from any liability therefor.





Ratification of Loan Documents; Cross-Default; Cross-Collateralization; Further Assurances





	16.	 	The Company and each Guarantor:






	 	a.	 	Hereby ratifies, confirms, and reaffirms all and singular the terms and
conditions of the Financing Documents and acknowledges and agrees that the Financing
Documents remain in full force and effect;




 


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	 	b.	 	Hereby ratifies, confirms, and reaffirms that (i) the obligations secured by
the Financing Documents include, without limitation, the Obligations, and any future
modifications, amendments, substitutions or renewals thereof, (ii) all collateral,
whether now existing or hereafter acquired, granted to the Lender pursuant to the
Financing Documents or otherwise shall secure all of the Obligations until full and
final payment of the Obligations, and (iii) the occurrence of a default and/or Event
of Default under any Financing Document and/or the occurrence of a Termination Event
under this Agreement, shall constitute an Event of Default under all of the
Financing Documents and a Termination Event hereunder, it being the express intent
of the Company that all of the Obligations be fully cross-collateralized and
cross-defaulted. Without limiting the foregoing, and for the avoidance of doubt, in
order to secure all debts, liabilities, obligations, covenants and duties owing by
the Company to the Lender, whether now existing or hereafter arising, including,
without limitation, the Obligations, the Company and each Guarantor hereby grants
the Lender a security interest in all of its assets, whether now existing or
hereafter acquired, including, without limitation, all accounts, inventory, goods,
equipment, software and computer programs, securities, investment property, equity
interests in any of the Company’s subsidiaries, financial assets, deposit accounts,
chattel paper, electronic chattel paper, instruments, documents, letter-of-credit
rights, health-care-insurance receivables, supporting obligations, notes secured by
real estate, commercial tort claims, and general intangibles, including payment
intangibles, and all products and proceeds of the foregoing; and






	 	c.	 	Shall, from and after the execution of this Agreement, execute and deliver to
the Lender whatever additional documents, instruments, and agreements that the Lender
may reasonably require in order to correct any document deficiencies, or to vest or
perfect the Financing Documents and the collateral granted therein or herein more
securely in the Lender and/or to otherwise give effect to the terms and conditions of
this Agreement, and hereby authorizes the Lender to file any financing statements
(including financing statements with a generic description of the collateral such as
“all assets”), and take any other normal and customary steps, the Lender deems
necessary to perfect or evidence the Lender’s security interests and liens in any such
collateral. This Agreement constitutes an authenticated record.





Costs and Expenses





	17.	 	The Company and each Guarantor shall be jointly and severally liable to Lender for any and
all unreimbursed costs, expenses, and costs of collection (including attorneys’ fees and
expenses) heretofore or hereafter incurred by the Lender in connection with the protection,
preservation, and enforcement by the Lender of its rights and remedies under the Financing
Documents and this Agreement.




 


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Representations, Warranties, and Covenants





	18.	 	The Company and each Guarantor hereby represents, warrants, and covenants to the Lender as
follows:






	 	a.	 	The execution and delivery of this Agreement by the Company and each Guarantor
and the performance by the Company and each Guarantor of its obligations and agreements
under this Agreement and the Financing Documents are within the authority of the
Company and each Guarantor, have been duly authorized by all necessary corporate
proceedings, if applicable, on behalf of the Company and each Guarantor, and do not and
will not contravene any provision of law, statute, rule or regulation to which the
Company or any Guarantor is subject or, if applicable, any of the Company’s or any
Guarantor’s charter, other organization papers, by-laws or any stock provision or any
amendment thereof or of any agreement or other instrument binding upon the Company or
any Guarantor.






	 	b.	 	This Agreement and the Financing Documents constitute legal, valid and binding
obligations of the Company and each Guarantor, enforceable in accordance with their
respective terms, except as limited by bankruptcy, insolvency, moratorium, fraudulent
transfer, reorganization and other laws of general applicability relating to or
affecting the rights or remedies of creditors and by general equitable principles
(whether considered in a proceeding in equity or at law).






	 	c.	 	No approval or consent of, or filing with, any governmental agency or authority
is required to make valid and legally binding the execution, delivery or performance by
the Company or any Guarantor of this Agreement or any of the Financing Documents.






	 	d.	 	The Company and each Guarantor has performed and complied in all material
respects with all terms and conditions herein required to be performed or complied with
by the Company and each Guarantor prior to or at the time hereof, and as of the date
hereof, to the best knowledge of the Company and each Guarantor, no default and/or
Event of Default has occurred and is continuing under any of the Financing Documents,
with the sole exception of the Existing Defaults.






	 	e.	 	The representations and warranties contained in the Financing Documents were
true and correct in all material respects at and as of the date made and are true and
correct as of the date hereof, except to the extent of changes resulting from
transactions specifically contemplated or specifically permitted by this Agreement and
the Financing Documents, and changes occurring in the ordinary course of business that
singly or in the aggregate are not materially adverse to the financial condition of the
Company, and to the extent that such representations and warranties relate expressly to
an earlier date.






	 	f.	 	To the best knowledge of the Company and each Guarantor, the Company and each
Guarantor currently has no commercial tort claims (as such term is defined in the
Code), and hereby covenants and agrees that in the event the Company or any Guarantor
shall hereafter hold or acquire a commercial tort claim, the
Company and/or such Guarantor shall immediately notify the Lender of the particulars
of such claim in writing and shall grant to the Lender a security interest therein
and in the proceeds thereof, upon such terms and documentation as may be
satisfactory to the Lender.




 


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	 	g.	 	The Company and each Guarantor has read and understands each of the terms and
conditions of this Agreement and confirms that it is entering into this Agreement
freely and voluntarily, without duress, after having had an opportunity for
consultation with independent counsel of its own selection, and not in reliance upon
any representations, warranties, or agreements made by the Lender and not set forth in
this Agreement.





Notices





	19.	 	Any communication between the Lender and the Company or any Guarantor shall be forwarded via
certified mail, return receipt requested, or via recognized overnight courier, addressed as
follows:





	 	 	 	 	 
	 

	 	If to the Lender:
	 	YA Global Investments, L.P.
	 

	 	 	 	101 Hudson Street, Suite 3700
	 

	 	 	 	Jersey City, New Jersey 07302
	 

	 	 	 	Attention: Michael Rosselli
	 

	 	 	 	Telephone: (201) 985-8300
	 

	 	 	 	Facsimile: (201) 985-8266
	 
	 	 	 	 
	 

	 	If to Company or:
	 	Homeland Security Capital Corporation.
	 

	 	Any Guarantor
	 	4601 North Fairfax Road, Suite 1200
	 

	 	 	 	Arlington, VA 22203
	 

	 	 	 	Attention: Thomas McMillen, CEO
	 

	 	 	 	Telephone: (703) 528-7073
	 

	 	 	 	Facsimile: (703) 528-0956






Waivers





	20.	 	Non-Interference. On and after the Forbearance Termination Date, the Company and
each Guarantor agrees not to interfere with the exercise by the Lender of any of its rights
and remedies. The Company and each Guarantor further agrees that it shall not seek to
distrain or otherwise hinder, delay, or impair the Lender’s efforts to realize upon any
collateral granted to the Lender, or otherwise to enforce its rights and remedies pursuant to
the Financing Documents, this Agreement and/or applicable law. The provisions of this
Paragraph shall be specifically enforceable by the Lender.




 


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	21.	 	Automatic Stay. The Company and each Guarantor agrees that upon the filing of any
Petition for Relief by or against the Company or any Guarantor under the United States
Bankruptcy Code, the Lender shall be entitled to immediate and complete relief
from the automatic stay with respect to the Company and any Guarantor, and
Lender shall be permitted to proceed to protect and enforce its rights and
remedies under state law. The Company and each Guarantor hereby expressly
assents to any motion filed by the Lender seeking relief from the automatic
stay. The Company and each Guarantor further hereby expressly WAIVES the
protections afforded under Section 362 of the United States Bankruptcy Code
with respect to the Lender.






	22.	 	Jury Trial. The Company, each Guarantor and the
Lender hereby make the following
waiver knowingly, voluntarily, and
intentionally, and understand that
the other, in entering into this
Agreement, is relying on such a
waiver: THE COMPANY, EACH GUARANTOR
AND THE LENDER EACH HEREBY
IRREVOCABLY WAIVE ANY PRESENT OR
FUTURE RIGHT TO A JURY IN ANY TRIAL
OF ANY CASE OR CONTROVERSY IN WHICH
THE OTHER BECOMES A PARTY (WHETHER
SUCH CASE OR CONTROVERSY IS
INITIATED BY OR AGAINST SUCH PARTY
OR IN WHICH SUCH PARTY IS JOINED AS
A PARTY LITIGANT), WHICH CASE OR
CONTROVERSY ARISES OUT OF, OR IS IN
RESPECT OF, ANY RELATIONSHIP BETWEEN
THE COMPANY, ANY GUARANTOR OR ANY
OTHER PERSON, AND THE LENDER.





Entire Agreement





	23.	 	This Agreement shall be binding upon the Company, each Guarantor, and the Company’s and each
Guarantor’s employees, representatives, successors, and assigns, and shall inure to the
benefit of the Lender and the Lender’s successors and assigns. This Agreement incorporates
all of the discussions and negotiations between the Company, each Guarantor and the Lender,
either expressed or implied, concerning the matters included herein and in such other
documents, instruments and agreements, any statute, custom, or usage to the contrary
notwithstanding. No such discussions or negotiations shall limit, modify, or otherwise affect
the provisions hereof. No modification, amendment, or waiver of any provision of this
Agreement, or any provision of any other document, instrument, or agreement between the
Company, any Guarantor and the Lender shall be effective unless executed in writing by the
party to be charged with such modification, amendment, or waiver, and if such party be the
Lender, then by a duly authorized officer thereof.





Construction of Agreement





	24.	 	In connection with the interpretation of this Agreement:






	 	a.	 	All rights and obligations hereunder and thereunder, including matters of
construction, validity, and performance, shall be governed by and construed in
accordance with the law of the State of New Jersey and are intended to take effect as
sealed instruments.




 


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	 	b.	 	The captions of this Agreement are for convenience purposes only, and shall not
be used in construing the intent of the Lender, the Company or any Guarantor under this
Agreement.






	 	c.	 	In the event of any inconsistency between the provisions of this Agreement and
any other document, instrument, or agreement entered into by and between the Lender,
the Company or any Guarantor, the provisions of this Agreement shall govern and
control.






	 	d.	 	The Lender, the Company and the Guarantors have prepared this Agreement with
the aid and assistance of their respective counsel. Accordingly, all of them shall be
deemed to have been drafted by the Lender, the Company and the Guarantors and shall not
be construed against the Lender, the Company or the Guarantors.





Illegality or Unenforceability





	25.	 	Any determination that any provision or application of this Agreement is invalid, illegal, or
unenforceable in any respect, or in any instance, shall not affect the validity, legality, or
enforceability of any such provision in any other instance, or the validity, legality, or
enforceability of any other provision of this Agreement.





Counterparts





	26.	 	This Agreement may be executed in multiple identical counterparts, each of which when duly
executed shall be deemed an original, and all of which shall be construed together as one
agreement. This Agreement will not be binding on or constitute evidence of a contract between
the parties hereto until such time as a counterpart has been executed by such party and a copy
thereof is delivered to each other party to this Agreement.





[Remainder of Page Intentionally Left Blank]



 


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IN WITNESS WHEREOF, this Agreement has been executed as of the date first set forth above.



	 	 	 	 	 
	 	HOMELAND SECURITY CAPITAL CORPORATION

 	 
	 	By:  	/c/
C. Thomas McMillen	 
	 	 	Name:  	C. Thomas McMillen	 
	 	 	Title:  	Cheif Executive Officer	 
	 
	 	HOMELAND SECURITY ADVISORY SERVICES, INC.

 	 
	 	By:  	/c/
C. Thomas McMillen	 
	 	 	Name:  	C. Thomas McMillen	 
	 	 	Title:  	President	 
	 
	 	CELERITY SYSTEMS, INC.

 	 
	 	By:  	/c/
C. Thomas McMillen	 
	 	 	Name:  	C. Thomas McMillen	 
	 	 	Title:  	President	 
	 
	 	NEXUS TECHNOLOGY GROUP, INC.

 	 
	 	By:  	/c/
Michael T. Brigante	 
	 	 	Name:  	Michael T. Brigante	 
	 	 	Title:  	Cheif Executive Officer	 



 


 









 





	 	 	 	 	 



	 	 	 	 	 	 	 
	 	 	YA GLOBAL INVESTMENTS, L.P.
	 
	 	 	 	 	 	 
	 	 	By: Yorkville Advisors, LLC

Its: Investment Manager
	 
	 	 	 	 	 	 
	 

	 	By:	 	 /c/ David Gonzalez
	 	 	 	 	 
	 

	 	 	 	Name:	 	David Gonzalez
	 

	 	 	 	Title:	 	Member