Unassociated Document


     SECURITY
AGREEMENT

    


    Image Metrics, Inc. (“the Borrower”), a Nevada
corporation with an address and principal place of business at 1918 Main Street,
2nd
Floor, Santa Monica, California, 90405, and Rosi Kahane (the “Lender”), with an address of Chesa Carla, Giassa de las Barrieras 17, 7505
Celerina, Switzerland, its successors and assigns are the parties to this
Agreement.  In consideration of the Lender's extending or having
extended loans and/or other financial considerations to the Borrower on this
date or on one or more occasions, the Borrower agrees with the Lender as
follows:

    


    SECTION
1.  THE SECURITY INTEREST: As security for the payment and performance
of all Liabilities (as defined below) now existing or hereafter arising of the
Borrower to the Lender, whether arising by future advances or otherwise, the
Borrower hereby grants a security interest to the Lender in the following
property, wherever located, and in all proceeds and products of such
property:

    


    
      	
              1.01

            	
              ALL
      INVENTORY of the Borrower now existing or hereafter arising; meaning all
      goods, merchandise, raw materials, supplies, goods in process, finished
      goods, and other tangible personal property held by the Borrower for
      processing, sale, or other business purpose, or to be used or consumed in
      the Borrower's business.

            


    

    


    
      	
              1.02

            	
              ALL
      ACCOUNTS AND ACCOUNTS RECEIVABLE of the Borrower now existing or hereafter
      arising; meaning all accounts, accounts receivable, papers, notes, drafts,
      acceptances, commercial tort claims, letter of credit rights (whether or
      not the letter of credit is evidenced by a writing), supporting
      obligations and all other debts, obligations, and liabilities in whatever
      form owing to the Borrower from any person, firm, corporation, or any
      other legal entity ("Account
      Debtors").

            


    

    


    
      	
              1.03

            	
              ALL
      DOCUMENTS of the Borrower now existing or hereafter arising; meaning all
      documents of title, including bills of lading, dock warrants, dock
      receipts, warehouse receipts, and orders for the delivery of goods, and
      also any other document which in the regular course of business or
      financing is treated as adequately evidencing that the person in the
      possession of it is entitled to receive, hold, and dispose of the document
      and goods it covers.

            


    

    


    
      	
              1.04

            	
              ALL
      INSTRUMENTS of the Borrower now existing or hereafter arising; meaning all
      negotiable instruments, securities, and any other writings which evidence
      a right to payment of money and are not themselves security agreements or
      leases and are of a type which are in the ordinary course of business
      transferred by delivery with any necessary endorsement or
      assignment.

            


    

    


    
      	
              1.05

            	
              ALL
      CHATTEL PAPER (whether tangible or electronic) of the Borrower now
      existing or hereafter arising; meaning a writing or writings which
      evidence both a monetary obligation and a security interest in or a lease
      of specific goods.

            


    

    


    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    
      	
              1.06

            	
              ALL
      GENERAL INTANGIBLES, including, but not limited to, choses in action of
      the Borrower now existing or hereafter arising, meaning any personal
      property other than goods, accounts, chattel papers, documents, and
      instruments, including, but not limited to, general intangibles of the
      following description or type: goodwill, literary rights, contract rights
      and rights to performance, copyrights, trade-marks,
      patents, computer programs, access codes, source codes, trade secrets,
      customer lists and all tax refunds.

            


    

    


    
      	
              1.07

            	
              ALL
      INVESTMENT PROPERTY of the Borrower, where located, now or hereafter
      existing or hereafter acquired including all securities (whether
      certificated or not), security entitlements, security accounts, financial
      assets and related rights, together with all proceeds of any of the
      foregoing.

            


    

    


    
      	
              1.08

            	
              ALL
      DEPOSIT ACCOUNTS of the Borrower, wherever located, now existing or
      hereafter acquired.

            


    

    


    
      	
              1.09

            	
              ALL
      OTHER GOODS of the Borrower, wherever located, now existing or hereafter
      acquired; meaning all motor vehicles, equipment, machinery, and other
      tangible personal property, whether fixtures or not, any and all records
      relating to any of the Collateral (as defined below) and all attachments
      and accessories thereto and substitutes
  therefor.

            


    

    


    It is the Borrower's express intention
that the continuing grant of this security interest remain as security for
payment and performance of all of its Liabilities, whether now existing, or
which may hereinafter be incurred by future advances, or otherwise, and whether
or not such Liabilities are related to any transactions described in this
Agreement, by class or kind, or whether or not contemplated by the parties at
the time of the granting of this security interest.  The notice of the
continuing grant of this security interest therefore shall not be required to be
stated on the face of any document representing any of the Borrower's
Liabilities nor otherwise identify it as being secured hereby.  If any
Liability of the Borrower shall be or become excused, the Borrower hereby
expressly hypothecates his, her, its, or their ownership interest in the
Collateral to the extent required to satisfy such Liabilities, without
restriction or limitation.  Any such Liabilities will include all
advances by the Lender whether or not the advances are made pursuant to
commitments.

    


    SECTION
2.  DEFINITIONS: All types of Collateral mentioned in Section 1 shall
have the meanings given to them under Uniform Commercial Code as adopted in the
State of California, Cal. Com. Code § 1101 et seq., (the “UCC”), unless
specifically defined otherwise in that section or elsewhere in this
Agreement.  In addition, as used herein, the following terms shall
have the following respective meanings:

    


    
      	
              2.01

            	
              LIABILITIES
      means all liabilities of the Borrower to the Lender of every kind and
      description, including those arising under the Loan Agreement with the
      Lender of even date, as may be amended from time to time (the "Loan
      Agreement"), and the Convertible Promissory Note of Borrower of
      even date executed pursuant thereto, direct or indirect, absolute or
      contingent, due or to become due, now existing or hereafter arising,
      regardless of how they arise or by what agreement or instrument they may
      be evidenced, including those arising under this Agreement, or whether
      evidenced by any agreement or instrument, including obligations to perform
      acts and refrain from taking action as well as obligations to pay
      money.

            


    

    


    
      
         

      

      
        2

        
          

        

      

      
         

      

       

    

    
      	
              2.02

            	
              COLLATERAL
      means any and all property of the Borrower in which the Lender now has, by
      this Agreement, or hereafter acquires and specifically includes without
      limitation all inventory, accounts, documents, instruments, chattel paper,
      general intangibles, investment property and other goods, as those terms
      are defined in Section 1 hereof; provided however, that notwithstanding
      anything in this Agreement to the contrary, upon termination of the
      Guarantee Period (as defined in the Loan Agreement, the Collateral shall
      immediately be deemed to exclude 35% of all equity interests of the
      Guarantor (as defined in the Loan Agreement) owned by the Borrower; and
      the parties shall cooperate in amending all applicable instruments,
      documents statements and recordations of liens to reflect such
      exclusion.

            


    

    


    SECTION
3. BORROWER'S REPRESENTATIONS, WARRANTIES AND COVENANTS:  To induce
the Lender to enter into this Agreement the Borrower represents, warrants,
agrees, and covenants that:

    


    
      	
              3.01

            	
              BORROWER
      OWNS ASSETS: The Borrower owns all its assets, including the Collateral,
      as represented on any papers furnished to the Lender and has and will have
      the exclusive right and authority to grant security interests
      therein.

            


    

    


    
      	
              3.02

            	
              ASSETS
      FREE OF ENCUMBRANCES: All the Borrower's assets, including the Collateral,
      are and will be kept in good condition and clear of all security
      interests, mortgages, liens, and encumbrances, except those granted or
      allowed under this Agreement or the Loan Agreement, purchase money
      security interests in acquired assets, and those referred to herein or in
      the Loan Agreement, and the
      Borrower has marketable title to all Collateral and shall defend the same
      against the claims and demands of all persons.  The Lender has
      the right but not the duty to discharge any liability giving rise to a
      lien on Collateral, including any liens of any taxing authority, and the
      Borrower shall repay the Lender immediately for all amounts paid by the
      Lender to discharge such
liabilities.

            


    

    


    
      	
              3.03

            	
              LOCATION
      OF COLLATERAL: Tangible Collateral, including, but not limited to,
      equipment, inventory, and fixtures, and if the Lender permits the Borrower
      to retain possession thereof, instruments, documents, and chattel paper,
      will be kept in the possession of the Borrower at its place of business
      named above or in the Loan Agreement.  The location or locations
      of such Collateral shall not be changed without prior written notice to
      the Lender.

            


    

    


    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    


    
      	
              3.04

            	
              RECORDS
      AND INFORMATION WITH RESPECT TO BORROWER AND
  COLLATERAL:

            


    

    


    
      	
               
      

            	
              (a)

            	
              The
      Borrower will furnish all information, financial or otherwise, that a duly
      authorized lending officer of the Lender deems reasonably necessary to
      properly inform the Lender with respect to Collateral or the condition of
      the Borrower.

            


    

    


    
      	
               
      

            	
              (b)

            	
              Borrower
      hereby irrevocably authorizes Lender at any time and from time to time to
      file in any Uniform Commercial Code jurisdiction any initial financing
      statements and amendments thereto that (a) indicate the Collateral (i) as
      all assets of Borrower or words of similar effect, regardless of whether
      any particular asset comprised in the Collateral falls within the scope of
      Article 9 of the Uniform Commercial Code of such jurisdiction, or (ii) as
      being of an equal or lesser scope or with greater detail, and (b) contain
      any other information required by the Uniform Commercial Code for the
      sufficiency or filing office acceptance of any financing statement or
      amendment, including (i) whether Borrower is an organization, the type of
      organization and any organization identification number issued to
      Borrower, and (ii) in the case of a financing statement filed as a fixture
      filing or indicating Collateral as as-extracted Collateral or timber to be
      cut, a sufficient description of real property to which the Collateral
      relates. Borrower agrees to furnish any such information to Lender
      promptly upon request. Borrower also ratifies its authorization for Lender
      to have filed in any Uniform Commercial Code jurisdiction any like initial
      financing statements or amendments thereto if filed prior to the date
      hereof. All reasonable charges, expenses and fees Lender may incur in
      filing any of the foregoing, together with reasonable costs and expenses
      of any lien search required by Lender, and any taxes relating thereto,
      shall be charged to the Borrowers and added to the
      Liabilities.

            


    

    


    
      	
               
      

            	
              (c)

            	
              The
      Borrower will execute upon the request of the Lender such other documents
      as the Lender deems reasonably necessary to perfect its security interest
      in the Collateraland will pay the cost of filing them in such offices as
      the Lender requests.

            


    

    


    
      	
              3.05

            	
              FIXTURES:
      If any machinery, equipment, or other property serving as Collateral under
      this Agreement is or will be attached to any real estate, the Borrower
      will, upon Lender's request, furnish the Lender with a description of such
      real estate with a disclaimer, signed by all persons having an interest in
      said real estate, of any interest in the Collateral which has or may have
      priority over the Lender's
interest.

            


    

    


    
      
         

      

      
        4

        
          

        

      

      
         

      

       

    

    
      	
              3.06

            	
              LIABILITIES
      OWING TO BORROWER:  Any liabilities in whatever form owing to
      the Borrower from any person, firm, or other legal entity serving as
      Collateral are and will be good and valid indebtedness not subject to any
      defenses, set-offs, claims, counter-claims, or agreements under which any
      deduction or discount may be made thereon, except as specified to the
      Lender on a statement or invoice made available to the Lender on or prior
      to the date hereof or from time to time
  hereafter.

            


    

    


    
      	
              3.07

            	
              RETURNED
      MERCHANDISE: The Lender may in its unfettered discretion charge to the
      Borrower the amount represented to be owing on any liability, in whatever
      form owing to the Borrower, from whatever source, if said liability serves
      as Collateral under this Agreement, and if any merchandise giving rise to
      any such liability is returned, and until such debit is made, Borrower
      shall hold any such returned merchandise segregated in trust for the
      Lender subject to its exclusive
disposition.

            


    

    


    
      	
              3.08

            	
              TAXES:  The
      Borrower will pay any sales or other taxes which may become due and
      payable with respect to a sale or other transaction giving rise to any
      Collateral.

            


    

    


    
      	
              3.09

            	
              CHATTEL
      PAPER: The Borrower agrees to label all chattel paper serving as
      Collateral under this Agreement with the words, "Subject to the security
      interest of Secured Lender."

            


    

    


    
      	
              3.10

            	
              INSURANCE:

            


    

    


    
      	
               
      

            	
              (a)

            	
              The
      Borrower agrees at its or his expense to keep all Collateral insured in
      accordance with any requirements prescribed by the Lender under the Loan
      Agreement.

            


    

    


    
      	
               
      

            	
              (b)

            	
              The
      Lender shall have no risk, liability, or responsibility in connection with
      payment or non-payment of any loss, the sole obligation of the Lender
      being to credit the Borrower's loan account with the net proceeds of any
      insurance payments received on account of any
  loss.

            


    

    


    
      	
              3.11

            	
              SALE
      OF COLLATERAL: Unless otherwise specifically provided by this Agreement or
      the Loan Agreement, the Borrower will not sell any Collateral without the
      prior written consent of the Lender.  So long as the Borrower is
      not in default hereunder the Borrower shall have the right to sell
      inventory, which may be Collateral, in the ordinary course of its or his
      business.  A sale in the ordinary course of business shall not
      include a transfer in total or partial satisfaction of a debt, other than
      a debt which has arisen solely as a result of prepayment or deposit by
      customers of the Borrower for items of inventory subsequently to be
      purchased or delivered.  Borrower shall also be entitled to sell
      (or trade in) obsolete equipment so long as Borrower receives therefor a
      sum (or credit) substantially equal to such equipment's fair
      value.

            


    

    


    
      
         

      

      
        5

        
          

        

      

      
         

      

       

    

    
      	
              3.12

            	
              LENDER'S
      RIGHT TO POSSESSION:

            


    

    


    
      	
               
      

            	
              (a)

            	
              Unless
      otherwise provided by law, at any time after the occurrence of, and during
      the continuance of, an Event of Default hereunder, the Lender shall have
      the right to the immediate possession of all Collateral and its products
      and proceeds, and in its sole discretion may operate and use said
      Collateral, complete work in process, and sell Collateral without being
      liable to the Borrower on account of any losses, damage, or depreciation
      that may occur as a result thereof so long as the Lender shall act in good
      faith.

            


    

    


    
      	
               
      

            	
              (b)

            	
              Unless
      otherwise provided by law, at any time after demand or the
      occurrence of an Event of Default hereunder, the Lender may, at the
      expense of the Borrower, maintain possession of the Borrower's premises by
      the use of a custodian or custodians, or in such other manner as the
      Lender may determine.

            


    

    


    
      	
               
      

            	
              (c)

            	
              Unless
      otherwise provided by law, at any time after demand or the
      occurrence of an Event of Default hereunder, the Lender may, at the
      expense of the Borrower, enter upon any premises on which Collateral may
      be situated and remove any such Collateral to such other places as the
      Lender determines.

            


    

    


    
      	
               
      

            	
              (d)

            	
              Unless
      otherwise provided by law, at any time, after demand or the
      occurrence of an Event of Default hereunder, the Lender may transfer any
      Collateral into its own name or that of its nominee and may at any time
      after demand or the occurrence of an Event of Default hereunder receive
      the income thereon and hold the same as security for Liabilities or apply
      it to principal or interest due on the
  Liabilities.

            


    

    


    
      	
              3.13

            	
              COMMERCIAL
      TORT CLAIMS:  If Borrower shall at any time hold or acquire a
      commercial tort claim, Borrower shall immediately notify Lender in a
      writing signed by Borrower of the brief details thereof and grant to
      Lender in such writing a security interest therein, and in the proceeds
      thereof, all upon the terms of this Agreement, with such writing to be in
      form and substance satisfactory to
Lender.

            


    

    


    SECTION
4.  COLLECTION:

    


    
      
        	
                4.01

              	
                (a)

              	
                The
      Lender may at any time after the occurrence of, and during the continuance
      of, an Event of Default hereunder, notify Account Debtors, on any
      Collateral, or require the Borrower to notify such Account Debtors, that
      they shall make all payments on their account or accounts with the
      Borrower directly to the Lender; or require the Borrower to hold all
      proceeds received from collection in trust for the Lender without
      commingling the same with other funds of the Borrower, and to turn the
      same over to the Lender immediately upon receipt in the identical form
      received, at which time the Lender may at its option either apply such
      proceeds to the Liabilities of the Borrower, in accordance with Section
      4.03, or release such proceeds to the Borrower for use in its
      business.

              


      

    

    


    
      
         

      

      
        6

        
          

        

      

      
         

      

       

    

    
      	
               
      

            	
              (b)

            	
              The
      Lender has the right at any time after demand or the
      occurrence of, and during the continuance of, an Event of Default
      hereunder, directly or through its agent, to collect proceeds directly
      from Account Debtors, on any Collateral and for that purpose to do all
      acts and things necessary or incident thereto, including the right to sue
      on such accounts, and to sell, transfer, set over, compromise, discharge,
      or extend the whole or any part of the
accounts.

            


    

    


    
      	
               
      

            	
              (c)

            	
              Borrower
      does hereby make, constitute and appoint any officer or agent of Lender as
      Borrower's true and lawful attorney-in-fact, with power to endorse the
      name of Borrower or any of Borrower's officers or agents upon any notices,
      checks, drafts, money orders, or other instruments of payment (including
      payments payable under any policy of insurance on the Collateral) or
      Collateral that may come into possession of the Lender in full or part
      payment of any amounts owing to Lender; to sign and endorse the name of
      Borrower or any of Borrower's officers or agents upon any warehouse
      receipts, drafts against debtors, assignments, verifications and notices
      in connection with accounts, and any instruments or documents relating
      thereto, or to Borrower's rights therein; to give written notice to such
      office or officials of the United States Post Office to effect such change
      or changes of address so that all mail addressed to the Borrower may be
      delivered directly to the Lender; granting unto Borrower's said attorney
      full power to do any and all things necessary to be done in and about the
      premises as fully and effectually as Borrower might or could do, and
      hereby ratifying all that said attorney shall lawfully do or cause to be
      done by virtue hereof.  Neither the Lender nor the attorney
      shall be liable for any acts or omissions nor for any errors of judgment
      or mistake, except for their gross negligence or willful
      misconduct.  This power of attorney shall be irrevocable for the
      term of this Agreement and all transactions hereunder and thereafter as
      long as Borrower may be indebted to Lender.  With the exception
      of the power granted to the Lender to endorse checks, drafts, and any
      other form of payment, which right may be exercised at any time and from
      time to time, the Lender will not exercise any of the powers granted
      hereunder absent demand or the
      occurrence of an Event of Default
hereunder.

            


    

    


    
      	
              4.02

            	
              Until
      the Lender exercises the rights contained in Section 4.01, the Borrower
      may continue to collect proceeds from Account Debtors on any Collateral
      and use the proceeds in any lawful manner not inconsistent with the terms
      of this Agreement.

            


    

    


    
      	
              4.03

            	
              In
      the event that the Lender exercises the rights contained in Section 4.01,
      the Lender shall credit to the Borrower the proceeds obtained from Account
      Debtors of the Borrower, such credits to be entered within two (2)
      business days after receipt of the proceeds.  Such credits,
      however, are conditional upon final payment to the Lender at its office in
      cash or solvent credits of the items giving rise to them, and, if any item
      is not so paid, the amount of any credit given with respect to any of the
      Borrower's Liabilities shall be reversed or, in the discretion of the
      Lender, it shall be charged to any deposit accounts of the Borrower with
      the Lender, whether or not the item is
returned.

            


    

    


    
      
         

      

      
        7

        
          

        

      

      
         

      

       

    

    SECTION
5.  DEFAULT AND ACCELERATION:

    


    
      	
              5.01

            	
              Any
      or all of the Liabilities of the Borrower to the Lender shall, at the
      option of the Lender and notwithstanding any time or credit allowed by any
      instrument evidencing a Liability, be immediately due and payable without
      notice or demand upon the occurrence of any of the following events of
      default (each an "Event of
      Default"):

            


    

    


    
      	
               
      

            	
              (a)

            	
              Subject
      to the right of the Company to grant a parity security interest in the
      Collateral in connection with a Subsequent Financing, as further described
      in Section 5.2 of the Loan Agreement, the security interest granted to the
      Lender in the Collateral shall, at any time after the execution and
      delivery of this Agreement, for any reason, ceases (i) to create a valid
      and perfected first priority security interest in all or a substantial
      portion of the Collateral including, without limitation, the occurrence of
      any event which would cause a lien creditor, as that term is defined in
      Section 9-102 of the Uniform Commercial Code, to take priority over
      advances made by Lender; the filing against or relating to the Borrower of
      a federal tax lien in favor of the United States of America or any
      political subdivision of the United States of America, or the filing
      against or relating to the Borrower of a state tax lien in favor of any
      state of the United States of America or any political subdivision of any
      such state; (ii) this Agreement shall cease to be in full force and effect
      or shall be declared null and void, or the validity or enforceability
      hereof shall be contested by the Borrower; or (iii) any guarantor of the
      Liabilities denies it has any further liability or obligation with respect
      to such Liabilities or terminates its guaranty or fails to honor any of
      its Liabilities under such
guaranty.

            


    

    


    
      	
               
      

            	
              (f)

            	
              The
      occurrence of an Event of Default under the Loan Agreement after the
      expiration of any applicable grace
period.

            


    

    


    
      	
              5.02

            	
              Upon
      the occurrence of, and during the continuance of, an Event of Default, the
      Lender shall have all the rights and remedies of a secured party under the
      UCC, in addition to all other rights and remedies mentioned in this
      Agreement.  Unless otherwise provided by law, the Lender may
      require the Borrower to assemble any tangible personal property
      constituting Collateral and make it available to the Lender at a place to
      be designated by the Lender which is reasonably convenient to both
      parties.

            


    

    


    
      
         

      

      
        8

        
          

        

      

      
         

      

       

    

    
      	
              5.03

            	
              The
      Borrower hereby grants to the Lender a nonexclusive irrevocable license in
      connection with the Lender's exercise of its rights hereunder, to use,
      apply and affix any trademark, trade name, logo or the like in which the
      Borrower now or hereafter has rights, which license may be used upon the
      occurrence of any of the Events of Default, or upon demand, if
      applicable.

            


    

    


    SECTION
6.  EXPENSES:

    


    
      	
              6.01

            	
              Omitted.

            


    

    


    SECTION
7.  GOVERNING LAW, MODIFICATION, AND WAIVERS:

    


    
      	
              7.01

            	
              This
      Agreement, including modifications or additions thereto, will be governed,
      interpreted, and construed in accordance with the laws of the State of
      California.

            


    

    


    
      	
              7.02

            	
              The
      rights, remedies, powers, privileges and discretions of the Lender
      hereunder shall be cumulative and not exclusive of any rights or remedies
      which it would otherwise have.

            


    

    


    
      	
              7.03

            	
              Any
      determination that any provision of this Agreement or any application
      thereof is invalid, illegal or unenforceable in any respect in any
      instance shall not affect the validity, legality and enforceability of
      such provision in any other instance, nor the validity, legality or
      enforceability of any other provision of this
  Agreement.

            


    

    


    
      	
              7.04

            	
              No
      modification of this Agreement will be binding unless in writing and
      signed by a duly authorized lending officer of the Lender and authorized
      officers of the Borrower.

            


    

    


    
      	
              7.05

            	
              Any
      default by the Borrower may be waived by the Lender in writing signed by a
      duly authorized lending officer of the Lender, but no such waiver shall
      extend to any subsequent default or any other
  default.

            


    

    


    
      	
              7.06

            	
              No
      delay on the part of the Lender in exercising any of the rights granted or
      referred to in this Agreement shall be held to constitute a
      waiver.

            


    

    


    SECTION
8.  NOTICE, ASSIGNMENT, TERMINATION:

    


    
      	
              8.01

            	
              Unless
      otherwise provided for by law, any demand, notice, or other communication
      to the Borrower that the Lender may elect to give shall be effective if
      sent in accordance with the terms of the Loan
  Agreement.

            


    

    


    
      	
              8.02

            	
              If
      at any time or times by assignment or otherwise the Lender assigns this
      Agreement, such assignment shall carry with it the Lender's powers and
      rights under this Agreement and the transferee shall become vested with
      said powers and rights whether or not they are specifically referred to in
      the transfer.  If and to the extent the Lender retains any other
      Liability or Collateral, the Lender will continue to have the rights and
      powers herein set forth with respect
thereto.

            


    

    


    
      
         

      

      
        9

        
          

        

      

      
         

      

       

    

    
      	
              8.03

            	
              This
      Agreement shall continue until all Liabilities of the Borrower to the
      Lender have been satisfied.

            


    

    


    
      	
              8.04

            	
              Any
      obligations the Lender may have to the Borrower, whether now existing or
      hereafter arising, run only to the Borrower and may not be assigned or
      transferred by said Borrower without the written consent of a duly
      authorized officer of the Lender.

            


    

    


    SECTION
9.  HEADINGS: SEAL:

    


    
      	
              9.01

            	
              Headings
      preceding the text of the several sections hereof are for the convenience
      of reference only and shall not constitute a part of this Agreement nor
      shall they affect its meaning, construction, or
  effect.

            


    

    


    
      	
              9.02

            	
              It
      is intended that this Agreement take effect as a sealed
      instrument.

            


    

    


    
      	
              9.03

            	
              This
      Agreement may be executed in multiple counterparts, each of which shall be
      effective upon delivery and, thereafter, shall be deemed to be an
      original, and all of which shall be taken as one and the same instrument
      with the same effect as if each party hereto had signed on the same
      signature page.  Any signature page of this Agreement may be
      detached from any counterpart of this Agreement without impairing the
      legal effect of any signature thereto and may be attached to another part
      of this Agreement identical in form hereto and having attached to it one
      or more additional signature pages.

            


    

    


    IN WITNESS WHEREOF, the parties hereto
have caused this Agreement to be signed as a sealed instrument this 9th day of
September, 2010.

    
       

      
        
          
            
              
                	

                         

                        WITNESS: 

                      	 	

                        BORROWER

                        
                          IMAGE
      METRICS, INC. 

                        

                      	 
	 	 	 	 
	 	 	 	 
	
                         

                      	 	By: 	
                         

                      	 
	
                         

                      	 	 	
                        Name: 

                      	 
	
                         

                      	 	 	
                        Title:

                      	 


              

            

          

        

      

      
         

         

         

        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  	

                                           

                                        	 	

                                          

                                            LENDER

                                          

                                        	 
	 	 	 	 
	
                                           

                                        	 	 	 
	 	 	

                                          Rosi
      Kahane 

                                        	 
	
                                           

                                        	 	 	
                                           

                                        	 


                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

           

          
            
               

            

            
              10