INTELLECTUAL
PROPERTY SECURITY AGREEMENT

This
Intellectual Property Security Agreement (as amended, supplemented or otherwise
modified from time to time, this IP Security Agreement) is made and
effective as of November 10, 2005, by SUNSET BRANDS, INC., a Nevada corporation
(Sunset) and U.S. MILLS, INC., a Delaware corporation (US Mills,
and collectively with Sunset, the Grantor), in favor of
IBF FUND LIQUIDATING LLC, a Delaware limited liability company (the Seller).
Capitalized terms used in this IP Security Agreement and not otherwise defined
shall have the respective meanings ascribed to such terms in the Security
Agreement (defined below).

RECITALS

WHEREAS,
pursuant to that certain Amended
and Restated Acquisition Agreement and Plan of Merger dated as of the date
hereof (as amended, restated, supplemented or otherwise modified from time to
time, the Acquisition Agreement) by and among Grantor, USM Acquisition
Sub, Inc. and Seller, Sunset will acquire US Mills by merger;

WHEREAS,
Grantor is party to that certain
Security Agreement dated as of the date hereof (as amended, restated,
supplemented or otherwise modified from time to time, the Security Agreement),
by and among Grantor and Seller; and

WHEREAS,
it is a condition precedent to the
obligation of the Seller to execute and perform under the Acquisition Agreement
that Grantor shall have executed and delivered this IP Security Agreement to
the Seller;

NOW,
THEREFORE, in consideration of the
willingness of the Seller to enter into the Acquisition Agreement, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, it is hereby agreed as follows:

1.
Grant of Security Interest. To secure the Grantors prompt, punctual and
faithful payment of the Obligations and the performance of all of the Grantors
obligations under the Security Agreement, Grantor hereby grants to Seller a
continuing security interest in all of the right, title and interest of Grantor
in and to any and all of the following collateral, whether now owned or
hereafter acquired, but excluding any Intellectual Property for which the
granting of a security interest therein would terminate, invalidate, void,
cancel or abandon such Intellectual Property (the IP Collateral):

(a)
The U.S and foreign copyrights, associated copyright registrations and
applications for copyright registration, set forth on Schedule A
attached hereto (collectively, the Copyrights);

(b)
The U.S. and foreign patents and patent applications set forth on Schedule B
attached hereto, including, without limitation, divisions, continuations,
renewals, reissues, extensions and continuations-in-part of the same
(collectively, the Patents);

(c)
The U.S., state and foreign trademark and service mark registrations, trademark
and service mark applications set forth on Schedule C attached hereto
and all goodwill associated with the foregoing (collectively, the Trademarks);

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(d)
The domain names and registrations set forth on Schedule D attached hereto and
all goodwill associated with the foregoing (collectively, the Domain Names);

(e)
Any and all claims and causes of action for past, present or future
infringement of any of the IP Collateral, with the right, but not the
obligation, to sue for and collect damages for infringement of the IP
Collateral;

(f)
Any and all licenses or rights granted under any of the IP Collateral, and all
license fees and royalties arising from such licenses or rights, in each case
to the extent permitted by such licenses or rights;

(g)
Any and all amendments, renewals, extensions, reissuances and replacements of
any of the IP Collateral; and

(h)
Any and all products and proceeds of any of the foregoing.

2.
Requested Recordation. Grantor authorizes and requests that the Register
of Copyrights and the Commissioner of Patents and Trademarks (and any state,
foreign or other authority to which this IP Security Agreement is submitted)
file and record this IP Security Agreement (and any corresponding or separate
forms of such jurisdiction) in order to publicly reflect the interests of the
Seller in the IP Collateral.

3.
Assignment. Upon the occurrence and during the continuance of an Event
of Default, Grantor shall execute and deliver to Seller an absolute assignment
transferring its entire right, title, and interest in and to the IP Collateral
to the Seller.

4.
Power of Attorney. Grantor hereby irrevocably grants to the Seller, a
power of attorney, to act as Grantors attorney-in-fact, with full authority in
the name, place and stead of Grantor, from time to time in the Sellers
discretion, to take any action and to execute any instrument that the Seller
may reasonably deem necessary or advisable to accomplish the purposes of this
IP Security Agreement. This authority includes, without limitation, the
following:

(a)
  To modify or amend (in the sole discretion of the Seller and without first
  obtaining Grantors approval thereof or signature thereto) Schedule A,
  Schedule B, Schedule C, and/or Schedule D hereof, as appropriate, to include
  references to any registered intellectual property (or application or license
  therefor) acquired by Grantor after the execution hereof or to delete any
  reference to any IP Collateral in which Grantor no longer has or claims any
  right, title or interest;(b)
  To execute, file and pursue (in the sole discretion of the Seller and without
  first obtaining Grantors approval thereof or signature thereto, unless
  otherwise prohibited by applicable law) any application, form or other
  document in order to perfect, maintain, continue or otherwise protect the
  Sellers interest or Grantors rights in the IP Collateral, including,
  without limitation, executing and filing (i) any financing statement, any
  continuation statement or any amendment thereto, and (ii) any document in any
  proceeding before the United States Patent and Trademark Office, the United
  States Copyright Office or the relevant office of any state or foreign
  jurisdiction (including,without limitation, the filing of applications for
  renewal, affidavits of use, affidavits of incontestability and opposition,
  interference and cancellation proceedings) and to pay any fees and taxes in
  connection therewith or otherwise;(c)
  To execute any document required to acknowledge, register or perfect the
  interest of the Seller in any part of the IP Collateral without the signature
  of Grantor unless prohibited by applicable law; and(d)
  Upon the occurrence and during the continuation of an Event of Default, to
  (i) endorse the Grantors name on all applications, documents, papers and
  instruments necessary or desirable for Seller in the use of the IP
  Collateral, (ii) take any other actions with respect to the IP Collateral as
  Seller deems to be in the best interest of Seller, (iii) grant or issue any
  exclusive or non-exclusive license under the IP Collateral to anyone or (iv)
  assign, pledge, convey or otherwise transfer title in or dispose of the IP
  Collateral to anyone.The foregoing power of attorney is coupled with an
interest and is irrevocable until the obligations secured hereby have been
unconditionally and indefeasibly paid or performed in full and the Security
Agreement has been terminated (except for any obligations designated under the
Security Agreement as continuing on an unsecured basis).

5.
Release. Unless otherwise agreed in writing by the parties, the security
interests granted herein will terminate (and all rights to the IP Collateral
will revert to the Grantor) upon satisfaction of the following conditions: (a)
payment and performance in full of all the Obligations secured hereby
(unconditionally and indefeasibly) and (b) the termination of the Security
Agreement (except for any obligations designated under the Security Agreement
as continuing on an unsecured basis). Upon any such termination, the Seller (at
the Grantors request and sole expense) will promptly execute and deliver to
the Grantor (without any representation, warranty or recourse of any kind whatsoever)
such documents as the Grantor may reasonably request and as are provided to the
Seller to evidence such termination.

6.
Newly Registered Copyrights, Patents and Trademarks. Grantor hereby
agrees to provide the Seller, every three (3) months, a schedule of newly
registered Copyrights, Patents and Trademarks (if any).

7.
Miscellaneous.

(a)
  This IP Security Agreement has been entered into in conjunction with the
  provisions of and the security interest granted to the Seller under the
  Security Agreement. The rights and remedies of the Grantor and the Seller
  with respect to the security interests granted herein are in addition and
  without prejudice to those set forth in the Security Agreement, all terms and
  provisions of which are hereby incorporated herein by reference. In the event
  that any provisions of this IP Security Agreement are deemed to conflict with
  the Security Agreement or the other Acquisition Documents, the provisions of
  the Security Agreement or the other Acquisition Documents shall govern.(b)
  This IP Security Agreement may be executed in any number of counterparts with
  the same effect as if all the signatures on such counterparts appeared onone document. Each such counterpart will be deemed
  to be an original, but all counterparts together will constitute one and the
  same instrument.8.
Subordination.

THE LIENS IN THE IP COLLATERAL GRANTED HEREIN ARE
SUBORDINATED TO THE LIENS IN THE IP COLLATERAL GRANTED TO CAPITALSOURCE FINANCE
LLC IN THE MANNER AND TO THE EXTENT SET FORTH IN THAT CERTAIN MASTER
SUBORDINATION AND INTERCREDITOR AGREEMENT, DATED AS OF THE DATE HEREOF, AMONG
SUNSET BRANDS, INC., U.S. MILLS, INC., IBF FUND LIQUIDATING LLC, AS SELLER, THE
DEBENTURE HOLDER (AS DEFINED THEREIN) AND CAPITALSOURCE FINANCE LLC.

[Remainder of Page
Intentionally Blank; Signature Page Follows]

IN
WITNESS WHEREOF, the parties hereto have executed this IP
Security Agreement as of the date first written above.

GRANTOR:SUNSET
  BRANDS, INC.By:
    /s/ Todd SandersName: Todd SandersTitle: President & CEOU.S. MILLS,
  INC.By:
    /s/ Todd SandersName: Todd SandersTitle: PresidentBy:
    /s/ Charles VerdeName: Charles VerdeTitle: PresidentSELLER:IBF
  FUND LIQUIDATING LLCBy:
    /s/ Arthur J. SteinbergName: Arthur J. Steinberg
        Title: Manager