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                                                                    EXHIBIT 10.4


                               SECURITY AGREEMENT
                            FOR INTELLECTUAL PROPERTY

                                                               Windsor, Colorado
                                                               January 27, 2000

     In order to induce Harry J. Tiffany, III ("Lender") whose address is 701
Automation Drive, Windsor, Colorado 80550 to assign certain assets and
intellectual property to Cardxx ("Borrower") in exchange for a promise by
Borrower to make payments to Lender as described herein, and in consideration
thereof and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the Borrower hereby agrees as follows:

1.   DEFINITIONS.

     When used herein, the terms set forth below shall be defined as follows:

     (a) "Obligations" means all the indebtedness, obligations and liabilities
of the Borrower to Lender described in an Assignment of even date herewith
between Lender as Assignor and Borrower as Assignee (the "Assignment"). In
particular, the Obligations include the agreement of Borrower to pay Lender the
sum of $600,000 on or before March 31, 2000 and $200,000 on or before January 1,
2001 together with interest on such amounts from the date due until paid at the
rate of 10% per annum.

     (b) "Collateral" means the following property: the intellectual property
described on Exhibit A attached hereto and all additions thereto and
substitutions therefor and all cash proceeds thereof. The Collateral is
sometimes referred to herein as the "IP."

     (c) "Event of Default" means: (i) any default with respect to payment or
performance of any of the Obligations; or (ii) insolvency of the Borrower; or
(iii) the Borrower makes an assignment for the benefit of creditors or a
petition in bankruptcy or for reorganization or to effect a plan or arrangement
with creditors is filed by or against the Borrower; or (iv) the Borrower applies
for or permits the appointment of a receiver or trustee for any or all property
or assets of the Borrower, or any such receiver or trustee shall have been
appointed for any or all property or assets of the Borrower; or (v) any of the
above actions or proceedings whatsoever are commenced by or against the
Borrower; or (vi) a proceeding is filed or commenced by or against the Borrower
for dissolution or liquidation; or (vii) the Borrower voluntarily or
involuntarily terminates or dissolves or is terminated or dissolved; (viii) the
breach by Borrower of any provision of this Agreement which breach has not been
cured within 30 days after written notice from Lender to Borrower setting forth
such breach, provided that if such breach is of a nature which cannot reasonably
be cured within such 30 day period, Borrower shall have such time as shall be
reasonably necessary to cure such breach so long as it is making diligent
efforts to effect such cure.


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2.   PLEDGE OF COLLATERAL.

     To secure the payment and performance of the Obligations, the Borrower
hereby pledges, to Lender, and grants to Lender a continuing security interest
in and to, all of the Collateral.

3.   REPRESENTATIONS AND WARRANTIES.

     The Borrower agrees to reimburse Lender, on demand, for any amounts paid or
advanced by Lender after the occurrence of a breach by Borrower of any provision
of this Agreement, until cured for the purpose of preserving the Collateral or
any part thereof and any liabilities or expenses incurred by Lender as the
transferee or holder of the Collateral. Lender shall exercise reasonable care in
the custody and preservation of the Collateral to the extent required by
applicable statute and use its best efforts to take such actions as the Borrower
may reasonably request in writing but the failure to do any such act shall not
be deemed a failure to exercise reasonable care. Borrower shall also observe and
perform all of the covenants and obligations contained in the Assignment.

4.   GENERAL COVENANTS.

     a. Confidentiality. All of the IP, except IP described in one or more
patent applications prepared with mutual consent of Lender and Borrower and made
publicly available, shall be considered confidential information and trade
secrets ("Confidential Information"). Except as otherwise provided herein, each
party agrees that it will not disclose the Confidential Information and will
take steps to safeguard such information from disclosure or discovery by third
persons. Each party agrees that it will -

        (i) Keep the Confidential Information secret and confidential and will
not disclose such information to any third party;

        (ii) Make no copies and permit no reproductions of the Confidential
Information other than for internal use;

        (iii) Keep the Confidential Information confidential and secret from
employees, agents, independent contractors or others unless such persons have a
need to know such information in connection with services they are performing
for the discloser and have agreed in writing to bound by the terms of this
agreement to keep the Confidential Information secret.

     The covenant of confidentiality shall not apply to any information which -

        (i) was in the recipient's possession or was known to recipient, without
an obligation to keep it confidential, before such information was disclosed to
recipient by the discloser;

        (ii) is or becomes public knowledge through a source other than the
recipient and through no fault of the recipient;


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        (iii) is independently developed by or for the recipient;

        (iv) is or becomes lawfully available to the recipient from a source
other than the discloser; or

        (v) is disclosed by the recipient with the discloser's prior written
approval.

     After the payment by Borrower of the $600,000 payment provided for in
Section 1.a. (plus any interest accrued thereon and unreimbursed expenses
advanced by Lender as provided for herein), the covenants of nondisclosure shall
continue to apply to Lender, but not to Borrower, who shall be free of any
limitations or restrictions on disclosure of the Confidential Information.

     If either party is required to disclose Confidential Information by law or
by court or governmental order, such party shall give the other party prompt
written notice thereof so that such other party may seek a protective order or
other appropriate remedy prior to such disclosure, and both parties shall
provide full and complete cooperation in seeking such order or remedy.

     b. Limitations on Use of IP. During the term of this Agreement, in addition
to the limitations on disclosure and the covenants of confidentiality contained
herein, each party agrees not to sell, lease, license or otherwise transfer the
IP or any part thereof to any third party. Furthermore, Borrower agrees that it
shall make no alterations or modifications to the IP. After the payment of
$600,000 provided for in Section 1.a. (plus any interest accrued thereon and
unreimbursed expenses advanced by Lender as provided for herein) by Borrower,
Borrower shall be free of such restrictions with respect to the IP, but Lender
shall remain bound by them. So long as Borrower is in default under this
Assignment or under the Security Agreement, or if Lender reacquires or transfers
the IP pursuant to a default under the Security Agreement, Lender shall be free
of such restrictions with respect to the IP but Borrower shall remain bound by
them.

     c. Defense of the IP and Infringement. Lender hereby represents to Borrower
that to the best of Lender's knowledge and belief, there is no infringement with
respect to the IP as of the date hereof. During the term of this Agreement, in
the event that Lender or Borrower suspects that a third party is infringing upon
any or all of the proprietary rights comprising the IP, such party shall provide
prompt notice thereof to the other party. If the infringement represents a
material threat to the proprietary nature of the IP or the business of Borrower,
Borrower shall initiate at its expense action against such infringer and use its
best efforts to achieve a successful result therefrom. Lender agrees to assist
Borrower in such effort and shall be consulted on the conduct of such
proceedings and shall have the right to consent to any material actions taken in
any such proceedings, including without limitation the settlement thereof, which
consent shall not be unreasonably withheld. Nothing herein shall limit the right
of Lender to take action on its own against any infringement of the IP.

     d. Treatment of Collateral. Lender shall be under no duty to: (i) collect
or protect the Collateral or any proceeds thereof or give any notice with
respect thereto; (ii) sell or otherwise realize upon the Collateral; or (iii)
seek payment from any particular source. Without limiting the generality of the
foregoing, Lender shall not be obligated to take any action in connection with
any conversion, call, redemption, retirement or any other event relating to any
of the Collateral.


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     After payment of part of the Obligations, Lender may, at its option, retain
all or any portion of the Collateral as security for any remaining Obligations
and retain this Agreement as evidence of such security. The Borrower agrees to
reimburse Lender, on demand, for any amounts paid or advanced by Lender from and
after the occurrence of a breach of this Agreement by Borrower until cured for
the purposes of preserving the Collateral or any part thereof and any
liabilities or expenses incurred by Lender as the transferee or holder of the
Collateral.

     During any period in which there are no uncured breaches of this Agreement
by Borrower, nothing contained in this Section 4 shall be construed to limit the
ability of the Borrower to use the IP in the ordinary course of business
consistent with past practices.

5.   RIGHTS AND REMEDIES.

     Lender shall have, by way of example and not of limitation, the rights and
remedies in subparagraph (a) of this paragraph at all times prior to and after
the occurrence of an Event of Default and shall have all the rights and remedies
enumerated herein after the occurrence of an Event of Default.

     (a) Lender may, at its option and without notice: (i) transfer into its
name or the name of its nominee all or any part of the Collateral for purposes
of perfecting its security interest in the Collateral; or (ii) notify any person
obligated on any of the Collateral of the security interest of Lender therein
and request such person to make payment directly to Lender.

     (b) If any Event of Default shall occur, then or at any time thereafter,
while such Event of Default shall continue, Lender may declare all Obligations
to be due and payable regardless of their terms, for the purposes of this
Agreement, without notice, protest, presentment or demand, all of which are
hereby expressly waived by the Borrower. At or after such time Lender shall
have, in addition to any other rights and remedies contained in this Agreement,
and any other agreements, guarantees, notes, instruments and documents
heretofore, now or at any time or times hereafter executed by the Borrower, and
delivered to Lender, all of the rights and remedies of a pledgee, under law,
including without limitation all of the rights and remedies of a secured party
under the Uniform Commercial Code in force in the State of Colorado as of the
date hereof, all of which rights and remedies shall be cumulative, and
non-exclusive, to the extent permitted by law.

6.   TERM AND TERMINATION.

     This Agreement shall terminate upon payment by Borrower of all amounts due
to Lender hereunder. Upon termination due to payment of all amounts due from
Borrower to Lender hereunder:

     (a) Lender shall continue to be bound by the confidentiality provisions
hereof.

     (b) Lender shall immediately deliver to Borrower all written copies of all
programs, drawings, specifications, instructions and any other documentation
pertaining to the IP and all magnetic copies of the foregoing documents. Lender
shall not retain any of the foregoing materials


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and shall take all steps necessary to insure that all copies of the foregoing
materials are permanently removed from his premises and that of his employees
and agents.

     Upon the occurrence of an Event of Default by Borrower -

     (a) Borrower shall continue to be bound by the confidentiality provisions
hereof.

     (b) Borrower shall immediately deliver to Lender all written copies of all
programs, drawings, specifications, instructions and any other documentation
pertaining to the IP and all magnetic copies of the foregoing documents.
Borrower shall not retain any of the foregoing materials and shall take all
steps necessary to insure that all copies of the foregoing materials are
permanently removed from its premises and that of its employees and agents.

7.   GENERAL.

     (a) Each reference herein to Lender and Borrower shall be deemed to include
their respective successors and assigns, all of whom shall be bound by the
provisions hereof.

     (b) Borrower represents that the officer signing on its behalf has been
duly authorized to execute this Agreement for and on behalf of the corporation
by its Board of Directors or stockholders.

     (c) No delay on the part of Lender in exercising any rights hereunder or
failure to exercise the same shall operate as a waiver of such rights; no notice
to or demand on the Borrower shall be deemed to be a waiver of any obligations
of the Borrower or of the right of Lender to take other or further action
without notice or demand as provided herein. In any event, no modification or
waiver of the provisions hereof shall be effective unless in writing and signed
by Lender nor shall any waiver be applicable except in the specific instance or
matter for which given.

     (d) The Borrower hereby certifies and covenants that all acts, conditions
and things required to be done and performed and to have happened precedent to
the creation and issuance of this Agreement and to constitute the same the valid
and legally binding obligation of the Borrower in accordance with its terms,
have been done and performed and have happened in due and strict compliance with
all applicable laws.

     (e) This Agreement is and shall be deemed to be a contract entered into and
made pursuant to the laws of the State of Colorado and shall in all respects be
governed, construed, applied and enforced in accordance with the laws of said
state; in the event that the Lender brings any action hereunder in any court of
record of Colorado or the Federal Government, the Borrower consents and consents
and confers personal jurisdiction over the Borrower by such court or courts and
agrees that service of process may be made upon the Borrower by mailing a copy
of the summons to the Borrower in the manner specified in paragraph 7(i) hereof;
and in any action hereunder the Borrower waives the right to demand a trial by
jury.


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     (f) Whenever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law.
Should any portion of this Agreement be declared invalid for any reason in any
jurisdiction, such declaration shall have no effect upon the remaining portions
of this Agreement; furthermore, the entirety of this Agreement shall continue in
full force and effect in all other jurisdictions and said remaining portions of
this Agreement shall continue in full force and effect in the subject
jurisdiction as if this Agreement had been executed with the invalid portions
thereof deleted.

     (g) The section headings herein are included for convenience only and shall
not be deemed to be a part of this Agreement.

     (h) Each party recognizes and acknowledges that any breach or threatened
breach of this Agreement by other may cause irreparable harm for which monetary
damages may be inadequate. The recipient of Confidential Information agrees,
therefore, that the discloser shall be entitled to an injunction to restrain the
recipient from such breach or threatened breach. Nothing in this Agreement shall
be construed as preventing the discloser from pursuing any remedy at law or in
equity for my breach or threatened breach of this Agreement.

     (i) All notices, statements, reports, requests, consents and other
communications, whether required by this Agreement or in any way related to the
transactions contemplated herein, shall be in writing and shall be deemed to
have been sufficiently given (i) three business days after depositing the same
in the U.S. mail, by registered or certified mail, postage prepaid, return
receipt requested; (ii) one business day after deposit with a recognized
overnight courier service; or (iii) immediately upon facsimile transmission, if
such transmission occurs during the regular business hours of the recipient, or
otherwise the next business day thereafter, provided that the transmission is
followed by the mailing of the original by registered or certified mail or by
recognized overnight courier service; at the following addresses, or at such
other addresses as the parties may designate by written notice in the foregoing
manner:

          (i)  If Lender:

               Harry J. Tiffany, III
               701 Automation Drive
               Windsor, Co 80550
               Fax: (970) 686-2422

               With a copy to:

               Jeffrey Davine
               Ballard Spahr Andrews & Ingersoll, LLP
               1225 17th Street, Suite 2300
               Denver, CO 80202
               Fax: (303) 296-3956


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          (ii) If to Borrower:

               CardXX, Inc.
               701 Automation Drive
               Windsor, CO 80550
               Bus Fax: (970) 686-2422

               With a copy to:

               Frank A. Leo
               44 Minebrook Road
               Colts Neck, New Jersey 07722
               Fax: (732) 462-7840

               Larry D. Harvey, Esq.
               5290 DTC Parkway, Suite 150
               Englewood, CO 80111
               Fax: (303) 850-7115

     (j) Upon the request of a party hereto, the other party shall execute any
documents and take all such further actions as shall be reasonably necessary to
accomplish the purposes of this Agreement.

8.   ASSIGNMENT BY LENDER.

     Lender may, from time to time, without notice to the Borrower, sell,
assign, transfer or otherwise dispose of all or any part of the Obligations or
the security interest therefor, or both. In such event, each and every immediate
and successive purchaser, assignee, transferee or holder of all or any part of
the Obligations or the Collateral shall have the right to enforce this Agreement
by legal action or otherwise, for its own benefit as fully as if such purchaser,
assignee, transferee or holder were herein by name specifically given such
rights. Lender shall have an unimpaired right to enforce this Agreement for its
benefit to the portion of the Obligations of Borrower as Lender has not sold,
assigned, transferred or otherwise disposed of.

                                             BORROWER:

                                             CardXX, Inc., a Nevada corporation


                                             By: /s/ Frank Leo
                                                 ------------------------------


                                             LENDER: /s/ Harry J. Tiffany, III
                                                     --------------------------
                                                     Harry J. Tiffany, III


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