Viscount Systems Inc.: Exhibit 10.2 - Filed by newsfilecorp.com






INTELLECTUAL PROPERTY SECURITY AGREEMENT 

This INTELLECTUAL PROPERTY
SECURITY AGREEMENT (this “IP Security Agreement”), dated as
of November 24, 2015, is made by and among Viscount Systems, Inc., a Nevada
corporation, with a principal place of business at 4585 Tillicum Street,
Burnaby, British Columbia V5J 5K9, Canada (the “Company”) all of the
subsidiaries of the Company and the guarantors listed on the signature pages
hereto (together with the Company, the “Grantors”) in favor of One East
Capital Advisors, 225 N.E. Mizner Boulevard, Suite 720, Boca Raton, Florida
33432, a Delaware limited partnership, as collateral agent for the current and
future holders (the “Secured Parties”) of the Secured Notes (as defined below).


WHEREAS, the Company has agreed
to (i) issue its 14% Senior Secured Convertible Demand Promissory A Notes, (each
an “A Note” and collectively, the “A Notes”) to the Secured
Parties in exchange (the “Exchange”) for (and as otherwise provided in the A
Notes), shares of the Company’s Series A Convertible Redeemable Preferred Stock
(the “Series A Shares”) held by such Secured Parties, and (ii) sell its
Senior Secured Convertible Demand Promissory B Notes (each a “B Note” and
collectively, the “B Notes”, and together with the A Notes, the
“Secured Notes”);

WHEREAS, in connection with, as
partial consideration and as an inducement for the Exchange and the purchase of
B Notes, the Company and the other Grantors have agreed to enter into and
perform, among other documents and instruments, this Agreement, the Security
Agreement and the Subsidiary Guaranty each dated on or about as of the date
hereof and defined in the Secured Notes, for the benefit of the Secured Parties;
and 

WHEREAS, under the terms of the
Security Agreement, the Grantors have, among other items, granted to the
Collateral Agent, for the benefit of itself and the other Secured Parties, a
security interest in, among other property, all intellectual property of the
Grantors, and have agreed to execute and deliver this Agreement, for recording
with national, federal and state government authorities, including, but not
limited to, the United States Patent and Trademark Office and the United States
Copyright Office. 

WHEREAS, pursuant to the Security
Agreement, the Secured Parties appointed the Collateral Agent to act for all
Secured Parties (including itself) with respect to, among other items, all
security agreements, instruments, collateral and/or related items relating to,
among other items, securing each Debtor’s obligations to the Secured Parties
under the Transaction Documents (as defined in Section 1(e) hereof) including,
but not limited to pursuant to this Agreement.

WHEREAS, the parties hereto are
parties to that Security Agreement dated on or about the date hereof.

WHEREAS, defined terms
that are not otherwise defined herein shall have the meanings given to them in
the Security Agreement. 




ARTICLE I 

NOW THEREFORE, for good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, each Grantor, jointly and severely, agrees with the Collateral
Agent as follows: 

1.                  Grant of Security. Each Grantor hereby pledges and
grants to the Collateral Agent for the ratable benefit of the Secured Parties a
security interest in and to all of the right, title and interest of such Grantor
in, to and under the following (the “IP Collateral”): 

(a)                  the patents and patent
applications set forth in Schedule 1 hereto and all reissues, divisions,
continuations, continuations-in-part, renewals, extensions and reexaminations
thereof and amendments thereto (the “Patents”);

(b)                  the trademark registrations
and applications set forth in Schedule 2 hereto, together with the
goodwill connected with the use thereof and symbolized thereby and all
extensions and renewals thereof (the “Trademarks”) , excluding only
United States intent-to-use trademark applications to the extent that, and
solely during the period in which, the grant, attachment or enforcement of a
security interest therein would, under applicable federal law, impair the
registrability of such applications or the validity or enforceability of
registrations issuing from such applications; 

(c)                  all copyright registrations,
applications and copyright registrations and applications exclusively licensed
to each Grantor set forth in Schedule 3 hereto, and all extensions and
renewals thereof (the “Copyrights”);

(d)                  all rights of any kind
whatsoever of such Grantor accruing under any of the foregoing provided by
applicable law of any jurisdiction, by international treaties and conventions
and otherwise throughout the world; 

(e)                  any and all royalties, fees,
income, payments and other proceeds now or hereafter due or payable with respect
to any and all of the foregoing; and 

(f)                  any and all claims and causes
of action with respect to any of the foregoing, whether occurring before, on or
after the date hereof, including all rights to and claims for damages,
restitution and injunctive and other legal and equitable relief for past,
present and future infringement, dilution, misappropriation, violation, misuse,
breach or default, with the right but no obligation to sue for such legal and
equitable relief and to collect, or otherwise recover, any such damages. 

2.                  Recordation. Each Grantor authorizes the Commissioner
for Patents, the Commissioner for Trademarks and the Register of Copyrights and
any other government officials to record and register this IP Security Agreement
upon request by the Collateral Agent.

2 




3.                  Documents. This IP Security Agreement has been
entered into pursuant to and in conjunction with the Security Agreement and the
Secured Notes, which are hereby incorporated by reference. The provisions of the
Secured Notes shall supersede and control over any conflicting or inconsistent
provision herein. The rights and remedies of the Collateral Agent with respect
to the IP Collateral are as provided by the Note, the Security Agreement and
related documents, and nothing in this IP Security Agreement shall be deemed to
limit such rights and remedies. 

4.                  Representations, Warranties and Agreements. Each
Grantor represents, warrants and agrees as follows: 

	 	(a) 	
      Existence; Authority. Each Grantor is a
      corporation duly organized, validly existing and in good standing under
      the laws of its state and/or place of incorporation, and this IP Security
      Agreement has been duly and validly authorized by all necessary company
      and other action on the part of each Grantor. 

	 	  	 
	 	(b) 	
      Patents. Schedule 1 accurately lists
      all Patents owned or controlled by Grantors as of the date hereof, or to
      which any Grantor has a right as of the date hereof to have assigned to it
      and accurately reflects the existence and status of all applications and
      letters pertaining to the Patents as of the date hereof. If after the date
      hereof and prior to the satisfaction of all of the Grantors obligations to
      the Secured Parties including, but not limited to, payment of all funds
      owed under the Secured Notes and/or otherwise, any Grantor owns, controls
      or has a right to have assigned to it any Patents not listed on
      Schedule 1, or if Schedule 1 ceases to accurately include and
      reflect the existence and status of Grantor’s applications pertaining to
      Patents, then the Grantors shall within 10 days provide written notice to
      the Secured Parties with a replacement Schedule 1, which upon
      acceptance by the Secured Parties shall become part of this IP Security
      Agreement. 

	 		 
	 	  	 
	 	(c) 	Trademarks.  
       Schedule 2 accurately lists all Trademarks owned or
      controlled by each Grantor as of the date hereof and accurately reflects
      the existence and status of Trademarks o f t he G r a nt ors and all
      applications and registrations pertaining thereto as of the date hereof;
      provided, however, that Schedule 2 d o e s not list
      common law marks (i.e., trademarks for which there are no applications or
      registrations) which are not material to any Grantor or any Affiliate’s
      business(es), either individually and/or as a whole. If after the date
      hereof , and satisfaction of all of the Grantors obligations to the
      Secured Parties including, but not limited to, payment of all funds owed
      under the Secured Notes and/or otherwise, any Grantor owns or controls any
      Trademarks not listed on Schedule 2 (other than common law marks
      which are not material to any Grantor’s or any Affiliate’s business(es),
      or if Schedule 2 ceases to accurately reflect the existence and
      status of applications and registrations pertaining to the Trademarks
      prior to the satisfaction of all of the Grantors obligations to the
      Secured Parties including, but not limited to, payment of all funds owed
      under the Secured Notes and/or otherwise, then Grantors shall within 10
      days provide written notice to the Secured Parties with a replacement
      Schedule 2, which upon acceptance by the Secured Parties shall
      become part of this this IP Security Agreement. 


3 





	 	
      (d) 
	
      Affiliates. As of the date hereof, no Affiliate
      owns, controls, or has a right to have assigned to it any items that
      would, if such item were owned by any Grantor, constitute Patents,
      Trademarks or Copyrights. If after the date hereof any Affiliate owns,
      controls, or has a right to have assigned to it any such items, then
      Grantors shall promptly either: (i) cause such Affiliate to assign all of
      its rights in such item(s) to Grantors; or (ii) notify the Secured Parties
      of such item(s) and cause such Affiliate to execute and deliver to the
      Secured Parties an intellectual property security agreement substantially
      in the form of this IP Security Agreement. 

	 	
      
	
      

	 	
      (e) 
	
      Title. Grantors have absolute title to each
      Patent, each Trademark and each Copyright listed on Schedule 1 2,
      and 3, respectively, free and clear of all Liens (as defined in the
      Secured Notes) except those related to the Factoring Agreement (as defined
      in the Secured Notes). Grantors (i) will have, at the time Grantors
      acquires any rights in Patents, Trademarks or Copyrights hereafter
      arising, absolute title to each such Patents, Trademarks and Copyrights
      free and clear of all Liens, and (ii) will keep all Patents, Trademarks
      and Copyrights free and clear of all Liens except Permitted Liens (as
      defined in the Secured Notes). 

	 	
      
	
      

	 	
      (f) 
	
      No Sale. Except as expressly permitted in
      the Security Agreement, no Grantor will not assign, transfer, encumber
      (whether by a Lien or otherwise), or otherwise dispose of a n y o f the
      Patents, Trademarks or Copyrights, or any interest therein, without the
      Secured Parties’ prior written consent. 

	 	
       
	 
	 	
      (g) 
	
      Defense. Grantors will at their own expense
      and using all its commercially best efforts, maintain, prosecute, enforce,
      protect and defend the Patents, Trademarks and Copyrights against all
      claims or demands of all persons. 

	 	
      
	
      

	 	
      (h) 
	
      Maintenance. Grantors will at its own
      expense maintain Patents, Trademarks and Copyright, including, but not
      limited to, filing all applications to obtain letters patent or trademark
      registrations and all affidavits, maintenance fees, annuities, and
      renewals possible with respect to letters patent, trademark registrations
      and applications therefor necessary and/or reasonably requested by the
      Collateral Agent. Grantors covenants that it will not abandon nor fail to
      pay any maintenance fee or annuity due and payable on any Patent,
      Trademark or Copyright, nor fail to file any required affidavit or renewal
      in support thereof. 

	 	
      
	
      

	 	
      (i) 
	
      The Secured Parties’ Right to Take Action. If any
      Grantor fails to perform or observe any of its covenants or agreements set
      forth in this Section 4, and If such failure continues for a period of
      five (5) calendar days after any Secured Party (or the Collateral Agent)
      gives any Grantor written notice thereof (or, in the case of the
      agreements contained in subsection (h), immediately upon the occurrence of
      such failure, without notice or lapse of time), or if any Grantor notifies
      the Secured Parties (or the Collateral Agent) that it intends to abandon a
      Patent, Trademark or Copyright, the Secured Parties (or the Collateral
      Agent) may require Grantors to take steps to prevent such intended
      abandonment, and may (but need not) take any and all other actions which
      the Secured Parties may reasonably deem necessary to cure or correct such
      failure or prevent such intended abandonment at Grantors sole cost and
      expense. 



4 





	 	(j) 	
      Costs and Expenses. Except to the extent
      that the effect of such payment would be to render any loan or forbearance
      of money usurious or otherwise illegal under any applicable law, Grantors
      shall pay the Secured Parties (or the Collateral Agent) on demand the
      amount of all moneys expended and all costs and expenses (including
      reasonable attorneys’ fees and disbursements) incurred by the Secured
      Parties (or the Collateral Agent) in connection with or as a result of the
      Secured Parties’ (or the Collateral Agent) taking action under subsection
      (i) or exercising its rights under Section 6, together with interest
      thereon from the date expended or incurred by the Secured Parties at the
    lower of (i) 22% and (ii) the maximum amount permitted by applicable law.      

	 	  	  
	 	(k) 	
      Power of Attorney. To facilitate the Secured Parties’ (or
      the Collateral Agent) taking action under subsection (i) and exercising
      its rights under Section 6, Grantors hereby irrevocably appoints (which
      appointment is coupled with an interest) the Collateral Agent, or its
      delegate, as the attorney-in-fact of Grantors with the right (but not the
      duty) from time to time to create, prepare, complete, execute, deliver,
      endorse or file, in the name and on behalf of Grantors, any and all
      instruments, documents, applications, financing statements, and other
      agreements and writings required to be obtained, executed, delivered or
      endorsed by Grantors under this Section 4, or, necessary for the
      Collateral Agent, after an Event of Default, to enforce or use the
      Patents, Copyrights and/or Trademarks or to grant or issue any exclusive
      or non- exclusive license under the Patents or Trademarks to any third
      party, or to sell, assign, transfer, pledge, encumber or otherwise
      transfer title in or dispose of the Patents, Copyrights and/or Trademarks
      to any third party. Grantors hereby ratifies all action that such attorney
      shall lawfully do or cause to be done by virtue hereof. The power of
      attorney granted herein shall terminate upon the receipt by each Secured
      Party of all amounts owed to them by all Grantors under the Secured Notes
    and related Transaction Documents in full and in cash. 

			


5.                  Use of the Patents, Trademarks or Copyrights.
Grantors shall be permitted to control and manage the Patents, Trademarks or
Copyrights, including the right to exclude others from making, using or selling
items covered by the Patents, Trademarks and Copyrights and any licenses
thereunder, in the same manner and with the same effect as if this this IP
Security Agreement had not been entered into, so long as no Event of Default
occurs and remains uncured. 

6.                  Events of Default. Each of the following occurrences
shall constitute an event of default under this this IP Security Agreement
(herein called “Event of Default”): (a) an Event of Default, as defined
in any of the Secured Note, shall occur; or (b) any Grantor shall fail promptly to observe or perform any covenant or agreement
herein binding on it; or (c) any of the representations or warranties contained
in any of the Secured Notes, Security Agreement and/or other Transaction
Documents shall prove to have been incorrect in any material respect when made.

5 




(a)                  Remedies. Upon the
occurrence of an Event of Default and at any time thereafter, the Collateral
Agent may, at its option, take any or all of the following actions: 

	 	
      (a) 
	
      the Collateral Agent may exercise any or all remedies
      available under the Secured Notes or the Security Agreement and/or any
      Transaction Documents. 

	 	
      
	
      

	 	
      (b) 
	
      the Collateral Agent may institute an action to and/or
      sell, assign transfer, pledge, encumber or otherwise dispose of the
      Patents, Trademarks and/or Copyrights.

	 	
       
	
      

	 	
      (c) 
	
      the Collateral Agent may enforce the Patents, Trademarks
      and Copyrights and any licenses thereunder, and if the Collateral Agent
      shall commence any suit for such enforcement, Grantors shall, at the
      request of the Secured Parties, do any and all lawful acts and execute any
      and all proper documents required by the Secured Parties in aid of such
      enforcement. 



7.                  Miscellaneous. This IP Security Agreement can be
waived, modified, amended, terminated or discharged, and the IP Collateral can
be released, only explicitly in a writing signed by the Collateral Agent. At
such time as all funds owed to each holder of Secured Notes has been received in
cash by each such holder from the Grantors, the Secured Parties shall release
the IP Collateral and execute such documentation provided by the Grantors (at
Grantors sale cost and expense) that Grantor deems reasonably necessary to
release the IP Collateral, provided no such document could have a material
adverse effect on any Secured Party and/or the Collateral Agent and the Grantors
provided to each Secured Party and the Collateral Agent a general release. A
waiver signed by the Secured Parties shall be effective only in the specific
instance and for the specific purpose given. Mere delay or failure to act shall
not preclude the exercise or enforcement of any of the Secured Parties’ rights
or remedies. All rights and remedies of the Secured Parties shall be cumulative
and may be exercised singularly or concurrently, at the Secured Parties’ option,
and the exercise or enforcement of any one such right or remedy shall neither be
a condition to nor bar the exercise or enforcement of any other. All notices to
be given to Grantors under this this IP Security Agreement shall be given in the
manner and with the effect provided in the SecuredNote. The Secured Parties
shall not be obligated to preserve any rights Grantors may have against prior
parties, to realize on the Patents, Trademarks and Copyrights at all or in any
particular manner or order, or to apply any cash proceeds of Patents, Trademarks
or Copyrights in any particular order of application. This IP Security Agreement
shall be binding upon and inure to the benefit of Grantors and the Secured
Parties and their respective participants, successors and assigns and shall take
effect when signed by Grantors and delivered to the Secured Parties, and
Grantors waive notice of the Secured Parties’ acceptance hereof. The Secured
Parties may execute this IP Security Agreement if appropriate for the purpose of
filing, but the failure of the Secured Parties to execute this IP Security
Agreement shall not affect or impair the validity or effectiveness of this IP
Security Agreement. A carbon, photographic or other reproduction of this IP
Security Agreement or of any financing statement signed by Grantors shall have
the same force and effect as the original for all purposes of a financing
statement. This IP Security Agreement shall be governed by the internal law of
New York without regard to conflicts of law provisions. If any provision or
application of this IP Security Agreement is held unlawful or unenforceable in
any respect, such illegality or unenforceability shall not affect other
provisions or applications which can be given effect and this IP Security
Agreement shall be construed as if the unlawful or unenforceable provision or
application had never been contained herein or prescribed hereby. All
representations and warranties contained in this IP Security Agreement shall
survive the execution, delivery and performance of this IP Security Agreement
and the creation and payment of all amounts owed to each holder of Secured Notes
by the Grantors under the Secured Notes and/or the Transaction Documents. 

6 




8.                  Execution in Counterparts. This IP Security Agreement
may be executed in counterparts (and by different parties hereto in different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. Delivery of an executed
counterpart of a signature page to this IP Security Agreement by facsimile or in
electronic (i.e., "pdf" or "tif") format shall be effective as delivery of a
manually executed counterpart of this IP Security Agreement. 

9.                  Successors and Assigns. This IP Security Agreement
will be binding on and shall inure to the benefit of the parties hereto and
their respective successors and assigns. No Grantor may assign this Agreement,
any IP Collateral and/or obligation hereunder without the express written
consent of the Collateral Agent. 

10.                  Governing Law. This IP Security Agreement and the
terms and conditions set forth herein, shall be governed by and construed solely
and exclusively in accordance with the internal laws of the State of New York
without regard to the conflicts of laws principles thereof. The parties hereto
hereby expressly and irrevocably agree that any suit or proceeding arising
directly and/or indirectly pursuant to or under this Agreement shall be brought
solely in a federal or state court located in the City, County and State of New
York. By its execution hereof, the parties hereto covenant and irrevocably
submit to the in personam jurisdiction of the federal and state courts located
in the City, County and State of New York and agree that any process in any such
action may be served upon any of them personally, or by certified mail or
registered mail upon them or their agent, return receipt requested, with the
same full force and effect as if personally served upon them in New York, New
York. The parties hereto expressly and irrevocably waive any claim that any such
jurisdiction is not a convenient forum for any such suit or proceeding and any
defense or lack of in personam jurisdiction with respect thereto. In the event
of any such action or proceeding, the party prevailing therein shall be entitled
to payment from the other parties hereto of all of its reasonable counsel fees
and disbursements. 

7 




[SIGNATURE PAGE FOLLOWS] 

8 




IN WITNESS WHEREOF, each Grantor has caused this IP Security
Agreement to be duly executed and delivered by its officer thereunto duly
authorized as of the date first above written. 

VISCOUNT SYSTEMS, INC., 
a Nevada corporation 

	By: 	 	 
	 	 	 
	Name: 	 	 
	 	 	 
	Title: 	 	 
	 	 	 
	Date: 	 	 


VISCOUNT COMMUNICATION AND CONTROL SYSTEMS INC. 
A
British Columbia corporation 

	By: 	 	 
	 	 	 
	Name: 	 	 
	 	 	 
	Title: 	 	 
	 	 	 
	Date: 	 	 


AGREED TO AND ACCEPTED: 
as Collateral Agent 
ONE EAST
CAPITAL ADVISORS, L.P. 

	By: 	 	 
	 	 	 
	Name: 	 	 
	 	 	 
	Title: 	 	 
	 	 	 
	Date: 	 	 


9 




SCHEDULE 1 – ISSUED PATENTS AND PATENT APPLICATIONS 

United States Patent No. 8854177, issued October 7, 2014, in
the name of Viscount Security Systems Inc., entitled “System, Method and
Database for Managing Permissions to Use Physical Devices and Logical Assets;”


United States Patent No. 8907763, issued December 9, 2014, in
the name of Viscount Security Systems Inc., entitled “System, Station and Method
for Mustering;” 

United States Patent No. 8941465, issued January 27, 2015, in
the name of Viscount Security Systems Inc., entitled “System and Method for
Secure Entry Using Door Tokens;” 

United States Patent No. 8836470, issued September 16, 2014, in
the name of Viscount Security Systems, Inc., entitled “System and Method for
Interfacing Facility Access with Control;” 

United States Patent Application No. 14/014,351, filed August
30, 2013, for “Door Lock, System and Method for Remotely Controlled Access;”

Canadian Patent No. 2870058, issued September 29, 2015, in the
name of Viscount Systems Inc., entitled “Device, System, Method and Database for
Managing Permissions to Use Physical Devices and Logical Assets;” 

Canadian Patent No. 2854613, issued September 29, 2015, in the
name of Viscount Systems Inc., entitled “Device, System, Method and Database for
Managing Permissions to Use Physical Devices and Logical Assets;” 

10 




SCHEDULE 2 – TRADEMARK REGISTRATIONS AND APPLICATIONS


ENTER PHONE – United States Trademark Reg. No. 1623361, issued
November 20, 1990, owned by Viscount Communications and Control Systems
Corporation; 

ENTERPHONE - Canadian Trademark Reg. No. TMA192854, issued July
27, 1973, in the name of Viscount Communication and Control Systems Inc.;

11 




SCHEDULE 3 – COPYRIGHT REGISTRATIONS AND APPLICATIONS


None Registered 

12