EX-10.2






Execution Copy




SECURITY AGREEMENT




VIASPACE, INC., a Nevada corporation, whose principal place of business and mailing address is
2102 Business Center Drive, suite 130, Irvine, CA 92612 (hereinafter “Debtor”), hereby
grants to SUNG HSIEN CHANG (hereinafter sometimes “Noteholder” or “Secured Party”)
a continuing security interest in and to, and a lien on, and hereby assigns to Secured Party as
collateral, all of the “Collateral”, as defined in Section 2 of this Agreement. In
addition, Debtor and Secured Party hereby agree as follows:



1. OBLIGATIONS: The security interest hereby granted shall secure the full, prompt and complete
payment and performance of all of the payment obligations of Debtor to pay principal, interest, or
other amounts (the “Secured Obligations”) under the Secured Promissory Note dated as of the
14th day of May 2010 issued by Debtor in favor of Noteholder (as the same may be amended, renewed,
consolidated, restated or replaced from time to time, the “Secured Note”). Capitalized
terms used herein but not otherwise defined herein shall have the meanings ascribed to such terms
in the Secured Note.



2. COLLATERAL: The collateral in which a security interest is hereby granted comprises all of the
assets and property, real and personal, tangible and intangible, of Debtor, whether now owned or
existing or hereafter arising or acquired, regardless of where any such property is located,
including all of Debtor’s rights, titles and interests in and to the following, whether now owned
or existing or hereafter arising or acquired, regardless of where any such property is located,
excluding, however, shares of stock or other equity owned by Debtor in Direct
Methanol Fuel Cell Corporation (DMFCC) and Ionfinity LLC (all of such assets and all of the below
described assets being, collectively, the “Collateral”):



(a) all Accounts, all Inventory, all Equipment, all trademarks, all General Intangibles, and
all Investment Property (each as defined in Section 3 of this Agreement);



(b) without limiting the description of the property or any rights or interests in the
property described above in this definition of Collateral, all goods, deposit accounts,
instruments, chattel paper (including tangible chattel paper and electronic chattel paper),
documents, securities, money, cash, letters of credit, letter-of-credit rights, promissory notes,
warrants, dividends, distributions, the commercial tort claims listed on Exhibit B attached
to this Agreement, contracts, agreements, contract rights and other property owned by Debtor or in
which Debtor has any rights or an interest, including those which are now or hereafter in the
possession or control of Secured Party or in transit by mail or carrier to or in the possession of
any third party acting on behalf of Secured Party, without regard to whether Secured Party received
the same in pledge, for safekeeping, as agent for collection or transmission or otherwise or
whether Secured Party had conditionally released the same, all rights to payment from, and all
claims against Secured Party, all as-extracted collateral, leases, lease contracts, lease
agreements, and proceeds of a letter of credit;



(c) without limiting the description of the property or any rights or interests in the
property described above in this definition of Collateral, all supporting obligations;



(d) without limiting the description of the property or any rights or interests in the
property described above in this definition of Collateral, all farm products including all crops
grown, growing, or to be grown, and all livestock and the born and unborn offspring thereof;



(e) without limiting the description of the property or any rights or interests in the
property described above in this definition of Collateral, all minerals or the like and accounts
resulting from sales at the wellhead or minehead, as well as all standing timber which is to be cut
and removed under a conveyance or contract for sale; and



(f) all products and cash proceeds and noncash proceeds (including all rents, revenues,
issues, and profits arising from the sale, lease, license, encumbrance, collection, or any other
temporary or permanent disposition of any and all of the property described above in this
definition of Collateral or any interest therein) of any and all of the property described above in
this definition of Collateral, and all additions, accessions, attachments, parts, appurtenances and
improvements to, replacements and substitutions of, and all supporting obligations for, guaranties
of, insurance or condemnation proceeds of, and documents covering, the property described above in
this definition of Collateral, all sales of accounts, all tort or other claims against third
parties arising out of damage or destruction of property described above in this definition of
Collateral, and all property received wholly or partly in trade or exchange for property described
above in this definition of Collateral.



3. DEFINITIONS: As used herein, the following capitalized terms will have the following meanings:



(a) “Accounts” means all accounts, accounts receivable, health-care-insurance
receivables, credit card receivables, contract rights, instruments, documents, chattel paper, tax
refunds from foreign, federal, state or local governments and all obligations in any form including
those arising out of the sale or lease of goods or the rendition of services by Debtor; all
guaranties, letters of credit and other security and supporting obligations for any of the above;
all merchandise returned to or reclaimed by Debtor; and all books and records (including computer
programs, tapes and data processing software) evidencing an interest in or relating to the above;
all winnings in a lottery or other game of chance operated by a governmental unit or entity
licensed to operate such game by a governmental unit and all rights to payment therefrom; and all
“accounts” as the same is now or hereinafter defined in the Georgia UCC (as hereafter defined).



(b) “Equipment” means all goods (other than Inventory, farm products or consumer
goods), machinery, machine tools, equipment, fixtures, office equipment, furniture, furnishings,
motors, motor vehicles, tools, dies, parts, jigs (including each of the items of equipment set
forth on any schedule which is either now or in the future attached to Secured Party’s copy of this
Agreement), and all attachments, accessories, accessions, replacements, substitutions, additions
and improvements thereto, all supplies used or useful in connection therewith, and all “equipment”
as the same is now or hereinafter defined in the Georgia UCC.



(c) “General Intangibles” means all general intangibles, choses in action, causes of
action, obligations or indebtedness owed to Debtor from any source whatsoever, payment intangibles,
software and all other intangible personal property of every kind and nature (other than Accounts)
including patents, trademarks, trade names, service marks, copyrights, patent applications,
trademark or service mark applications, copyright applications and goodwill, trade secrets,
licenses, franchises, rights under agreements, tax refund claims, insurance refunds, insurance
refund claims, pension plan refunds, pension plan reversions, and all books and records including
all computer programs, disks, tapes, printouts, customer lists, credit files and other business and
financial records, the equipment containing any such information, and all “general intangibles” as
the same is now or hereinafter defined in the Georgia UCC.



(d) “Inventory” means all goods (other than Equipment, farm products or consumer
goods), supplies, wares, merchandises and other tangible personal property, including raw
materials, work in process, supplies and components, and finished goods, whether held for sale or
lease, or furnished or to be furnished under any contract for service, or used or consumed in
business, and also including products of and accessions to inventory, packing and shipping
materials, all documents of title, whether negotiable or non-negotiable, representing any of the
foregoing, and all “inventory” as the same is now or hereinafter defined in the Georgia UCC.



(e) “Investment Property” means all securities, whether certificated or
uncertificated, financial assets, security entitlements, securities accounts, commodity contracts
or commodity accounts; and all “investment property” as the same is now or hereafter defined in the
Georgia UCC; excluding, however, shares of stock or other equity owned by Debtor in
Direct Methanol Fuel Cell Corporation (DMFCC) and Ionfinity LLC.



(f) "Trademarks” shall mean all Trademarks used and/or registered by Debtor as set
forth in the Schedule attached as Exhibit C.



(g) “Uniform Commercial Code” means the Uniform Commercial Code as adopted in each
applicable jurisdiction, as amended or superceded from time to time. The “Georgia UCC”
means the Uniform Commercial Code, as adopted in Georgia, as amended or superceded from time to
time.



All of the uncapitalized terms contained in this Agreement which are now or hereafter defined
in the Georgia UCC will, unless the context expressly indicates otherwise, have the meanings
provided for now or hereafter in the Georgia UCC, as such definitions may be enlarged or expanded
from time to time by amendment or judicial decision.



4. REPRESENTATIONS AND WARRANTIES: Debtor represents and warrants to Noteholder that the following
statements are, and will continue as long as the Note is outstanding or any Secured Obligations
unpaid, to be, true:



(a) Debtor is a corporation with its chief executive office and mailing address located at the
address set forth on Exhibit A and is organized in the State of Nevada, with an
organizational number as set forth on Exhibit A. Debtor further warrants that its exact
legal name is set forth in the first paragraph of this Agreement. Debtor’s federal tax
identification number is as set forth on Exhibit A. Exhibit A attached to this
Agreement lists the location of any and all of the Collateral that consists of documents,
equipment, instruments, inventory, or tangible chattel;



(b) Debtor is, and as to any property which at any time forms a part of the Collateral, shall
be, the owner of each and every item of the Collateral, or otherwise have the right to grant a
security interest in the Collateral, free from any lien or security interest, except for the liens
and security interests (i) in favor of Secured Party, (ii) created by Secured Party in his
individual capacity against the Collateral, (iii) of which Secured Party has Knowledge as of the
Closing, but which are unknown to Debtor or any Affiliate thereof; or (iv) claims asserted by Frank
Steele.



(c) Debtor has full right to grant the security interest hereby granted. Debtor shall defend
the Collateral and each and every part thereof against all claims of all third parties at any time
claiming any of the Collateral or claiming any interest therein adverse to Secured Party except for
the lien created by this Agreement and claims by third parties regarding the Collateral to the
extent caused by Secured Party in his individual capacity;



(d) as to any Accounts which are or become part of the Collateral, each such Account is a
valid Account and that no such Account shall be sold, assigned, transferred, discounted,
hypothecated, or otherwise subjected to any lien or security interest, and Debtor shall defend such
Accounts against all claims of any third party whosoever;



(e) if any of the Collateral is or will be attached to real estate in such a manner as to
become a fixture under applicable state law, Debtor will secure from the lien holder or the party
in whose favor it is or, at Secured Party’s option, will become so encumbered a written consent and
subordination to the security interest hereby granted or a written disclaimer of any interest in
the Collateral, in such form as is acceptable to Secured Party;



(f) all trade names, assumed names, fictitious names and other names used by Debtor during the
five year period preceding the date of this Agreement are set forth on Exhibit A, and
Debtor has not, during the preceding five year period, except as may be set forth on Exhibit
A, acquired any of its assets in any bulk transfer;



(g) except as set forth on Exhibit B, Debtor has no rights, titles or interests in, or
with respect to, any investment property, deposit accounts, letters of credit, electronic chattel
paper, or any instruments, including promissory notes, except checks received in the ordinary
course of business in payment of Accounts.



5. DEBTOR’S RESPONSIBILITIES:



(a) Until the Secured Obligations are fully paid, performed and satisfied and this Agreement
is terminated, Debtor will:



(i) furnish to Secured Party in writing upon Secured Party’s reasonable request (but if no
Event of Default has occurred and is continuing, no more frequently than quarterly) a current list
of all Collateral for the purpose of identifying the Collateral and, further, execute and deliver
such supplemental instruments, in the form of assignments or otherwise, as Secured Party shall
reasonably request for the purpose of confirming and perfecting Secured Party’s security interest
in any or all of the Collateral, or as is reasonably necessary to provide Secured Party with
control over the Collateral or any portion thereof;



(ii) at its expense and upon request of Secured Party (but if no Event of Default has occurred
and is continuing, no more frequently than quarterly), furnish copies of invoices issued by Debtor
in connection with the Collateral, furnish certificates of insurance evidencing insurance on the
Collateral in accordance with the Secured Note, furnish proof of payment of taxes and assessments
on the Collateral, make available to Secured Party any and all of Debtor’s books, records, written
memoranda, correspondence, purchase orders, invoices and other instruments or writings that in any
way evidence or relate to the Collateral;



(iii) maintain all Inventory in good and salable condition exclusive of slow-moving, obsolete
or damaged Inventory for which reserves or write-downs have been made on Debtor’s books and records
in the ordinary course of business and will handle, maintain and store the Collateral in a safe and
careful manner in material compliance with all applicable laws, rules, regulations, ordinances and
governmental orders;



(iii) notify Secured Party promptly in writing of any information which Debtor has or may
receive which might in any way materially adversely affect the value of the Collateral or the
rights of Secured Party with respect thereto;



(iv) notify Secured Party at least fifteen days in advance in writing of any change in
Debtor’s (A) chief executive office, principal place of business, or other places of business, or
the opening of any new places of business, (B) exact legal name as set forth in the first paragraph
of this Agreement, (C) names from those set forth on Exhibit A, or (D) the adoption by
Debtor of trade names, assumed names or fictitious names;



(v) pay all costs of filing any financing, continuation or termination statements with respect
to the security interest created hereby;



(vii) pay all expenses and reasonable attorneys’ fees of Secured Party incurred by Secured
Party in the exercise (including enforcement) of any of Secured Party’s rights or remedies under
this Agreement or applicable law; and Debtor agrees that said expenses and fees shall constitute
part of the Secured Obligations and be secured by the Collateral;



(viii) maintain possession of all tangible Collateral at the locations set forth on
Exhibit A and not remove the Collateral from those locations (except for Inventory in
transit, sales of Inventory, permitted use of other Collateral and proceeds thereof in the ordinary
course of business and disposal of Equipment [as permitted by the Transaction Documents]) without
giving Secured Party at least 15 days prior notice of such action and complying with the other
terms of this Agreement; provided that such location is within the [continental United States];



(ix) promptly notify Secured Party in writing of any contract with respect to which the
account debtor is (A) a United States Account Debtor, (B) any state, city, county or other
governmental authority (other than a United States Account Debtor) or any department, agency or
instrumentality of any of them, or any foreign government or instrumentality thereof, if at any
time, the account debtor owes Debtor, in the aggregate, in excess of $20,000, or (C) a business
which is located in a foreign country;



(vi) take any other and further action reasonably necessary or desirable as requested by
Secured Party to grant Secured Party control over the Collateral, including the execution and/or
authentication of any assignments or third party agreements; upon and during the continuation of an
Event of Default, to obtain delivery of the Collateral to the possession of Secured Party; or to
obtain acknowledgments of the lien of Secured Party from third parties in possession of any
Collateral. Debtor agrees to consent to and authorize any third party in an authenticated record
or agreement between Debtor, Secured Party, and the third party, including depository institutions,
securities intermediaries, and issuers of letters of credit or other supporting obligations to
accept direction from Secured Party regarding the maintenance and disposition of the Collateral and
the products and proceeds thereof, and to enter into agreements with Secured Party regarding same,
without further consent of Debtor;



(xi) if Debtor shall at any time hold or acquire a commercial tort claim, promptly notify
Secured Party in a writing signed by Debtor of the particulars thereof and grant to Secured Party
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 Secured Party;



(xii) deliver to Secured Party, promptly on Secured Party’s request, any instrument (whether
negotiable or non-negotiable) or any chattel paper that evidences any amount payable under or in
connection with any of the Collateral, which, in each instance, is duly indorsed to Secured Party
in a manner acceptable to it, to be held as Collateral pursuant to this Agreement;



(xiii) not, without the prior written consent of Secured Party, change the form of or the
jurisdiction of Debtor’s organization;



(xiv) not back date, post date or redate any invoice issued by Debtor with respect to any
Account; and



(xv) on Secured Party’s request, deliver to Secured Party any and all evidences of ownership
of the Collateral, including any certificates of title and applications for title pertaining to
Debtor’s motor vehicles so that Secured Party may cause its security interest and lien to be noted
on such certificates of title. Debtor will not permit any of the Equipment to become an accession
to other personal property not constituting part of the Collateral.



(b) To protect, perfect, or enforce, from time to time, Secured Party’s rights or interests in
the Collateral, Secured Party may, in its discretion (but without any obligation to do so), (i)
discharge any liens or security interests (other than those created by this Agreement) at any time
levied or placed on the Collateral, (ii) pay any insurance to the extent Debtor has failed to
timely pay the same, (ii) maintain guards, if an Event of Default has occurred and is continuing,
(A) at Debtor’s chief executive offices or (B) where any Collateral constituting documents,
equipment, instruments, inventory, or tangible chattel paper with a value in excess of $10,000 is
located, and (iv) obtain any record from any service bureau and pay such service bureau the cost
thereof. All costs and expenses incurred by Secured Party in exercising its discretion under this
subparagraph (b) will be part of the Secured Obligations, payable on Secured Party’s demand and
secured by the Collateral.



(c) Debtor shall remain liable under any contracts and agreements included in the Collateral
to perform all of its duties and obligations thereunder to the same extent as if this Agreement had
not been executed, and Secured Party shall not have any obligation or liability under such
contracts and agreements by reason of this Agreement or otherwise.



6. ACCOUNTS:



(a) Debtor hereby agrees that Secured Party may, upon the occurrence and during the
continuation of an Event of Default, serve written notice on Debtor instructing Debtor to deliver
to Secured Party all subsequent payments on Accounts which Debtor shall do until notified
otherwise.



(b) Secured Party may, upon the occurrence and during the continuation of an Event of Default,
notify the account debtor(s) of its security interest and instruct such account debtor(s) to make
further payments on Accounts to Secured Party instead of to Debtor.



(c) Secured Party may also, at any time and from time to time, in its own name or in the name
of others, periodically communicate with Debtor’s account debtors and other obligors to verify with
them, to Secured Party’s satisfaction, the existence, amount and terms of any sums owed by such
account debtors or other obligors to Debtor and the nature of any such account debtor’s or other
obligor’s relationship with Debtor. In addition, Secured Party may also, upon the occurrence or
during the continuation of an Event of Default, communicate with Debtor’s customers to verify with
them, to Secured Party’s satisfaction, the existence and the nature of any such customer’s
relationship with Debtor.



(d) Secured Party may, upon the occurrence and during the continuation of an Event of Default,
serve written notice upon Debtor that all subsequent billings or statements of account rendered to
any account debtor shall bear a notation directing the account debtor(s) to make payment directly
to Secured Party. Any payment received by Secured Party pursuant to this Section shall be retained
in a separate non-interest-bearing account as security for the payment of all Secured Obligations.



7. POWER OF ATTORNEY: Debtor hereby makes, constitutes and appoints Secured Party its true and
lawful attorney in fact to act with respect to the Collateral in any transaction, legal proceeding,
or other matter in which Secured Party is acting pursuant to this Agreement. Debtor: (i)
specifically authorizes Secured Party as its true and lawful attorney in fact to execute and/or
authenticate on its behalf and/or file financing statements reflecting its security interest in the
Collateral and any other documents reasonably necessary or desirable to perfect or otherwise
further the security interest granted herein; (ii) specifically authorizes Secured Party to act as
its true and lawful attorney in fact to execute and/or authenticate any third party agreements or
assignments to grant Secured Party control over the Collateral, including third party agreements
between Debtor, Secured Party, and depository institutions, securities intermediaries, and issuers
of letters of credit or other supporting obligations which third party agreements direct the third
party to accept direction from Secured Party regarding the maintenance and disposition of the
Collateral and the products and proceeds thereof, such power of attorney to be exercised after the
occurrence and during the continuation of an Event of Default or after Debtor’s failure to so
execute and/or authenticate after Secured Party’s request therefor after the occurrence and during
the continuation of an Event of Default; and (iii) specifically authorizes Secured Party, upon the
occurrence and during the continuation of an Event of Default, to issue, without further consent of
Debtor, all (a) instructions to any bank at which any deposit account is maintained with respect to
all existing or future funds held in such deposit account and (b) exclusive entitlement orders to
all securities intermediaries with respect to all existing or future investment property held in
any securities account maintained by such securities intermediary. Debtor recognizes and agrees
that this power of attorney is a power coupled with an interest and shall be irrevocable. Debtor
ratifies and confirms all actions taken by the Secured Party or its agents pursuant to this power
of attorney.



8. DEFAULT: If an Event of Default occurs and is continuing, then, in any such event, Secured
Party may, without further notice to Debtor, at Secured Party’s option, take all actions permitted
under the Secured Note. In addition, Secured Party may resort to the rights and remedies available
at law, in equity and under the Transaction Documents, including the rights and remedies of a
secured party under the Uniform Commercial Code, including the right (i) to enter any premises of
Debtor, with or without legal process and take possession of the Collateral and remove it and any
records pertaining thereto and/or remain on such premises and use it for the purpose of collecting,
preparing and disposing of the Collateral; (ii) to ship, reclaim, recover, store, finish, maintain
and repair the Collateral; and (iii) to sell the Collateral at public or private sale in a manner
that complies in all material respects with all applicable laws, and Debtor will be credited with
the net proceeds of such sale, after payment in full of all Obligations, only when they are
actually received by Secured Party; any requirement of reasonable notice of any disposition of the
Collateral will be satisfied if such notice is sent to Debtor 10 days prior to such disposition.
Debtor will, upon request, assemble the Collateral and any records pertaining thereto and make them
available at a place designated by Secured Party. Moreover, Secured Party may, without notice to
Debtor, apply for and have a receiver appointed under state or federal law by a court of competent
jurisdiction in any action taken by Secured Party to enforce its rights and remedies under this
Agreement and, as applicable, Secured Note and the other Transaction Documents in order to manage,
protect, preserve, and sell and otherwise dispose of all or any portion of the Collateral and/or
continue the operation of the business of Debtor, and to collect all revenues and profits thereof
and apply the same to the payment of all expenses and other charges of such receivership, including
the compensation of the receiver, and to the payment of the Secured Obligations until a sale or
other disposition of such Collateral is finally made and consummated. Secured Party may use, in
connection with any assembly or disposition of the Collateral, any trademark, tradename,
tradestyle, copyright, patent right, trade secret or technical process used or utilized by Debtor.
No remedy set forth herein is exclusive of any other available remedy or remedies, but each is
cumulative and in addition to every other remedy given under this Agreement, the Secured Note or
now or hereafter existing at law or in equity or by statute. Secured Party may proceed to protect
and enforce its rights by an action at law, in equity or by any other appropriate proceedings. No
failure on the part of Secured Party to enforce any of the rights hereunder shall be deemed a
waiver of such rights or of any Event of Default and no waiver of any Event of Default will be
deemed to be a waiver of any subsequent Event of Default. Moreover, Debtor acknowledges and agrees
that Secured Party shall have no obligation to, and Debtor hereby waives to the fullest extent
permitted by law any right that it may have to require Secured Party to, (a) clean up or otherwise
prepare any of the Collateral for sale, (b) pursue any third party to collect any of the
Obligations, or (c) exercise collection remedies against any third party obligated on the
Collateral. Secured Party’s compliance with applicable local, state or federal law requirements,
in addition to those imposed by the Uniform Commercial Code, in connection with a disposition of
any or all of the Collateral will not be considered to adversely affect the commercial
reasonableness of any disposition of any or all of the Collateral under the Uniform Commercial
Code.



9. GENERAL PROVISIONS:



(a) All rights of Secured Party shall inure to the benefit of its successors, assigns and
affiliates and all obligations of Debtor shall bind the successors and assigns of Debtor.



(b) This Agreement, the Secured Note and the other Transaction Documents contain the entire
agreement of the parties with respect to the subject matter of this Agreement and supercede all
previous understandings and agreements relating to the subject matter hereof, and no oral agreement
whatsoever, whether made contemporaneously herewith or hereafter shall amend, modify or otherwise
affect the terms of this Agreement.



(c) All rights and liabilities hereunder shall be governed and limited by and construed in
accordance with the local laws of the State of Georgia (without regard to Georgia conflicts of law
principles).



(d) If any provision of this Agreement is found invalid by a court of competent jurisdiction,
the invalid term will be considered excluded from this Agreement and will not invalidate the
remaining provisions of this Agreement.



(e) Debtor hereby authorizes Secured Party to file a copy of this Agreement as a financing
statement with government authorities necessary to perfect Secured Party’s security interest in the
Collateral. Debtor hereby irrevocably authorizes Secured Party at any time and from time to time
to file in any filing office in any jurisdiction any initial financing statements and amendments
thereto that (i) indicate the Collateral (A) as all assets of Debtor, whether now owned or
hereafter acquired or arising, and all proceeds and products thereof and (B) as being of an equal
or lesser scope or with greater detail, and (ii) provide any other information required by Part 5
of Article 9 of the Uniform Commercial Code for the sufficiency or filing office acceptance of any
financing statement or amendment, including whether Debtor is an organization, the type of
organization and any organizational identification number issued to Debtor. Debtor hereby
irrevocably authorizes Secured Party at any time and from time to time to correct or complete, or
to cause to be corrected or completed, any financing statements, continuation statements or other
such documents as have been filed naming Debtor as debtor and Secured Party as secured party.
Secured Party is hereby authorized to give notice to any creditor, landlord or any other person as
may be necessary or desirable under applicable laws to evidence, protect, perfect, or enforce the
security interest granted to Secured Party in the Collateral.



(f) Secured Party shall have no duty of care with respect to the Collateral except that
Secured Party shall exercise reasonable care with respect to the Collateral in Secured Party’s
custody. Secured Party shall be deemed to have exercised reasonable care if (A) such property is
accorded treatment substantially equal to that which Secured Party accords its own property or (B)
Secured Party takes such action with respect to the Collateral as Debtor shall reasonably request
in writing. Secured Party will not be deemed to have, and nothing in this subparagraph (g) may be
construed to deem that Secured Party has, failed to exercise reasonable care in the custody or
preservation of Collateral in its possession merely because either (1) Secured Party failed to
comply with any request of Debtor or (2) Secured Party failed to take steps to preserve rights
against any third party in such property. Debtor agrees that Secured Party has no obligation to
take steps to preserve rights against any prior parties.



(g) Any capitalized term used but not defined herein shall have the meaning ascribed thereto
in the Secured Note. The definition of any document, instrument or agreement includes all
schedules, attachments and exhibits thereto and all renewals, extensions, supplements, restatements
and amendments thereof. All schedules, exhibits or other attachments to this Agreement are
incorporated into, and are made and form an integral part of, this Agreement for all purposes. As
used in this Agreement, “hereunder,” “herein,” “hereto,” “this Agreement” and words of similar
import refer to this entire document; “including” is used by way of illustration and not by way of
limitation, unless the context clearly indicates the contrary; the singular includes the plural and
conversely; and any action required to be taken by Debtor is to be taken promptly, unless the
context clearly indicates the contrary.



(h) The transactions contemplated in this Security Agreement shall be governed as to validity,
interpretation, construction, effect, and in all other respects by the laws of the State of
Georgia, without regard to the conflicts of laws principals thereof. Debtor irrevocably submits to
the exclusive jurisdiction of the courts of the State of Georgia located in the County of Cobb and
the United States District Court in and for the Northern District of Georgia for the purpose of any
suit, action, proceeding or judgment relating to or arising out of this Security Agreement and the
transactions contemplated thereby. Borrower irrevocably consents to the jurisdiction of any such
court in any such suit, action or proceeding and to the laying of venue in such court, irrevocably
waives any objection to the laying of venue of any such suit, action or proceeding brought in such
courts, and irrevocably waives any claim that any such suit, action or proceeding brought in any
such court has been brought in an inconvenient forum. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT
TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS SECURITY AGREEMENT AND REPRESENTS
THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.



This Security Agreement (as used hereinabove, this “Agreement”) is made and dated as
of the 14th day of May 2010.



	 	 	 
	VIASPACE, INC.	 	SUNG HSIEN CHANG
	By:

	 	By:
	 

	 	 
	Name:     

Title:      

	 	









(a)



EXHIBIT A




Debtor’s Organizational Identification



VIASPACE Inc. incorporated in Nevada



Debtor’s Federal Tax Identification Number:



76-0742386



Debtor’s Chief Executive Office and Mailing Address:



VIASPACE Inc.


2102 Business Center Dr., Suite 130


Irvine, CA 92612



Debtor’s Offices or Locations Where any Collateral is Located:



VIASPACE Inc.


2102 Business Center Dr., Suite 130


Irvine, CA 92612



Trade Names, Assumed Names and Fictitious Names:



A. Currently in Use



None



B. Used During Last Five Years but not Currently in Use



None



Assets Acquired in Bulk Transfer:



Section 1.01



None



1



EXHIBIT B




Commercial Tort Claims:


None



Investment Property:




	 	1.	 	Common and Preferred Stock in Direct Methanol Fuel Cell Corporation






	 	2.	 	Membership Interests in Ionfinity LLC






	 	3.	 	Common Stock in VIASPACE Green Energy, Inc.






	 	4.	 	Merrill Lynch Bank Account at Merrill Lynch, 4141 Inland Empire Blvd., Ontario, CA
91764





Electronic Chattel Paper:


None



Instruments:


None



Deposit Accounts:


Merrill Lynch


4141 Inland Empire Blvd.


Ontario, CA 91764



Other Accounts used in operations



Letters of Credit:


None



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EXHIBIT C




Trademarks




“VIASPACE”




3