EXECUTION
COPY


 


INTELLECTUAL
PROPERTY SECURITY AGREEMENT


 


This
INTELLECTUAL PROPERTY SECURITY AGREEMENT (as amended, modified, supplemented, renewed, restated or replaced from time to time,
this “IP Security Agreement”), dated August 19, 2019, is made by the Persons listed on the signature pages
hereof (collectively, the “Grantors”) in favor of Alto Opportunity Master Fund, SPC - Segregated Master Portfolio
B, in its capacity as collateral agent (the “Collateral Agent”) for the Noteholders. All capitalized terms
not otherwise defined herein shall have the meanings respectively ascribed thereto in the Security Agreement (as defined below).


 


WHEREAS,
Toughbuilt Industries, Inc., a Nevada corporation (the “Company”), and each party listed as a “Buyer”
therein (collectively, the “Buyers”) are parties to that certain Securities Purchase Agreement, dated August
19, 2019, pursuant to which the Company shall be required to sell, and the Buyers shall purchase or have the right to purchase,
the “Notes” and “Warrants” (each as defined therein) issued pursuant thereto (as such Notes or Warrants
may be amended, modified, supplemented, renewed, restated or replaced from time to time in accordance with the terms thereof,
collectively, the “Notes” and “Warrants”, respectively);


 


WHEREAS,
it is a condition precedent to the purchase of the Notes and Warrants under the Securities Purchase Agreement that each Grantor
has executed and delivered that certain Security and Pledge Agreement, dated August 19, 2019, made by the Grantors to the Collateral
Agent (as amended, modified, supplemented, renewed, restated or replaced from time to time, the “Security Agreement”);
and


 


WHEREAS,
under the terms of the Security Agreement, the Grantors have granted to the Collateral Agent, for the ratable benefit of the Collateral
Agent and the Noteholders, a security interest in, among other property, certain intellectual property of the Grantors, and have
agreed as a condition thereof to execute this IP Security Agreement for recording with the U.S. Patent and Trademark Office, the
United States Copyright Office and other governmental authorities.


 


WHEREAS,
the Grantors have determined that the execution, delivery and performance of this IP Security Agreement directly benefits, and
is in the best interest of, the Grantors.


 


NOW,
THEREFORE, in consideration of the premises and the agreements herein and in order to induce the Buyers to perform under the Securities
Purchase Agreement, each Grantor agrees with the Collateral Agent, for the benefit of the Noteholders, as follows


 


SECTION
1. Grant of Security. Each Grantor hereby grants to the Collateral Agent for the ratable benefit of the Collateral Agent
and the Noteholders a security interest in all of such Grantor’s right, title and interest in and to the following (the
“Collateral”):


 


(i)
the Patents and Patent applications set forth in Schedule A hereto;


 


(ii)
the Trademark and service mark registrations and applications set forth in Schedule B hereto (provided that no security
interest shall be granted in United States intent-to-use trademark applications to the extent that, and solely during the period
in which, the grant of a security interest therein would impair the validity or enforceability of such intent-to-use trademark
applications under applicable federal law), together with the goodwill symbolized thereby;


 






    	 	 	 



     


    

 


(iii)
all Copyrights, whether registered or unregistered, now owned or hereafter acquired by such Grantor, including, without limitation,
the copyright registrations and applications and exclusive copyright licenses set forth in Schedule C hereto;


 


(iv)
all reissues, divisions, continuations, continuations-in-part, extensions, renewals and reexaminations of any of the foregoing,
all rights in the foregoing provided by international treaties or conventions, all rights corresponding thereto throughout the
world and all other rights of any kind whatsoever of such Grantor accruing thereunder or pertaining thereto;


 


(v)
any and all claims for damages and injunctive relief for past, present and future infringement, dilution, misappropriation, violation,
misuse or breach with respect to any of the foregoing, with the right, but not the obligation, to sue for and collect, or otherwise
recover, such damages; and


 


(vi)
any and all proceeds of, collateral for, income, royalties and other payments now or hereafter due and payable with respect to,
and supporting obligations relating to, any and all of the Collateral of or arising from any of the foregoing.


 


SECTION
2. Security for Obligations. The grant of a security interest in, the Collateral by each Grantor under this IP Security
Agreement secures the payment of all Obligations of such Grantor now or hereafter existing under or in respect of the Notes and
the Transaction Documents, whether direct or indirect, absolute or contingent, and whether for principal, reimbursement obligations,
interest, premiums, penalties, fees, indemnifications, contract causes of action, costs, expenses or otherwise.


 


SECTION
3. Recordation. Each Grantor authorizes and requests that the Register of Copyrights, the Commissioner for Patents and
the Commissioner for Trademarks and any other applicable government officer record this IP Security Agreement.


 


SECTION
4. Execution in Counterparts. This IP Security Agreement may be executed in any number of counterparts, each of which when
so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.


 


SECTION
5. Grants, Rights and Remedies. This IP Security Agreement has been entered into in conjunction with the provisions of
the Security Agreement. Each Grantor does hereby acknowledge and confirm that the grant of the security interest hereunder to,
and the rights and remedies of, the Collateral Agent with respect to the Collateral are more fully set forth in the Security Agreement,
the terms and provisions of which are incorporated herein by reference as if fully set forth herein.


 






    	 	 	 



     


    

 


SECTION
6. Governing Law; Jurisdiction; Jury Trial.


 


(i)
All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the
internal laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether
of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than
the State of New York.


 


(ii)
Each Grantor hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City of New
York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or under any of the other
Transaction Documents or with any transaction contemplated hereby or thereby, and hereby irrevocably waives, and agrees not to
assert in any suit, action or proceeding, any claim, defense or objection that it is not personally subject to the jurisdiction
of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action
or proceeding is improper. Each party hereby irrevocably waives personal service of process and consents to process being served
in any such suit, action or proceeding by mailing a copy thereof to such party at the address for such notices to it under Section
9(f) of the Securities Purchase Agreement and agrees that such service shall constitute good and sufficient service of process
and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted
by law. Nothing contained herein shall be deemed or operate to preclude the Collateral Agent or the Noteholders from bringing
suit or taking other legal action against any Grantor in any other jurisdiction to collect on a Grantor’s obligations or
to enforce a judgment or other court ruling in favor of the Collateral Agent or a Noteholder.


 


(iii)
WAIVER OF JURY TRIAL, ETC. EACH GRANTOR IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY
TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR UNDER ANY OTHER TRANSACTION DOCUMENT OR IN CONNECTION WITH OR ARISING OUT
OF THIS AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY.


 


(iv)
Each Grantor irrevocably and unconditionally waives any right it may have to claim or recover in any legal action, suit or proceeding
referred to in this Section any special, exemplary, indirect, incidental, punitive or consequential damages.


 


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


 


	 	TOUGHBUILT
    INDUSTRIES, INc
	 	 
	 	By	                 
	 	Name:	 
	 	Title:	 
	 	 
	 	Address
    for Notices:
	 	 
	 	25371
    Commercentre Drive,
	 	Ste
    200,
	 	Lake
    Forest, CA 92630



 




    	 	 	 



     


    

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


 


	 	TOUGHBUILT
    Technologies, INc
	 	 
	 	By	                     
	 	Name:	 
	 	Title:	 
	 	 
	 	Address
    for Notices:
	 	 
	 	25371
    Commercentre Drive,
	 	Ste
    200,
	 	Lake
    Forest, CA 92630





 




    	 	 	 



     


    

 


Schedule
A


 


Patents


 


	Grantor	 	Country	 	Title	 	Application
                                         or

                                               Patent
                                         No.
	 	Application
                                         or

                                               Registration
                                         Date
	 	Assignees
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 







 



    	 	 	 



     


    

 


Schedule
B


 


Trademarks


 


	Grantor	 	Country	 	Trademark	 	Application
    or Registration No.	 	Application
    or Registration Date	 	Assignees
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 







 




    	 	 	 



     


    

 


Schedule
C


 


Copyrights


 


	Grantor	 	Country	 	Title	 	Type
    of Work	 	Application
                                         or

                                                                                Registration
                                         No.
	 	Issue
    Date	 	Assignees