Document:

<PAGE>
                                                                     Exhibit 4.5

                                                                       EXHIBIT B

                          REGISTRATION RIGHTS AGREEMENT

     This Registration Rights Agreement (this "Agreement") is made and entered
into as of December 31, 2004, among Edentify, Inc., a ______________ corporation
(the "Company"), and the purchasers signatory hereto (each such purchaser is a
"Purchaser" and collectively, the "Purchasers").

     This Agreement is made pursuant to the Securities Purchase Agreement, dated
as of the date hereof among the Company and the Purchasers (the "Purchase
Agreement").

     The Company and the Purchasers hereby agree as follows:

     1. Definitions

     CAPITALIZED TERMS USED AND NOT OTHERWISE DEFINED HEREIN THAT ARE DEFINED IN
THE PURCHASE AGREEMENT SHALL HAVE THE MEANINGS GIVEN SUCH TERMS IN THE PURCHASE
AGREEMENT. As used in this Agreement, the following terms shall have the
following meanings:

          "Advice" shall have the meaning set forth in Section 6(d).

          "Effectiveness Date" means, with respect to the initial Registration
     Statement required to be filed hereunder, the 120th calendar day following
     the date hereof and, with respect to any additional Registration Statements
     which may be required pursuant to Section 3(c), the 120th calendar day
     following the date on which the Company first knows, or reasonably should
     have known, that such additional Registration Statement is required
     hereunder; provided, however, in the event the Company is notified by the
     Commission that one of the above Registration Statements will not be
     reviewed or is no longer subject to further review and comments, the
     Effectiveness Date as to such Registration Statement shall be the fifth
     Trading Day following the date on which the Company is so notified if such
     date precedes the dates required above.

          "Effectiveness Period" shall have the meaning set forth in Section
     2(a).

          "Event" shall have the meaning set forth in Section 2(b).

          "Event Date" shall have the meaning set forth in Section 2(b).

          "Filing Date" means, with respect to the initial Registration
     Statement required hereunder, the 60th calendar day following the date
     hereof and, with respect to any additional Registration Statements which
     may be required pursuant to Section 3(c), the 30th day following the date
     on which the Company first knows, or reasonably should have known that such
     additional Registration Statement is required hereunder.

                                        1

<PAGE>

          "Holder" or "Holders" means the holder or holders, as the case may be,
     from time to time of Registrable Securities.

          "Indemnified Party" shall have the meaning set forth in Section 5(c).

          "Indemnifying Party" shall have the meaning set forth in Section 5(c).

          "Losses" shall have the meaning set forth in Section 5(a).

          "Plan of Distribution" shall have the meaning set forth in Section
     2(a).

          "Proceeding" means an action, claim, suit, investigation or proceeding
     (including, without limitation, an investigation or partial proceeding,
     such as a deposition), whether commenced or threatened.

          "Prospectus" means the prospectus included in a Registration Statement
     (including, without limitation, a prospectus that includes any information
     previously omitted from a prospectus filed as part of an effective
     registration statement in reliance upon Rule 430A promulgated under the
     Securities Act), as amended or supplemented by any prospectus supplement,
     with respect to the terms of the offering of any portion of the Registrable
     Securities covered by a Registration Statement, and all other amendments
     and supplements to the Prospectus, including post-effective amendments, and
     all material incorporated by reference or deemed to be incorporated by
     reference in such Prospectus.

          "Registrable Securities" means (i) all of the shares of Common Stock
     issuable upon conversion in full of the Debentures, (ii) all shares
     issuable as interest on the Debentures assuming all permissible interest
     payments are made in shares of Common Stock and the Debentures are held
     until maturity, (iii) all Warrant Shares and (iv) any securities issued or
     issuable upon any stock split, dividend or other distribution,
     recapitalization or similar event with respect to the foregoing.

          "Registration Statement" means the registration statements required to
     be filed hereunder and any additional registration statements contemplated
     by Section 3(c), including (in each case) the Prospectus, amendments and
     supplements to such registration statement or Prospectus, including pre-
     and post-effective amendments, all exhibits thereto, and all material
     incorporated by reference or deemed to be incorporated by reference in such
     registration statement.

          "Rule 415" means Rule 415 promulgated by the Commission pursuant to
     the Securities Act, as such Rule may be amended from time to time, or any
     similar rule or regulation hereafter adopted by the Commission having
     substantially the same purpose and effect as such Rule.

          "Rule 424" means Rule 424 promulgated by the Commission pursuant to
     the Securities Act, as such Rule may be amended from time to time, or any
     similar rule or

                                        2

<PAGE>

     regulation hereafter adopted by the Commission having substantially the
     same purpose and effect as such Rule.

          "Selling Shareholder Questionnaire" shall have the meaning set forth
     in Section 3(a).

     2. Shelf Registration

     (a) On or prior to each Filing Date, the Company shall prepare and file
with the Commission a "Shelf" Registration Statement covering the resale of 125%
of the Registrable Securities on such Filing Date for an offering to be made on
a continuous basis pursuant to Rule 415. The Registration Statement shall be on
Form S-3 (except if the Company is not then eligible to register for resale the
Registrable Securities on Form S-3, in which case such registration shall be on
another appropriate form in accordance herewith) and shall contain (unless
otherwise directed by the Holders) substantially the "Plan of Distribution"
attached hereto as Annex A. Subject to the terms of this Agreement, the Company
shall use its best efforts to cause the Registration Statement to be declared
effective under the Securities Act as promptly as possible after the filing
thereof, but in any event prior to the applicable Effectiveness Date, and shall
use its best efforts to keep such Registration Statement continuously effective
under the Securities Act until all Registrable Securities covered by such
Registration Statement have been sold or may be sold without volume restrictions
pursuant to Rule 144(k) as determined by the counsel to the Company pursuant to
a written opinion letter to such effect, addressed and acceptable to the
Company's transfer agent and the affected Holders (the "Effectiveness Period").
The Company shall immediately notify the Holders via facsimile of the
effectiveness of the Registration Statement on the same day that the Company
receives notification of the effectiveness from the Commission. Failure to so
notify the Holder within 1 Trading Day of such notification shall be deemed an
Event under Section 2(b).

     (b) If: (i) a Registration Statement is not filed on or prior to its Filing
Date (if the Company files a Registration Statement without affording the
Holders the opportunity to review and comment on the same as required by Section
3(a), the Company shall not be deemed to have satisfied this clause (i)), or
(ii) the Company fails to file with the Commission a request for acceleration in
accordance with Rule 461 promulgated under the Securities Act, within five
Trading Days of the date that the Company is notified (orally or in writing,
whichever is earlier) by the Commission that a Registration Statement will not
be "reviewed," or not subject to further review, or (iii) prior to its
Effectiveness Date, the Company fails to file a pre-effective amendment and
otherwise respond in writing to comments made by the Commission in respect of
such Registration Statement within 10 calendar days after the receipt of
comments by or notice from the Commission that such amendment is required in
order for a Registration Statement to be declared effective, or (iv) a
Registration Statement filed or required to be filed hereunder is not declared
effective by the Commission by its Effectiveness Date, or (v) after the
Effectiveness Date, a Registration Statement ceases for any reason to remain
continuously effective as to all Registrable Securities for which it is required
to be effective, or the Holders are not permitted to utilize the Prospectus
therein to resell such Registrable Securities for 10 consecutive calendar days
but no more than an aggregate of 15 calendar days during any 12-month period
(which need not be consecutive Trading Days) (any such failure or breach being

                                        3

<PAGE>

referred to as an "Event", and for purposes of clause (i) or (iv) the date on
which such Event occurs, or for purposes of clause (ii) the date on which such
five Trading Day period is exceeded, or for purposes of clause (iii) the date
which such 10 calendar day period is exceeded, or for purposes of clause (v) the
date on which such 10 or 15 calendar day period, as applicable, is exceeded
being referred to as "Event Date"), then in addition to any other rights the
Holders may have hereunder or under applicable law, on each such Event Date and
on each monthly anniversary of each such Event Date (if the applicable Event
shall not have been cured by such date) until the applicable Event is cured, the
Company shall pay to each Holder an amount in cash, as partial liquidated
damages and not as a penalty, equal to 1% of the aggregate purchase price paid
by such Holder pursuant to the Purchase Agreement for any Registrable Securities
then held by such Holder for the first 30 days during the occurrence of an Event
and 1.5% for each month thereafter. If the Company fails to pay any partial
liquidated damages pursuant to this Section in full within seven days after the
date payable, the Company will pay interest thereon at a rate of 18% per annum
(or such lesser maximum amount that is permitted to be paid by applicable law)
to the Holder, accruing daily from the date such partial liquidated damages are
due until such amounts, plus all such interest thereon, are paid in full. The
partial liquidated damages pursuant to the terms hereof shall apply on a daily
pro-rata basis for any portion of a month prior to the cure of an Event.

     3. Registration Procedures

     In connection with the Company's registration obligations hereunder, the
Company shall:

     (a) Not less than five Trading Days prior to the filing of each
Registration Statement or any related Prospectus or any amendment or supplement
thereto (including any document that would be incorporated or deemed to be
incorporated therein by reference), the Company shall, (i) furnish to each
Holder copies of all such documents proposed to be filed, which documents (other
than those incorporated or deemed to be incorporated by reference) will be
subject to the review of such Holders, and (ii) cause its officers and
directors, counsel and independent certified public accountants to respond to
such inquiries as shall be necessary, in the reasonable opinion of respective
counsel to conduct a reasonable investigation within the meaning of the
Securities Act. The Company shall not file the Registration Statement or any
such Prospectus or any amendments or supplements thereto to which the Holders of
a majority of the Registrable Securities shall reasonably object in good faith,
provided that, the Company is notified of such objection in writing no later
than 5 Trading Days after the Holders have been so furnished copies of such
documents. Each Holder agrees to furnish to the Company a completed
Questionnaire in the form attached to this Agreement as Annex B (a "Selling
Shareholder Questionnaire") not less than two Trading Days prior to the Filing
Date or by the end of the fourth Trading Day following the date on which such
Holder receives draft materials in accordance with this Section.

     (b) (i) Prepare and file with the Commission such amendments, including
post-effective amendments, to a Registration Statement and the Prospectus used
in connection therewith as may be necessary to keep a Registration Statement
continuously effective as to the applicable Registrable Securities for the
Effectiveness Period and prepare and file with the Commission such additional
Registration Statements in order to register for resale under the

                                        4

<PAGE>

Securities Act all of the Registrable Securities; (ii) cause the related
Prospectus to be amended or supplemented by any required Prospectus supplement
(subject to the terms of this Agreement), and as so supplemented or amended to
be filed pursuant to Rule 424; (iii) respond as promptly as reasonably possible
to any comments received from the Commission with respect to a Registration
Statement or any amendment thereto and as promptly as reasonably possible
provide the Holders true and complete copies of all correspondence from and to
the Commission relating to a Registration Statement; and (iv) comply in all
material respects with the provisions of the Securities Act and the Exchange Act
with respect to the disposition of all Registrable Securities covered by a
Registration Statement during the applicable period in accordance (subject to
the terms of this Agreement) with the intended methods of disposition by the
Holders thereof set forth in such Registration Statement as so amended or in
such Prospectus as so supplemented.

     (c) If during the Effectiveness Period, the number of Registrable
Securities at any time exceeds 90% of the number of shares of Common Stock then
registered in a Registration Statement, then the Company shall file as soon as
reasonably practicable but in any case prior to the applicable Filing Date, an
additional Registration Statement covering the resale by the Holders of not less
than [125% of the number of such Registrable Securities.

     (d) Notify the Holders of Registrable Securities to be sold (which notice
shall, pursuant to clauses (ii) through (vi) hereof, be accompanied by an
instruction to suspend the use of the Prospectus until the requisite changes
have been made) as promptly as reasonably possible (and, in the case of (i)(A)
below, not less than five Trading Days prior to such filing) and (if requested
by any such Person) confirm such notice in writing no later than one Trading Day
following the day (i)(A) when a Prospectus or any Prospectus supplement or
post-effective amendment to a Registration Statement is proposed to be filed;
(B) when the Commission notifies the Company whether there will be a "review" of
such Registration Statement and whenever the Commission comments in writing on
such Registration Statement (the Company shall provide true and complete copies
thereof and all written responses thereto to each of the Holders); and (C) with
respect to a Registration Statement or any post-effective amendment, when the
same has become effective; (ii) of any request by the Commission or any other
Federal or state governmental authority for amendments or supplements to a
Registration Statement or Prospectus or for additional information; (iii) of the
issuance by the Commission or any other federal or state governmental authority
of any stop order suspending the effectiveness of a Registration Statement
covering any or all of the Registrable Securities or the initiation of any
Proceedings for that purpose; (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction, or the initiation or threatening of any Proceeding for such
purpose; (v) of the occurrence of any event or passage of time that makes the
financial statements included in a Registration Statement ineligible for
inclusion therein or any statement made in a Registration Statement or
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires any revisions to a
Registration Statement, Prospectus or other documents so that, in the case of a
Registration Statement or the Prospectus, as the case may be, it will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not

                                        5

<PAGE>

misleading; and (vi) the occurrence or existence of any pending corporate
development with respect to the Company that the Company believes may be
material and that, in the determination of the Company, makes it not in the best
interest of the Company to allow continued availability of the Registration
Statement or Prospectus; provided that any and all of such information shall
remain confidential to each Holder until such information otherwise becomes
public, unless disclosure by a Holder is required by law; provided, further,
notwithstanding each Holder's agreement to keep such information confidential,
the Holders make no acknowledgement that any such information is material,
non-public information.

     (e) Use its best efforts to avoid the issuance of, or, if issued, obtain
the withdrawal of (i) any order suspending the effectiveness of a Registration
Statement, or (ii) any suspension of the qualification (or exemption from
qualification) of any of the Registrable Securities for sale in any
jurisdiction, at the earliest practicable moment.

     (f) Furnish to each Holder, without charge, at least one conformed copy of
each such Registration Statement and each amendment thereto, including financial
statements and schedules, all documents incorporated or deemed to be
incorporated therein by reference to the extent requested by such Person, and
all exhibits to the extent requested by such Person (including those previously
furnished or incorporated by reference) promptly after the filing of such
documents with the Commission.

     (g) Promptly deliver to each Holder, without charge, as many copies of the
Prospectus or Prospectuses (including each form of prospectus) and each
amendment or supplement thereto as such Persons may reasonably request in
connection with resales by the Holder of Registrable Securities. Subject to the
terms of this Agreement, the Company hereby consents to the use of such
Prospectus and each amendment or supplement thereto by each of the selling
Holders in connection with the offering and sale of the Registrable Securities
covered by such Prospectus and any amendment or supplement thereto, except after
the giving on any notice pursuant to Section 3(d).

     (h) If NASDR Rule 2710 requires any broker-dealer to make a filing prior to
executing a sale by a Holder, make an Issuer Filing with the NASDR, Inc.
Corporate Financing Department pursuant to NASDR Rule 2710(b)(10)(A)(i) and
respond within five Trading Days to any comments received from NASDR in
connection therewith, and pay the filing fee required in connection therewith.

     (i) Prior to any resale of Registrable Securities by a Holder, use its
commercially reasonable efforts to register or qualify or cooperate with the
selling Holders in connection with the registration or qualification (or
exemption from the Registration or qualification) of such Registrable Securities
for the resale by the Holder under the securities or Blue Sky laws of such
jurisdictions within the United States as any Holder reasonably requests in
writing, to keep each registration or qualification (or exemption therefrom)
effective during the Effectiveness Period and to do any and all other acts or
things reasonably necessary to enable the disposition in such jurisdictions of
the Registrable Securities covered by each Registration Statement; provided,
that the Company shall not be required to qualify generally to do business in
any jurisdiction where it

                                        6

<PAGE>

is not then so qualified, subject the Company to any material tax in any such
jurisdiction where it is not then so subject or file a general consent to
service of process in any such jurisdiction.

     (j) If requested by the Holders, cooperate with the Holders to facilitate
the timely preparation and delivery of certificates representing Registrable
Securities to be delivered to a transferee pursuant to a Registration Statement,
which certificates shall be free, to the extent permitted by the Purchase
Agreement, of all restrictive legends, and to enable such Registrable Securities
to be in such denominations and registered in such names as any such Holders may
request.

     (k) Upon the occurrence of any event contemplated by this Section 3, as
promptly as reasonably possible under the circumstances taking into account the
Company's good faith assessment of any adverse consequences to the Company and
its stockholders of the premature disclosure of such event, prepare a supplement
or amendment, including a post-effective amendment, to a Registration Statement
or a supplement to the related Prospectus or any document incorporated or deemed
to be incorporated therein by reference, and file any other required document so
that, as thereafter delivered, neither a Registration Statement nor such
Prospectus will contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. If the Company notifies the Holders in accordance with clauses
(ii) through (vi) of Section 3(d) above to suspend the use of any Prospectus
until the requisite changes to such Prospectus have been made, then the Holders
shall suspend use of such Prospectus. The Company will use its best efforts to
ensure that the use of the Prospectus may be resumed as promptly as is
practicable. The Company shall be entitled to exercise its right under this
Section 3(j) to suspend the availability of a Registration Statement and
Prospectus, subject to the payment of partial liquidated damages pursuant to
Section 2(b), for a period not to exceed 60 days (which need not be consecutive
days) in any 12 month period.

     (l) Comply with all applicable rules and regulations of the Commission.

     (m) The Company may require each selling Holder to furnish to the Company a
certified statement as to the number of shares of Common Stock beneficially
owned by such Holder and, if required by the Commission, the person thereof that
has voting and dispositive control over the Shares. During any periods that the
Company is unable to meet its obligations hereunder with respect to the
registration of the Registrable Securities solely because any Holder fails to
furnish such information within three Trading Days of the Company's request, any
liquidated damages that are accruing at such time as to such Holder only shall
be tolled and any Event that may otherwise occur solely because of such delay
shall be suspended as to such Holder only, until such information is delivered
to the Company.

     4. Registration Expenses. All fees and expenses incident to the performance
of or compliance with this Agreement by the Company shall be borne by the
Company whether or not any Registrable Securities are sold pursuant to the
Registration Statement. The fees and expenses referred to in the foregoing
sentence shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses (A) with respect to filings
required to

                                        7

<PAGE>

be made with the Trading Market on which the Common Stock is then listed for
trading, (B) in compliance with applicable state securities or Blue Sky laws
reasonably agreed to by the Company in writing (including, without limitation,
fees and disbursements of counsel for the Company in connection with Blue Sky
qualifications or exemptions of the Registrable Securities and determination of
the eligibility of the Registrable Securities for investment under the laws of
such jurisdictions as requested by the Holders) and (C) if not previously paid
by the Company in connection with an Issuer Filing, with respect to any filing
that may be required to be made by any broker through which a Holder intends to
make sales of Registrable Securities with NASD Regulation, Inc. pursuant to the
NASD Rule 2710, so long as the broker is receiving no more than a customary
brokerage commission in connection with such sale, (ii) printing expenses
(including, without limitation, expenses of printing certificates for
Registrable Securities and of printing prospectuses if the printing of
prospectuses is reasonably requested by the holders of a majority of the
Registrable Securities included in a Registration Statement), (iii) messenger,
telephone and delivery expenses, (iv) fees and disbursements of counsel for the
Company, (v) Securities Act liability insurance, if the Company so desires such
insurance, and (vi) fees and expenses of all other Persons retained by the
Company in connection with the consummation of the transactions contemplated by
this Agreement. In addition, the Company shall be responsible for all of its
internal expenses incurred in connection with the consummation of the
transactions contemplated by this Agreement (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expense of any annual audit and the fees and expenses
incurred in connection with the listing of the Registrable Securities on any
securities exchange as required hereunder. In no event shall the Company be
responsible for any broker or similar commissions or, except to the extent
provided for in the Transaction Documents, any legal fees or other costs of the
Holders.

     5. Indemnification

     (a) Indemnification by the Company. The Company shall, notwithstanding any
termination of this Agreement, indemnify and hold harmless each Holder, the
officers, directors, agents, brokers (including brokers who offer and sell
Registrable Securities as principal as a result of a pledge or any failure to
perform under a margin call of Common Stock), investment advisors and employees
of each of them, each Person who controls any such Holder (within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act) and the
officers, directors, agents and employees of each such controlling Person, to
the fullest extent permitted by applicable law, from and against any and all
losses, claims, damages, liabilities, costs (including, without limitation,
reasonable attorneys' fees) and expenses (collectively, "Losses"), as incurred,
arising out of or relating to any untrue or alleged untrue statement of a
material fact contained in a Registration Statement, any Prospectus or any form
of prospectus or in any amendment or supplement thereto or in any preliminary
prospectus, or arising out of or relating to any omission or alleged omission of
a material fact required to be stated therein or necessary to make the
statements therein (in the case of any Prospectus or form of prospectus or
supplement thereto, in light of the circumstances under which they were made)
not misleading, except to the extent, but only to the extent, that (i) such
untrue statements or omissions are based solely upon information regarding such
Holder furnished in writing to the Company by such Holder expressly for use
therein, or to the extent that such information relates to such Holder or such
Holder's proposed method of distribution of Registrable Securities and was
reviewed and

                                        8

<PAGE>

expressly approved in writing by such Holder expressly for use in a Registration
Statement, such Prospectus or such form of Prospectus or in any amendment or
supplement thereto (it being understood that the Holder has approved Annex A
hereto for this purpose) or (ii) in the case of an occurrence of an event of the
type specified in Section 3(d)(ii)-(vi), the use by such Holder of an outdated
or defective Prospectus after the Company has notified such Holder in writing
that the Prospectus is outdated or defective and prior to the receipt by such
Holder of the Advice contemplated in Section 6(d). The Company shall notify the
Holders promptly of the institution, threat or assertion of any Proceeding
arising from or in connection with the transactions contemplated by this
Agreement of which the Company is aware.

     (b) Indemnification by Holders. Each Holder shall, severally and not
jointly, indemnify and hold harmless the Company, its directors, officers,
agents and employees, each Person who controls the Company (within the meaning
of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the
directors, officers, agents or employees of such controlling Persons, to the
fullest extent permitted by applicable law, from and against all Losses, as
incurred, to the extent arising out of or based solely upon: (x) such Holder's
failure to comply with the prospectus delivery requirements of the Securities
Act or (y) any untrue or alleged untrue statement of a material fact contained
in any Registration Statement, any Prospectus, or any form of prospectus, or in
any amendment or supplement thereto or in any preliminary prospectus, or arising
out of or relating to any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein not
misleading (i) to the extent, but only to the extent, that such untrue statement
or omission is contained in any information so furnished in writing by such
Holder to the Company specifically for inclusion in such Registration Statement
or such Prospectus or (ii) to the extent that (1) such untrue statements or
omissions are based solely upon information regarding such Holder furnished in
writing to the Company by such Holder expressly for use therein, or to the
extent that such information relates to such Holder or such Holder's proposed
method of distribution of Registrable Securities and was reviewed and expressly
approved in writing by such Holder expressly for use in the Registration
Statement (it being understood that the Holder has approved Annex A hereto for
this purpose), such Prospectus or such form of Prospectus or in any amendment or
supplement thereto or (2) in the case of an occurrence of an event of the type
specified in Section 3(d)(ii)-(vi), the use by such Holder of an outdated or
defective Prospectus after the Company has notified such Holder in writing that
the Prospectus is outdated or defective and prior to the receipt by such Holder
of the Advice contemplated in Section 6(d). In no event shall the liability of
any selling Holder hereunder be greater in amount than the dollar amount of the
net proceeds received by such Holder upon the sale of the Registrable Securities
giving rise to such indemnification obligation.

     (c) Conduct of Indemnification Proceedings. If any Proceeding shall be
brought or asserted against any Person entitled to indemnity hereunder (an
"Indemnified Party"), such Indemnified Party shall promptly notify the Person
from whom indemnity is sought (the "Indemnifying Party") in writing, and the
Indemnifying Party shall have the right to assume the defense thereof, including
the employment of counsel reasonably satisfactory to the Indemnified Party and
the payment of all fees and expenses incurred in connection with defense
thereof; provided, that the failure of any Indemnified Party to give such notice
shall not relieve the Indemnifying Party of its obligations or liabilities
pursuant to this Agreement, except (and only)

                                        9

<PAGE>

to the extent that it shall be finally determined by a court of competent
jurisdiction (which determination is not subject to appeal or further review)
that such failure shall have prejudiced the Indemnifying Party.

     An Indemnified Party shall have the right to employ separate counsel in any
such Proceeding and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such Indemnified Party or
Parties unless: (1) the Indemnifying Party has agreed in writing to pay such
fees and expenses; (2) the Indemnifying Party shall have failed promptly to
assume the defense of such Proceeding and to employ counsel reasonably
satisfactory to such Indemnified Party in any such Proceeding; or (3) the named
parties to any such Proceeding (including any impleaded parties) include both
such Indemnified Party and the Indemnifying Party, and such Indemnified Party
shall reasonably believe that a material conflict of interest is likely to exist
if the same counsel were to represent such Indemnified Party and the
Indemnifying Party (in which case, if such Indemnified Party notifies the
Indemnifying Party in writing that it elects to employ separate counsel at the
expense of the Indemnifying Party, the Indemnifying Party shall not have the
right to assume the defense thereof and the reasonable fees and expenses of one
separate counsel shall be at the expense of the Indemnifying Party). The
Indemnifying Party shall not be liable for any settlement of any such Proceeding
effected without its written consent, which consent shall not be unreasonably
withheld. No Indemnifying Party shall, without the prior written consent of the
Indemnified Party, effect any settlement of any pending Proceeding in respect of
which any Indemnified Party is a party, unless such settlement includes an
unconditional release of such Indemnified Party from all liability on claims
that are the subject matter of such Proceeding.

     Subject to the terms of this Agreement, all reasonable fees and expenses of
the Indemnified Party (including reasonable fees and expenses to the extent
incurred in connection with investigating or preparing to defend such Proceeding
in a manner not inconsistent with this Section) shall be paid to the Indemnified
Party, as incurred, within ten Trading Days of written notice thereof to the
Indemnifying Party; provided, that the Indemnified Party shall promptly
reimburse the Indemnifying Party for that portion of such fees and expenses
applicable to such actions for which such Indemnified Party is not entitled to
indemnification hereunder, determined based upon the relative faults of the
parties.

     (d) Contribution. If the indemnification under Section 5(a) or 5(b) is
unavailable to an Indemnified Party or insufficient to hold an Indemnified Party
harmless for any Losses, then each Indemnifying Party shall contribute to the
amount paid or payable by such Indemnified Party, in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party and
Indemnified Party in connection with the actions, statements or omissions that
resulted in such Losses as well as any other relevant equitable considerations.
The relative fault of such Indemnifying Party and Indemnified Party shall be
determined by reference to, among other things, whether any action in question,
including any untrue or alleged untrue statement of a material fact or omission
or alleged omission of a material fact, has been taken or made by, or relates to
information supplied by, such Indemnifying Party or Indemnified Party, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such action, statement or omission. The amount paid or
payable by a party as a result of any Losses shall be deemed to include, subject
to the limitations set forth in this Agreement, any

                                       10

<PAGE>

reasonable attorneys' or other reasonable fees or expenses incurred by such
party in connection with any Proceeding to the extent such party would have been
indemnified for such fees or expenses if the indemnification provided for in
this Section was available to such party in accordance with its terms.

     The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 5(d), no Holder shall be required
to contribute, in the aggregate, any amount in excess of the amount by which the
proceeds actually received by such Holder from the sale of the Registrable
Securities subject to the Proceeding exceeds the amount of any damages that such
Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission, except in the case of fraud by
such Holder.

     The indemnity and contribution agreements contained in this Section are in
addition to any liability that the Indemnifying Parties may have to the
Indemnified Parties.

     6. Miscellaneous

     (a) Remedies. In the event of a breach by the Company or by a Holder, of
any of their obligations under this Agreement, each Holder or the Company, as
the case may be, in addition to being entitled to exercise all rights granted by
law and under this Agreement, including recovery of damages, will be entitled to
specific performance of its rights under this Agreement. The Company and each
Holder agree that monetary damages would not provide adequate compensation for
any losses incurred by reason of a breach by it of any of the provisions of this
Agreement and hereby further agrees that, in the event of any action for
specific performance in respect of such breach, it shall waive the defense that
a remedy at law would be adequate.

     (b) No Piggyback on Registrations. Except as set forth on Schedule 6(b)
attached hereto, neither the Company nor any of its security holders (other than
the Holders in such capacity pursuant hereto) may include securities of the
Company in the Registration Statement other than the Registrable Securities. The
Company shall not file any other registration statements until the initial
Registration Statement required hereunder is declared effective by the
Commission, provided that this Section 6(b) shall not prohibit the Company from
filing amendments to registration statements already filed.

     (c) Compliance. Each Holder covenants and agrees that it will comply with
the prospectus delivery requirements of the Securities Act as applicable to it
in connection with sales of Registrable Securities pursuant to the Registration
Statement.

     (d) Discontinued Disposition. Each Holder agrees by its acquisition of such
Registrable Securities that, upon receipt of a notice from the Company of the
occurrence of any event of the kind described in Section 3(d), such Holder will
forthwith discontinue disposition of such Registrable Securities under a
Registration Statement until such Holder's receipt of the

                                       11

<PAGE>

copies of the supplemented Prospectus and/or amended Registration Statement, or
until it is advised in writing (the "Advice") by the Company that the use of the
applicable Prospectus may be resumed, and, in either case, has received copies
of any additional or supplemental filings that are incorporated or deemed to be
incorporated by reference in such Prospectus or Registration Statement. The
Company will use its best efforts to ensure that the use of the Prospectus may
be resumed as promptly as it practicable. The Company agrees and acknowledges
that any periods during which the Holder is required to discontinue the
disposition of the Registrable Securities hereunder shall be subject to the
provisions of Section 2(b).

     (e) Piggy-Back Registrations. If at any time during the Effectiveness
Period there is not an effective Registration Statement covering all of the
Registrable Securities and the Company shall determine to prepare and file with
the Commission a registration statement relating to an offering for its own
account or the account of others under the Securities Act of any of its equity
securities, other than on Form S-4 or Form S-8 (each as promulgated under the
Securities Act) or their then equivalents relating to equity securities to be
issued solely in connection with any acquisition of any entity or business or
equity securities issuable in connection with the stock option or other employee
benefit plans, then the Company shall send to each Holder a written notice of
such determination and, if within fifteen days after the date of such notice,
any such Holder shall so request in writing, the Company shall include in such
registration statement all or any part of such Registrable Securities such
holder requests to be registered; provided, that, the Company shall not be
required to register any Registrable Securities pursuant to this Section 6(e)
that are eligible for resale pursuant to Rule 144(k) promulgated under the
Securities Act or that are the subject of a then effective Registration
Statement.

     (f) Amendments and Waivers. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may not be given,
unless the same shall be in writing and signed by the Company and each Holder of
the then outstanding Registrable Securities. Notwithstanding the foregoing, a
waiver or consent to depart from the provisions hereof with respect to a matter
that relates exclusively to the rights of Holders and that does not directly or
indirectly affect the rights of other Holders may be given by Holders of all of
the Registrable Securities to which such waiver or consent relates; provided,
however, that the provisions of this sentence may not be amended, modified, or
supplemented except in accordance with the provisions of the immediately
preceding sentence.

     (g) Notices. Any and all notices or other communications or deliveries
required or permitted to be provided hereunder shall be delivered as set forth
in the Purchase Agreement.

     (h) Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the successors and permitted assigns of each of the parties
and shall inure to the benefit of each Holder. The Company may not assign its
rights or obligations hereunder without the prior written consent of all of the
Holders of the then-outstanding Registrable Securities. Each Holder may assign
their respective rights hereunder in the manner and to the Persons as permitted
under the Purchase Agreement. Any Public Liquidity Company that is not the

                                       12

<PAGE>

Company shall, as a condition to any Public Liquidity Event, agree to, and be
bound by, all the terms, conditions and obligations set forth hereunder.

     (i) No Inconsistent Agreements. Neither the Company nor any of its
subsidiaries has entered, as of the date hereof, nor shall the Company or any of
its subsidiaries, on or after the date of this Agreement, enter into any
agreement with respect to its securities, that would have the effect of
impairing the rights granted to the Holders in this Agreement or otherwise
conflicts with the provisions hereof. Except as set forth on Schedule 6(i),
neither the Company nor any of its subsidiaries has previously entered into any
agreement granting any registration rights with respect to any of its securities
to any Person that have not been satisfied in full.

     (j) Execution and Counterparts. This 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. In the event that any signature is delivered by facsimile
transmission, such signature shall create a valid binding obligation of the
party executing (or on whose behalf such signature is executed) the same with
the same force and effect as if such facsimile signature were the original
thereof.

     (k) Governing Law. All questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be determined with the
provisions of the Purchase Agreement.

     (l) Cumulative Remedies. The remedies provided herein are cumulative and
not exclusive of any remedies provided by law.

     (m) Severability. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void or unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect and shall in
no way be affected, impaired or invalidated, and the parties hereto shall use
their commercially reasonable efforts to find and employ an alternative means to
achieve the same or substantially the same result as that contemplated by such
term, provision, covenant or restriction. It is hereby stipulated and declared
to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such that
may be hereafter declared invalid, illegal, void or unenforceable.

     (n) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.

     (o) Independent Nature of Holders' Obligations and Rights. The obligations
of each Holder hereunder are several and not joint with the obligations of any
other Holder hereunder, and no Holder shall be responsible in any way for the
performance of the obligations of any other Holder hereunder. Nothing contained
herein or in any other agreement or document delivered at any closing, and no
action taken by any Holder pursuant hereto or thereto, shall be deemed to
constitute the Holders as a partnership, an association, a joint venture or any
other kind of entity, or create a presumption that the Holders are in any way
acting in concert with respect to such obligations or the transactions
contemplated by this Agreement. Each Holder

                                       13

<PAGE>

shall be entitled to protect and enforce its rights, including without
limitation the rights arising out of this Agreement, and it shall not be
necessary for any other Holder to be joined as an additional party in any
proceeding for such purpose.

                              ********************

                                       14

<PAGE>

     IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.

                                        EDENTIFY, INC.

                                        By:
                                            ------------------------------------
                                        Name: Terrence DeFranco
                                        Title: President

                       [SIGNATURE PAGE OF HOLDERS FOLLOWS]

                                       15

<PAGE>

                   [SIGNATURE PAGE OF HOLDERS TO EDENTIFY RRA]

Name of Holder:
                ------------------------

Signature of Authorized Signatory of Holder:
                                             --------------------------
Name of Authorized Signatory:
                              -------------------------
Title of Authorized Signatory:
                               ------------------------

                           [SIGNATURE PAGES CONTINUE]

                                       16

<PAGE>

                              Plan of Distribution

     Each Selling Stockholder (the "Selling Stockholders") of the common stock
("Common Stock") of [_______, a [______ corporation (the "Company") and any of
their pledgees, assignees and successors-in-interest may, from time to time,
sell any or all of their shares of Common Stock on the Trading Market or any
other stock exchange, market or trading facility on which the shares are traded
or in private transactions. These sales may be at fixed or negotiated prices. A
Selling Stockholder may use any one or more of the following methods when
selling shares:

          -    ordinary brokerage transactions and transactions in which the
               broker-dealer solicits purchasers;

          -    block trades in which the broker-dealer will attempt to sell the
               shares as agent but may position and resell a portion of the
               block as principal to facilitate the transaction;

          -    purchases by a broker-dealer as principal and resale by the
               broker-dealer for its account;

          -    an exchange distribution in accordance with the rules of the
               applicable exchange;

          -    privately negotiated transactions;

          -    settlement of short sales entered into after the date of this
               prospectus;

          -    broker-dealers may agree with the Selling Stockholders to sell a
               specified number of such shares at a stipulated price per share;

          -    a combination of any such methods of sale;

          -    through the writing or settlement of options or other hedging
               transactions, whether through an options exchange or otherwise;
               or

          -    any other method permitted pursuant to applicable law.

     The Selling Stockholders may also sell shares under Rule 144 under the
Securities Act of 1933, as amended (the "Securities Act"), if available, rather
than under this prospectus.

     Broker-dealers engaged by the Selling Stockholders may arrange for other
brokers-dealers to participate in sales. Broker-dealers may receive commissions
or discounts from the Selling Stockholders (or, if any broker-dealer acts as
agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated, but, except as set forth in a supplement to this Prospectus, in the
case of an agency transaction not in excess of a customary brokerage commission
in compliance with NADSR Rule 2440; and in the case of a principal transaction a
markup or markdown in compliance with NASDR IM-2440.

                                       17

<PAGE>

     In connection with the sale of the Common Stock or interests therein, the
Selling Stockholders may enter into hedging transactions with broker-dealers or
other financial institutions, which may in turn engage in short sales of the
Common Stock in the course of hedging the positions they assume. The Selling
Stockholders may also sell shares of the Common Stock short and deliver these
securities to close out their short positions, or loan or pledge the Common
Stock to broker-dealers that in turn may sell these securities. The Selling
Stockholders may also enter into option or other transactions with
broker-dealers or other financial institutions or the creation of one or more
derivative securities which require the delivery to such broker-dealer or other
financial institution of shares offered by this prospectus, which shares such
broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such transaction).

     The Selling Stockholders and any broker-dealers or agents that are involved
in selling the shares may be deemed to be "underwriters" within the meaning of
the Securities Act in connection with such sales. In such event, any commissions
received by such broker-dealers or agents and any profit on the resale of the
shares purchased by them may be deemed to be underwriting commissions or
discounts under the Securities Act. Each Selling Stockholder has informed the
Company that it does not have any written or oral agreement or understanding,
directly or indirectly, with any person to distribute the Common Stock. In no
event shall any broker-dealer receive fees, commissions and markups which, in
the aggregate, would exceed eight percent (8%).

     The Company is required to pay certain fees and expenses incurred by the
Company incident to the registration of the shares. The Company has agreed to
indemnify the Selling Stockholders against certain losses, claims, damages and
liabilities, including liabilities under the Securities Act.

     Because Selling Stockholders may be deemed to be "underwriters" within the
meaning of the Securities Act, they will be subject to the prospectus delivery
requirements of the Securities Act. In addition, any securities covered by this
prospectus which qualify for sale pursuant to Rule 144 under the Securities Act
may be sold under Rule 144 rather than under this prospectus. Each Selling
Stockholder has advised us that they have not entered into any written or oral
agreements, understandings or arrangements with any underwriter or broker-dealer
regarding the sale of the resale shares. There is no underwriter or coordinating
broker acting in connection with the proposed sale of the resale shares by the
Selling Stockholders.

     We agreed to keep this prospectus effective until the earlier of (i) the
date on which the shares may be resold by the Selling Stockholders without
registration and without regard to any volume limitations by reason of Rule
144(e) under the Securities Act or any other rule of similar effect or (ii) all
of the shares have been sold pursuant to the prospectus or Rule 144 under the
Securities Act or any other rule of similar effect. The resale shares will be
sold only through registered or licensed brokers or dealers if required under
applicable state securities laws. In addition, in certain states, the resale
shares may not be sold unless they have been registered or qualified for sale in
the applicable state or an exemption from the registration or qualification
requirement is available and is complied with.

                                       18

<PAGE>

     Under applicable rules and regulations under the Exchange Act, any person
engaged in the distribution of the resale shares may not simultaneously engage
in market making activities with respect to the Common Stock for a period of two
business days prior to the commencement of the distribution. In addition, the
Selling Stockholders will be subject to applicable provisions of the Exchange
Act and the rules and regulations thereunder, including Regulation M, which may
limit the timing of purchases and sales of shares of the Common Stock by the
Selling Stockholders or any other person. We will make copies of this prospectus
available to the Selling Stockholders and have informed them of the need to
deliver a copy of this prospectus to each purchaser at or prior to the time of
the sale.

                                       19

<PAGE>

                                                                         ANNEX B

                                   [__________

                 SELLING SECURITYHOLDER NOTICE AND QUESTIONNAIRE

     The undersigned beneficial owner of common stock, par value $[______ per
share (the "Common Stock"), of [_______, a [_______corporation (the "Company"),
(the "Registrable Securities") understands that the Company has filed or intends
to file with the Securities and Exchange Commission (the "Commission") a
registration statement on Form S-3 (the "Registration Statement") for the
registration and resale under Rule 415 of the Securities Act of 1933, as amended
(the "Securities Act"), of the Registrable Securities, in accordance with the
terms of the Registration Rights Agreement, dated as of [____ (the "Registration
Rights Agreement"), among the Company and the Purchasers named therein. A copy
of the Registration Rights Agreement is available from the Company upon request
at the address set forth below. All capitalized terms not otherwise defined
herein shall have the meanings ascribed thereto in the Registration Rights
Agreement.

     Certain legal consequences arise from being named as a selling
securityholder in the Registration Statement and the related prospectus.
Accordingly, holders and beneficial owners of Registrable Securities are advised
to consult their own securities law counsel regarding the consequences of being
named or not being named as a selling securityholder in the Registration
Statement and the related prospectus.

                                     NOTICE

     The undersigned beneficial owner (the "Selling Securityholder") of
Registrable Securities hereby elects to include the Registrable Securities owned
by it and listed below in Item 3 (unless otherwise specified under such Item 3)
in the Registration Statement.

                                       20

<PAGE>

The undersigned hereby provides the following information to the Company and
represents and warrants that such information is accurate:

                                  QUESTIONNAIRE

1.   NAME.

     (a)  Full Legal Name of Selling Securityholder

          ----------------------------------------------------------------------

     (b)  Full Legal Name of Registered Holder (if not the same as (a) above)
          through which Registrable Securities Listed in Item 3 below are held:

          ----------------------------------------------------------------------

     (c)  Full Legal Name of Natural Control Person (which means a natural
          person who directly you indirectly alone or with others has power to
          vote or dispose of the securities covered by the questionnaire):

          ----------------------------------------------------------------------

2.   ADDRESS FOR NOTICES TO SELLING SECURITYHOLDER:

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

Telephone:
          ----------------------------------------------------------------------
Fax:
     ---------------------------------------------------------------------------

Contact Person:
                ----------------------------------------------------------------

3.   BENEFICIAL OWNERSHIP OF REGISTRABLE SECURITIES:

     (a)  Type and Principal Amount of Registrable Securities beneficially
          owned:

          ----------------------------------------------------------------------

          ----------------------------------------------------------------------

          ----------------------------------------------------------------------

                                       21

<PAGE>

4.   BROKER-DEALER STATUS:

     (a)  Are you a broker-dealer?

                                 Yes [ ] No [ ]

     Note: If yes, the Commission's staff has indicated that you should be
           identified as an underwriter in the Registration Statement.

     (b)  Are you an affiliate of a broker-dealer?

                                 Yes [ ] No [ ]

     (c)  If you are an affiliate of a broker-dealer, do you certify that you
          bought the Registrable Securities in the ordinary course of business,
          and at the time of the purchase of the Registrable Securities to be
          resold, you had no agreements or understandings, directly or
          indirectly, with any person to distribute the Registrable Securities?

                                 Yes [ ] No [ ]

     Note: If no, the Commission's staff has indicated that you should be
           identified as an underwriter in the Registration Statement.

5.   BENEFICIAL OWNERSHIP OF OTHER SECURITIES OF THE COMPANY OWNED BY THE
     SELLING SECURITYHOLDER.

     Except as set forth below in this Item 5, the undersigned is not the
     beneficial or registered owner of any securities of the Company other than
     the Registrable Securities listed above in Item 3.

     (a)  Type and Amount of Other Securities beneficially owned by the Selling
          Securityholder:

          ----------------------------------------------------------------------

          ----------------------------------------------------------------------

                                       22

<PAGE>

6.   RELATIONSHIPS WITH THE COMPANY:

     Except as set forth below, neither the undersigned nor any of its
     affiliates, officers, directors or principal equity holders (owners of 5%
     of more of the equity securities of the undersigned) has held any position
     or office or has had any other material relationship with the Company (or
     its predecessors or affiliates) during the past three years.

     State any exceptions here:

     ---------------------------------------------------------------------------

     ---------------------------------------------------------------------------

     The undersigned agrees to promptly notify the Company of any inaccuracies
or changes in the information provided herein that may occur subsequent to the
date hereof at any time while the Registration Statement remains effective.

     By signing below, the undersigned consents to the disclosure of the
information contained herein in its answers to Items 1 through 6 and the
inclusion of such information in the Registration Statement and the related
prospectus. The undersigned understands that such information will be relied
upon by the Company in connection with the preparation or amendment of the
Registration Statement and the related prospectus.

     IN WITNESS WHEREOF the undersigned, by authority duly given, has caused
this Notice and Questionnaire to be executed and delivered either in person or
by its duly authorized agent.

Dated:                                  Beneficial Owner:
       ------------------------------                     ----------------------

                                        By:
                                            ------------------------------------
                                        Name:
                                              ----------------------------------
                                        Title:
                                               ---------------------------------

PLEASE FAX A COPY OF THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE, AND
RETURN THE ORIGINAL BY OVERNIGHT MAIL, TO:

                                       23<PAGE>
                                                                     Exhibit 4.6

                                                                       EXHIBIT E

                               SECURITY AGREEMENT

     SECURITY AGREEMENT, dated as of December 31, 2004 (this "Agreement"), among
Edentify, Inc., a __________ corporation (the "Debtor") and the holder or
holders of the 8% Debtor's Secured Convertible Debenture in the original
principal amount of $300,000 (the "Debenture"), signatory hereto, their
endorsees, transferees and assigns (collectively referred to as, the "Secured
Parties"). [IF SUBSIDIARIES EXIST, ALSO REQUIRE A SECURITY AGREEMENT AND
GUARANTEE FOR EACH SUBSIDIARY MODIFIED ACCORDINGLY]

                                   WITNESSETH:

     WHEREAS, pursuant to the Debenture, the Secured Parties have severally
agreed to extend the loans to the Debtor evidenced by the Debenture; and

     WHEREAS, in order to induce the Secured Parties to extend the loans
evidenced by the Debentures, the Debtor has agreed to execute and deliver to the
Secured Parties this Agreement and to grant the Secured Parties, pari passu with
each other Secured Party, a perfected first priority security interest in
certain property of the Debtor to secure the prompt payment, performance and
discharge in full of all of the Debtor's obligations under the Debenture.

     NOW, THEREFORE, in consideration of the agreements herein contained and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto hereby agree as follows:

     1. CERTAIN DEFINITIONS. As used in this Agreement, the following terms
shall have the meanings set forth in this Section 1. Terms used but not
otherwise defined in this Agreement that are defined in Article 9 of the UCC
(such as "general intangibles" and "proceeds") shall have the respective
meanings given such terms in Article 9 of the UCC.

          (a) "Collateral" means the collateral in which the Secured Parties are
     granted a security interest by this Agreement and which shall include the
     following, whether presently owned or existing or hereafter acquired or
     coming into existence, and all additions and accessions thereto and all
     substitutions and replacements thereof, and all proceeds, products and
     accounts thereof, including, without limitation, all proceeds from the sale
     or transfer of the Collateral and of insurance covering the same and of any
     tort claims in connection therewith:

               (i) All Goods of the Debtor, including, without limitations, all
          machinery, equipment, computers, motor vehicles, trucks, tanks, boats,
          ships, appliances, furniture, special and general tools, fixtures,
          test and quality control devices and other equipment of every kind and
          nature and wherever situated, together with all documents of title and
          documents representing the same, all additions and accessions thereto,
          replacements therefor, all parts therefor, and all substitutes for

                                       1

<PAGE>

          any of the foregoing and all other items used and useful in connection
          with the Debtor's businesses and all improvements thereto
          (collectively, the "Equipment"); and

               (ii) All Inventory of the Debtor; and

               (iii) All of the Debtor's contract rights and general
          intangibles, including, without limitation, all partnership interests,
          stock or other securities, licenses, distribution and other
          agreements, computer software (whether "off-the-shelf", licensed from
          any third party or developed by Debtor) computer software development
          rights, leases, franchises, customer lists, quality control
          procedures, grants and rights, goodwill, trademarks, service marks,
          trade styles, trade names, patents, patent applications, copyrights,
          deposit accounts and income tax refunds (collectively, the "General
          Intangibles"); and

               (iv) All Receivables of the Debtor including all insurance
          proceeds, and rights to refunds or indemnification whatsoever owing,
          together with all instruments, all documents of title representing any
          of the foregoing, all rights in any merchandising, goods, equipment,
          motor vehicles and trucks which any of the same may represent, and all
          right, title, security and guaranties with respect to each Receivable,
          including any right of stoppage in transit; and

               (v) All of the Debtor's documents, instruments and chattel paper,
          files, records, books of account, business papers, computer programs
          and the products and proceeds of all of the foregoing Collateral set
          forth in clauses (i)-(iv) above.

          (b) "Obligations" means all of the Debtor's obligations under this
     Agreement and the Debentures, in each case, whether now or hereafter
     existing, voluntary or involuntary, direct or indirect, absolute or
     contingent, liquidated or unliquidated, whether or not jointly owed with
     others, and whether or not from time to time decreased or extinguished and
     later increased, created or incurred, and all or any portion of such
     obligations or liabilities that are paid, to the extent all or any part of
     such payment is avoided or recovered directly or indirectly from any of the
     Secured Parties as a preference, fraudulent transfer or otherwise as such
     obligations may be amended, supplemented, converted, extended or modified
     from time to time.

          (c) "UCC" means the Uniform Commercial Code and or any other
     applicable law of any jurisdiction (including, without limitation, the
     state of California) as to any Collateral located therein.

     2. GRANT OF PERFECTED FIRST PRIORITY SECURITY INTEREST. As an inducement
for the Secured Parties to extend the loans as evidenced by the Debentures and
to secure the complete and timely payment, performance and discharge in full, as
the case may be, of all of the Obligations, the Debtor hereby unconditionally
and irrevocably pledges, grants and hypothecates to the Secured Parties a
continuing and perfected first priority security interest in and to, a lien

                                       2

<PAGE>

upon and a right of set-off against all of their respective right, title and
interest of whatsoever kind and nature in and to, the Collateral (the "Security
Interest").

     3. REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS OF THE DEBTOR. The
Debtor represents and warrants to, and covenants and agrees with, the Secured
Parties as follows:

          (a) The Debtor has the requisite corporate power and authority to
     enter into this Agreement and otherwise to carry out its obligations
     hereunder. The execution, delivery and performance by the Debtor of this
     Agreement and the filings contemplated therein have been duly authorized by
     all necessary action on the part of the Debtor and no further action is
     required by the Debtor.

          (b) The Debtor represents and warrants that they have no place of
     business or offices where their respective books of account and records are
     kept (other than temporarily at the offices of its attorneys or
     accountants) or places where Collateral is stored or located, except as set
     forth on Schedule A attached hereto.

          (c) Except as set forth on Schedule B attached hereto, the Debtor is
     the sole owner of the Collateral (except for non-exclusive licenses granted
     by the Debtor in the ordinary course of business), free and clear of any
     liens, security interests, encumbrances, rights or claims, and are fully
     authorized to grant the Security Interest in and to pledge the Collateral.
     There is not on file in any governmental or regulatory authority, agency or
     recording office an effective financing statement, security agreement,
     license or transfer or any notice of any of the foregoing (other than those
     that will be filed in favor of the Secured Parties pursuant to this
     Agreement) covering or affecting any of the Collateral. So long as this
     Agreement shall be in effect, Debtor shall not execute and shall not
     knowingly permit to be on file in any such office or agency any such
     financing statement or other document or instrument (except to the extent
     filed or recorded in favor of the Secured Parties pursuant to the terms of
     this Agreement).

          (d) No part of the Collateral has been judged invalid or
     unenforceable. No written claim has been received that any Collateral or
     Debtor's use of any Collateral violates the rights of any third party.
     There has been no adverse decision to Debtor's claim of ownership rights in
     or exclusive rights to use the Collateral in any jurisdiction or to
     Debtor's right to keep and maintain such Collateral in full force and
     effect, and there is no proceeding involving said rights pending or, to the
     best knowledge of the Debtor, threatened before any court, judicial body,
     administrative or regulatory agency, arbitrator or other governmental
     authority.

          (e) The Debtor shall at all times maintain its books of account and
     records relating to the Collateral at its principal place of business and
     its Collateral at the locations set forth on Schedule A attached hereto and
     may not relocate such books of account and records or tangible Collateral
     unless it delivers to the Secured Parties at least 30 days prior to such
     relocation (i) written notice of such relocation and the new location
     thereof (which must be within the United States) and (ii) evidence that
     appropriate financing statements under the UCC and other necessary
     documents have been filed and

                                       3

<PAGE>

     recorded and other steps have been taken to perfect the Security Interest
     to create in favor of the Secured Parties a valid, perfected and continuing
     perfected first priority lien in the Collateral.

          (f) This Agreement creates in favor of the Secured Parties a valid
     security interest in the Collateral securing the payment and performance of
     the Obligations and, upon making the filings described in the immediately
     following sentence, a perfected first priority security interest in such
     Collateral.

          (g) The Debtor hereby authorizes the Secured Parties, or any of them,
     to file one or more financing statements under the UCC, with respect to the
     Security Interest with the proper filing and recording agencies in any
     jurisdiction deemed proper by them.

          (h) The execution, delivery and performance of this Agreement by the
     Debtor does not conflict with, or constitute a default (or an event that
     with notice or lapse of time or both would become a default) under, or give
     to others any rights of termination, amendment, acceleration or
     cancellation (with or without notice, lapse of time or both) of, any
     agreement, credit facility, debt or other instrument (evidencing Debtor's
     debt or otherwise) or other understanding to which Debtor is a party or by
     which any property or asset of the Debtor is bound or affected. No consent
     (including, without limitation, from stockholders or creditors of the
     Debtor) is required for the Debtor to enter into and perform its
     obligations hereunder.

          (i) The Debtor shall at all times maintain the liens and Security
     Interest provided for hereunder as valid and perfected first priority liens
     and security interests in the Collateral in favor of the Secured Parties
     until this Agreement and the Security Interest hereunder shall be
     terminated pursuant to Section 11 hereof. The Debtor hereby agrees to
     defend the same against any and all persons. The Debtor shall safeguard and
     protect all Collateral for the account of the Secured Parties. At the
     request of the Secured Parties, the Debtor will sign and deliver to the
     Secured Parties at any time or from time to time one or more financing
     statements pursuant to the UCC in form reasonably satisfactory to the
     Secured Parties and will pay the cost of filing the same in all public
     offices wherever filing is, or is deemed by the Secured Parties to be,
     necessary or desirable to effect the rights and obligations provided for
     herein. Without limiting the generality of the foregoing, the Debtor shall
     pay all fees, taxes and other amounts necessary to maintain the Collateral
     and the Security Interest hereunder, and the Debtor shall obtain and
     furnish to the Secured Parties from time to time, upon demand, such
     releases and/or subordinations of claims and liens which may be required to
     maintain the priority of the Security Interest hereunder.

          (j) The Debtor will not transfer, pledge, hypothecate, encumber,
     license (except for non-exclusive licenses granted by a Debtor in its
     ordinary course of business and sales of inventory), sell or otherwise
     dispose of any of the Collateral without the prior written consent of a
     majority in interest of the Secured Parties.

                                       4

<PAGE>

          (k) The Debtor shall keep and preserve its Equipment, Inventory and
     other tangible Collateral in good condition, repair and order and shall not
     operate or locate any such Collateral (or cause to be operated or located)
     in any area excluded from insurance coverage.

          (l) The Debtor shall, within ten (10) days of obtaining knowledge
     thereof, advise the Secured Parties promptly, in sufficient detail, of any
     substantial change in the Collateral, and of the occurrence of any event
     which would have a material adverse effect on the value of the Collateral
     or on the Secured Parties' security interest therein.

          (m) The Debtor shall promptly execute and deliver to the Secured
     Parties such further deeds, mortgages, assignments, security agreements,
     financing statements or other instruments, documents, certificates and
     assurances and take such further action as the Secured Parties may from
     time to time request and may in its sole discretion deem necessary to
     perfect, protect or enforce its security interest in the Collateral
     including, without limitation, if applicable, the execution and delivery of
     a separate security agreement with respect to each Debtor's intellectual
     property ("Intellectual Property Security Agreement") in which the Secured
     Parties have been granted a security interest hereunder, substantially in a
     form acceptable to the Secured Parties, which Intellectual Property
     Security Agreement, other than as stated therein, shall be subject to all
     of the terms and conditions hereof.

          (n) The Debtor shall permit the Secured Parties and their
     representatives and agents to inspect the Collateral at any time, and to
     make copies of records pertaining to the Collateral as may be requested by
     a Secured Party from time to time.

          (o) The Debtor shall take all steps reasonably necessary to diligently
     pursue and seek to preserve, enforce and collect any rights, claims, causes
     of action and accounts receivable in respect of the Collateral.

          (p) The Debtor shall promptly notify the Secured Parties in sufficient
     detail upon becoming aware of any attachment, garnishment, execution or
     other legal process levied against any Collateral and of any other
     information received by the Debtor that may materially affect the value of
     the Collateral, the Security Interest or the rights and remedies of the
     Secured Parties hereunder.

          (q) All information heretofore, herein or hereafter supplied to the
     Secured Parties by or on behalf of the Debtor with respect to the
     Collateral is accurate and complete in all material respects as of the date
     furnished.

          (r) The Debtor shall at all times preserve and keep in full force and
     effect their respective valid existence and good standing and any rights
     and franchises material to its business.

          (s) The Debtor will not change its name, corporate structure, or
     identity, or add any new fictitious name unless it provides at least 30
     days prior written notice to the

                                       5

<PAGE>

     Secured Parties of such change and, at the time of such written
     notification, such Debtor provides any financing statements or fixture
     filings necessary to perfect and continue perfected the perfected first
     priority Security Interest granted and evidenced by this Agreement.

          (t) The Debtor may not consign any of its Inventory or sell any of its
     Inventory on bill and hold, sale or return, sale on approval, or other
     conditional terms of sale without the consent of a majority in interest of
     the Secured Parties which shall not be unreasonably withheld..

          (u) The Debtor may not relocate its chief executive office to a new
     location without providing 30 days prior written notification thereof to
     the Secured Parties and so long as, at the time of such written
     notification, the Debtor provides any financing statements or fixture
     filings necessary to perfect and continue perfected the perfected first
     priority Security Interest granted and evidenced by this Agreement.

     4. DEFAULTS. The following events shall be "Events of Default":

          (a) The occurrence of an Event of Default (as defined in the
     Debenture) under the Debenture;

          (b) Any representation or warranty of Debtor in this Agreement shall
     prove to have been incorrect in any material respect when made;

          (c) The failure by Debtor to observe or perform any of its obligations
     hereunder for five (5) days after delivery to Debtor of notice of such
     failure by or on behalf of a Secured Party;

          (c) If any provision of this Agreement shall at any time for any
     reason be declared to be null and void, or the validity or enforceability
     thereof shall be contested by Debtor, or a proceeding shall be commenced by
     Debtor, or by any governmental authority having jurisdiction over Debtor,
     seeking to establish the invalidity or unenforceability thereof, or Debtor
     shall deny that Debtor has any liability or obligation purported to be
     created under this Agreement; or

     5. Duty To Hold In Trust. Upon the occurrence of any Event of Default and
at any time thereafter, the Debtor shall, upon receipt of any revenue, income or
other sums subject to the Security Interest, whether payable pursuant to the
Debenture or otherwise, or of any check, draft, note, trade acceptance or other
instrument evidencing an obligation to pay any such sum, hold the same in trust
for the Secured Parties and shall forthwith endorse and transfer any such sums
or instruments, or both, to the Secured Parties, pro-rata in proportion to their
initial purchases of Debentures for application to the satisfaction of the
Obligations (and if any Debenture is not outstanding, pro-rata in proportion to
the initial purchases of the remaining Debentures).

     6. Rights and Remedies Upon Default. Upon the occurrence of any Event of
Default and at any time thereafter, the Secured Parties shall have the right to
exercise all of the remedies

                                       6

<PAGE>

conferred hereunder and under the Debentures, and the Secured Parties shall have
all the rights and remedies of a secured party under the UCC. Without
limitation, the Secured Parties shall have the following rights and powers:

          (a) The Secured Parties shall have the right to take possession of the
     Collateral and, for that purpose, enter, with the aid and assistance of any
     person, any premises where the Collateral, or any part thereof, is or may
     be placed and remove the same, and the Debtor shall assemble the Collateral
     and make it available to the Secured Parties at places which the Secured
     Parties shall reasonably select, whether at the Debtor's premises or
     elsewhere, and make available to the Secured Parties, without rent, all of
     the Debtor's respective premises and facilities for the purpose of the
     Secured Parties taking possession of, removing or putting the Collateral in
     saleable or disposable form.

          (b) The Secured Parties shall have the right to operate the business
     of the Debtor using the Collateral and shall have the right to assign,
     sell, lease or otherwise dispose of and deliver all or any part of the
     Collateral, at public or private sale or otherwise, either with or without
     special conditions or stipulations, for cash or on credit or for future
     delivery, in such parcel or parcels and at such time or times and at such
     place or places, and upon such terms and conditions as the Secured Parties
     may deem commercially reasonable, all without (except as shall be required
     by applicable statute and cannot be waived) advertisement or demand upon or
     notice to the Debtor or right of redemption of a Debtor, which are hereby
     expressly waived. Upon each such sale, lease, assignment or other transfer
     of Collateral, the Secured Parties may, unless prohibited by applicable law
     which cannot be waived, purchase all or any part of the Collateral being
     sold, free from and discharged of all trusts, claims, right of redemption
     and equities of the Debtor, which are hereby waived and released.

     7. Applications of Proceeds. The proceeds of any such sale, lease or other
disposition of the Collateral hereunder shall be applied first, to the expenses
of retaking, holding, storing, processing and preparing for sale, selling, and
the like (including, without limitation, any taxes, fees and other costs
incurred in connection therewith) of the Collateral, to the reasonable
attorneys' fees and expenses incurred by the Secured Parties in enforcing their
rights hereunder and in connection with collecting, storing and disposing of the
Collateral, and then to satisfaction of the Obligations pro rata among the
Secured Parties, and to the payment of any other amounts required by applicable
law, after which the Secured Parties shall pay to the applicable Debtor any
surplus proceeds. If, upon the sale, license or other disposition of the
Collateral, the proceeds thereof are insufficient to pay all amounts to which
the Secured Parties are legally entitled, the Debtor will be liable for the
deficiency, together with interest thereon, at the rate of 10% per annum or the
lesser amount permitted by applicable law (the "Default Rate"), and the
reasonable fees of any attorneys employed by the Secured Parties to collect such
deficiency. To the extent permitted by applicable law, the Debtor waives all
claims, damages and demands against the Secured Parties arising out of the
repossession, removal, retention or sale of the Collateral, unless due to the
gross negligence or willful misconduct of the Secured Parties.

                                       7

<PAGE>

     8. Costs and Expenses. The Debtor agrees to pay all reasonable
out-of-pocket fees, costs and expenses incurred in connection with any filing
required hereunder, including without limitation, any financing statements
pursuant to the UCC, continuation statements, partial releases and/or
termination statements related thereto or any expenses of any searches
reasonably required by the Secured Parties. The Debtor shall also pay all other
claims and charges which in the reasonable opinion of the Secured Parties might
prejudice, imperil or otherwise affect the Collateral or the Security Interest
therein. The Debtor will also, upon demand, pay to the Secured Parties the
amount of any and all reasonable expenses, including the reasonable fees and
expenses of its counsel and of any experts and agents, which the Secured Parties
may incur in connection with (i) the enforcement of this Agreement, (ii) the
custody or preservation of, or the sale of, collection from, or other
realization upon, any of the Collateral, or (iii) the exercise or enforcement of
any of the rights of the Secured Parties under the Debentures. Until so paid,
any fees payable hereunder shall be added to the principal amount of the
Debentures and shall bear interest at the Default Rate.

     9. Responsibility for Collateral. The Debtor assumes all liabilities and
responsibility in connection with all Collateral, and the Obligations in no way
be affected or diminished by reason of the loss, destruction, damage or theft of
any of the Collateral or its unavailability for any reason.

     10. Security Interest Absolute. All rights of the Secured Parties and all
Obligations of the Debtor hereunder, shall be absolute and unconditional,
irrespective of: (a) any lack of validity or enforceability of this Agreement,
the Debentures or any agreement entered into in connection with the foregoing,
or any portion hereof or thereof; (b) any change in the time, manner or place of
payment or performance of, or in any other term of, all or any of the
Obligations, or any other amendment or waiver of or any consent to any departure
from the Debentures or any other agreement entered into in connection with the
foregoing; (c) any exchange, release or nonperfection of any of the Collateral,
or any release or amendment or waiver of or consent to departure from any other
collateral for, or any guaranty, or any other security, for all or any of the
Obligations; (d) any action by the Secured Parties to obtain, adjust, settle and
cancel in its sole discretion any insurance claims or matters made or arising in
connection with the Collateral; or (e) any other circumstance which might
otherwise constitute any legal or equitable defense available to a Debtor, or a
discharge of all or any part of the Security Interest granted hereby. Until the
Obligations shall have been paid and performed in full, the rights of the
Secured Parties shall continue even if the Obligations are barred for any
reason, including, without limitation, the running of the statute of limitations
or bankruptcy. The Debtor expressly waives presentment, protest, notice of
protest, demand, notice of nonpayment and demand for performance. In the event
that at any time any transfer of any Collateral or any payment received by the
Secured Parties hereunder shall be deemed by final order of a court of competent
jurisdiction to have been a voidable preference or fraudulent conveyance under
the bankruptcy or insolvency laws of the United States, or shall be deemed to be
otherwise due to any party other than the Secured Parties, then, in any such
event, the Debtor's obligations hereunder shall survive cancellation of this
Agreement, and shall not be discharged or satisfied by any prior payment thereof
and/or cancellation of this Agreement, but shall remain a valid and binding
obligation enforceable in accordance with the terms and provisions hereof. The
Debtor waives all right to require the Secured Parties to proceed against any
other person or to apply any Collateral which the Secured

                                       8

<PAGE>

Parties may hold at any time, or to marshal assets, or to pursue any other
remedy. The Debtor waives any defense arising by reason of the application of
the statute of limitations to any obligation secured hereby.

     11. Term of Agreement. This Agreement and the Security Interest shall
terminate on the date on which all payments under the Debentures have been made
in full or have been satisfied and all other Obligations have been paid or
discharged. Upon such termination, the Secured Parties, at the request and at
the expense of the Debtor, will join in executing any termination statement with
respect to any financing statement executed and filed pursuant to this
Agreement.

     12. Power of Attorney; Further Assurances.

          (a) The Debtor authorizes the Secured Parties, and does hereby make,
     constitute and appoint the Secured Parties and their respective officers,
     agents, successors or assigns with full power of substitution, as the
     Debtor's true and lawful attorney-in-fact, with power, in the name of the
     various Secured Parties or the Debtor, to, after the occurrence and during
     the continuance of an Event of Default, (i) endorse any note, checks,
     drafts, money orders or other instruments of payment (including payments
     payable under or in respect of any policy of insurance) in respect of the
     Collateral that may come into possession of the Secured Parties; (ii) to
     sign and endorse any financing statement pursuant to the UCC or any
     invoice, freight or express bill, bill of lading, storage or warehouse
     receipts, drafts against debtors, assignments, verifications and notices in
     connection with accounts, and other documents relating to the Collateral;
     (iii) to pay or discharge taxes, liens, security interests or other
     encumbrances at any time levied or placed on or threatened against the
     Collateral; (iv) to demand, collect, receipt for, compromise, settle and
     sue for monies due in respect of the Collateral; and (v) generally, to do,
     at the option of the Secured Parties, and at the expense of the Debtor, at
     any time, or from time to time, all acts and things which the Secured
     Parties deem necessary to protect, preserve and realize upon the Collateral
     and the Security Interest granted therein in order to effect the intent of
     this Agreement and the Debentures all as fully and effectually as the
     Debtor might or could do; and the Debtor hereby ratifies all that said
     attorney shall lawfully do or cause to be done by virtue hereof. This power
     of attorney is coupled with an interest and shall be irrevocable for the
     term of this Agreement and thereafter as long as any of the Obligations
     shall be outstanding.

          (b) On a continuing basis, the Debtor will make, execute, acknowledge,
     deliver, file and record, as the case may be, with the proper filing and
     recording agencies in any jurisdiction, including, without limitation, the
     jurisdictions indicated on Schedule C attached hereto, all such
     instruments, and take all such action as may reasonably be deemed necessary
     or advisable, or as reasonably requested by the Secured Parties, to perfect
     the Security Interest granted hereunder and otherwise to carry out the
     intent and purposes of this Agreement, or for assuring and confirming to
     the Secured Parties the grant or perfection of a perfected first priority
     security interest in all the Collateral under the UCC.

                                       9

<PAGE>

          (c) The Debtor hereby irrevocably appoints the Secured Parties as the
     Debtor's attorney-in-fact, with full authority in the place and instead of
     the Debtor and in the name of the Debtor, from time to time in the Secured
     Parties' discretion, to take any action and to execute any instrument which
     the Secured Parties may deem necessary or advisable to accomplish the
     purposes of this Agreement, including the filing, in its sole discretion,
     of one or more financing or continuation statements and amendments thereto,
     relative to any of the Collateral without the signature of the Debtor where
     permitted by law.

     13. Notices. All notices, requests, demands and other communications
hereunder shall be subject to the notice provision of the Purchase Agreement.

     14. Other Security. To the extent that the Obligations are now or hereafter
secured by property other than the Collateral or by the guarantee, endorsement
or property of any other person, firm, corporation or other entity, then the
Secured Parties shall have the right, in its sole discretion, to pursue,
relinquish, subordinate, modify or take any other action with respect thereto,
without in any way modifying or affecting any of the Secured Parties' rights and
remedies hereunder.

     15. Miscellaneous.

          (a) No course of dealing between the Debtor and the Secured Parties,
     nor any failure to exercise, nor any delay in exercising, on the part of
     the Secured Parties, any right, power or privilege hereunder or under the
     Debentures shall operate as a waiver thereof; nor shall any single or
     partial exercise of any right, power or privilege hereunder or thereunder
     preclude any other or further exercise thereof or the exercise of any other
     right, power or privilege.

          (b) All of the rights and remedies of the Secured Parties with respect
     to the Collateral, whether established hereby or by the Debentures or by
     any other agreements, instruments or documents or by law shall be
     cumulative and may be exercised singly or concurrently.

          (c) This Agreement constitutes the entire agreement of the parties
     with respect to the subject matter hereof and is intended to supersede all
     prior negotiations, understandings and agreements with respect thereto.
     Except as specifically set forth in this Agreement, no provision of this
     Agreement may be modified or amended except by a written agreement
     specifically referring to this Agreement and signed by the parties hereto.

          (d) In the event any provision of this Agreement is held to be
     invalid, prohibited or unenforceable in any jurisdiction for any reason,
     unless such provision is narrowed by judicial construction, this Agreement
     shall, as to such jurisdiction, be construed as if such invalid, prohibited
     or unenforceable provision had been more narrowly drawn so as not to be
     invalid, prohibited or unenforceable. If, notwithstanding the foregoing,
     any provision of this Agreement is held to be invalid, prohibited or
     unenforceable in any jurisdiction, such provision, as to such jurisdiction,
     shall be ineffective to the extent of such invalidity,

                                       10

<PAGE>

     prohibition or unenforceability without invalidating the remaining portion
     of such provision or the other provisions of this Agreement and without
     affecting the validity or enforceability of such provision or the other
     provisions of this Agreement in any other jurisdiction.

          (e) No waiver of any breach or default or any right under this
     Agreement shall be considered valid unless in writing and signed by the
     party giving such waiver, and no such waiver shall be deemed a waiver of
     any subsequent breach or default or right, whether of the same or similar
     nature or otherwise.

          (f) This Agreement shall be binding upon and inure to the benefit of
     each party hereto and its successors and assigns.

          (g) Each party shall take such further action and execute and deliver
     such further documents as may be necessary or appropriate in order to carry
     out the provisions and purposes of this Agreement.

          (h) All questions concerning the construction, validity, enforcement
     and interpretation of this Agreement shall be governed by and construed and
     enforced in accordance with the internal laws of the State of New York,
     without regard to the principles of conflicts of law thereof. Each party
     agrees that all proceedings concerning the interpretations, enforcement and
     defense of the transactions contemplated by this Agreement and the
     Debenture (whether brought against a party hereto or its respective
     affiliates, directors, officers, shareholders, employees or agents) shall
     be commenced exclusively in the state and federal courts sitting in the
     City of New York, Borough of Manhattan. Each party hereto 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 with any
     transaction contemplated hereby or discussed herein, and hereby irrevocably
     waives, and agrees not to assert in any proceeding, any claim that it is
     not personally subject to the jurisdiction of any such court, that such
     proceeding is improper. Each party hereto hereby irrevocably waives
     personal service of process and consents to process being served in any
     such proceeding by mailing a copy thereof via registered or certified mail
     or overnight delivery (with evidence of delivery) to such party at the
     address in effect for notices to it under this 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. Each party
     hereto hereby irrevocably waives, to the fullest extent permitted by
     applicable law, any and all right to trial by jury in any legal proceeding
     arising out of or relating to this Agreement or the transactions
     contemplated hereby. If either party shall commence a proceeding to enforce
     any provisions of this Agreement, then the prevailing party in such
     proceeding shall be reimbursed by the other party for its reasonable
     attorneys fees and other costs and expenses incurred with the
     investigation, preparation and prosecution of such proceeding.

                                       11

<PAGE>

          (i) This 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. In the
     event that any signature is delivered by facsimile transmission, such
     signature shall create a valid binding obligation of the party executing
     (or on whose behalf such signature is executed) the same with the same
     force and effect as if such facsimile signature were the original thereof.

                            [SIGNATURE PAGES FOLLOW]

                                       12

<PAGE>

     IN WITNESS WHEREOF, the parties hereto have caused this Security Agreement
to be duly executed on the day and year first above written.

                                        EDENTIFY, INC.

                                        By:
                                            ------------------------------------
                                        Name: Terrence DeFranco
                                        Title: President

                       [SIGNATURE PAGE OF HOLDERS FOLLOWS]

                                       13

<PAGE>

                   [SIGNATURE PAGE OF HOLDERS TO EDENTIFY SA]

Name of Investing Entity:
                          -----------------------------

Signature of Authorized Signatory of Investing entity:
                                                       -------------------------
Name of Authorized Signatory:
                              --------------------------
Title of Authorized Signatory:
                               -------------------------

                       [SIGNATURE PAGE OF HOLDERS FOLLOWS]

                                       14

<PAGE>

                                   SCHEDULE A

Principal Place of Business of Debtor:

     ---------------------------------------------------------------------------

     ---------------------------------------------------------------------------

     ---------------------------------------------------------------------------

Locations Where Collateral is Located or Stored:

     ---------------------------------------------------------------------------

     ---------------------------------------------------------------------------

     ---------------------------------------------------------------------------

                                       15

<PAGE>

                                   SCHEDULE B

                                       16

<PAGE>

                                   SCHEDULE C

                                       17

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00096-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00096-of-00352.parquet"}]]