Document:

Exhibit 10.12 Amended and Restated Security Agreement

    
      

    

    Exhibit
      10.12

     

    AMENDED
      AND RESTATED SECURITY AGREEMENT

    

    THIS
      AMENDED AND RESTATED SECURITY AGREEMENT
      (the
“Agreement”), is
      entered into and made effective as of December 30, 2005, by and between
TREY
      RESOURCES, INC., a
      Delaware corporation (the “Company”),
      and
      the BUYER(S)
      listed
      on Schedule I attached to the Securities Purchase Agreement dated the date
      hereof (the
      “Secured
      Party”).

    

    WHEREAS,
      the
      Company issued to the Secured Party a Promissory Note dated January 20,2005
      in
      original principal amount of One Million One Hundred Fifty Thousand Dollars
      ($1,150,000) (the “January
      Note”),
      of
      which the principal amount of Eight Hundred Twenty Five Thousand Dollars
      ($825,000) is outstanding as of the date hereof plus One Hundred Twenty Six
      Thousand Ninety One Dollars ($126,091) of accrued and unpaid interest, which
      was
      secured by the Security Agreement dated January 20, 2005;

    

    WHEREAS,
      the
      Company issued to the Secured Party a Promissory Note dated August 31, 2005
      in
      original principal amount of Two Hundred Thousand Dollars ($200,000) (the
“August
      Note”),
      of
      which the principal amount of Two Hundred Thousand Dollars ($200,000) is
      outstanding as of the date hereof plus Seven Thousand Nine Hundred Fifty Six
      Dollars ($7,956) of accrued and unpaid interest, which was secured by the
      Security Agreement dated August 31, 2005;

    

    WHEREAS,
      this
      Agreement shall amend and restate the Security Agreement dated January 20,
      2005
      and the Security Agreement dated August 31, 2005, both between the Company
      and
      the Secured Party; 

    

    WHEREAS,
      the
      Company has requested the Secured Party to make additional financing available
      to the Company; 

    

    WHEREAS,
      the
      Secured Party is willing to provide such additional financing on the condition
      that such additional financing is secured hereunder and under the UCC-1 filed
      on
      August 10, 2005 (#5248807 1), the UCC-1 filed on August 10, 2005 (#2311920-8),
      both filed in connection with the January Note, the UCC-1 filed on September
      1,
      2005 (#5272581 0) and the UCC-1 filed on September 1, 2005 (#2317054-4), both
      filed in connection with the August Note;

    

    WHEREAS,
      the
      Company shall issue and sell to the Secured Party, as provided in the Securities
      Purchase Agreement of even date herewith between the Company and the Secured
      Party (the “Securities
      Purchase Agreement”),
      and
      the Secured Party shall purchase up to Two Million Three Hundred Fifty Nine
      Thousand Forty Seven Dollars ($2,359,047) of secured convertible
      debentures (the “Convertible
      Debentures”),
      which
      shall be convertible into shares of the Company’s Class A common stock, par
      value $0.00001 (the “Common
      Stock”)
      (as
      converted, the “Conversion
      Shares”)
      in the
      respective amounts set forth opposite each Buyer(s) name on Schedule I
      attached to the Securities Purchase Agreement;

    

    WHEREAS,
      to
      induce
      the Secured Party to enter into the transaction contemplated by the Securities
      Purchase Agreement, the Convertible Debentures, the Investor Registration Rights
      Agreement of even date herewith between the Company and the Secured Party (the
      “Investor
      Registration Rights Agreement”),
      the
      Escrow Agreement of even date herewith among the Company, the Secured Party,
      and
      David Gonzalez, Esq. (the “Escrow
      Agreement”),
      and
      the Irrevocable Transfer Agent Instructions among the Company, the Secured
      Party, the Transfer Agent, and David Gonzalez, Esq. (the “Transfer
      Agent Instructions”)
      (collectively referred to as the “Transaction
      Documents”),
      the
      Company hereby grants to the Secured Party a security interest in and to the
      pledged property identified on Exhibit
      A
      hereto
      (collectively referred to as the “Pledged
      Property”)
      until
      the satisfaction of the Obligations, as defined herein below.

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    NOW,
      THEREFORE, in
      consideration of the promises and the mutual covenants herein contained, and
      for
      other good and valuable consideration, the adequacy and receipt of which are
      hereby acknowledged, the parties hereto hereby agree as follows:

    

    ARTICLE
      1.

    

    DEFINITIONS
      AND INTERPRETATIONS

    

    Section
      1.1.    Recitals.
      

    

    The
      above
      recitals are true and correct and are incorporated herein, in their entirety,
      by
      this reference.

    

    Section
      1.2.    Interpretations.
      

    

    Nothing
      herein expressed or implied is intended or shall be construed to confer upon
      any
      person other than the Secured Party any right, remedy or claim under or by
      reason hereof.

    

    Section
      1.3.    Obligations
      Secured.

    

    The
      obligations secured hereby are any and all obligations of the Company now
      existing or hereinafter incurred to the Secured Party, whether oral or written
      and whether arising before, on or after the date hereof including, without
      limitation, those obligations of the Company to the Secured Party under this
      Agreement, the Transaction Documents, and any other amounts now or hereafter
      owed to the Secured Party by the Company thereunder or hereunder (collectively,
      the “Obligations”).

    

    ARTICLE
      2.

    

    PLEDGED
      PROPERTY, ADMINISTRATION OF COLLATERAL 

    AND
      TERMINATION OF SECURITY INTEREST

    

    Section
      2.1.    Pledged
      Property.

    

    (a)    Company
      hereby pledges to the Secured Party, and creates in the Secured Party for its
      benefit, a security interest for such time until the Obligations are paid in
      full, in and to all of the property of the Company as set forth in Exhibit “A”
      attached
      hereto and the products thereof and the proceeds of all such items
      (collectively, the “Pledged
      Property”):

    
      
        
        

      

      
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    (b)    Simultaneously
      with the execution and delivery of this Agreement, the Company shall make,
      execute, acknowledge, file, record and deliver to the Secured Party any
      documents reasonably requested by the Secured Party to perfect its security
      interest in the Pledged Property. Simultaneously with the execution and delivery
      of this Agreement, the Company shall make, execute, acknowledge and deliver
      to
      the Secured Party such documents and instruments, including, without limitation,
      financing statements, certificates, affidavits and forms as may, in the Secured
      Party’s reasonable judgment, be necessary to effectuate, complete or perfect, or
      to continue and preserve, the security interest of the Secured Party in the
      Pledged Property, and the Secured Party shall hold such documents and
      instruments as secured party, subject to the terms and conditions contained
      herein.

    

    Section
      2.2.    Rights;
      Interests; Etc.

    

    (a)    So
      long
      as no Event of Default (as hereinafter defined) shall have occurred and be
      continuing:

    

    (i)    the
      Company shall be entitled to exercise any and all rights pertaining to the
      Pledged Property or any part thereof for any purpose not inconsistent with
      the
      terms hereof; and

    

    (ii)   the
      Company shall be entitled to receive and retain any and all payments paid or
      made in respect of the Pledged Property.

    

    (b)    Upon
      the
      occurrence and during the continuance of an Event of Default:

    

    (i)    All
      rights of the Company to exercise the rights which it would otherwise be
      entitled to exercise pursuant to Section 2.2(a)(i) hereof and to
      receive payments which it would otherwise be authorized to receive and retain
      pursuant to Section 2.2(a)(ii) hereof shall be suspended, and all such
      rights shall thereupon become vested in the Secured Party who shall thereupon
      have the sole right to exercise such rights and to receive and hold as Pledged
      Property such payments; provided,
      however,
      that if
      the Secured Party shall become entitled and shall elect to exercise its right
      to
      realize on the Pledged Property pursuant to Article 5 hereof, then all cash
      sums received by the Secured Party, or held by Company for the benefit of the
      Secured Party and paid over pursuant to Section 2.2(b)(ii) hereof,
      shall be applied against any outstanding Obligations; and

    

    (ii)    All
      interest, dividends, income and other payments and distributions which are
      received by the Company contrary to the provisions of
      Section 2.2(b)(i) hereof shall be received in trust for the benefit of
      the Secured Party, shall be segregated from other property of the Company and
      shall be forthwith paid over to the Secured Party; or 

    

    (iii)   The
      Secured Party in its sole discretion shall be authorized to sell
      any
      or all of the Pledged Property at public or private sale in order to recoup
      all
      of the outstanding principal plus accrued interest owed pursuant to the
      Convertible Debenture as described herein

    

    (c)    An
      “Event
      of Default”
shall
      be deemed to have occurred under this Agreement upon an Event of Default under
      the Convertible Debentures.

    
      
        
        

      

      
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    ARTICLE
      3.

    

    ATTORNEY-IN-FACT;
      PERFORMANCE

    

    Section
      3.1.    Secured
      Party Appointed Attorney-In-Fact.

    

    Upon
      the
      occurrence of an Event of Default, the Company hereby appoints the Secured
      Party
      as its attorney-in-fact, with full authority in the place and stead of the
      Company and in the name of the Company or otherwise, from time to time in the
      Secured Party’s discretion to take any action and to execute any instrument
      which the Secured Party may reasonably deem necessary to accomplish the purposes
      of this Agreement, including, without limitation, to receive and collect all
      instruments made payable to the Company representing any payments in respect
      of
      the Pledged Property or any part thereof and to give full discharge for the
      same. The Secured Party may demand, collect, receipt for, settle, compromise,
      adjust, sue for, foreclose, or realize on the Pledged Property as and when
      the
      Secured Party may determine. To facilitate collection, the Secured Party may
      notify account debtors and obligors on any Pledged Property to make payments
      directly to the Secured Party.

    

    Section
      3.2.    Secured
      Party May Perform.

    

    If
      the
      Company fails to perform any agreement contained herein, the Secured Party,
      at
      its option, may itself perform, or cause performance of, such agreement, and
      the
      expenses of the Secured Party incurred in connection therewith shall be included
      in the Obligations secured hereby and payable by the Company under
      Section 8.3.

    

    ARTICLE
      4.

    

    REPRESENTATIONS
      AND WARRANTIES

    

    Section
      4.1.    Authorization;
      Enforceability.

    

    Each
      of
      the parties hereto represents and warrants that it has taken all action
      necessary to authorize the execution, delivery and performance of this Agreement
      and the transactions contemplated hereby; and upon execution and delivery,
      this
      Agreement shall constitute a valid and binding obligation of the respective
      party, subject to applicable bankruptcy, insolvency, reorganization, moratorium
      and similar laws affecting creditors’ rights or by the principles governing the
      availability of equitable remedies.

    

    Section
      4.2.    Ownership
      of Pledged Property.

    

    The
      Company warrants and represents that it is the legal and beneficial owner of
      the
      Pledged Property free and clear of any lien, security interest, option or other
      charge or encumbrance except for the security interest created by this
      Agreement.

    
      
        
        

      

      
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    ARTICLE
      5.

    

    DEFAULT;
      REMEDIES; SUBSTITUTE COLLATERAL

    

    Section
      5.1.    Default
      and Remedies.

    

    (a)    If
      an
      Event of Default occurs, then in each such case the Secured Party may declare
      the Obligations to be due and payable immediately, by a notice in writing to
      the
      Company, and upon any such declaration, the Obligations shall become immediately
      due and payable. 

    

    (b)    Upon
      the
      occurrence of an Event of Default, the Secured Party shall: (i) be entitled
      to receive all distributions with respect to the Pledged Property, (ii) to
      cause the Pledged Property to be transferred into the name of the Secured Party
      or its nominee, (iii) to dispose of the Pledged Property, and (iv) to
      realize upon any and all rights in the Pledged Property then held by the Secured
      Party.

    

    Section
      5.2.    Method
      of Realizing Upon the Pledged Property: Other Remedies.

    

    Upon
      the
      occurrence of an Event of Default, in addition to any rights and remedies
      available at law or in equity, the following provisions shall govern the Secured
      Party’s right to realize upon the Pledged Property:

    

    (a)    Any
      item
      of the Pledged Property may be sold for cash or other value in any number of
      lots at brokers board, public auction or private sale and may be sold without
      demand, advertisement or notice (except that the Secured Party shall give the
      Company ten (10) days’ prior written notice of the time and place or
      of the time after which a private sale may be made (the “Sale
      Notice”)),
      which notice period is hereby agreed to be commercially reasonable. At any
      sale
      or sales of the Pledged Property, the Company may bid for and purchase the
      whole
      or any part of the Pledged Property and, upon compliance with the terms of
      such
      sale, may hold, exploit and dispose of the same without further accountability
      to the Secured Party. The Company will execute and deliver, or cause to be
      executed and delivered, such instruments, documents, assignments, waivers,
      certificates, and affidavits and supply or cause to be supplied such further
      information and take such further action as the Secured Party reasonably shall
      require in connection with any such sale.

    

    (b)    Any
      cash
      being held by the Secured Party as Pledged Property and all cash proceeds
      received by the Secured Party in respect of, sale of, collection from, or other
      realization upon all or any part of the Pledged Property shall be applied as
      follows:

    

    (i)    to
      the
      payment of all amounts due the Secured Party for the expenses reimbursable
      to it
      hereunder or owed to it pursuant to Section 8.3 hereof;

    

    (ii)   to
      the
      payment of the Obligations then due and unpaid.

    

    (iii)   the
      balance, if any, to the person or persons entitled thereto, including, without
      limitation, the Company.

    
      
        
        

      

      
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    (c)    In
      addition to all of the rights and remedies which the Secured Party may have
      pursuant to this Agreement, the Secured Party shall have all of the rights
      and
      remedies provided by law, including, without limitation, those under the Uniform
      Commercial Code.

    

    (i)    If
      the
      Company fails to pay such amounts due upon the occurrence of an Event of Default
      which is continuing, then the Secured Party may institute a judicial proceeding
      for the collection of the sums so due and unpaid, may prosecute such proceeding
      to judgment or final decree and may enforce the same against the Company and
      collect the monies adjudged or decreed to be payable in the manner provided
      by
      law out of the property of Company, wherever situated.

    

    (ii)    The
      Company agrees that it shall be liable for any reasonable fees, expenses and
      costs incurred by the Secured Party in connection with enforcement, collection
      and preservation of the Transaction Documents, including, without limitation,
      reasonable legal fees and expenses, and such amounts shall be deemed included
      as
      Obligations secured hereby and payable as set forth in Section 8.3
      hereof.

    

    Section
      5.3.    Proofs
      of Claim.

    

    In
      case
      of the pendency of any receivership, insolvency, liquidation, bankruptcy,
      reorganization, arrangement, adjustment, composition or other judicial
      proceeding relating to the Company or the property of the Company or of such
      other obligor or its creditors, the Secured Party (irrespective of whether
      the
      Obligations shall then be due and payable as therein expressed or by declaration
      or otherwise and irrespective of whether the Secured Party shall have made
      any
      demand on the Company for the payment of the Obligations), subject to the rights
      of Previous Security Holders, shall be entitled and empowered, by intervention
      in such proceeding or otherwise:

    

    (i)    to
      file
      and prove a claim for the whole amount of the Obligations and to file such
      other
      papers or documents as may be necessary or advisable in order to have the claims
      of the Secured Party (including any claim for the reasonable legal fees and
      expenses and other expenses paid or incurred by the Secured Party permitted
      hereunder and of the Secured Party allowed in such judicial proceeding),
      and

    

    (ii)    to
      collect and receive any monies or other property payable or deliverable on
      any
      such claims and to distribute the same; and any custodian, receiver, assignee,
      trustee, liquidator, sequestrator or other similar official in any such judicial
      proceeding is hereby authorized by the Secured Party to make such payments
      to
      the Secured Party and, in the event that the Secured Party shall consent to
      the
      making of such payments directed to the Secured Party, to pay to the Secured
      Party any amounts for expenses due it hereunder.

    

    Section
      5.4.    Duties
      Regarding Pledged Property.

    

    The
      Secured Party shall have no duty as to the collection or protection of the
      Pledged Property or any income thereon or as to the preservation of any rights
      pertaining thereto, beyond the safe custody and reasonable care of any of the
      Pledged Property actually in the Secured Party’s possession.

    
      
        
        

      

      
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    ARTICLE
      6.

    

    AFFIRMATIVE
      COVENANTS

    

    The
      Company covenants and agrees that, from the date hereof and until the
      Obligations have been fully paid and satisfied, unless the Secured Party shall
      consent otherwise in writing (as provided in Section 8.4
      hereof):

    

    Section
      6.1.    Existence,
      Properties, Etc.

    

    (a)    The
      Company shall do, or cause to be done, all things, or proceed with due diligence
      with any actions or courses of action, that may be reasonably necessary
      (i) to maintain Company’s due organization, valid existence and good
      standing under the laws of its state of incorporation, and (ii) to preserve
      and keep in full force and effect all qualifications, licenses and registrations
      in those jurisdictions in which the failure to do so could have a Material
      Adverse Effect (as defined below); and (b) the Company shall not do, or
      cause to be done, any act impairing the Company’s corporate power or authority
      (i) to carry on the Company’s business as now conducted, and (ii) to
      execute or deliver this Agreement or any other document delivered in connection
      herewith, including, without limitation, any UCC-1 Financing Statements required
      by the Secured Party to which it is or will be a party, or perform any of
      its obligations hereunder or thereunder. For purpose of this Agreement, the
      term
“Material
      Adverse Effect”
shall
      mean any material and adverse affect as determined by Secured Party in its
      sole
      discretion, whether individually or in the aggregate, upon (a) the
      Company’s assets, business, operations, properties or condition, financial or
      otherwise; (b) the Company’s to make payment as and when due of all or any
      part of the Obligations; or (c) the Pledged Property.

    

    Section
      6.2.    Financial
      Statements and Reports.

    

    The
      Company shall furnish to the Secured Party within a reasonable time such
      financial data as the Secured Party may reasonably request, including, without
      limitation, the following:

    

    (a)    The
      balance sheet of the Company as of the close of each fiscal year, the statement
      of earnings and retained earnings of the Company as of the close of such fiscal
      year, and statement of cash flows for the Company for such fiscal year, all
      in
      reasonable detail, prepared in accordance with generally accepted accounting
      principles consistently applied, certified by the chief executive and chief
      financial officers of the Company as being true and correct and accompanied
      by a
      certificate of the chief executive and chief financial officers of the Company,
      stating that the Company has kept, observed, performed and fulfilled each
      covenant, term and condition of this Agreement during such fiscal year and
      that
      no Event of Default hereunder has occurred and is continuing, or if an Event
      of
      Default has occurred and is continuing, specifying the nature of same, the
      period of existence of same and the action the Company proposes to take in
      connection therewith;

    

    (b)    A
      balance
      sheet of the Company as of the close of each month, and statement of earnings
      and retained earnings of the Company as of the close of such month, all in
      reasonable detail, and prepared substantially in accordance with generally
      accepted accounting principles consistently applied, certified by the chief
      executive and chief financial officers of the Company as being true and correct;
      and

    
      
        
        

      

      
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    (c)    Copies
      of
      all accountants' reports and accompanying financial reports submitted to the
      Company by independent accountants in connection with each annual examination
      of
      the Company.

    

    Section
      6.3.    Accounts
      and Reports.

    

    The
      Company shall maintain a standard system of accounting in accordance with
      generally accepted accounting principles consistently applied and provide,
      at
      its sole expense, to the Secured Party the following:

    

    (a)    as
      soon
      as available, a copy of any notice or other communication alleging any
      nonpayment or other material breach or default, or any foreclosure or other
      action respecting any material portion of its assets and properties, received
      respecting any of the indebtedness of the Company in excess of $15,000 (other
      than the Obligations), or any demand or other request for payment under any
      guaranty, assumption, purchase agreement or similar agreement or arrangement
      respecting the indebtedness or obligations of others in excess of $15,000,
      including any received from any person acting on behalf of the Secured Party
      or
      beneficiary thereof; and

    

    (b)    within
      fifteen (15) days after the making of each submission or filing, a copy of
      any report, financial statement, notice or other document, whether periodic
      or
      otherwise, submitted to the shareholders of the Company, or submitted to or
      filed by the Company with any governmental authority involving or affecting
      (i)
      the Company that could have a Material Adverse Effect; (ii) the
      Obligations; (iii) any part of the Pledged Property; or (iv) any of
      the transactions contemplated in this Agreement or the Loan
      Instruments.

    

    Section
      6.4.    Maintenance
      of Books and Records; Inspection.

    

    The
      Company shall maintain its books, accounts and records in accordance with
      generally accepted accounting principles consistently applied, and permit the
      Secured Party, its officers and employees and any professionals designated
      by
      the Secured Party in writing, at any time to visit and inspect any of its
      properties (including but not limited to the collateral security described
      in
      the Transaction Documents and/or the Loan Instruments), corporate books and
      financial records, and to discuss its accounts, affairs and finances with any
      employee, officer or director thereof.

    

    Section
      6.5.    Maintenance
      and Insurance.

    

    (a)    The
      Company shall maintain or cause to be maintained, at its own expense, all of
      its
      assets and properties in good working order and condition, making all necessary
      repairs thereto and renewals and replacements thereof.

    

    (b)    The
      Company shall maintain or cause to be maintained, at its own expense, insurance
      in form, substance and amounts (including deductibles), which the Company deems
      reasonably necessary to the Company’s business, (i) adequate to insure all
      assets and properties of the Company, which assets and properties are of a
      character usually insured by persons engaged in the same or similar business
      against loss or damage resulting from fire or other risks included in an
      extended coverage policy; (ii) against public liability and other tort
      claims that may be incurred by the Company; (iii) as may be required by the
      Transaction Documents and/or applicable law and (iv) as may be reasonably
      requested by Secured Party, all with adequate, financially sound and reputable
      insurers.

    
      
        
        

      

      
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    Section
      6.6.    Contracts
      and Other Collateral.

    

    The
      Company shall perform all of its obligations under or with respect to each
      instrument, receivable, contract and other intangible included in the Pledged
      Property to which the Company is now or hereafter will be party on a timely
      basis and in the manner therein required, including, without limitation, this
      Agreement.

    

    Section
      6.7.    Defense
      of Collateral, Etc.

    

    The
      Company shall defend and enforce its right, title and interest in and to any
      part of: (a) the Pledged Property; and (b) if not included within the
      Pledged Property, those assets and properties whose loss could have a Material
      Adverse Effect, the Company shall defend the Secured Party’s right, title and
      interest in and to each and every part of the Pledged Property, each against
      all
      manner of claims and demands on a timely basis to the full extent permitted
      by
      applicable law.

    

    Section
      6.8.    Payment
      of Debts, Taxes, Etc.

    

    The
      Company shall pay, or cause to be paid, all of its indebtedness and other
      liabilities and perform, or cause to be performed, all of its obligations in
      accordance with the respective terms thereof, and pay and discharge, or cause
      to
      be paid or discharged, all taxes, assessments and other governmental charges
      and
      levies imposed upon it, upon any of its assets and properties on or before
      the
      last day on which the same may be paid without penalty, as well as pay all
      other
      lawful claims (whether for services, labor, materials, supplies or
      otherwise) as and when due

    

    Section
      6.9.    Taxes
      and Assessments; Tax Indemnity.

    

    The
      Company shall (a) file all tax returns and appropriate schedules thereto
      that are required to be filed under applicable law, prior to the date of
      delinquency, (b) pay and discharge all taxes, assessments and governmental
      charges or levies imposed upon the Company, upon its income and profits or
      upon
      any properties belonging to it, prior to the date on which penalties attach
      thereto, and (c) pay all taxes, assessments and governmental charges or
      levies that, if unpaid, might become a lien or charge upon any of its
      properties; provided,
      however,
      that
      the Company in good faith may contest any such tax, assessment, governmental
      charge or levy described in the foregoing clauses (b) and (c) so long as
      appropriate reserves are maintained with respect thereto. 

    

    Section
      6.10.    Compliance
      with Law and Other Agreements.
      

    

    The
      Company shall maintain its business operations and property owned or used in
      connection therewith in compliance with (a) all applicable federal, state
      and local laws, regulations and ordinances governing such business operations
      and the use and ownership of such property, and (b) all agreements,
      licenses, franchises, indentures and mortgages to which the Company is a party
      or by which the Company or any of its properties is bound. Without limiting
      the
      foregoing, the Company shall pay all of its indebtedness promptly in accordance
      with the terms thereof.

    
      
        
        

      

      
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    Section
      6.11.    Notice
      of Default.
      

    

    The
      Company shall give written notice to the Secured Party of the occurrence of
      any
      default or Event of Default under this Agreement, the Transaction Documents
      or
      any other Loan Instrument or any other agreement of Company for the payment
      of
      money, promptly upon the occurrence thereof.

    

    Section
      6.12.    Notice
      of Litigation.

    

    The
      Company shall give notice, in writing, to the Secured Party of (a) any
      actions, suits or proceedings wherein the amount at issue is in excess of
      $50,000, instituted by any persons against the Company, or affecting any of
      the
      assets of the Company, and (b) any dispute, not resolved within fifteen
      (15) days of the commencement thereof, between the Company on the one hand
      and
      any governmental or regulatory body on the other hand, which might reasonably
      be
      expected to have a Material Adverse Effect on the business operations or
      financial condition of the Company.

    

    ARTICLE
      7.

    

    NEGATIVE
      COVENANTS

    

    The
      Company covenants and agrees that, from the date hereof until the Obligations
      have been fully paid and satisfied, the Company shall not, unless the Secured
      Party shall consent otherwise in writing:

    

    Section
      7.1.    Indebtedness.

    

    The
      Company shall not directly or indirectly permit, create, incur, assume, permit
      to exist, increase, renew or extend on or after the date hereof any indebtedness
      on its part, including commitments, contingencies and credit availabilities,
      or
      apply for or offer or agree to do any of the foregoing (excluding any
      indebtedness of the Company to the Secured Party, trade accounts payable and
      accrued expenses incurred in the ordinary course of business and the endorsement
      of negotiable instruments payable to the Company, respectively for deposit
      or
      collection in the ordinary course of business).

    

    Section
      7.2.    Liens
      and Encumbrances.

    

    The
      Company shall not directly or indirectly make, create, incur, assume or permit
      to exist any assignment, transfer, pledge, mortgage, security interest or other
      lien or encumbrance of any nature in, to or against any part of the Pledged
      Property or of the Company’s capital stock, or offer or agree to do so, or own
      or acquire or agree to acquire any asset or property of any character subject
      to
      any of the foregoing encumbrances (including any conditional sale contract
      or
      other title retention agreement), or assign, pledge or in any way transfer
      or
      encumber its right to receive any income or other distribution or proceeds
      from
      any part of the Pledged Property or the Company’s capital stock; or enter into
      any sale-leaseback financing respecting any part of the Pledged Property as
      lessee, or cause or assist the inception or continuation of any of the
      foregoing.

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    

    Section
      7.3.    Certificate
      of Incorporation, By-Laws, Mergers, Consolidations, Acquisitions and
      Sales.

    

    Without
      the prior express written consent of the Secured Party, the Company shall not:
      (a) Amend its Certificate of Incorporation or By-Laws; (b) issue or sell
      its stock, stock options, bonds, notes or other corporate securities or
      obligations; (c) be a party to any merger, consolidation or corporate
      reorganization, (d) purchase or otherwise acquire all or substantially all
      of the assets or stock of, or any partnership or joint venture interest in,
      any
      other person, firm or entity, (e) sell, transfer, convey, grant a security
      interest in or lease all or any substantial part of its assets, nor (f) create
      any subsidiaries nor convey any of its assets to any subsidiary. Notwithstanding
      anything to the contrary, the Company may issue Common Stock issuable pursuant
      to the Company’s obligations upon the conversion of stock options, convertible
      debt or Class B Common Stock.

    

    Section
      7.4.    Management,
      Ownership.

    

    The
      Company shall not materially change its ownership, executive staff or management
      without the prior written consent of the Secured Party. The ownership, executive
      staff and management of the Company are material factors in the Secured Party's
      willingness to institute and maintain a lending relationship with the
      Company.

    

    Section
      7.5.    Dividends,
      Etc.

    

    The
      Company shall not declare or pay any dividend of any kind, in cash or in
      property, on any class of its capital stock, nor purchase, redeem, retire or
      otherwise acquire for value any shares of such stock, nor make any distribution
      of any kind in respect thereof, nor make any return of capital to shareholders,
      nor make any payments in respect of any pension, profit sharing, retirement,
      stock option, stock bonus, incentive compensation or similar plan (except as
      required or permitted hereunder), without the prior written consent of the
      Secured Party.

    

    Section
      7.6.    Guaranties;
      Loans.

    

    The
      Company shall not guarantee nor be liable in any manner, whether directly or
      indirectly, or become contingently liable after the date of this Agreement
      in
      connection with the obligations or indebtedness of any person or persons, except
      for (i) the indebtedness currently secured by the liens identified on the
      Pledged Property identified on Exhibit A hereto and (ii) the endorsement of
      negotiable instruments payable to the Company for deposit or collection in
      the
      ordinary course of business. The Company shall not make any loan, advance or
      extension of credit to any person other than in the normal course of its
      business.

    

    Section
      7.7.    Conduct
      of Business.

    

    The
      Company will continue to engage, in an efficient and economical manner, in
      a
      business of the same general type as conducted by it on the date of this
      Agreement.

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    Section
      7.8.    Places
      of Business.

    

    The
      location of the Company’s chief place of business is 5 Regent Street, Suite 520,
      Livingston, NJ 07039. The Company shall not change the location of its chief
      place of business, chief executive office or any place of business disclosed
      to
      the Secured Party or move any of the Pledged Property from its current location
      without thirty (30) days' prior written notice to the Secured Party in each
      instance. 

    

    ARTICLE
      8.

    

    MISCELLANEOUS

    

    Section
      8.1.    Notices.

    

    All
      notices or other communications required or permitted to be given pursuant
      to
      this Agreement shall be in writing and shall be considered as duly given on:
      (a) the date of delivery, if delivered in person, by nationally recognized
      overnight delivery service or (b) five (5) days after mailing if
      mailed from within the continental United States by certified mail, return
      receipt requested to the party entitled to receive the same:

    

    
      	
              If
                to the Secured Party:

            	
              Cornell
                Capital Partners, LP

            
	 	
              101
                Hudson Street-Suite 3700 

            
	 	
              Jersey
                City, New Jersey 07302 

            
	 	
              Attention:        
                Mark
                Angelo

            
	 	
                                         
                Portfolio Manager

            
	 	
              Telephone:       
                (201)
                986-8300

            
	 	
              Facsimile:          
                (201)
                985-8266

            
	 	 
	
              With
                a copy to:

            	
              David
                Gonzalez, Esq.

            
	 	
              101
                Hudson Street, Suite 3700

            
	 	
              Jersey
                City, NJ 07302

            
	 	
              Telephone:        (201)
                985-8300

            
	 	
              Facsimile:          
                (201)
                985-8266

            
	 	 
	 	 
	 	 
	
              And
                if to the Company:

            	
              Trey
                Resources, Inc.

            
	 	
              5
                Regent Street - Suite 520

            
	 	
              Livingston,
                NJ 07039

            
	 	
              Attention:         
                Mark
                Meller

            
	 	
              Telephone:        
                (973)
                758-6108

            
	 	
              Facsimile:           
                (973)
                758-9449

            
	 	 
	
              With
                a copy to:

            	
              Meritz
                & Muenz LLP

            
	 	
              2021
                O Street, NW

            
	 	Washington,
              DC 20036
	 	
              Telephone:
                (202) 787-1964

            
	 	
              Facsimile:
                (202) 787-3909

            
	 	
              Attention:
                Lawrence A. Muenz, Esq.

            

    

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

    Any
      party
      may change its address by giving notice to the other party stating its new
      address. Commencing on the tenth (10th) day
      after the giving of such notice, such newly designated address shall be such
      party’s address for the purpose of all notices or other communications required
      or permitted to be given pursuant to this Agreement.

    

    Section
      8.2.    Severability.

    

    If
      any
      provision of this Agreement shall be held invalid or unenforceable, such
      invalidity or unenforceability shall attach only to such provision and shall
      not
      in any manner affect or render invalid or unenforceable any other severable
      provision of this Agreement, and this Agreement shall be carried out as if
      any
      such invalid or unenforceable provision were not contained herein.

    

    Section
      8.3.    Expenses.

    

    In
      the
      event of an Event of Default, the Company will pay to the Secured Party the
      amount of any and all reasonable expenses, including the reasonable fees and
      expenses of its counsel, which the Secured Party may incur in connection with:
      (i) the custody or preservation of, or the sale, collection from, or other
      realization upon, any of the Pledged Property; (ii) the exercise or
      enforcement of any of the rights of the Secured Party hereunder or
      (iii) the failure by the Company to perform or observe any of the
      provisions hereof.

    

    Section
      8.4.    Waivers,
      Amendments, Etc.

    

    The
      Secured Party’s delay or failure at any time or times hereafter to require
      strict performance by Company of any undertakings, agreements or covenants
      shall
      not waiver, affect, or diminish any right of the Secured Party under this
      Agreement to demand strict compliance and performance herewith. Any waiver
      by
      the Secured Party of any Event of Default shall not waive or affect any other
      Event of Default, whether such Event of Default is prior or subsequent thereto
      and whether of the same or a different type. None of the undertakings,
      agreements and covenants of the Company contained in this Agreement, and no
      Event of Default, shall be deemed to have been waived by the Secured Party,
      nor
      may this Agreement be amended, changed or modified, unless such waiver,
      amendment, change or modification is evidenced by an instrument in writing
      specifying such waiver, amendment, change or modification and signed by the
      Secured Party.

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    

    Section
      8.5.    Continuing
      Security Interest.

    

    This
      Agreement shall create a continuing security interest in the Pledged Property
      and shall: (i) remain in full force and effect until payment in full of the
      Obligations; and (ii) be binding upon the Company and its successors and
      heirs and (iii) inure to the benefit of the Secured Party and its
      successors and assigns. Upon the payment or satisfaction in full of the
      Obligations, the Company shall be entitled to the return, at its expense, of
      such of the Pledged Property as shall not have been sold in accordance with
      Section 5.2 hereof or otherwise applied pursuant to the terms
      hereof.

    

    Section
      8.6.    Independent
      Representation.

    

    Each
      party hereto acknowledges and agrees that it has received or has had the
      opportunity to receive independent legal counsel of its own choice and that
      it
      has been sufficiently apprised of its rights and responsibilities with regard
      to
      the substance of this Agreement.

    

    Section
      8.7.    Applicable
      Law: Jurisdiction.

    

    This
      Agreement shall be governed by and interpreted in accordance with the laws
      of
      the State of New Jersey without regard to the principles of conflict of laws.
      The parties further agree that any action between them shall be heard in Hudson
      County, New Jersey, and expressly consent to the jurisdiction and venue of
      the
      Superior Court of New Jersey, sitting in Hudson County and the United States
      District Court for the District of New Jersey sitting in Newark, New Jersey
      for
      the adjudication of any civil action asserted pursuant to this
      Paragraph.

    

    Section
      8.8.    Waiver
      of Jury Trial.

    

    AS
      A
      FURTHER INDUCEMENT FOR THE SECURED PARTY TO ENTER INTO THIS AGREEMENT AND TO
      MAKE THE FINANCIAL ACCOMMODATIONS TO THE COMPANY, THE COMPANY HEREBY WAIVES
      ANY
      RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATED IN ANY WAY TO THIS
      AGREEMENT AND/OR ANY AND ALL OTHER DOCUMENTS RELATED TO THIS TRANSACTION.

    

    Section
      8.9.    Entire
      Agreement.

    

    This
      Agreement constitutes the entire agreement among the parties and supersedes
      any
      prior agreement or understanding among them with respect to the subject matter
      hereof.

     

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK]

    
 

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              COMPANY:

            
	 	
              TREY
                RESOURCES, INC.

            
	 	 	 
	 	
              By:
                

            	/s/
Mark
              Meller 
	 	
              Name:  
                Mark
                Meller

            
	 	
              Title:    
                President
                & CEO

            
	 	 	 
	 	 	 
	 	
              SECURED
                PARTY:

            
	 	
              CORNELL
                CAPITAL PARTNERS, LP

            
	 	 	 
	 	
              By:       
                Yorkville
                Advisors, LLC

            
	 	
              Its:        
                General
                Partner

            
	 	 	 
	 	
              By:
                

            	/s/
Mark
              Angelo 
	 	
              Name:   
                Mark
                Angelo

            
	 	
              Title:      Portfolio
                Manager

            

    

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    

      
        
          EXHIBIT A

        

      

    

    DEFINITION
      OF PLEDGED PROPERTY

    

    For
      the
      purpose of securing prompt and complete payment and performance by the Company
      of all of the Obligations, the Company unconditionally and irrevocably hereby
      grants to the Secured Party a continuing security interest in and to, and lien
      upon, the following Pledged Property of the Company:

    

    (a)    all
      goods
      of the Company, including, without limitation, machinery, equipment, furniture,
      furnishings, fixtures, signs, lights, tools, parts, supplies and motor vehicles
      of every kind and description, now or hereafter owned by the Company or in
      which
      the Company may have or may hereafter acquire any interest, and all
      replacements, additions, accessions, substitutions and proceeds thereof, arising
      from the sale or disposition thereof, and where applicable, the proceeds of
      insurance and of any tort claims involving any of the foregoing;

    

    (b)    all
      inventory of the Company, including, but not limited to, all goods, wares,
      merchandise, parts, supplies, finished products, other tangible personal
      property, including such inventory as is temporarily out of Company’s custody or
      possession and including any returns upon any accounts or other proceeds,
      including insurance proceeds, resulting from the sale or disposition of any
      of
      the foregoing;

    

    (c)    all
      contract rights and general intangibles of the Company, including, without
      limitation, goodwill, trademarks, trade styles, trade names, leasehold
      interests, partnership or joint venture interests, patents and patent
      applications, copyrights, deposit accounts whether now owned or hereafter
      created;

    

    (d)    all
      documents, warehouse receipts, instruments and chattel paper of the Company
      whether now owned or hereafter created;

    

    (e)    all
      accounts and other receivables, instruments or other forms of obligations and
      rights to payment of the Company (herein collectively referred to as
“Accounts”),
      together with the proceeds thereof, all goods represented by such Accounts
      and
      all such goods that may be returned by the Company’s customers, and all proceeds
      of any insurance thereon, and all guarantees, securities and liens which the
      Company may hold for the payment of any such Accounts including, without
      limitation, all rights of stoppage in transit, replevin and reclamation and
      as
      an unpaid vendor and/or lienor, all of which the Company represents and warrants
      will be bona fide and existing obligations of its respective customers, arising
      out of the sale of goods by the Company in the ordinary course of
      business;

    

    (f)    to
      the
      extent assignable, all of the Company’s rights under all present and future
      authorizations, permits, licenses and franchises issued or granted in connection
      with the operations of any of its facilities;

    

    (g)    all
      products and proceeds (including, without limitation, insurance proceeds) from
      the above-described Pledged Property.

     

     

     A-1Exhibit 10.13 Escrow Agreement

    
      

    

    Exhibit
      10.13

     

    ESCROW
      AGREEMENT

    

    THIS
      ESCROW AGREEMENT
      (this
“Agreement”)
      is
      made and entered into as of December 30, 2005 TREY
      RESOURCES, INC., a
      Delaware corporation (the “Company”);
      the
      Buyer(s) listed on the Securities Purchase Agreement, dated the date
      hereof (also referred to as the “Investor(s)”),
      and
DAVID
      GONZALEZ, ESQ.,
      as
      Escrow Agent hereunder (the “Escrow
      Agent”).

    

    BACKGROUND

    

    WHEREAS,
      the
      Company and the Investor(s) have entered into a Securities Purchase Agreement
      (the “Securities
      Purchase Agreement”),
      dated
      as of the date hereof, pursuant to which the Company proposes to sell secured
      convertible debentures (the “Convertible
      Debentures”)
      which
      shall be convertible into the Company’s Class A Common Stock, par value $0.00001
      per share (the “Common
      Stock”),
      for a
      total purchase price of up to Two Million Three Hundred Fifty Eight Thousand
      Thirty Six Dollars ($2,358,036). The Securities Purchase Agreement provides
      that
      the Investor(s) shall deposit the purchase amount in a segregated escrow account
      to be held by Escrow Agent in order to effectuate a disbursement to the Company
      at a closing to be held as set forth in the Securities Purchase Agreement (the
      “Closing”).

    

    WHEREAS,
      the
      Company intends to sell Convertible Securities (the “Offering”).

    

    WHEREAS,
      Escrow
      Agent has agreed to accept, hold, and disburse the funds deposited with it
      in
      accordance with the terms of this Agreement.

    

    WHEREAS,
      in
      order to establish the escrow of funds and to effect the provisions of the
      Securities Purchase Agreement, the parties hereto have entered into this
      Agreement.

    

    NOW
      THEREFORE,
      in
      consideration of the foregoing, it is hereby agreed as follows:

    

    1.    Definitions.
      The
      following terms shall have the following meanings when used herein:

    

    a.    “Escrow
      Funds”
shall
      mean the funds deposited with Escrow Agent pursuant to this
      Agreement.

    

    b.    “Joint
      Written Direction” shall
      mean a written direction
      executed by the Investor(s) and the Company directing Escrow Agent to disburse
      all or a portion of the Escrow Funds or to take or refrain from taking any
      action pursuant to this Agreement.

    

    c.    “Escrow
      Period”
shall
      begin with the commencement of the Offering and shall terminate upon the earlier
      to occur of the following dates:

    

    (i)    The
      date
      upon which Escrow Agent confirms that it has received in the Escrow Account
      all
      of the proceeds of the sale of the Convertible Debentures; 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (ii)    The
      expiration of twenty (20) days from the date of commencement of the Offering
      (unless extended by mutual written agreement between the Company and the
      Investor(s) with a copy of such extension to Escrow Agent); or

    

    (iii)    The
      date
      upon which a determination is made by the Company and the Investor(s) to
      terminate the Offering prior to the sale of all the Convertible
      Debentures.

    

    During
      the Escrow Period, the Company and the Investor(s) are aware that they are
      not
      entitled to any funds received into escrow and no amounts deposited in the
      Escrow Account shall become the property of the Company or the Investor(s)
      or
      any other entity, or be subject to the debts of the Company or the Investor(s)
      or any other entity.

    

    2.    Appointment
      of and Acceptance by Escrow Agent.
      The
      Investor(s) and the Company hereby appoint Escrow Agent to serve as Escrow
      Agent
      hereunder. Escrow Agent hereby accepts such appointment and, upon receipt by
      wire transfer of the Escrow Funds in accordance with Section 3 below, agrees
      to
      hold, invest and disburse the Escrow Funds in accordance with this
      Agreement.

    

    a.    The
      Company hereby acknowledges that the Escrow Agent is general counsel to the
      Investor(s), a partner in the general partner of the Investor(s), and counsel
      to
      the Investor(s) in connection with the transactions contemplated and referred
      herein. The Company agrees that in the event of any dispute arising in
      connection with this Escrow Agreement or otherwise in connection with any
      transaction or agreement contemplated and referred herein, the Escrow Agent
      shall be permitted to continue to represent the Investor(s) and the Company
      will
      not seek to disqualify such counsel. 

    

    3.    Creation
      of Escrow Funds.
      On or
      prior to the date of the commencement of the Offering, the parties shall
      establish an escrow account with the Escrow Agent, which escrow account shall
      be
      entitled as follows: Trey Resources, Inc./Cornell Capital Partners, LP Escrow
      Account for the deposit of the Escrow Funds. The Investor(s) will instruct
      subscribers to wire funds to the account of the Escrow Agent as
      follows:

    

    
      	
              Bank:

            	
              Wachovia,
                N.A. of New Jersey

            
	 	 
	
              Routing
                #:

            	
              031201467

            
	 	 
	
              Account
                #:

            	
              2000014931134

            
	 	 
	
              Name
                on Account:

            	
              David
                Gonzalez Attorney Trust Account

            
	 	 
	
              Name
                on Sub-Account:

            	
              Trey
                Resources, Inc./Cornell Capital Partners, LP Escrow
                Account

            

    

    

    4.    Deposits
      into the Escrow Account.
      The
      Investor(s) agrees that they shall promptly deliver funds for the payment of
      the
      Convertible Debentures to Escrow Agent for deposit in the Escrow
      Account.

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    5.    Disbursements
      from the Escrow Account.

    

    a.    The
      Escrow Agent will continue to hold such funds until Cornell Capital Partners,
      LP
      on behalf of the Investor(s) and Company execute a Joint Written Direction
      directing the Escrow Agent to disburse the Escrow Funds pursuant to Joint
      Written Direction signed by the Company and the Investor(s). In disbursing
      such
      funds, Escrow Agent is authorized to rely upon such Joint Written Direction
      from
      the Company and the Investor(s) and may accept any signatory from the Company
      listed on the signature page to this Agreement and any signature from the
      Investor(s) that the Escrow Agent already has on file.

    

    b.    In
      the
      event Escrow Agent does not receive the amount of the Escrow Funds from the
      Investor(s), Escrow Agent shall notify the Company and the Investor(s). Upon
      receipt of payment instructions from the Company, Escrow Agent shall refund
      to
      each subscriber without interest the amount received from each Investor(s),
      without deduction, penalty, or expense to the subscriber. The purchase money
      returned to each subscriber shall be free and clear of any and all claims of
      the
      Company, the Investor(s) or any of their creditors.

    

    c.    In
      the
      event Escrow Agent does receive the amount of the Escrow Funds prior to
      expiration of the Escrow Period, in no event will the Escrow Funds be released
      to the Company until such amount is received by Escrow Agent in collected funds.
      For purposes of this Agreement, the term “collected funds” shall mean all funds
      received by Escrow Agent which have cleared normal banking channels and are
      in
      the form of cash.

    

    6.    Collection
      Procedure.
      Escrow
      Agent is hereby authorized to deposit the proceeds of each wire in the Escrow
      Account.

    

    7.    Suspension
      of Performance: Disbursement Into Court.
      If at
      any time, there shall exist any dispute between the Company and the Investor(s)
      with respect to holding or disposition of any portion of the Escrow Funds or
      any
      other obligations of Escrow Agent hereunder, or if at any time Escrow Agent
      is
      unable to determine, to Escrow Agent’s sole satisfaction, the proper disposition
      of any portion of the Escrow Funds or Escrow Agent’s proper actions with respect
      to its obligations hereunder, or if the parties have not within thirty (30)
      days
      of the furnishing by Escrow Agent of a notice of resignation pursuant to Section
      9 hereof, appointed a successor Escrow Agent to act hereunder, then Escrow
      Agent
      may, in its sole discretion, take either or both of the following
      actions:

    

    a.    suspend
      the performance of any of its obligations (including without limitation any
      disbursement obligations) under this Escrow Agreement until such dispute or
      uncertainty shall be resolved to the sole satisfaction of Escrow Agent or until
      a successor Escrow Agent shall be appointed (as the case may be); provided
      however, Escrow Agent shall continue to invest the Escrow Funds in accordance
      with Section 8 hereof; and/or

    

    b.    petition
      (by means of an interpleader action or any other appropriate method) any court
      of competent jurisdiction in any venue convenient to Escrow Agent, for
      instructions with respect to such dispute or uncertainty, and to the extent
      required by law, pay into such court, for holding and disposition in accordance
      with the instructions of such court, all funds held by it in the Escrow Funds,
      after deduction and payment to Escrow Agent of all fees and expenses (including
      court costs and attorneys’ fees) payable to, incurred by, or expected to be
      incurred by Escrow Agent in connection with performance of its duties and the
      exercise of its rights hereunder.

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    c.    Escrow
      Agent shall have no liability to the Company, the Investor(s), or any person
      with respect to any such suspension of performance or disbursement into court,
      specifically including any liability or claimed liability that may arise, or
      be
      alleged to have arisen, out of or as a result of any delay in the disbursement
      of funds held in the Escrow Funds or any delay in with respect to any other
      action required or requested of Escrow Agent.

    

    8.    Investment
      of Escrow Funds.
      Escrow
      Agent shall deposit the Escrow Funds in a non-interest bearing account.

    

    If
      Escrow
      Agent has not received a Joint Written Direction at any time that an investment
      decision must be made, Escrow Agent shall maintain the Escrow Funds, or such
      portion thereof, as to which no Joint Written Direction has been received,
      in a
      non-interest bearing account. 

    

    9.    Resignation
      and Removal of Escrow Agent.
      Escrow
      Agent may resign from the performance of its duties hereunder at any time by
      giving thirty (30) days’ prior written notice to the parties or may be removed,
      with or without cause, by the parties, acting jointly, by furnishing a Joint
      Written Direction to Escrow Agent, at any time by the giving of ten (10) days’
prior written notice to Escrow Agent as provided herein below. Upon any such
      notice of resignation or removal, the representatives of the Investor(s) and
      the
      Company identified in Sections 13a.(iv) and 13b.(iv), below, jointly shall
      appoint a successor Escrow Agent hereunder, which shall be a commercial bank,
      trust company or other financial institution with a combined capital and surplus
      in excess of $10,000,000.00. Upon the acceptance in writing of any appointment
      of Escrow Agent hereunder by a successor Escrow Agent, such successor Escrow
      Agent shall thereupon succeed to and become vested with all the rights, powers,
      privileges and duties of the retiring Escrow Agent, and the retiring Escrow
      Agent shall be discharged from its duties and obligations under this Escrow
      Agreement, but shall not be discharged from any liability for actions taken
      as
      Escrow Agent hereunder prior to such succession. After any retiring Escrow
      Agent’s resignation or removal, the provisions of this Escrow Agreement shall
      inure to its benefit as to any actions taken or omitted to be taken by it while
      it was Escrow Agent under this Escrow Agreement. The retiring Escrow Agent
      shall
      transmit all records pertaining to the Escrow Funds and shall pay all funds
      held
      by it in the Escrow Funds to the successor Escrow Agent, after making copies
      of
      such records as the retiring Escrow Agent deems advisable and after deduction
      and payment to the retiring Escrow Agent of all fees and expenses (including
      court costs and attorneys’ fees) payable to, incurred by, or expected to be
      incurred by the retiring Escrow Agent in connection with the performance of
      its
      duties and the exercise of its rights hereunder.

    

    10.    Liability
      of Escrow Agent.

    

    a.    Escrow
      Agent shall have no liability or obligation with respect to the Escrow Funds
      except for Escrow Agent’s willful misconduct or gross negligence. Escrow Agent’s
      sole responsibility shall be for the safekeeping, investment, and disbursement
      of the Escrow Funds in accordance with the terms of this Agreement. Escrow
      Agent
      shall have no implied duties or obligations and shall not be charged with
      knowledge or notice or any fact or circumstance not specifically set forth
      herein. Escrow Agent may rely upon any instrument, not only as to its due
      execution, validity and effectiveness, but also as to the truth and accuracy
      of
      any information contained herein, which Escrow Agent shall in good faith believe
      to be genuine, to have been signed or presented by the person or parties
      purporting to sign the same and conform to the provisions of this Agreement.
      In
      no event shall Escrow Agent be liable for incidental, indirect, special, and
      consequential or punitive damages. Escrow Agent shall not be obligated to take
      any legal action or commence any proceeding in connection with the Escrow Funds,
      any account in which Escrow Funds are deposited, this Agreement or the Purchase
      Agreement, or to appear in, prosecute or defend any such legal action or
      proceeding. Escrow Agent may consult legal counsel selected by it in any event
      of any dispute or question as to construction of any of the provisions hereof
      or
      of any other agreement or its duties hereunder, or relating to any dispute
      involving any party hereto, and shall incur no liability and shall be fully
      indemnified from any liability whatsoever in acting in accordance with the
      opinion or instructions of such counsel. The Company and the Investor(s) jointly
      and severally shall promptly pay, upon demand, the reasonable fees and expenses
      of any such counsel.

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    b.    Escrow
      Agent is hereby authorized, in its sole discretion, to comply with orders issued
      or process entered by any court with respect to the Escrow Funds, without
      determination by Escrow Agent of such court’s jurisdiction in the matter. If any
      portion of the Escrow Funds is at any time attached, garnished or levied upon
      under any court order, or in case the payment, assignment, transfer, conveyance
      or delivery of any such property shall be stayed or enjoined by any court order,
      or in any case any order judgment or decree shall be made or entered by any
      court affecting such property or any part thereof, then and in any such event,
      Escrow Agent is authorized, in its sole discretion, to rely upon and comply
      with
      any such order, writ judgment or decree which it is advised by legal counsel
      selected by it, binding upon it, without the need for appeal or other action;
      and if Escrow Agent complies with any such order, writ, judgment or decree,
      it
      shall not be liable to any of the parties hereto or to any other person or
      entity by reason of such compliance even though such order, writ judgment or
      decree may be subsequently reversed, modified, annulled, set aside or
      vacated.

    

    11.    Indemnification
      of Escrow Agent.
      From and
      at all times after the date of this Agreement, the parties jointly and
      severally, shall, to the fullest extent permitted by law and to the extent
      provided herein, indemnify and hold harmless Escrow Agent and each director,
      officer, employee, attorney, agent and affiliate of Escrow Agent (collectively,
      the “Indemnified
      Parties”)
      against any and all actions, claims (whether or not valid), losses, damages,
      liabilities, costs and expenses of any kind or nature whatsoever (including
      without limitation reasonable attorney’s fees, costs and expenses) incurred by
      or asserted against any of the Indemnified Parties from and after the date
      hereof, whether direct, indirect or consequential, as a result of or arising
      from or in any way relating to any claim, demand, suit, action, or proceeding
      (including any inquiry or investigation) by any person, including without
      limitation the parties to this Agreement, whether threatened or initiated,
      asserting a claim for any legal or equitable remedy against any person under
      any
      statute or regulation, including, but not limited to, any federal or state
      securities laws, or under any common law or equitable cause or otherwise,
      arising from or in connection with the negotiation, preparation, execution,
      performance or failure of performance of this Agreement or any transaction
      contemplated herein, whether or not any such Indemnified Party is a party to
      any
      such action or proceeding, suit or the target of any such inquiry or
      investigation; provided, however, that no Indemnified Party shall have the
      right
      to be indemnified hereunder for liability finally determined by a court of
      competent jurisdiction, subject to no further appeal, to have resulted from
      the
      gross negligence or willful misconduct of such Indemnified Party. If any such
      action or claim shall be brought or asserted against any Indemnified Party,
      such
      Indemnified Party shall promptly notify the Company and the Investor(s)
      hereunder in writing, and the Investor(s) and the Company shall assume the
      defense thereof, including the employment of counsel and the payment of all
      expenses. Such Indemnified Party shall, in its sole discretion, have the right
      to employ separate counsel (who may be selected by such Indemnified Party in
      its
      sole discretion) in any such action and to participate and to participate in
      the
      defense thereof, and the fees and expenses of such counsel shall be paid by
      such
      Indemnified Party, except that the Investor(s) and/or the Company shall be
      required to pay such fees and expense if (a) the Investor(s) or the Company
      agree to pay such fees and expenses, or (b) the Investor(s) and/or the Company
      shall fail to assume the defense of such action or proceeding or shall fail,
      in
      the sole discretion of such Indemnified Party, to employ counsel reasonably
      satisfactory to the Indemnified Party in any such action or proceeding, (c)
      the
      Investor(s) and the Company are the plaintiff in any such action or proceeding
      or (d) the named or potential parties to any such action or proceeding
      (including any potentially impleaded parties) include both the Indemnified
      Party, the Company and/or the Investor(s) and the Indemnified Party shall have
      been advised by counsel that there may be one or more legal defenses available
      to it which are different from or additional to those available to the Company
      or the Investor(s). The Investor(s) and the Company shall be jointly and
      severally liable to pay fees and expenses of counsel pursuant to the preceding
      sentence, except that any obligation to pay under clause (a) shall apply only
      to
      the party so agreeing. All such fees and expenses payable by the Company and/or
      the Investor(s) pursuant to the foregoing sentence shall be paid from time
      to
      time as incurred, both in advance of and after the final disposition of such
      action or claim. The obligations of the parties under this section shall survive
      any termination of this Agreement, and resignation or removal of the Escrow
      Agent shall be independent of any obligation of Escrow Agent.

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    

    The
      parties agree that neither payment by the Company or the Investor(s) of any
      claim by Escrow Agent for indemnification hereunder shall impair, limit, modify,
      or affect, as between the Investor(s) and the Company, the respective rights
      and
      obligations of Investor(s), on the one hand, and the Company, on the other
      hand.

    

    12.    Expenses
      of Escrow Agent.
      Except
      as set forth in Section 11 the Company shall reimburse Escrow Agent for all
      of
      its reasonable out-of-pocket expenses, including attorneys’ fees, travel
      expenses, telephone and facsimile transmission costs, postage (including express
      mail and overnight delivery charges), copying charges and the like. All of
      the
      compensation and reimbursement obligations set forth in this Section shall
      be
      payable by the Company, upon demand by Escrow Agent. The obligations of the
      Company under this Section shall survive any termination of this Agreement
      and
      the resignation or removal of Escrow Agent.

    

    13.    Warranties.

    

    a.    The
      Investor(s) makes the following representations and warranties to Escrow
      Agent:

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    

    (i)    The
      Investor(s) has full power and authority to execute and deliver this Agreement
      and to perform its obligations hereunder.

    

    (ii)    This
      Agreement has been duly approved by all necessary action of the Investor(s),
      including any necessary approval of the limited partner of the Investor(s)
      or
      necessary corporate approval, as applicable, has been executed by duly
      authorized officers of the Investor(s), enforceable in accordance with its
      terms.

    

    (iii)   The
      execution, delivery, and performance of the Investor(s) of this Agreement will
      not violate, conflict with, or cause a default under any agreement of limited
      partnership of Investor(s) or the articles of incorporation or bylaws of the
      Investor(s) (as applicable), any applicable law or regulation, any court
      order or administrative ruling or degree to which the Investor(s) is a party
      or
      any of its property is subject, or any agreement, contract, indenture, or other
      binding arrangement.

    

    (iv)   Mark
      Angelo has been duly appointed to act as the representative of the Investor(s)
      hereunder and has full power and authority to execute, deliver, and perform
      this
      Escrow Agreement, to execute and deliver any Joint Written Direction, to amend,
      modify, or waive any provision of this Agreement, and to take any and all other
      actions as the Investor(s)’s representative under this Agreement, all without
      further consent or direction form, or notice to, the Investor(s) or any other
      party.

    

    (v)    No
      party
      other than the parties hereto and the Investor(s)s have, or shall have, any
      lien, claim or security interest in the Escrow Funds or any part thereof. No
      financing statement under the Uniform Commercial Code is on file in any
      jurisdiction claiming a security interest in or describing (whether specifically
      or generally) the Escrow Funds or any part thereof.

    

    (vi)   All
      of
      the representations and warranties of the Investor(s) contained herein are
      true
      and complete as of the date hereof and will be true and complete at the time
      of
      any disbursement from the Escrow Funds.

    

    b.    The
      Company makes the following representations and warranties to the Escrow
      Agent:

    

    (i)    The
      Company is
      a
      corporation duly organized, validly existing, and in good standing under the
      laws of the State of Delaware and has full power and authority to execute and
      deliver this Agreement and to perform its obligations hereunder.

    

    (ii)    This
      Agreement has been duly approved by all necessary corporate action of the
      Company, including any necessary shareholder approval, has been executed by
      duly
      authorized officers of the Company, enforceable in accordance with its
      terms.

    

    (iii)   The
      execution, delivery, and performance by the Company of this Agreement is in
      accordance with the Securities Purchase Agreement and will not violate, conflict
      with, or cause a default under the certificate of incorporation or bylaws of
      the
      Company, any applicable law or regulation, any court order or administrative
      ruling or decree to which the Company is a party or any of its property is
      subject, or any agreement, contract, indenture, or other binding arrangement,
      including without limitation to the Securities Purchase Agreement, to which
      the
      Company is a party.

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    

    (iv)    Mark
      Meller has been duly appointed to act as the representative of the Company
      hereunder and has full power and authority to execute, deliver, and perform
      this
      Agreement, to execute and deliver any Joint Written Direction, to amend, modify
      or waive any provision of this Agreement and to take all other actions as the
      Company’s Representative under this Agreement, all without further consent or
      direction from, or notice to, the Company or any other party.

    

    (v)    No
      party
      other than the parties hereto and the Investor(s)s have, or shall have, any
      lien, claim or security interest in the Escrow Funds or any part thereof. No
      financing statement under the Uniform Commercial Code is on file in any
      jurisdiction claiming a security interest in or describing (whether specifically
      or generally) the Escrow Funds or any part thereof.

    

    (vi)    All
      of
      the representations and warranties of the Company contained herein are true
      and
      complete as of the date hereof and will be true and complete at the time of
      any
      disbursement from the Escrow Funds.

    

    14.    Consent
      to Jurisdiction and Venue.
      In the
      event that any party hereto commences a lawsuit or other proceeding relating
      to
      or arising from this Agreement, the parties hereto agree that the United States
      District Court for the District of New Jersey shall have the sole and exclusive
      jurisdiction over any such proceeding. If all such courts lack federal subject
      matter jurisdiction, the parties agree that the Superior Court Division of
      New
      Jersey, Chancery Division of Hudson County shall have sole and exclusive
      jurisdiction. Any of these courts shall be proper venue for any such lawsuit
      or
      judicial proceeding and the parties hereto waive any objection to such venue.
      The parties hereto consent to and agree to submit to the jurisdiction of any
      of
      the courts specified herein and agree to accept the service of process to vest
      personal jurisdiction over them in any of these courts.

    

    15.    Notice.
      All
      notices and other communications hereunder shall be in writing and shall be
      deemed to have been validly served, given or delivered five (5) days after
      deposit in the United States mails, by certified mail with return receipt
      requested and postage prepaid, when delivered personally, one (1) day delivered
      to any overnight courier, or when transmitted by facsimile transmission and
      upon
      confirmation of receipt and addressed to the party to be notified as
      follows:

    

    
      	
              If
                to Investor(s), to:

            	
              Cornell
                Capital Partners, LP

            
	 	
              101
                Hudson Street - Suite 3700

            
	 	
              Jersey
                City, NJ 07302

            
	 	
              Attention:   
                Mark
                Angelo

            
	 	
                                    
                Portfolio Manager

            
	 	
              Telephone:  
                (201)
                985-8300

            
	 	
              Facsimile:     
                (201)
                985-8266

            

    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    
      
        	 	 
	
                If
                  to Escrow Agent, to:

              	
                David
                  Gonzalez, Esq.

              
	 	
                101
                  Hudson Street - Suite 3700

              
	 	
                Jersey
                  City, NJ 07302

              
	 	
                Telephone:   
                  (201)
                  985-8300

              
	 	
                Facsimile:      
                  (201)
                  985-8266

              
	 	 
	
                If
                  to the Company, to:

              	
                Trey
                  Resources, Inc.

              
	 	
                5
                  Regent Street - Street

              
	 	
                Livingston,
                  NJ 07039

              
	 	
                Attention:     
                  Mark
                  Meller

              
	 	
                Telephone:    
                  (973)
                  758-6108

              
	 	
                Facsimile:       
                  (973)
                  758-9449

              
	 	 
	
                With
                  a copy to:

              	
                Meritz
                  & Muenz LLP

              
	 	
                2021
                  O Street, NW

              
	 	
                Washington,
                  DC 20036

              
	 	
                Telephone:
                  (202) 787-1964

              
	 	
                Facsimile:
                  (202) 787-3909

              
	 	
                Attention:
                  Lawrence A. Muenz, Esq.

              

      

       

    

    Or
      to
      such other address as each party may designate for itself by like
      notice.

    

    16.    Amendments
      or Waiver.
      This
      Agreement may be changed, waived, discharged or terminated only by a writing
      signed by the parties hereto. No delay or omission by any party in exercising
      any right with respect hereto shall operate as waiver. A waiver on any one
      occasion shall not be construed as a bar to, or waiver of, any right or remedy
      on any future occasion.

    

    17.    Severability.
      To the
      extent any provision of this Agreement is prohibited by or invalid under
      applicable law, such provision shall be ineffective to the extent of such
      prohibition, or invalidity, without invalidating the remainder of such provision
      or the remaining provisions of this Agreement.

    

    18.    Governing
      Law.
      This
      Agreement shall be construed and interpreted in accordance with the internal
      laws of the State of New Jersey without giving effect to the conflict of laws
      principles thereof.

    

    19.    Entire
      Agreement.
      This
      Agreement constitutes the entire Agreement between the parties relating to
      the
      holding, investment, and disbursement of the Escrow Funds and sets forth in
      their entirety the obligations and duties of the Escrow Agent with respect
      to
      the Escrow Funds.

    

    20.    Binding
      Effect.
      All of
      the terms of this Agreement, as amended from time to time, shall be binding
      upon, inure to the benefit of and be enforceable by the respective heirs,
      successors and assigns of the Investor(s), the Company, or the Escrow
      Agent.

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    21.    Execution
      of Counterparts.
      This
      Agreement and any Joint Written Direction may be executed in counter parts,
      which when so executed shall constitute one and same agreement or
      direction.

    

    22.    Termination.
      Upon the
      first to occur of the disbursement of all amounts in the Escrow Funds pursuant
      to Joint Written Directions or the disbursement of all amounts in the Escrow
      Funds into court pursuant to Section 7 hereof, this Agreement shall terminate
      and Escrow Agent shall have no further obligation or liability whatsoever with
      respect to this Agreement or the Escrow Funds.

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK]

     

     

     

     

     

     

     

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF
      the
      parties have hereunto set their hands and seals the day and year above set
      forth.

     

    
      
        	 	
                TREY RESOURCES,
                  INC.

              
	 	 	 
	 	
                By:

              	/s/ Mark
                Meller
	 	
                Name:    
                  Mark
                  Meller

              
	 	
                Title:      
                  President
                  & CEO

              
	 	 	 
	 	 	 
	 	 	 
	 	
                CORNELL
                  CAPITAL PARTNERS, LP

              
	 	 	 
	 	
                By:

              	
                Yorkville
                  Advisors, LLC

              
	 	
                Its:         
                  

              	General
                Partner
	 	 	 
	 	
                By:

              	/s/ Mark
                Angelo
	 	
                Name:     Mark
                  Angelo

              
	 	
                Title:       Portfolio
                  Manager

              
	 	 	 
	 	 	 
	 	 	 
	 	
                By:

              	/s/
David
                Gonzalez  
	 	
                Name:    
                  David
                  Gonzalez, Esq.

              

      

    

    

     

     11

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