Document:

Unassociated Document

     

    SECURITY
      AGREEMENT

     

    (Patent)

     

    THIS
      SECURITY AGREEMENT (PATENT)
      (“Security
      Agreement”),
      dated
      as of March 16, 2007, between Compliance
      Systems Corporation, a
      Nevada
      corporation (the “Grantor”)
      and
Cornell
      Capital Partners, LP, a
      Delaware limited partnership.

     

     

    WITNESSETH:

     

    WHEREAS,
      pursuant to a Securities Purchase Agreement, dated as of March 16,
      2007 (together with all amendments, supplements, restatements and other
      modifications, if any, from time to time made thereto, the “Purchase
      Agreement”)
      between the Grantor, as borrower, and Cornell Capital Partners, LP, as Lender
      (the “Lender”),
      has
      agreed to purchase up to $150,000 of secured convertible debentures of the
      Grantor (the “Convertible
      Debentures”)
      subject to the terms and provisions of the Purchase Agreement;

     

    AND
      WHEREAS,
      in
      connection with the Purchase Agreement, the Grantor has agreed to provide the
      Lender a general security interest in Pledged Collateral (as this term is
      defined in the Security Agreement by and between the Grantor and the Lender,
      dated March 8, 2006 (together with all amendments, supplements, restatements
      and
      other modifications, if any, from time to time made thereto, the “Security
      Agreement”);

     

    AND
      WHEREAS,
      as a
      condition precedent to the purchasing the Convertible Debentures on the closing
      date under the Purchase Agreement, the Grantor is required to execute and
      deliver this Agreement and to grant to the Lender a continuing security interest
      in all of the Patent Collateral (as hereinafter defined) to secure all
      Obligations (as defined in the Security Agreement);

     

    AND
      WHEREAS,
      the
      Grantor has duly authorized the execution, delivery and performance of this
      Agreement;

     

    NOW
      THEREFORE,
      for
      good and valuable consideration, the receipt of which is hereby acknowledged,
      the Grantor agrees as follows:

     

    SECTION
      1. Definitions.
      Unless
      otherwise defined herein otherwise requires, terms used in this Agreement,
      including its preamble and recitals, have the meanings provided in the Purchase
      Agreement.

     

    SECTION
      2. Grant
      of Security Interest.
      For good
      and valuable consideration, the receipt and sufficiency of which are hereby
      acknowledged, to secure the payment and performance of all of the Obligations
      of
      the Grantor, the Grantor does hereby mortgage, pledge and hypothecate to the
      Lender and grant to the Lender a security interest in all of the following
      property (the “Patent
      Collateral”),
      now
      owned and existing:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (a) all
      letters patent and applications for letters patent throughout the world,
      including all patent applications in preparation for filing anywhere in the
      world and including each patent and patent application referred to in
Schedule
      “A”
      hereto;

     

    (b) all
      reissues, divisions, continuations, continuations-in-part, extensions, renewals
      and reexaminations of any of the items described in clause (a);

     

    (c) all
      patent licenses and other agreements providing the Grantor with the right to
      use
      any of the items of the type referred to in clauses (a) and (b), including
      each
      patent license referred to in Schedule
      “A”
      hereto;

     

    (d) the
      right
      to sue third parties for past, present or future infringements of any Patent
      Collateral described in clauses (a) and (b) and, to the extent applicable,
      clause (c); and

     

    (e) all
      proceeds of, and rights associated with, the foregoing, (including license
      royalties and proceeds of infringement suits), and all rights corresponding
      thereto throughout the world.

     

    SECTION
      3. Security
      Agreement.
      This
      Agreement has been executed and delivered by the Grantor for the purpose of
      recording the security interest of the Lender in the Patent Collateral relating
      to patents referred to in Schedule
      “A”
      with the
      United States Patent and Trade Marks Office, to the extent it may be so
      registered therein. The security interest granted hereby has been granted as
      a
      supplement to, and not in limitation of, the security interest granted to the
      Lender under the Security Agreement. The Security Agreement (and all rights
      and
      remedies of the Lender thereunder) shall remain in full force and effect in
      accordance with its terms.

     

    SECTION
      4. Release
      of Security Interest.
      Upon
      payment in full of all Obligations and the termination of the Purchase
      Agreement, the Lender shall, at the Grantor’s expense, execute and deliver to
      the Grantor all instruments and other documents as may be necessary or proper
      to
      release the lien on any security interest in the Patent Collateral which has
      been granted hereunder.

     

    SECTION
      5. Acknowledgement.
      The
      Grantor does hereby further acknowledge and affirm that the rights and remedies
      of the Lender with respect to the security interest in the Patent Collateral
      granted hereby are more fully set forth in the Security Agreement, the terms
      and
      provisions of which (including the remedies provided for therein) are
      incorporated by references herein as if fully set forth herein.

     

    SECTION
      6. Purchase
      Agreement.
      Notwithstanding any other term or provision hereof, in the event that any
      provisions hereof contradict and are incapable of being construed in conjunction
      with the provisions of the Purchase Agreement, the provisions of the Purchase
      Agreement shall take precedence over those contained herein and, in particular,
      if any act of the Grantor is expressly permitted under the Purchase Agreement
      but is prohibited hereunder, any such act shall be permitted hereunder and
      any
      encumbrance expressly permitted under the Purchase Agreement to exist or to
      remain outstanding shall be permitted hereunder and thereunder. This instrument,
      document or agreement may be sold, assigned or transferred by the Agent in
      accordance with the terms of the Purchase Agreement.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    SECTION
      7. Counterparts.
      This
      Agreement may be executed by the parties hereto in several counterparts, each
      of
      which shall be deemed to be an original and all of which shall constitute
      together but one and the same agreement.

     

    IN
      WITNESS WHEREOF,
      the
      parties hereto have caused this Agreement to be duly executed and delivered
      by
      their respective officers thereunto duly authorized as of the day and first
      year
      above written.

     

    
      	 	
              Compliance
                Systems Corporation

            
	 	 
	 	
              Per:
                /s/ Dean Garfinkel

            
	 	
              Name:
                Dean Garfinkel

            
	 	
              Title:
                President

            
	 	 
	 	 

    

    

    

    STATE
      OF ____________________)

    )
      SS:

    COUNTY
      OF __________________)

    

    BEFORE
      ME,
      a Notary
      Public in and for said County and State, personally appeared the above-named
      _______________________ who acknowledged that he/she did sign the foregoing
      agreement and that the same is his/her free act and deed.

     

    IN
      TESTIMONY WHEREOF,
      I have
      hereunto set my hand an official seal at __________________,
      ____________________, this ___ day of __________, 2007.

     

    
      	 	 
	 	______________________________
	 	
              Notary
                Public 

            
	 	 
	 	 
	 	
              CORNELL
                CAPITAL PARTNERS, LP

            
	 	 
	 	
              Per: /s/ Authorize
                Person     

            
	 	
              Name: /s/
                Authorize Person    

            
	 	
              Title: Officer     

            
	 	 
	 	 

    

    

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    
       

    

    SCHEDULE
      “A”

     

    U.S.
      Letters Patent And Applications 

    For
      Letters Patent Of Compliance Systems Corporation

     

    
      	
              Title

            	 	
              Filing
                Date

            	 	
              Application
                Number

            	 	
              Issue
                Date

            	 	
              Patent
                Number

            
	
              [Call
                Blocking System]

            	 	
              November
                9, 1999

            	 	
              435955

            	 	
              [December
                11, 2001]

            	 	
              [6330317]

            
	 	 	 	 	 	 	 	 	 

    

    

    

    
      
        
        

      

      A-1PLEDGE
      AND ESCROW AGREEMENT

     

    THIS
      PLEDGE AND ESCROW AGREEMENT
      (the
“Agreement”)
      is
      made and entered into as of March 16, 2007 (the “Effective
      Date”)
      by and
      among COMPLIANCE
      SYSTEMS CORPORATION,
      a
      corporation organized and existing under the laws of the State of Nevada (the
      “Pledgor”),
      CORNELL
      CAPITAL PARTNERS, L.P.,
      (the
“Pledgee”),
      and
DAVID
      GONZALEZ,
      ESQ.,
      as
      escrow agent (“Escrow
      Agent”).
      

     

    RECITALS:

     

    WHEREAS,
      in
      order
      to secure the full and prompt payment when due (whether at the stated maturity,
      by acceleration or otherwise) of all of the Company’s obligations to the Pledgee
      or any successor to the Pledgee under this
      Agreement, the Securities Purchase Agreement of even date herewith between
      the
      Pledgor and the Pledgee (the “Securities
      Purchase Agreement”),
      the
      Convertible Debentures (the “Convertible
      Debentures”)
      issued
      or to be issued by the Company to the Pledgee, either now or in the future,
      up
      to a total of One Hundred Fifty Thousand Dollars ($150,000) of principal, plus
      any interest, costs, fees, and other amounts owed to the Pledgee thereunder,
      the
      Security Agreement dated March 8, 2006, between the Pledgor and the Pledgee
      (the
“Security
      Agreement”),
      and
      all other agreements entered into between the parties hereto (collectively,
      the
“Transaction
      Documents”),
      the
      Pledgor has agreed to irrevocably pledge to the Pledgee Three Million
      (3,000,000) shares (the “Pledged
      Shares”)
      of the
      Pledgor’s common stock. 

     

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

     

     

    TERMS
      AND CONDITIONS

     

    1. Pledge
      and Transfer of Pledged Shares.
      

     

    The
      Pledgor hereby grants to Pledgee a security interest in all Pledged Shares
      as
      security for Pledgor’s obligations to the Pledgee (the “Obligations”)
      under
      the Convertible Debentures. Simultaneously with the execution of this Agreement,
      the Pledgor shall deliver to the Escrow Agent stock certificates representing
      the Pledged Shares, together with duly executed stock powers or other
      appropriate transfer documents executed in blank by the Pledgor (the
“Transfer
      Documents”),
      and
      such stock certificates and Transfer Documents shall be held by the Escrow
      Agent
      pursuant to this Agreement until the full payment of all amounts due to the
      Pledgee under the Convertible Debentures and through repayment in accordance
      with the terms of the Convertible Debentures, or the termination or expiration
      of this Agreement.

     

    2. Rights
      Relating to Pledged Shares.
      Prior
      to the occurrence of an Event of Default (as defined herein) and the issuance
      of
      Pledged Shares to the Pledgee (in accordance with Section 5.1), the Pledged
      Shares shall not be, or be deemed to be, issued or outstanding shares of the
      Pledgor and neither the Pledgee nor any other person shall be entitled to vote
      the Pledged Shares, to receive dividends and other distributions thereon, or
      to
      enjoy any other rights and privileges incident to the ownership of the Pledged
      Shares.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    3. Release
      of Pledged Shares from Pledge.
      Upon
      the payment of all amounts due to the Pledgee under the Convertible Debentures
      by repayment in accordance with the terms of the Note, the parties hereto shall
      notify the Escrow Agent to such effect in writing. Upon receipt of such written
      notice, the Escrow Agent shall return to the Pledgor the Transfer Documents
      and
      the certificates representing the Pledged Shares, (collectively the
“Pledged
      Materials”),
      whereupon any and all rights of Pledgee in the Pledged Materials shall be
      terminated. Notwithstanding anything to the contrary contained herein, upon
      full
      payment of all amounts due to the Pledgee under the Convertible Debentures,
      by
      repayment in accordance with the terms of the Convertible Debentures, this
      Agreement and Pledgee’s security interest and rights in and to the Pledged
      Shares shall terminate.

     

    4. Event
      of Default.
      An
      “Event
      of Default”
shall
      be deemed to have occurred under this Agreement upon an Event of Default under
      the Transaction Documents.

     

    5. Remedies.
      

     

    Upon
      and
      anytime after the occurrence of an Event of Default, the Pledgee shall have
      the
      right acquire the Pledged Shares in accordance with the following procedure:
      (a)
      the Pledgee shall provide written notice of such Event of Default (the
“Default
      Notice”)
      to the
      Escrow Agent, with a copy to the Pledgor; (b) in a Default Notice the Pledgee
      shall specify the number of Pledged Shares to be issued to the Plegdee,
provided
      however,
      that
      the Pledgee shall not have the right to acquire such number of Pledged Shares
      which would cause the Pledgee, together with its affiliates, to beneficially
      own
      in excess of 4.99% of the outstanding capital of the Pledgor (unless the Pledgee
      waives such limitation by providing 65 days’ advance written notice); and (c) as
      soon as practicable after receipt of a Default Notice, the Escrow Agent shall
      deliver the specified number of Pledged Shares along with the applicable
      Transfer Documents to the Pledgor’s Transfer Agent with instructions to issue
      such Pledged Shares to the Pledgee in accordance with the Irrevocable Transfer
      Agent Instructions of even date herewith, among the Pledgee, the Pledgor, the
      Escrow Agent, and the Transfer Agent. 

     

    Upon
      receipt of the Pledged Shares issued to the Pledgee, the Pledgee shall have
      the
      right to (i) sell the Pledged Shares and to apply the proceeds of such sales,
      net of any selling commissions, to the Obligations owed to the Pledgee by the
      Pledgor under the Transaction Documents, including, without limitation,
      outstanding principal, interest, legal fees, and any other amounts owed to
      the
      Pledgee, and exercise all other rights and (ii) any and all remedies of a
      secured party with respect to such property as may be available under the
      Uniform Commercial Code as in effect in the State of New Jersey. To the extent
      that the net proceeds received by the Pledgee are insufficient to satisfy the
      Obligations in full, the Pledgee shall be entitled to a deficiency judgment
      against the Pledgor for such amount. The Pledgee shall have the absolute right
      to sell or dispose of the Pledged Shares in any manner it sees fit and shall
      have no liability to the Pledgor or any other party for selling or disposing
      of
      such Pledged Shares even if other methods of sales or dispositions would or
      allegedly would result in greater proceeds than the method actually used. The
      Pledgor shall remain liable for shortfalls, if any, that may exist after the
      Pledgee has exhausted all remedies hereunder. The Pledgee shall return any
      Pledged Shares issued to it and instruct the Escrow Agent to return any Pledged
      Shares it is holding in escrow after the all amounts owed to the Pledgee under
      the Convertible Debentures have been satisfied.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    Each
      right, power and remedy of the Pledgee provided for in this Agreement or any
      other Transaction Document shall be cumulative and concurrent and shall be
      in
      addition to every other such right, power or remedy. The
      exercise or beginning of the exercise by the Pledgee of any one or more of
      the
      rights, powers or remedies provided for in this Agreement or any
      other
      Transaction Document or
      now or
      hereafter existing at law or in equity or by statute or otherwise shall not
      preclude the simultaneous or later exercise by the
      Pledgee of all such other rights, powers or remedies, and no failure or delay
      on
      the part of the Pledgee to exercise any such right, power or remedy shall
      operate as a waiver thereof. No notice to or demand on the Pledgor in any case
      shall entitle it to any other or further notice or demand in similar or other
      circumstances or constitute a waiver of any of the rights of the Pledgee to
      any
      other further action in any circumstances without demand or notice. The Pledgee
      shall have the full power to enforce or to assign or contract is rights under
      this Agreement to a third party.

     

    Demand
      Registration Rights. In
      addition to all other remedies available to the Pledgee, upon the issuance
      of
      Pledged Shares to the Pledgee, the Pledgor shall promptly, but in no event
      more
      than thirty (30) days after the date of the Default Notice, file a registration
      statement to register with the Securities and Exchange Commission the Pledged
      Shares for the resale by the Pledgee. The Pledgor shall cause the registration
      statement to remain in effect until all of the Pledged Shares have been sold
      by
      the Pledgee. 

     

    6. Concerning
      the Escrow Agent.

     

    The
      Escrow Agent undertakes to perform only such duties as are expressly set forth
      herein and no implied duties or obligations shall be read into this Agreement
      against the Escrow Agent.

     

    The
      Escrow Agent may act in reliance upon any writing or instrument or signature
      which it, in good faith, believes to be genuine, may assume the validity and
      accuracy of any statement or assertion contained in such a writing or
      instrument, and may assume that any person purporting to give any writing,
      notice, advice or instructions in connection with the provisions hereof has
      been
      duly authorized to do so. The Escrow Agent shall not be liable in any manner
      for
      the sufficiency or correctness as to form, manner, and execution, or validity
      of
      any instrument deposited in this escrow, nor as to the identity, authority,
      or
      right of any person executing the same; and its duties hereunder shall be
      limited to the safekeeping of such certificates, monies, instruments, or other
      document received by it as such escrow holder, and for the disposition of the
      same in accordance with the written instruments accepted by it in the
      escrow.

     

    Pledgee
      and the Pledgor hereby agree, to defend and indemnify the Escrow Agent and
      hold
      it harmless from any and all claims, liabilities, losses, actions, suits, or
      proceedings at law or in equity, or any other expenses, fees, or charges of
      any
      character or nature which it may incur or with which it may be threatened by
      reason of its acting as Escrow Agent under this Agreement; and in connection
      therewith, to indemnify the Escrow Agent against any and all expenses, including
      attorneys’ fees and costs of defending any action, suit, or proceeding or
      resisting any claim (and any costs incurred by the Escrow Agent pursuant to
      Sections 6.4 or 6.5 hereof). The Escrow Agent shall be vested with a lien on
      all
      property deposited hereunder, for indemnification of attorneys’ fees and court
      costs regarding any suit, proceeding or otherwise, or any other expenses, fees,
      or charges of any character or nature, which may be incurred by the Escrow
      Agent
      by reason of disputes arising between the makers of this escrow as to the
      correct interpretation of this Agreement and instructions given to the Escrow
      Agent hereunder, or otherwise, with the right of the Escrow Agent, regardless
      of
      the instructions aforesaid, to hold said property until and unless said
      additional expenses, fees, and charges shall be fully paid. Any fees and costs
      charged by the Escrow Agent for serving hereunder shall be paid by the
      Pledgor.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    If
      any of
      the parties shall be in disagreement about the interpretation of this Agreement,
      or about the rights and obligations, or the propriety of any action contemplated
      by the Escrow Agent hereunder, the Escrow Agent may, at its sole discretion
      deposit the Pledged Materials with the Clerk of the United States District
      Court
      of New Jersey, sitting in Newark, New Jersey, and, upon notifying all parties
      concerned of such action, all liability on the part of the Escrow Agent shall
      fully cease and terminate. The Escrow Agent shall be indemnified by the Pledgor,
      the Company and Pledgee for all costs, including reasonable attorneys’ fees in
      connection with the aforesaid proceeding, and shall be fully protected in
      suspending all or a part of its activities under this Agreement until a final
      decision or other settlement in the proceeding is received.

     

    The
      Escrow Agent may consult with counsel of its own choice (and the costs of such
      counsel shall be paid by the Pledgor and Pledgee) and shall have full and
      complete authorization and protection for any action taken or suffered by it
      hereunder in good faith and in accordance with the opinion of such counsel.
      The
      Escrow Agent shall not be liable for any mistakes of fact or error of judgment,
      or for any actions or omissions of any kind, unless caused by its willful
      misconduct or gross negligence.

     

    The
      Escrow Agent may resign upon ten (10) days’ written notice to the parties in
      this Agreement. If a successor Escrow Agent is not appointed within this ten
      (10) day period, the Escrow Agent may petition a court of competent jurisdiction
      to name a successor.

     

    6.7 Conflict
      Waiver.
      The
      Pledgor hereby acknowledges that the Escrow Agent is general counsel to the
      Pledgee, a partner in the general partner of the Pledgee, and counsel to the
      Pledgee in connection with the transactions contemplated and referred herein.
      The Pledgor agrees that in the event of any dispute arising in connection with
      this 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 Pledgee and the Pledgor will not seek to disqualify
      such counsel and waives any objection Pledgor might have with respect to the
      Escrow Agent acting as the Escrow Agent pursuant to this Agreement.

     

    6.8 Notices.
      Unless
      otherwise provided herein, all demands, notices, consents, service of process,
      requests and other communications hereunder shall be in writing and shall be
      delivered in person or by overnight courier service, or mailed by certified
      mail, return receipt requested, addressed:

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    
      	
              If
                to the Pledgor, to:

            	
              Compliance
                Systems Corporation

            
	 	
              90
                Pratt Oval

            
	 	
              Glen
                Cove, NY 11542

            
	 	
              Attention: Dean
                Garfinkel

            
	 	
              Telephone: (516)
                656-5155

            
	 	
              Facsimile: (516)
                676-2420

            
	 	 
	
              With
                a copy to:

            	
              Kirkpatrick
                & Lockhart Preston Gates Ellis LLP

            
	 	
              201
                South Biscayne Boulevard.
                -
                Suite 2000

            
	 	
              Miami,
                Florida 33131-2399

            
	 	
              Attention:
                Clayton E. Parker, Esq.

            
	 	
              Telephone:
                (305) 539-3352 

            
	 	
              Facsimile:
                (305) 358-7095

            
	 	 
	
              If
                to the Pledgee:

            	
              Cornell
                Capital Partners, L.P.

            
	 	
              101
                Hudson Street, Suite 3700

            
	 	
              Jersey
                City, NJ 07302

            
	 	
              Attention:
                 Mark
                A. Angelo

            
	 	
              Telephone: (201)
                985-8300

            
	 	
              Facsimile:
                 (201)
                985-8744

            
	 	 
	
              With
                copy to:

            	
              David
                Gonzalez, Esq.

            
	 	
              101
                Hudson Street, Suite 3700

            
	 	
              Jersey
                City, NJ 07302

            
	 	
              Telephone: (201)
                985-8300

            
	 	
              Facsimile: (201)
                985-1964

            
	 	 

    

    

    Any
      such
      notice shall be effective (a) when delivered, if delivered by hand delivery
      or overnight courier service, or (b) five (5) days after deposit in the
      United States mail, as applicable.

     

    7. Binding
      Effect.
      All of
      the covenants and obligations contained herein shall be binding upon and shall
      inure to the benefit of the respective parties, their successors and
      assigns.

     

    8. Governing
      Law; Venue; Service of Process.
      The
      validity, interpretation and performance of this Agreement shall be determined
      in accordance with the laws of the State of New Jersey applicable to contracts
      made and to be performed wholly within that state except to the extent that
      Federal law applies. The parties hereto agree that any disputes, claims,
      disagreements, lawsuits, actions or controversies of any type or nature
      whatsoever that, directly or indirectly, arise from or relate to this Agreement,
      including, without limitation, claims relating to the inducement, construction,
      performance or termination of this Agreement, shall be brought in the state
      superior courts located in Hudson County, New Jersey or Federal district courts
      located in Newark, New Jersey, and the parties hereto agree not to challenge
      the
      selection of that venue in any such proceeding for any reason, including,
      without limitation, on the grounds that such venue is an inconvenient forum.
      The
      parties hereto specifically agree that service of process may be made, and
      such
      service of process shall be effective if made, pursuant to Section 6
      hereto.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    9. Enforcement
      Costs.
      If any
      legal action or other pro-ceeding is brought for the enforcement of this
      Agreement, or because of an alleged dispute, breach, default or
      misrepresenta-tion in connection with any provisions of this Agreement, the
      successful or prevailing party or parties shall be entitled to recover
      reasonable attorneys’ fees, court costs and all expenses even if not taxable as
      court costs (including, without limita-tion, all such fees, costs and expenses
      incident to appeals), incurred in that action or proceeding, in addition to
      any
      other relief to which such party or parties may be entitled.

     

    10. Remedies
      Cumulative.
      No
      remedy herein conferred upon any party is intended to be exclusive of any other
      remedy, and each and every such remedy shall be cumulative and shall be in
      addition to every other remedy given hereunder or now or here-after existing
      at
      law, in equity, by statute, or otherwise. No single or partial exercise by
      any
      party of any right, power or remedy hereunder shall preclude any other or
      further exercise thereof. 

     

    11. Counterparts.
      This
      Agreement may be executed in one or more counterparts, each of which shall
      be
      deemed an original, but all of which together shall constitute the same
      instrument.

     

    12. No
      Penalties.
      No
      provision of this Agreement is to be interpreted as a penalty upon any party
      to
      this Agreement.

     

    13. JURY
      TRIAL.
      EACH OF
      THE PLEDGEE AND THE PLEDGOR HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
      WAIVES THE RIGHT WHICH IT MAY HAVE TO A TRIAL BY JURY OF ANY CLAIM, DEMAND,
      ACTION OR CAUSE OF ACTION BASED HEREON, OR ARISING OUT OF, UNDER OR IN ANY
      WAY
      CONNECTED WITH THE DEALINGS BETWEEN PLEDGEE AND PLEDGOR, THIS PLEDGE AND ESCROW
      AGREEMENT OR ANY DOCUMENT EXECUTED IN CONNECTION HEREWITH, OR ANY COURSE OF
      CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS
      OF
      ANY PARTY HERETO OR THERETO IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
      ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE. 

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF,
      the
      parties hereto have duly executed this Pledge and Escrow Agreement as of the
      date first above written. 

     

    

    
      	 	 	Cornell Capital Partners,
              L.P. 
	 	 	 
	 	 	By:  Yorkville
              Advisors, LLC 
	 	 	Its: Investment
              Manager 
	 	 	 
	 	 	By: /s/ Mark Angelo
	 	 	
              

              Name: Mark
              Angelo
	 	 	Title: Portfolio
              Manager
	 	 	 
	 	 	 
	 	 	Compliance Systems
              Corporation
	 	 	 
	 	 	By: /s/ Dean Garfinkel
	 	 	
              
                

                Name: Dean
                Garfinkel

            
	 	 	
              Title: Chairman

            
	 	 	 
	 	 	 
	 	 	Escrow
              Agent 
	 	 	 
	 	 	By: /s/ David Gonzalez, Esq. 
	 	 	
              

              Name: David
              Gonzalez, Esq. 

    

    

    
      
        
        

      

      7

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00120-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00120-of-00352.parquet"}]]