Document:

EXHIBIT 10.2
                               SECURITY AGREEMENT

      This Security Agreement (this "Agreement") is made as of March 3, 2006, by
and among Vocalscape Networks, Inc., a Nevada corporation ("Debtor"), Azatel
Communications Inc., a British Columbia corporation (the "Debtor-sub"), in favor
of Armada Group USA, Inc., a Delaware corporation (the "Secured Party").

                                    RECITALS

      A. Debtor is the holder of substantially all of the common shares of the
Debtor-sub and, generally speaking, controls the Debtor-sub.

      B. Secured Party has loaned Debtor One Hundred Fifty Thousand Dollars
($150,000), as evidenced by that certain Convertible Promissory Note, dated as
of the date hereof and executed by Debtor (the "Convertible Promissory Note").

      C. The Secured Party's obligation to loan the $150,000 to Debtor pursuant
to the terms of the Convertible Promissory Note is subject, among other
conditions, to receipt by the Secured Party of this Security Agreement, duly
executed by the Debtor-sub.

                                   AGREEMENT

      In consideration of the foregoing and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
Debtor and Debtor-sub hereby agree with the Secured Party as follows:

      1. Grant of Security Interest.

            (a) To secure the Debtor-sub's full and timely payment and
performance of the obligations under the Convertible Promissory Note, the
Debtor-sub hereby grants to the Secured Party a lien on and security interest
(the "Security Interest") in, all of the Debtor-sub's right, title and interest
in and the following of its personal property and assets (both tangible and
intangible), including, without limitation, the following, whether now owned or
hereafter acquired and wherever located: (a) all Receivables (b) all Inventory;
(c) Equipment, (d) General Intangibles, (e) Intellectual Property, (f) Deposit
Accounts and (g) all Proceeds of each of the foregoing and all accessions to,
and replacements for, each of the foregoing (collectively, the "Collateral").
The Security Interest shall be a first interest in all of the Collateral.

            (b) The following terms shall have the following meanings for
purposes of this Agreement:

            "Account" means any "Account," as such term is defined in the UCC,
now owned or hereafter acquired by the Debtor-sub or in which the Debtor-sub now
holds or hereafter acquires any interest and, in any event, shall include,
without limitation, all accounts receivable, book debts, rights to payment and
other forms of obligations (other than forms of obligations evidenced by Chattel
Paper, Documents or Instruments) now owned or hereafter received or acquired by
or belonging or owing to the Debtor-sub whether or not arising out of goods or
software sold or services rendered by the Debtor-sub or from any other
transaction, whether or not the same involves the sale of goods or services by
the Debtor-sub and all of the Debtor-sub's rights in, to and under all purchase
orders or receipts now owned or hereafter acquired by it for goods or services,
and all of the Debtor-sub's rights to any goods represented by any of the
foregoing, and all monies due or to become due to the Debtor-sub under all
purchase orders and contracts for the sale of goods or the performance of
services or both by the Debtor-sub or in connection with any other transaction
(whether or not yet earned by performance on the part of the Debtor-sub), now in
existence or hereafter occurring, including, without limitation, the right to
receive the proceeds of said purchase orders and contracts, and all collateral
security and guarantees of any kind given by any Person with respect to any of
the foregoing.

<PAGE>

            "Chattel Paper" means any "Chattel paper," as such term is defined
in the UCC, now owned or hereafter acquired by the Debtor-sub or in which the
Debtor-sub now holds or hereafter acquires any interest.

            "Deposit Accounts" means any "Deposit accounts," as such term is
defined in the UCC, and includes any checking account, savings account, or
certificate of deposit, now owned or hereafter acquired by the Debtor-sub or in
which the Debtor-sub now holds or hereafter acquires any interest.

            "Documents" means any "Documents," as such term is defined in the
UCC, now owned or hereafter acquired by the Debtor-sub or in which the
Debtor-sub now holds or hereafter acquires any interest.

            "Equipment" means any "Equipment," as such term is defined in the
UCC, now owned or hereafter acquired by Debtor-sub or in which Debtor-sub now
holds or hereafter acquires any interest and any and all additions, upgrades,
substitutions and replacements of any of the foregoing, together with all
attachments, components, parts, equipment and accessories installed thereon or
affixed thereto, now owned or hereafter acquired by Debtor-sub or in which
Debtor-sub now holds or hereafter acquires an interest.

            "General Intangible" means any "General intangible," as such term is
defined in the UCC, now owned or hereafter acquired by the Debtor-sub or in
which the Debtor-sub now holds or hereafter acquires any interest and, in any
event, shall include, without limitation, all right, title and interest that the
Debtor-sub may now or hereafter have in or under any contracts, rights to
payment, payment intangibles, confidential information, interests in
partnerships, limited liability companies, corporations, joint ventures and
other business associations, permits, goodwill, claims in or under insurance
policies, including unearned premiums and premium adjustments, uncertificated
securities, deposit, checking and other bank accounts, but shall not include any
Intellectual Property (including the right to receive all proceeds and damages
therefrom), rights to receive tax refunds and other payments and rights of
indemnification

<PAGE>

            "Instruments" means any "Instrument," as such term is defined in the
UCC, now owned or hereafter acquired by the Debtor-sub or in which the
Debtor-sub now holds or hereafter acquires any interest.

            "Intellectual Property" means, collectively, all rights, priorities
and privileges of the Debtor-sub relating to intellectual property, whether
arising under United States, multinational or foreign laws or otherwise,
including copyrights, copyright licenses, inventions, patents, patent licenses,
trademarks, trademark licenses and trade secrets (including customer lists),
domain names, websites and know-how.

            "Inventory" means any "Inventory," as such term is defined in the
UCC, now owned or hereafter acquired by the Debtor-sub or in which the
Debtor-sub now holds or hereafter acquires any interest, and, in any event,
shall include, without limitation, all inventory, goods and other personal
property that are held by or on behalf of the Debtor-sub for sale or lease or
are furnished or are to be furnished under a contract of service or that
constitute raw materials, work in process or materials used or consumed or to be
used or consumed in the Debtor-sub's business, or the processing, packaging,
promotion, delivery or shipping of the same, and all finished goods, whether or
not the same is in transit or in the constructive, actual or exclusive
possession of the Debtor-sub or is held by others for the Debtor-sub's account,
including, without limitation, all goods covered by purchase orders and
contracts with suppliers and all goods billed and held by suppliers and all such
property that may be in the possession or custody of any carriers, forwarding
agents, truckers, warehousemen, vendors, selling agents or other Persons.

            "Proceeds" means "Proceeds," as such term is defined in the UCC and,
in any event, shall include, without limitation, (a) any and all Accounts,
Chattel Paper, Instruments, cash or other forms of money or currency or other
proceeds payable to the Debtor-sub from time to time in respect of the
Collateral, (b) any and all proceeds of any insurance, indemnity, warranty or
guaranty payable to the Debtor-sub from time to time with respect to any of the
Collateral, (c) any and all payments (in any form whatsoever) made or due and
payable to the Debtor-sub from time to time in connection with any requisition,
confiscation, condemnation, seizure or forfeiture of all or any part of the
Collateral by any governmental authority (or any Person acting under color of
governmental authority), (d) the proceeds, damages, or recovery based on any
claim of the Debtor-sub against third parties (i) for past, present or future
infringement of any copyright, patent or patent license or (ii) for past,
present or future infringement or dilution of any trademark or trademark license
or for injury to the goodwill associated with any trademark, trademark
registration or trademark licensed under any trademark license and (e) any and
all other amounts from time to time paid or payable under or in connection with
any of the Collateral.

            "Receivables" means all of the Debtor-sub's Accounts, Instruments,
Documents and Chattel Paper.

            "UCC" has the meaning ascribed to it under California Law.

<PAGE>

      2. Representations and Warranties. The Debtor-sub hereby represents and
warrants to the Secured Party that:

            (a) Ownership of Collateral. The Debtor-sub is the legal and
beneficial owner of the Collateral (or, in the case of after-acquired
Collateral, at the time the Debtor-sub acquires rights in the Collateral, will
be the legal and beneficial owner thereof). Except for the Security Interest
granted to the Secured Party pursuant to this Agreement, the Debtor-sub has
rights in or the power to transfer the Collateral free and clear of any adverse
lien, security interest or encumbrance. No financing statements covering any
Collateral or any proceeds thereof are on file in any public office (other than
filings listing the Secured Party as the secured party).

            (b) Valid Security Interest. The Security Interest granted pursuant
to this Agreement will constitute a valid and continuing first priority,
perfected security interest in favor of the Secured Party in the Collateral for
which perfection is governed by the UCC. Such Security Interest will be prior to
all other liens on the Collateral.

            (c) Organization and Good Standing. The Debtor-sub has been duly
incorporated, and is validly existing and in good standing, under the laws of
the Province of British Columbia.

            (d) Location, Province of Organization and Name of the Debtor-sub.
The Debtor-sub's province of organization is British Columbia and the
Debtor-sub's exact legal name as it appears in the official filings in the
Province of British Columbia is as set forth in the first paragraph of this
Agreement. The Debtor-sub has only one jurisdiction of organization.

            (e) Location of Inventory. All Equipment and Inventory are (i)
located in the following locations: 305-1847 West Broadway, Vancouver, British
Columbia V6J 1Y6 (ii) in transit to such locations or (iii) in transit to a
third party purchaser which will become obligated on a Receivable to the
Debtor-sub upon receipt. Except Inventory referred to in clauses (ii) and (iii)
of the preceding sentence, the Debtor-sub has exclusive possession and control
of the Inventory.

            (f) Receivables. Each Receivable is genuine and enforceable against
the party obligated to pay the same (an "Account Debtor-sub ") free from any
right of rescission, defense, setoff or discount.

            (g) Creation of Lien. This Agreement is effective to create a valid
and continuing lien upon the Collateral.

      3. Covenants. The Debtor-sub covenants and agrees with the Secured Party
that, from and after the date of this Agreement until the obligations under the
Convertible Promissory Note are paid in full:

            (a) Other Liens. Except for the Security Interest, the Debtor-sub
has rights in or the power to transfer the Collateral and its title and will be
able to do so hereafter free from any adverse lien, security interest or
encumbrance, and the Debtor-sub will defend the Collateral against the claims
and demands of all persons at any time claiming the same or any interest
therein.

<PAGE>

            (b) Further Documentation. At any time and from time to time, upon
the written request of the Secured Party, and at the sole expense of the
Debtor-sub, the Debtor-sub will promptly and duly authenticate and deliver such
further instruments and documents and take such further action as the Secured
Party may reasonably request for the purpose of obtaining or preserving the full
benefits of this Agreement and of the rights and powers herein granted
including, without limitation, filing any financing or continuation statements
under the UCC or the laws of any other jurisdiction in effect with respect to
the liens created hereby. The Debtor-sub also hereby authorizes the Secured
Party to file any such financing, amendment or continuation statement without
the authentication of the Debtor-sub to the extent permitted by applicable law.
A reproduction of this Agreement shall be sufficient as a financing statement
(or as an exhibit to a financing statement on form UCC-1) for filing in any
jurisdiction.

            (c) Indemnification. The Debtor-sub agrees to defend, indemnify and
hold harmless the Secured Party against any and all liabilities, costs and
expenses (including, without limitation, legal fees and expenses): (i) with
respect to, or resulting from, any delay in paying, any and all excise, sales or
other taxes which may be payable or determined to be payable with respect to any
of the Collateral, (ii) with respect to, or resulting from, any delay in
complying with any law, rule, regulation or order of any governmental authority
applicable to any of the Collateral or (iii) in connection with any of the
transactions contemplated by this Agreement.

            (d) Maintenance of Records. The Debtor-sub will keep and maintain at
its own expense complete and satisfactory, in all material respects, records of
the Collateral.

            (e) Inspection Rights. The Secured Party shall have full access
during normal business hours, upon prior notice and in a manner that will not
interfere with the normal business operations of the Debtor-sub, to all the
books, correspondence and other records of the Debtor-sub relating to the
Collateral. The Secured Party or its representatives may examine such records
and make photocopies or otherwise take extracts from such records. The
Debtor-sub agrees to render to the Secured Party, at the Debtor-sub's expense,
such clerical and other assistance as the Secured Party may reasonably request
with regard to the exercise of its rights pursuant to this paragraph.

            (f) Compliance with Laws, etc. The Debtor-sub (i) will comply with
all laws, rules, regulations and orders of any governmental authority applicable
to any part of the Collateral or to the operation of the Debtor-sub's business ,
the failure of which to comply with will have a material adverse effect on the
Debtor-sub, and (ii) shall not use or permit any Collateral to be used in
violation of any provision of this Agreement or the Convertible Promissory Note,
any law, rule or obligation or order of any governmental authority, or any
policy of insurance covering the Collateral; provided, however, that in each
case, the Debtor-sub may contest any such law, rule, regulation or order; in any
reasonable manner which does not, in the reasonable opinion of the Secured
Party, adversely affect the Secured Party's rights or the priority of its liens
on the Collateral.

<PAGE>

            (g) Payment of Obligations. The Debtor-sub will pay promptly when
due all taxes, assessments and governmental charges or levies imposed upon the
Collateral or with respect to any of its income or profits derived from the
Collateral, as well as all claims of any kind (including, without limitation,
claims for labor, materials and supplies) against or with respect to the
Collateral, except for amounts contested by the Debtor-sub in good faith through
appropriate proceedings.

            (h) Limitation on Liens on Collateral. The Debtor-sub will not
create, incur or permit to exist, will defend the Collateral against, and will
take such other action as is necessary to remove, any lien or claim on or to the
Collateral, other than the Security Interest, and will defend the right, title
and interest of the Secured Party in and to any of the Collateral against the
claims and demands of all other persons.

            (i) Limitations on Dispositions of Collateral. The Debtor-sub will
not sell, transfer, lease, or otherwise dispose of any of the Collateral, or
attempt, offer or contract to do so other than (i) dispositions of Inventory in
the ordinary course of the Debtor-sub's business or (ii) the sale of obsolete or
unneeded Equipment in the ordinary course of business; provided, however , that
the Debtor-sub will be allowed to grant licenses to its products and related
documentation in the ordinary course of business and to establish or provide for
escrows of related intellectual property in connection therewith.

            (j) Further Identification of Collateral. The Debtor-sub will
furnish to the Secured Party from time to time statements and schedules further
identifying and describing the Collateral and such other reports in connection
with the Collateral as the Secured Party may reasonably request, all in detail
acceptable to the Secured Party.

            (k) Notice of Change of Province of Incorporation. Without 30 days'
prior written notice to the Secured Party, the Debtor-sub shall not (i) change
the Debtor-sub's name, province of incorporation or organization, organizational
identification number or place of business (or, if the Debtor-sub has more than
one place of business, its chief executive office), or the office in which the
Debtor-sub's records relating to Receivables are kept.

            (l) Future Commercial Tort Claims. The Debtor-sub will promptly give
notice to the Secured Party upon the initiation of any commercial tort claim.
The Debtor-sub hereby authorizes the Secured Party to amend this Agreement
(without any further action or consent from the Debtor-sub) to include any such
commercial tort claim as Collateral hereunder.

            (m) Collection of Receivables . The Debtor-sub shall collect,
enforce and receive delivery of the Receivables in accordance with past
practice.

            (n) Limitation on Filing of Financing Statements. The Debtor-sub
acknowledges that it is not authorized to file any financing statement or
amendment or termination statement with respect to any financing statement
without the prior written consent of the Secured Party and agrees that it will
not do so without the prior written consent of the Secured Party, subject to the
Debtor-sub's rights under Section 9-509(d)(2) of the UCC.

<PAGE>

      4. Event of Default; the Secured Party's Appointment as Attorney-in-Fact .

            (a) Event of Default. For purposes of this Agreement, the occurrence
of any one of the following events (each an "Event of Default") shall constitute
a default hereunder and under the Convertible Promissory Note:

            (i) Debtor shall fail to pay any other amount required under the
terms of the Convertible Promissory Note;

            (ii) Debtor-sub shall fail to perform any other non-monetary
obligation set forth in this Agreement, or Debtor shall fail to perform any
other non-monetary obligation set forth in the Convertible Promissory Note,
which by its nature cannot be cured;

            (iii) Debtor-sub shall fail to perform any other non-monetary
obligation set forth in this Agreement, or Debtor shall fail to perform any
other non-monetary obligation set forth in the Convertible Promissory Note,
which failure is not cured within ten (10) days after written notice of such
failure is provided to Debtor-sub or Debtor or if such failure cannot be cured
within such time period, if work on such cure is not begun within such time
period and continuously prosecuted thereafter on a commercially reasonable basis
until cured;

            (iv) Any representation, warranty, certificate, information or other
statement (financial or otherwise) made or furnished by or on behalf of
Debtor-sub or Debtor to the Secured Party in or in connection with this
Agreement, or the Convertible Promissory Note, or as an inducement to the
Secured Party to enter into this Agreement, shall be false, incorrect,
incomplete or misleading in any material respect when made or furnished;

            (v) Any levy, assessment, attachment, seizure, lien or encumbrance
is made on all or any part of the Collateral which is not cured or contested
within twenty (20) days after the occurrence of the same;

            (vi) Debtor-sub shall breach any covenant in any material respect in
this Agreement, or Debtor shall breach any covenant in any material respect
under the Convertible Promissory Note, or any other agreement entered into
between the Debtor, the Debtor-sub and the Secured Party in connection
therewith.

            (vii) Dissolution, termination of existence, or appointment of a
receiver, trustee or custodian, for all or any part of the property of,
assignment for the benefit of creditors by, or the commencement of any
proceeding by Debtor or Debtor-sub under any reorganization, bankruptcy,
arrangement, dissolution or liquidation law or statute of any jurisdiction, now
or in the future in effect;

            (viii) Commencement of any proceeding against debtor or Debtor-sub
under any reorganization, bankruptcy, arrangement, dissolution or liquidation
law or statute of any jurisdiction, now or in the future in effect, which is not
cured by the dismissal thereof within ninety (90) days after the date commenced;

<PAGE>

            (ix) Debtor-sub shall conceal, remove or transfer any part of its
property, with intent to hinder, delay or defraud its creditors, or make or
suffer any transfer of any of its property which may be fraudulent under any
bankruptcy, fraudulent conveyance or similar law; or

            (x) Debtor shall be in default beyond any applicable period of grace
or cure under any other agreement involving the borrowing of money, the purchase
of property, the advance of credit or any other monetary liability of any kind
to any lender or to any person which results in the acceleration of payment of
such obligation in an amount in excess of $150,000.

            (b) Powers. The Debtor-sub hereby appoints the Secured Party and any
officer or agent of the Secured Party, with full power of substitution, as its
attorney-in-fact with full irrevocable power and authority in the place of the
Debtor-sub and in the name of the Debtor-sub or its own name, from time to time
in the Secured Party's discretion so long as an Event of Default has occurred
and is continuing, for the purpose of carrying out the terms of this Agreement,
to take any appropriate action and to authenticate any instrument which may be
necessary or desirable to accomplish the purposes of this Agreement. Without
limiting the foregoing, so long as an Event of Default has occurred and is
continuing, the Secured Party shall have the right, without notice to, or the
consent of, the Debtor-sub, to do any of the following on the Debtor-sub's
behalf:

            (i) to pay or discharge any taxes or liens levied or placed on or
threatened against the Collateral;

            (ii) to direct any party liable for any payment under any of the
Collateral to make payment of any and all amounts due or to become due
thereunder directly to the Secured Party or as the Secured Party directs;

            (iii) to ask for or demand, collect, and receive payment of and
receipt for, any payments due or to become due at any time in respect of or
arising out of any Collateral;

            (iv) to commence and prosecute any suits, actions or proceedings at
law or in equity in any court of competent jurisdiction to enforce any right in
respect of any Collateral;

            (v) to defend any suit, action or proceeding brought against the
Debtor-sub with respect to any Collateral;

            (vi) to settle, compromise or adjust any suit, action or proceeding
described in subsection (v) above and to give such discharges or releases in
connection therewith as the Secured Party may deem appropriate;

            (vii) to assign any patent right included in the Collateral of the
Debtor-sub (along with the goodwill of the business to which any such patent
right pertains), throughout the world for such term or terms, on such
conditions, and in such manner, as the Secured Party shall in its sole
discretion determine; and

<PAGE>

            (viii) generally, to sell, transfer, pledge and make any agreement
with respect to or otherwise deal with any of the Collateral and to take, at the
Secured Party's option and the Debtor-sub's expense, any actions which the
Secured Party deems necessary to protect, preserve or realize upon the
Collateral and the Secured Party's liens on the Collateral and to carry out the
intent of this Agreement, in each case to the same extent as if the Secured
Party were the absolute owner of the Collateral for all purposes.

            The Debtor and Debtor-sub hereby ratify whatever actions the Secured
Party shall lawfully do or cause to be done in accordance with this Section 4.
This power of attorney shall be a power coupled with an interest and shall be
irrevocable.

            (c) No Duty on the Secured Party's Part. The powers conferred on the
Secured Party by this Section 5 are solely to protect the Secured Party's
interests in the Collateral and shall not impose any duty upon it to exercise
any such powers. The Secured Party shall be accountable only for amounts that it
actually receives as a result of the exercise of such powers, and neither the
Secured Party nor any of its officers, directors, employees or agents shall, in
the absence of willful misconduct or gross negligence, be responsible to the
Debtor or Debtor-sub for any act or failure to act pursuant to this Section 4.

      5. Performance by the Secured Party of the Debtor-sub's Obligations. If
the Debtor or Debtor-sub fail to perform or comply with any of its agreements or
covenants contained in this Agreement and the Secured Party performs or
complies, or otherwise causes performance or compliance, with such agreement or
covenant in accordance with the terms of this Agreement, then the expenses of
the Secured Party incurred in connection with such performance or compliance
shall be payable by the Debtor or Debtor-sub to the Secured Party on demand and
shall constitute obligations secured by this Agreement.

      6. Remedies. If an Event of Default has occurred and is continuing, the
Secured Party may exercise, in addition to all other rights and remedies granted
to it in this Agreement and in any other instrument or agreement relating to the
obligations under the Convertible Promissory Note, all rights and remedies of a
secured party under the UCC. Without limiting the foregoing, the Secured Party,
without demand of performance or other demand, presentment, protest,
advertisement or notice of any kind (except any notice required by law) to or
upon the Debtor-sub or any other person (all of which demands, defenses,
advertisements and notices are hereby waived), may in such circumstances
collect, receive, appropriate and realize upon any or all of the Collateral,
and/or may sell, lease, assign, give an option or options to purchase, or
otherwise dispose of and deliver any or all of the Collateral (or contract to do
any of the foregoing), in one or more parcels at a public or private sale or
sales, at any exchange, broker's board or office of the Secured Party or
elsewhere upon such terms and conditions as the Secured Party may deem
advisable, for cash or on credit or for future delivery without assumption of
any credit risk. The Secured Party shall have the right upon any such public
sale or sales and, to the extent permitted by law, upon any such private sale or
sales, to purchase all or any part of the Collateral so sold, free of any right
or equity of redemption in the Debtor-sub, which right or equity is hereby
waived or released. The Secured Party shall apply the net proceeds of any such
collection, recovery, receipt, appropriation, realization or sale, after
deducting all reasonable expenses incurred therein or in connection with the
care or safekeeping of any of the Collateral or in any way relating to the
Collateral or the rights of the Secured Party under this Agreement (including,
without limitation, reasonable attorneys' fees and expenses) to the payment in
whole or in part of the obligations under the Convertible Promissory Note, in
such order as the Secured Party may elect, and only after such application and
after the payment by the Secured Party of any other amount required by any
provision of law, need the Secured Party account for the surplus, if any, to the
Debtor-sub. To the extent permitted by applicable law, the Debtor and Debtor-sub
waives all claims, damages and demands it may acquire against the Secured Party
arising out of the exercise by the Secured Party of any of its rights hereunder.
If any notice of a proposed sale or other disposition of Collateral shall be
required by law, such notice shall be deemed reasonable and proper if given at
least ten days before such sale or other disposition. The Debtor and Debtor-sub
shall remain liable for any deficiency if the proceeds of any sale or other
disposition of the Collateral are insufficient to pay the obligations under the
Convertible Promissory Note and the fees and disbursements of any attorneys
employed by the Secured Party to collect such deficiency.

<PAGE>

      7. Limitation on Duties Regarding Preservation of Collateral. The Secured
Party's sole duty with respect to the custody, safekeeping and preservation of
the Collateral, under Section 9-207 of the UCC or otherwise, shall be to deal
with it in the same manner as the Secured Party deals with similar property for
its own account. Neither the Secured Party nor any of its directors, officers,
employees or agents shall be liable for failure to demand, collect or realize
upon all or any part of the Collateral or for any delay in doing so or shall be
under any obligation to sell or otherwise dispose of any Collateral upon the
request of the Debtor-sub or otherwise.

      8. Powers Coupled with an Interest. All authorizations and agencies
contained in this Agreement with respect to the Collateral are irrevocable and
are powers coupled with an interest.

      9. No Waiver; Cumulative Remedies. The Secured Party shall not by any act
(except by a written instrument pursuant to Section 11(a) hereof), delay,
indulgence, omission or otherwise be deemed to have waived any right or remedy
hereunder or to have acquiesced in any default under the Convertible Promissory
Note or in any breach of any of the terms and conditions of this Agreement. No
failure to exercise, nor any delay in exercising, on the part of the Secured
Party, any right, power or privilege hereunder shall operate as a waiver
thereof. No single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. A waiver by the Secured Party of any
right or remedy under this Agreement on any one occasion shall not be construed
as a bar to any right or remedy which the Secured Party would otherwise have on
any subsequent occasion. The rights and remedies provided in this Agreement are
cumulative, may be exercised singly or concurrently and are not exclusive of any
rights or remedies provided by law.

      10. Termination of Security Interest. Upon satisfaction of the Debtors
obligations pursuant to the Convertible Note, the security interest granted
herein shall terminate and all rights to the Collateral shall revert to the
Debtor-sub. Upon any such termination, the Secured Party shall authenticate and
deliver to the Debtor-sub such documents as the Debtor-sub may reasonably
request to evidence such termination.

<PAGE>

      11. Miscellaneous.

            (a) Amendments and Waivers. Any term of this Agreement may be
amended with the written consent of the parties hereto. Any amendment or waiver
effected in accordance with this Section 11 (a) shall be binding upon the
parties and their respective successors and assigns.

            (b) Transfer; Successors and Assigns. The terms and conditions of
this Agreement shall be binding upon the Debtor and Debtor-sub and their
successors and assigns, as well as all persons who become bound as a Debtor or
Debtor-sub to this Agreement and inure to the benefit of the Secured Party and
its successors and assigns. Nothing in this Agreement, express or implied, is
intended to confer upon any party other than the parties hereto or their
respective successors and assigns any rights, remedies, obligations or
liabilities under or by reason of this Agreement, except as expressly provided
in this Agreement.

            (c) Governing Law . This Agreement and all acts and transactions
pursuant hereto and the rights and obligations of the parties hereto shall be
governed, construed and interpreted in accordance with the laws of the State of
California, without giving effect to principles of conflicts of law, with the
exception that the parties agree that the perfection of any security interest,
mortgage, lien or other encumbrance granted hereunder may perfected under the
laws of British Columbia and any other foreign jurisdiction.

            (d) Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.

            (e) Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.

            (f) Notices. Any notice required or permitted by this Agreement
shall be in writing and shall be deemed sufficient upon receipt, when delivered
personally or by courier, overnight delivery service or confirmed facsimile, or
48 hours after being deposited in the U.S. mail as certified or registered mail
with postage prepaid, if such notice is addressed to the party to be notified at
such party's address or facsimile number as set forth below or as subsequently
modified by written notice.

            (h) Payments Free of Taxes, etc. All payments made by the Debtor-sub
under this Agreement shall be made by the Debtor-sub free and clear of and
without deduction for any and all present and future taxes, levies, charges,
deductions and withholdings. In addition, the Debtor-sub shall pay upon demand
any stamp or other taxes, levies or charges of any jurisdiction with respect to
the execution, delivery, registration, performance and enforcement of this
Agreement. Upon request by the Secured Party, the Debtor-sub shall furnish
evidence satisfactory to the Secured Party that all requisite authorizations and
approvals by, and notices to and filings with, governmental authorities and
regulatory bodies have been obtained and made and that all requisite taxes,
levies and charges have been paid.

<PAGE>

            (i) Severability. If one or more provisions of this Agreement are
held to be unenforceable under applicable law, the parties agree to renegotiate
such provision in good faith, in order to maintain the economic position enjoyed
by each party as close as possible to that under the provision rendered
unenforceable. In the event that the parties cannot reach a mutually agreeable
and enforceable replacement for such provision, then (i) such provision shall be
excluded from this Agreement, (ii) the balance of the Agreement shall be
interpreted as if such provision were so excluded and (iii) the balance of the
Agreement shall be enforceable in accordance with its terms.

            (j) Entire Agreement. This Agreement, and the documents referred to
herein constitute the entire agreement between the parties hereto pertaining to
the subject matter hereof, and any and all other written or oral agreements
existing between the parties hereto concerning such subject matter are expressly
canceled.

                            [signature page follows]

<PAGE>

      The Debtor, Debtor-sub and the Secured Party have caused this Agreement to
be duly executed and delivered as of the date first above written.

DEBTOR:

VOCALSCAPE NETWORKS, INC.

By: _____________________________
    Name:  Ron McIntyre
    Title:  President

Address:  305 - 1847 West Broadway
          Vancouver, British Columbia
          Canada V6J 1Y6

DEBTOR-SUB:

AZITEL COMMUNICATIONS INC.

By: _____________________________
    Name:  Ron McIntyre
    Title:  President

Address:  305 - 1847 West Broadway
          Vancouver, British Columbia
          Canada V6J 1Y6

SECURED PARTY:

ARMADA GROUP USA, INC.

By: _______________________________
    Name:  Patrick Cole
    Title:  President

Address:  9575 Pinehurst Drive
          Roseville, California 95747
          USAEMPLOYMENT AGREEMENT

      THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into to be effective as
of the 1st day of March 2006, by and between Tix Corporation, a Delaware
corporation (hereinafter the "Company"), and Mitch Francis, an individual
(hereinafter "Employee").

                                   WITNESSETH

      WHEREAS, the Company desires to continue the services of Employee, and
Employee is willing to continue as an employee of the Company, on the terms and
subject to the conditions hereinafter set forth. This Agreement supersedes and
replaces all prior agreements between the Company and Employee regarding the
subject matter hereof.

      NOW, THEREFORE, for and in consideration of the mutual promises herein
contained, the parties hereto hereby agree as follows;

      1. Engagement; Nature of Duties. The Company hereby engages Employee, for
the period hereinafter set forth, to serve as and hold the offices of Chairman
of the Board, President and Chief Executive Officer, and to perform the duties
of such offices as provided in the Bylaws of the Company and as directed by the
Board of Directors of the Company. Employee agrees to serve in such capacity and
to do and perform the service, acts, or things necessary to carry out the duties
of such offices, and such other duties, not inconsistent with such offices and
Employee's position as an executive officer of the Company. Employee shall
report only to the Board of Directors of the Company from time to time. It is
expressly agreed and acknowledged that employment in the capacity of the
aforementioned offices was a material inducement to Employee to enter into this
Agreement. The Company further agrees and acknowledges that election, and being
retained in office, as a director was a material inducement to Employee to enter
into this Agreement. The Board of Directors agrees to use its best efforts, so
long as this Agreement remains in effect, to cause Employee to be nominated as a
director at any meeting or action of the stockholders of the Company for the
purpose of electing directors, and to use their best efforts to cause Employee
to be elected and retained in office as a director throughout the term of this
Agreement. Employee may assign certain of the compensatory benefits hereunder to
Francis Development Inc. subject to approval of the Company, which shall not be
unreasonably withheld. Employee is solely responsible for any and all federal or
state tax consequences arising from any assignment of compensatory benefits to
Francis Development, Inc.

<PAGE>

      2. Term. The term of employment pursuant to this Agreement shall be for a
period of three (3) years, commencing on March 1, 2006 (the "Commencement
Date"), unless sooner terminated in accordance with the provisions hereof (the
"Term").

      3. Performance of Duties. Employee shall devote such time and attention to
Employee's duties as may be reasonably necessary to perform and carry out such
duties. Nothing herein contained shall be deemed to preclude Employee from
performing services to other businesses or entities not affiliated with the
Company or having personal investments and from devoting a reasonable amount of
time to the care and attention thereof, provided that the same shall in no
manner interfere with or derogate from Employee's work for the Company or
conflict with the Company's business.

      Employee shall perform his duties hereunder primarily in the Los Angeles,
California area, and shall not be required to perform such duties on a regular
basis at any other location except for site or location visits to be conducted
by Employee from time to time. Employee shall not be required to relocate
without his consent.

      4. Compensation.

            (i) Base Salary. The Company shall pay to Employee a base salary in
the amount of Two Hundred Seventy-five Thousand Dollars ($275,000) per year (the
"Base Salary"), payable in periodic installments in accordance with the
Company's prevailing policy for compensating personnel, but not less often than
semi monthly. On each yearly anniversary of the Commencement Date (March 1,
2006), the Base Salary shall be increased by eight percent (8%).

            (2) Earnings Bonus. In addition to the Base Salary, and any and all
other compensation, profit-sharing participation, benefits, bonuses or other
amounts due to or receivable by Employee pursuant to this Agreement, Employee
shall receive an annual bonus (the "Earnings Bonus") equal to six (6%) percent
of the Company's annual earnings in excess of $500,000 before taxes,
depreciation and amortization (ebtda) but after interest. A pro rata portion of
the Earnings Bonus (calculated by annualizing the year to date ebtda and taking
into account any Earnings Bonus paid for any prior periods) shall be due and
payable within ninety (90) days after the calendar (or the Company's fiscal)
year end.

            (c) Restricted Shares. Within thirty (30) days of the Commencement
Date, the Company shall cause the issuance to Employee of 500,000 restricted
shares of the Company's Common Stock. The shares shall be subject to a
prohibition on trading, encumbering, or otherwise transferring the shares
(without prior board approval) which shall lapse equally over three (3) years
(166,666 shares on 3/1/07, 166,666 shares on 3/1/08 and 166,667 shares on
3/1/09).

                                       2
<PAGE>

      5. Expenses Reimbursement; Automobile. The services required of Employee
by this Agreement shall include the responsibility and duty of entertaining
business associates and others with whom the Company is, desires to be, or may
become engaged in business or with whom it seeks, now or in the future, to
develop or expand business relationships, or with whom it is otherwise to the
benefit of the Company to establish or maintain communications. It may also be
necessary for Employee to travel from time to time on behalf of and for the
benefit of the Company, or in furtherance of the Company's business. It is the
Company's belief that the performance of Employee's duties in such travel and
entertainment activities will produce the maximum benefits which the Company
expects to derive from Employee's services. Accordingly, the Company shall pay,
or if Employee shall have paid, shall reimburse to Employee, any and all
expenses incurred by him or for his account in the performance of his duties
hereunder, including all expenses for business, entertainment, promotion and
travel by Employee, subject only to Employee providing appropriate documentation
for such expenses. It is expressly agreed, in connection therewith, that
Employee shall be provided or reimbursed for reasonable travel and
accommodations, but no first-class air travel will be deemed reasonable, (unless
under special price offering). The Company shall provide Employee with an
automobile, reasonably commensurate with Employee's office and position, for use
by Employee in performing Employee's duties hereunder and the Company shall be
responsible for all expenses associated with ownership/leasing of such
automobile, including, but not limited to, costs of licensing or registration,
maintenance, taxes and gasoline. Employee shall maintain such records with
respect to the use of such automobile as the Company may reasonably request.

      In the event that Employee shall be deemed to have received income, for
state or federal income tax purposes, by reason of Employee's receipt of or
reimbursement for any of the benefits or expenses set forth in this Section 5,
the Company shall pay or reimburse Employee for all taxes required to be paid by
Employee with respect to such income.

      6. Medical and Life Insurance; Pension Benefits; Tax Preparation. The
Company shall provide or reimburse Employee and Employee's spouse for health and
long-term care insurance (premiums up to $25,000 per year), and Employee life
insurance (premiums up to $10,000 per year), and disability insurance (up to
$10,000 per month coverage) (premiums up to $5,000 per year). Employee shall
also have the right to participate in any and all employee retirement benefits
plan or profit-sharing plan which the Company maintains for its personnel, and
in effect at any time during the period of Employee's employment hereunder,
subject only to any eligibility restrictions of such plans, the plan documents
and generally applicable policies of the Company. Employee shall be entitled to
reimbursement of up to $4,000 per year for personal tax consultation and
preparation of tax returns and other forms and filings.

                                       3
<PAGE>

      7. Vacation. During each year of the Term, Employee shall be entitled to a
vacation of four (4) weeks, without deduction of salary. Such vacation shall be
taken at such time or times during the applicable year as may be mutually
determined by Employee and the Company. Any additional vacation period shall be
determined by the Company consistent with the general customs and practices of
the Company applicable to its personnel.

      8. Termination. This Agreement may be terminated by the Company for cause.
As used herein, "cause" shall mean:

            (a) the commission by Employee of any act of embezzlement, fraud,
larceny or theft on or from the Company or an affiliate of the Company;

            (b) the commission by Employee of, or indictment of Employee for a
felony;

            (c) failure to perform, or materially poor performance of,
Employee's duties and responsibilities assigned or delegated under this
Agreement, or any material misconduct or violation of the Company's policies, in
either case, which continues for a period of thirty (30) days after written
notice given to Employee; or

            (d) a material breach by Employee of any of the covenants, terms or
provisions of this Agreement or any agreement between the Company and Employee
regarding confidentiality, non-competition or assignment of inventions.

            In addition, this Agreement shall automatically be terminated upon
Employee's death or permanent disability. As used herein, "permanent disability"
shall mean Employee's complete inability to perform Employee's duties hereunder,
as determined by Employer's physician, which inability continues for more than
one-hundred eighty (180) consecutive days.

            In the event that this Agreement is terminated by the Company for
any reason other than for cause or for death or permanent disability as defined
above, or pursuant to a Change in Control discussed below, the Company expressly
agrees and acknowledges that Employee shall be entitled to receive the base
salary, bonuses and benefits described in Sections 4 and 5 of this Agreement for
the remainder of the Term and shall have no duty or obligation to accept other
employment, or otherwise mitigate Employee's damages resulting from such
termination. The Company further agrees and acknowledges that, in the event
Employee does obtain other employment following the Company's termination of
this Agreement other than for cause, the Company shall not be entitled to any
set off or reduction in the amounts payable to Employee hereunder as a result of
any compensation paid to Employee with respect to such new employment.

                                       4
<PAGE>

      9. Change in Control

            (a) Termination following a Change in Control. If a Change in
Control of the Company shall have occurred, Employee shall be entitled to
Termination Benefits (as defined in Section 9(c)) upon the subsequent
termination of Employee's employment during the term of this Agreement, unless
such termination is pursuant to Section 8, above, or upon termination by
Employee for Good Reason, as defined in Section 9(d).

            (b) What Constitutes a "Change in Control". A "Change in Control of
the Company" shall be deemed to have occurred upon the occurrence of any one or
more of the following events:

                  (i) any "person" (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
other than Employee or a trustee or other fiduciary holding securities under an
employee benefit plan of the Company; hereafter becomes the "beneficial owner"
(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing 20% or more of the combined voting power
of the Company's then outstanding securities;

                  (ii) during any period (other than any period prior to the
execution of this Agreement), individuals who at the beginning of such period
constitute the Board and any new directors (other than directors designated by a
person who has entered into an agreement with the Company to effect a
transaction described in clauses (i) or (iii) of this Section 9(b)) whose
election by the Board or nomination for election by the Company's stockholders
was approved by a vote of at least two-thirds of the directors then still in
office who either were directors at the beginning of the period or whose
election or nomination for election was previously so approved, cease for any
reason to constitute a majority thereof; or

                  (iii) the stockholders of the Company approve a merger or
consolidation of the Company with any other corporation, other than a merger or
consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) at least 80% of the combined voting power of the voting
securities of the Company or such surviving entity outstanding immediately after
such merger or consolidation, or the stockholders of the Company approve a plan
of complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the Company's assets.

            (c) Termination Benefits. As used in this Agreement, the term
"Termination Benefits" means the payment provision of all of the following:

                  (i) Employee's salary through Employee's date of termination
at the rate in effect at that time, plus all other amounts, including bonuses,
to which Employee is entitled under this Agreement and any compensation plan of
the Company, at the time such payments are due but in any event no later than
the 30th day after Employee's date of termination;

                                       5
<PAGE>

                  (ii) a lump sum Severance Payment (in an amount determined
pursuant to Section 9(c)(vi) below) which amount shall be paid to Employee not
later than the 30th day after Employee's date of termination;

                  (iii) the Company also shall pay to Employee all legal fees
and expenses incurred by Employee as a result of such termination (including all
such fees and expenses, if any, incurred in contesting or disputing any such
termination or in seeking to obtain or enforce any right or benefit provided by
this Agreement or in connection with any tax audit or proceeding to the extent
attributable to the application of Section 280G(b) of the Code, to any payment
or benefit provided hereunder), within five days after Employee's request for
payment accompanied with such evidence of fees and expenses incurred as the
Company reasonably may require;

                  (iv) the Company shall continue to provide Employee for a
period of eighteen (18) months after Employee's date of termination with
benefits substantially similar to those enjoyed by Employee under any of the
Company's life, medical, health, accident, or disability plans in which Employee
were participating at the time the Change in Control of the Company occurred;
and

                  (v) any and all options to purchase securities of the Company
held by Employee on Employee's date of termination (whether or not otherwise
fully vested and immediately exercisable by Employee) shall be fully vested and
immediately exercisable by Employee for a period of one (1) year following
Employee's date of termination.

                  (vi) The term "Severance Payment" means an amount equal to
five (5) times the current annual base salary actually paid to Employee by the
Company before the time of the Change in Control of the Company.

                  (vii) Employee shall not be required to mitigate the amount of
any payment provided for in this Section 9 by seeking other employment or
otherwise, nor shall the amount of any payment or benefit provided for in this
Section 9 be reduced by any compensation earned by Employee as the result of the
employment by another employer, by retirement benefits, by offset against any
amount claimed to be owned by Employee to the Company or otherwise.

                  (viii) In addition to all other amounts payable to Employee
under this Section, Employee shall be entitled to receive all benefits payable
to Employee under the Company's profit sharing plan and any other plan or
agreement relating to retirement benefits.

                                       6
<PAGE>

                  (ix) If a Change in Control of the Company shall have occurred
during the original or extended term of this Agreement, this section shall
continue in effect for a period of 24 months beyond the month in which such
change in Control of the Company occurred.

            (d) Termination by Employee for Good Reason. The term "Good Reason"
means the occurrence, without Employee's express written consent, after a Change
in Control of the Company of any of the following circumstances:

                  (i) the assignment to Employee of any duties inconsistent with
Employee's status as a senior executive officer or key employee of the Company
or a substantial adverse alteration in the nature or status of Employee's
responsibilities from those in effect immediately prior to the Change in Control
of the Company;

                  (ii) a reduction by the Company in Employee's annual salary as
in effect on the date thereof or as the same may be increased from time to time
except for across-the-board salary reductions similarly affecting all senior
executives of the Company and all senior executives of any person in control of
the Company;

                  (iii) the relocation of the Company's principal executive
offices to a location more than fifty miles from the location of such offices
immediately prior to the Change in Control of the Company or the Company's
requiring Employee to be based anywhere other than the Company's principal
executive substantially consistent with Employee's present business travel
obligations;

                  (iv) the failure by the Company, without Employee's consent,
to pay to Employee any portion of Employee's current compensation except
pursuant to an across-the-board compensation deferral similarly affecting all
senior executives of the Company and all senior executives of any person in
control of the Company, within seven days of the date such compensation is due;

                  (v) the failure by the Company to continue in effect any
compensation plan in which Employee participate immediately prior to the Change
in Control of the Company which is material to Employee's total compensation ,
including but not limited to the Company's profit sharing plan, or any
substitute plans adopted prior to the Change in Control of the Company, unless
an equitable arrangement (embodied in an ongoing substitute or alternative plan)
has been made with respect to such plan, or failure by the Company to continue
Employee's participation therein (or in such substitute or alternative plan) on
a basis not materially less favorable, both in terms of the amount of benefits
provided and the level of Employee's participation relative to other
participants, as existed at the time of the Change in Control of the Company;

                                       7
<PAGE>

                  (vi) the failure by the Company to continue to provide
Employee with benefits substantially similar to those enjoyed by Employee under
any of the Company's pension, life insurance, medical, health, and accident, or
disability plans in which Employee were participating at the time of the Change
in Control of the Company, the taking of any action by the Company which would
directly or indirectly materially reduce any of such benefits or deprive
Employee of any material fringe benefits enjoyed by Employee at the time of the
Change in Control of the Company, or the failure by the Company to provide
Employee with the number of paid vacation days to which Employee is entitled on
the basis of years of service with the Company in accordance with the Company's
normal vacation policy in effect at the time of the Change in Control of the
Company; or

                  (vii) the failure of the Company to obtain a satisfactory
agreement from any successor to assume and agree to perform this Agreement.

      Employee's continued employment shall not constitute consent to, or waiver
of rights with respect to, any circumstances constituting Good Reason.

      10. Indemnification. The Company shall indemnify, defend and hold Employee
harmless from and against any and all claims, demands, suits, obligations,
liabilities, actions, losses, cost, expenses, fines or penalties which may now
or hereafter be pending, threatened or commenced against or incurred by Employee
relating to or in any way resulting from Employee's performance of his duties
hereunder, or any action or failure to act by Employee in connection with such
duties. Employee's rights under this Section 10 shall be in addition to, and not
in lieu of, any and all other rights of Employee under applicable law or any
agreement with the Company regarding indemnification.

                                       8
<PAGE>

      11. Confidential Information.

            (a) As used in this Agreement "Confidential Information" means any
and all information disclosed to Employee or which Employee gains knowledge of
as a consequence or through Employee's employment by the Company (including
information conceived, originated, discovered or developed by Employee) about
the Company's products, processes, and services, including information relating
to research, development, inventions, manufacture, purchasing, accounting,
engineering, marketing, merchandising, selling trade secrets, or customer lists,
which information the Company maintains as confidential.

            (b) Except as required in Employee's duties to the Company and then
only with the Company's prior written consent, Employee will not, directly or
indirectly, use for Employee's own benefit or the benefit of others, or
disseminate, disclose, comment upon or publish articles concerning, any
Confidential Information either during or at any time after the term of this
Agreement without the Company's consent.

            (c) All documents, papers, notes, notebooks, memoranda, computer
files, and other written electronic records of the Company of any kind in the
possession or under the control of Employee, shall remain in the property of the
Company at all times. Upon the termination of Employee's employment with the
Company, all documents, papers, notes, notebooks, memoranda, computer files and
other written or electronic records in Employee's possession, whether prepared
by Employee or others will be left with Company.

      12. Successors; Binding Agreement.

            (a) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. Failure of the Company to obtain such assumption and agreement
prior to the effectiveness of any such succession shall be a breach of this
Agreement and shall entitle Employee to Termination of Benefits from the Company
as provided herein, except that, for purposes of implementing the foregoing, the
date on which any such succession becomes effective shall be deemed Employee's
date of termination. As used in this Agreement, "Company" shall mean the Company
as hereinbefore defined and any successor to its business and/or assets as
aforesaid which assumes and agrees to perform this Agreement, by operation of
law or otherwise.

            (b) This Agreement shall inure to the benefit of and be enforceable
by Employee's personal or legal representatives, executors, administrators,
successors, heirs, distribute, devised, and legatees. If Employee should die
while any amount would still be payable to Employee hereunder if Employee had
continued to live, all such amounts, unless otherwise provided herein, shall be
paid in accordance with the terms of this Agreement to Employee's devisee,
legatee or other designee or, if there is no such designee, to Employee's
estate.

                                       9
<PAGE>

      13. Notices.

            Any and all notices which are required or permitted to be given by
any party to any other party hereunder shall be given in writing, sent by
registered or certified mail, electronic communications (including telegram or
facsimile) followed by a confirmation letter sent by registered or certified
mail, postage prepaid, return receipt requested, or delivered by hand or
messenger service with the charges therefore prepaid, addressed to such party as
follows:

         (a)      Notice to the Employee:

         Mitch Francis
         12001 Ventura Place
         Suite 340
         Studio City, CA 91604
         Fax (818) 761-1072

         (b)      Notice to the Company:

         Tix Corporation
         12001 Ventura Place
         Suite 340
         Studio City, CA 91604
         Fax (818) 761-1072

      Or to such other address as the parties shall from time to time give
notice of in accordance with this Section. Notices sent in accordance with this
Section shall be deemed effective on the date of dispatch, and an affidavit of
mailing or dispatch, executed under penalty of perjury, shall be deemed
presumptive evidence of the date of dispatch.

      14. Entire agreement and Modification. This Agreement, including the
exhibits hereto and the agreements expressly referred to herein, constitutes the
entire understanding between the parties pertaining to the subject matter hereof
and supersedes all prior agreements, understandings, negotiations and
discussions, whether oral or written. There are no warranties, representations
or other agreements between the parties, in connection with the subject matter
hereof, except as specifically set forth herein. No supplement, modification,
waiver or termination of this Agreement shall be binding unless made in writing
and executed by the party thereto to be bound.

                                       10
<PAGE>

      15. Waivers. No term, condition or provision of this Agreement may be
waived except by an express written instrument to such effect signed by the
party to whom the benefit of such term condition or provision runs. No such
waiver of any term, condition or provision of this Agreement shall be deemed a
waiver of any other term, condition or provision, irrespective of similarity, or
shall constitute a continuing waiver of the same term, condition or provision,
unless otherwise expressly provided. No failure or delay on the part of any
party in exercising any right, power or privilege under any term, condition or
provision of this agreement shall operate as a waiver thereof, nor shall a
single or partial exercise thereof preclude any other or further exercise of any
other right, power or privilege.

      16. Severability. In the event any one or more of the terms, conditions or
provisions contained in this Agreement should be found in a final award or
judgment rendered by any court or arbitrator or panel of arbitrators of
competent jurisdiction to be invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining terms, conditions and
provisions contained herein shall not in any way be affected or impaired
thereby, and this Agreement shall be interpreted and construed as if such term,
condition or provision, to the extent the same shall have been held invalid,
illegal or unenforceable, had never been contained herein, provided that such
interpretation and construction is consistent with the intent of the parties as
expressed in this Agreement.

      17. Headings. The headings of the Articles and Sections contained in this
Agreement are included herein for reference purposes only, solely for the
convenience of the parties hereto, and shall not in any way be deemed to affect
the meaning, interpretation or applicability of this Agreement or any term,
condition or provision hereof.

      18. Applicable Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California, without reference to its
choice of law principles, notwithstanding the fact that one or more counterparts
hereof may be executed outside of the State, or one or more of the obligations
of the parties hereunder are to be performed outside of the state.

      19. Attorney's fees. In the event that any party to this Agreement shall
commence any suit, action, arbitration or other proceeding to interpret this
Agreement, or determine or enforce any right or obligation created hereby,
including but not limited to any action for rescission of this Agreement or for
a determination that this Agreement is void or ineffective ab initio, the
prevailing party in such action shall recover such party's costs and expenses
incurred in connection therewith, including attorney's fees and costs of appeal,
if any. Any court, arbitrator or panel of arbitrators shall, in entering any
judgment or making any award in any such suit, action, arbitration or other
proceeding, in addition to any and all other relief awarded to such prevailing
party, include in such judgment or award such party's costs and expenses as
provided in this Section 19.

                                       11
<PAGE>

      20. Execution and Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed and delivered shall be
deemed an original, and such counterparts together shall constitute only one
instrument. Any or all of such counterparts may be executed within or outside
the State of California. Facsimile signatures shall be have the same binding
effect as an original wet ink signature.

      21. Covenant of Further Assurances. All parties to this Agreement shall,
upon request, perform any and all acts and execute and deliver any and all
certificates, instruments and other documents that may be necessary or
appropriate to carry out any of the terms, conditions and provisions hereof or
to carry out the intent of this Agreement.

      22. Remedies Cumulative. Each and all of the several rights and remedies
provided for in this Agreement shall be construed as being cumulative and no one
of them shall be deemed to be exclusive of the others or of any right or remedy
allowed by law or equity, and pursuit of any one remedy, or a waiver of any
other remedy.

      23. Binding Effect. Subject to the restrictions in Section 25 hereof
respecting assignments, this Agreement shall inure to the benefit of and be
binding upon all of the parties hereto and their respective executors,
administrators, successors and permitted assigns.

      24. Compliance With Laws. Nothing contained in this Agreement shall be
construed to require the commission of any act contrary to law and whenever
there is a conflict between any term, condition or provision of this Agreement
and any present or future statute, law, ordinance or regulation contrary to
which the parties have no legal right to contract, the latter shall prevail, but
in such event the term, condition or provision of this Agreement affected shall
be curtailed and limited only to the extent necessary to bring it within the
requirement of the law, provided that such construction is consistent with the
intent of the parties as expressed in this Agreement.

      25. Gender. As used in this Agreement, the masculine, feminine or neuter
gender, and the singular or plural number, shall be deemed to include the others
whenever the context so indicates.

      26. No Third Party Benefit. Nothing contained in this Agreement shall be
deemed to confer any right or benefit on any person who is not a party to this
Agreement.

      27. Assignment. Neither party may assign this Agreement, or any rights
hereunder, without the prior express consent of the other party.

                                       12
<PAGE>

      28. Arbitration. Any controversy, dispute or claim of whatever nature
arising out of, in connection with or relating to this Agreement or the
interpretation, meaning, performance, breach or enforcement thereof, including
any controversy, dispute or claim based on contract, tort, or statute, and
including without limitation claims relating to the validity of this Agreement
or relating to termination of employment, shall be resolved at the request of
either party to this Agreement, by final and binding arbitration conducted at a
location determined by the arbitrator in Los Angeles, California, administered
by and in accordance with the then existing Rules of Judicate West Alternative
Dispute Resolution, and judgment upon any award rendered by the arbitrator(s)
may be entered by any State or Federal Court having jurisdiction thereof. Either
party may commence such proceeding by giving notice to the other party in the
manner provided in Section 11 of this Agreement. Upon filing a demand for
arbitration, all parties to the Agreement will have the right of discovery to
the maximum extent provided by law for actions tried before a court, and both
agree that in the event of an arbitration, disputes as to discovery shall be
determined by the arbitrator(s). The arbitrator(s) in any such proceeding shall
apply California substantive law and the California Evidence Code to the
proceeding. The arbitrator(s) shall have the power to grant all legal and
equitable remedies (provisional and final) and award damages provided by
California law. The arbitrator(s) shall prepare in writing and provide to the
parties an award including findings of fact and conclusions of law. The
arbitrator(s) shall not have the power to commit errors of law or legal
reasoning, and the award may be vacated or corrected pursuant to California Code
of Civil Procedure ss.ss.1286.2 or 1286.6 for any such error. The Company shall
pay all fees of the arbitrator, and each party shall bear its or his expenses,
costs and attorney fees relating to the arbitration and recovery under any order
and/or judgment rendered therein. In any such proceeding general counsel for the
Company may represent the Company regardless of whether such counsel has
rendered advice to Employee in the past unless prohibited by law or rules of the
California State Bar Association. The parties hereto hereby submit to the
exclusive jurisdiction of the courts of the State of California for the purpose
of enforcement of this agreement to arbitrate and any and all awards or orders
rendered pursuant thereto.

                                       13
<PAGE>

      IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the day and year first above written.

      "Company"

      TIX CORPORATION
      A Delaware Corporation

      By: /s/ BEN FRANKEL
          ------------------------------------------------------------
          Ben Frankel, Director

      "Employee"

      By: /s/ MITCH FRANCIS
          ------------------------------------------------------------
          Mitch Francis

                                       14
<PAGE>

                         COMPENSATION COMMITTEE APPROVAL

         The Tix Corporation Compensation Committee hereby confirms and approves
THE EMPLOYMENT AGREEMENT for Mitch Francis effective as of March 1, 2006.

       /s/ BEN FRANKEL                                            March 13, 2006
       -----------------------------------------------------      --------------
       Ben Frankel                                                Date

       /s/ NORMAN FEIRSTEIN                                       March 13, 2006
       -----------------------------------------------------      --------------
       Norman Feirstein                                           Date

                                       15

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