Document:

Exhibit
10.56

 

INTELLECTUAL PROPERTY
RIGHTS TRANSFER AGREEMENT

 

This Intellectual
Property Rights Transfer Agreement (this “Agreement”) is made effective as of March 04,
2008 (the Effective Date) by and between Mark McDonald (“Assignor”) and 1ST
Security Group, Inc., a Delaware corporation (“Company”). Assignor and
Company are referred to in this Agreement each as a “Party” and collectively as
the “Parties.” Assignor has developed an Estimation Software Package “The
Estimator” application (the “Software”, as more specifically defined below and in
Exhibit A to this Agreement). The Parties desire that Assignor sell and
assign all of its interest in the Software to Company and Company desires to
accept such interest from Assignor in consideration for the ownership interest
in Company granted to Assignor.

 

1.       Definitions. As used in this Agreement:

 

(a)    “Software” means all components of the
reverse publishing software, as described in Exhibit A to this Agreement,
including but not limited to all source code, object code, micro code, scripts,
algorithms, and related code, as applicable, including any enhancements, translations,
customizations, modifications, updates, releases, or other changes to the same.

 

(b)    “Documentation” means user guides, administrators
guides, operating manuals, education materials, product descriptions and
specifications, technical manuals, supporting materials and other information
relating to the Software or used in conjunction with the Software, whether distributed
in print, magnetic, or electronic format.

 

2.      Assignment of Rights. Assignor hereby
sells, assigns, transfers and conveys to Company (and its successors and
assigns), all of Assignor’s rights, title and interest in and to (a) the
Software, (b) the Documentation, (c) any inventions, ideas,
discoveries or concepts, whether patentable or not, embodied in the Software
and the Documentation, (d) all original works of authorship, including
source code, object code, and related written materials, related to the Software,
and all copyrights, whether or not registered, covering such works of
authorship, (e) all trade secrets, proprietary information and know-how
including, without limitation, technical data, designs, plans, functional
specifications, test data and operating specifications, relating to or embodied
in the Software, and (f) all patentable subject matter and all United States
and foreign issued design and utility patents, and all applications relating to
any inventions, and all reissues, divisions, continuations and extensions of
them, that are embodied by or contained in the Software. Assignor acknowledges
that as of the Effective Date, Company owns all United States and international
intellectual property rights, including patent rights, copyrights, trademarks,
trade secrets and moral rights related to the Software and the Documentation.
Assignor hereby waives, and agrees to use best efforts to cause its employees
to waive, any claims it may have to the Software and the Documentation under
any moral rights doctrine of any country. Assignor represents and warrants that
it has required, and will continue to require, its past, present and future
employees and contractors to assign all tights, title and interest in the
Software and the Documentation to Company.

 

3.      Consideration. In consideration for the
assignment of the Software Company agrees to pay Assignor one hundred dollars,
which the parties agree constitutes valid and binding consideration.

 

4.      Additional Documents and Actions.
Assignor agrees to execute all documents and take all actions reasonably
requested by Company to vest in Company the rights contemplated in this
Agreement. Further, at Company’s request, Assignor and/or its personnel shall
confirm Company’s ownership in the Software and the Documentation by execution
and delivery of assignments, confirmations of assignment, or other written
instruments as Company may reasonably request. As of the Effective Date,
Assignor has no further rights to market or sell the Software.

 

 5.     
Confidentiality. Assignor shall hold the terms of this Agreement, the
Software, the Documentation, and any other materials related to the Software,
including the source code and any related intellectual properly, in strict
confidence, and shall not disclose the terms of this Agreement, the Software

 

 

or intellectual property
to any third party without first receiving Company’s prior written consent.

 

6.      Representation and Warranty. Assignor
represents and warrants that immediately prior to the Effective Date, Assignor
was the sole owner of, and had title to, all intellectual property rights in
the Software and Documentation and has the authority and right to sell and
assign the Software amid Documentation to Company as set forth in this
Agreement.

 

7.      Covenant not to Compete. Assignor agrees
not to develop, market, promote or distribute any software that is similar to
the Software in code, features or functions.

 

8.      General. This Agreement embodies the complete
agreement of the Parties with respect to the subject matter hereof and
supersedes any prior written, or Prior or contemporaneous oral, understandings
or agreements between the Parties that relates in any way to the subject matter
hereof. This Agreement may be amended only in writing executed by Company and
Assignor. This Agreement is binding upon and inures to the benefit of the
respective heirs, executors, administrators, legal representatives and
successors of Company and Assignor. This Agreement is governed by and construed
and interpreted in accordance with substantive laws of Texas, without giving
effect to any conflict of laws, rule or principle that might require the application
of the laws of another jurisdiction.

 

IN WITNESS WHEREOF, the
Parties have caused this Agreement to he duly executed by their authorized
representatives.

 

 

	
  ISI Security
  Group, Inc.

  	
  Mark McDonald

  
	
  By:

  	
  /Sam Youngblood/

  	
   

  	
  /Mark McDonald/

  	
   

  
	
  Printed Name: Sam
  Youngblood

  	
   

  
	
  Title: CEO

  	
   

  
					

 

 

Exhibit A

 

Software

 

Estimation
Software Package

“The Estimator”

Current Version is 12.22Exhibit
10.57

 

ASSIGNMENT and AMENDMENT
OF LEASE BETWEEN

PETERSON DETENTION, INC., CC&E, LLC; AND

ISI DETENTION CONTRACTING GROUP, INC.

 

This Assignment and
Amendment of Lease (“Assignment”) is entered into effective as of the 1st day
of January, 2008, by and between CC&E LLC a California limited liability
company (“Landlord”); Peterson Detention, Inc., a California corporation (“Assignor”)
and 1SI Detention Contracting Group, Inc., a California corporation. (“Assignee”).

 

WHEREAS, Landlord and
Assignor entered into that one certain Standard Industrial/Commercial
Multi-Tenant Lease - Gross dated March 14, 2005 (the “Lease”), that certain
First Amendment to Lease dated February 14, 2006, that certain Second
Amendment to Lease dated June 20, 2006, that certain Third Amendment to
Lease dated May 8, 2007 pertaining to approximately 15,200 rentable square
feet (RSF) of commercial office space located at 577 North Batavia Street,
Orange, California (the “Building”); and

 

WHEREAS, the term of the
Lease expires on August 31, 2010; and

 

WHEREAS, Assignor now
desires to assign all of its right, interest and title in and to the

 

Lease to Assignee, as
more particularly set forth below;

 

NOW, THEREFORE, for and
in consideration of the mutual promises and covenants set forth herein, all of
Assignor’s right, title and interest in and to the Lease is hereby assigned to Assignee
upon the following terms and conditions. Capitalized terms not otherwise
defined in this Assignment shall have the meanings ascribed to them in the Lease.

 

1.    Assignor hereby assigns, transfers and
delivers to Assignee all of Tenant’s rights in and to the Lease.

 

2.    Assignee accepts the Lease, as amended
herein, and agrees to punctually perform all obligations of Assignor under the
Lease accruing on and after January 1, 2008.  Landlord acknowledges that all Rents and
other charges that have accrued under the Lease prior to said date have been
fully paid by Assignor, and hereby releases Assignor from any further
obligations under the lease from and after January 1, 2008.

 

3.    The Lease is hereby amended to reflect that
the amount of the Security Deposit required by Section 1.7(c) of the
Lease is increased from $7,600.00 to $28,576.00 and such amount shall not be
increased during the term of the Lease. All, but $7,600.00, of such Security Deposit
shall, at the option of Lessee, be applied as partial payment of the last three
months Base Rent due and owing under the Lease, and the reduction in Security
Deposit upon application of the Security Deposit to Base Rent as permitted
herein, shall not be deemed to be a default or breach of any term or provision
of the Lease. Any monetary default of Lessee prior to the last three months of
the Term shall negate the Lessee’s right to apply Security Deposit to Base Rent
as outlined above.   Any provision of the
Lease contrary to this amendment is void and unenforceable.

 

4.    As of the effective data of this Assignment
and Amendment of Lease, the Guaranty of Lease attached hereto as Exhibit A
will be effective. The Guarantor, then obligated for all obligations accruing
after the effective date of this Assignment and Amendment of Lease shall be
Argyle Security, Inc.

 

5.    There shall be no further assignment of the
Lease without the prior written consent of Landlord.

 

6.    Miscellaneous.

 

 

(a)   Counterparts. 
This Assignment may be executed in any number of counterparts and by
different parties on separate counterparts, each of which counterparts shall be
deemed to be an original and all of which counterparts shall constitute one and
the same agreement. The signature of each party to this Assignment is not
required to appear on each counterpart of this Assignment, provided that each
party to this Assignment has executed at least one counterpart of this
Assignment. In making proof of this Assignment it will not be necessary to
account for or produce each executed counterpart of this Assignment.

 

(b)   Entirety and Controlling Agreement.   This Assignment, in conjunction with the
Lease (including its various exhibits), embodies the entire agreement between the
parties with respect to the Leased Premises. 
Except as expressly set forth herein, nothing in this Assignment
modifies or amends the provisions of the Lease. However, in the event of an
irreconcilable conflict or inconsistency between the provisions of the Lease
and the provisions of this Assignment, the provisions of this Assignment shall control.

 

(c)   Binding on Successors.   This Assignment shall be binding upon and inure
to the benefit of the parties, their successors, assigns and personal
representatives.

 

IN WITNESS WHEREOF,
Landlord, Assignor and Assignee have executed this instrument as of

 

the date first written
above.

 

	
  LANDLORD:

  
	
   

  
	
  CC&E, LLC,

  
	
  A California limited
  liability company

  
	
  By:

  	
  /illegible/

  	
   

  
	
  Its: Managing Partner

  
	
  Date: 01/07/08

  

 

 

	
  ASSIGNOR:

  
	
   

  
	
  PETERSON DETENTION,
  INC.

  
	
  a California
  corporation

  
	
   

  
	
  By: 

  	
  /Michael Peterson/

  	
   

  
	
  Its: President

  
	
  Date: 01/07/08

  
	
   

  
	
  ASSIGNEE:

  
	
   

  
	
  ISI DETENTION
  CONTRACTING GROUP, INC.

  
	
   

  
	
  By: 

  	
  /Sam Youngblood/

  	
   

  
	
  Its: CEO

  
	
  Date: 01/07/08

  
				

 

Guaranty Agreement

 

Argyle Security, Inc.
hereby guarantees the full and prompt performance of each of the Lessee’s
duties and obligations pursuant to the Lease and this Lease Assignment.

 

	
  By:

  	
  /Don Neville/

  	
   

  
	
  Name:

  	
      Don
  Neville

  
	
  Its; Chief Financial
  Officer

  	
   

  
					

 

 

AIR COMMERCIAL
REAL ESTATE ASSOCIATION

GUARANTY OF LEASE

EXHIBIT A

 

WHEREAS, CC & E,
LLC hereinafter “Lessor” and ISI Detention Contracting Group, Inc., a
California corporation hereinafter “Lessee”‘, we about to execute a document
entitled Assignment and Amendment of Lease dated January 1, 2008 concerning
the premises commonly known as 577 North Batavia Street, Orange, CA wherein
Lessor will lease the premises to Lessee, and WHEREAS, Argyle Security, Inc. hereinafter
Guarantors have a financial interest at Lessee, and WHEREAS, Lessor would not execute
the Lease V Guarantors did riot execute and deliver to Lessor this Guarantee of
Lease.

 

NOW THEREFORE. inconsideration
of the execution of the foregoing Lease by Lessor and as a material inducement
to Lessor to execute said Lease, Guarantors hereby jointly, severally, unconditionally
and irrevocably guarantee the prompt payment by Lessee of at rents and at other
sums payable by Lessee under said Lease and the faithful and prompt performance
by Lessee of each and every one of the terms, conditions and covenants of said
Lease to be kept and performed by Lessee.

 

It is specifically agreed
that the terms of the foregoing Lease may be modified by agreement between
Lessor and Lessee, or by a course of conduct, and said Lease may be assigned by
Lessor or any assignee of Lessor without consent or notice to Guarantors and
that this Guaranty shed guarantee the performance of said Lease as so modified.

 

This Guaranty shalt not
be released, modified or affected by the talkie or delay on the part of Lessor
to enforce any of the rights or remedies of the Lessor raider said Lease,
whether pursuant to the terms thereof or at law or in equity.

 

No notice of default need
be given to Guarantors, It being specifically agreed that the guarantee of the
undersigned is a continuing guarantee under which Lessor may proceed
immediately against Lessee and/or against Guarantors following any breath or
default by Lessee or for the enforcement of any rights which Lessor may have as
against Lessee raider the terms of the Lease or at law or in equity.

 

Lessor that have the
right to proceed against Guarantors hereunder following any breath or default
by Lessee without first proceeding against Lessee and without previous notice
to or demand upon either Lessee or Guarantors.

 

Guarantors hereby waive (a) notice
of acceptance of this Guaranty. (b) demand of payment, presentation and
protest, (c) at right to assail or plead any statute of limitations
relating to this Guaranty or the Lease, (d) any right to require the
Lessor to proceed against the Lessee or any other Guarantor or any other person
or entity liable to Lessor, (e) any right to require Lessor to apply to
any default any security deposit or other security it may hold under’ the
Lease, (f) any right to require Lessor to proceed under any other remedy
Lessor may have before proceeding against Guarantors. (g) any right of subrogation.

 

Guarantors do hereby
subrogate at existing or future indebtedness of Lessee to Guarantors to the
obligations owed to Lessor under the Lease and this Guaranty.

 

If a Guarantor is
married, such Guarantor expressly agrees that recourse may be had against his
or her separate property for all of the obligations hereunder.

 

The obligations of Lessee
under the Lease to execute and deliver estoppel statements and financial
statements, as therein provided, that be deemed to also requite the Guarantors
hereunder to do and provide the same.

 

 

The term “Lessor” refers
to and means the Lessor named in the Lease and also Lessor’s successors stat
assigns. So long as Lessor’s interest In the Lease, the leased premises or the
rents, issues and profits therefrom, are subject to any mortgage or deed of
bust or assignment for security, no acquisition by Guarantors of the Lessor’s
Interest shalt affect the continuing obligation of Guarantors raider this
Guaranty which that nevertheless continue In full force and effect [or the
benefit of the mortgagee, beneficiary, trustee or assignee under such mortgage,
deed of trust or assignment and their successors and assigns.

 

The term “Lessee” refers
to and means the Lessee named In the Lease and also Lessee’s successors and
assigns.

 

In the event any action
be brought by said Lessor against Guarantors hereunder to enforce the
obligation of Guarantors hereunder, the unsuccessful party in such action that
pay to the prevailing party therein a reasonable attorney’s fee which, shall be
fixed by the court

 

If this Form has
been filled in, It has been prepared for submission to your attorney for his approval.
No representation or recommendation is made, by the AIR Commercial Real Estate Association,
the real estate broker or Its agents or employees as to the legal sufficiency,
legal affect, or tax consequences of this Form or the transaction relating
thereto.

 

 

	
  Executed at:

  	
  Argyle Security Inc.

  
	
  On: /1-30-08/

  	
  By:

  	
  /Don Neville/

  	
   

  	
   

  
	
  Address:

  	
  CFO

  “GUARANTORS”

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