Document:

exv10w5

 

Exhibit 10.5

Director Grant

Quovadx, Inc.

2006 Equity Incentive Plan

Restricted Stock Award Agreement

     Pursuant to the Restricted Stock Award Grant Notice (the “Grant Notice”) and this
Restricted Stock Award Agreement (the “Agreement”) (collectively, the “Award”) and in consideration
of your services rendered or to be rendered, as applicable, Quovadx, Inc. (the “Company”) has
granted you a Restricted Stock Award under its 2006 Equity Incentive Plan (the “Plan”) for the
number of shares of the Company’s Common Stock subject to the Award as set forth in the Grant
Notice. Defined terms not explicitly defined in this Agreement but defined in the Plan shall have
the same definitions as in the Plan.

     The details of your Award are as follows:

     1. Vesting. Subject to the limitations contained herein and in the Plan, your
Award will vest as follows:

          (a) The shares will vest as provided in the Vesting Schedule set forth in your Grant Notice,
provided that vesting will cease upon the termination of your Continuous Service.

          (b) Shares subject to your Award that have vested in accordance with the Vesting Schedule set
forth in the Grant Notice and this Section 1 are “Vested Shares.” Shares subject to your Award
that are not Vested Shares are “Unvested Shares.”

     2. Number of Shares. The number of shares of Common Stock subject to your Award as
referenced in your Grant Notice may be adjusted from time to time for capitalization adjustments as
set forth in the Plan.

     3. Securities Law Compliance. Notwithstanding anything to the contrary contained
herein, you may not be issued any shares of Common Stock under your Award unless the shares of
Common Stock are either then registered under the Securities Act or, if such shares of Common Stock
are not then so registered, the Company has determined that such issuance would be exempt from the
registration requirements of the Securities Act. Your Award must also comply with other applicable
laws and regulations governing the Award, and you will not receive such shares if the Company
determines that such receipt would not be in material compliance with such laws and regulations.

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     4. Right of Reacquisition. The Company shall simultaneously with the termination of
your Continuous Service automatically reacquire (the “Reacquisition Right”) for no consideration
all of the Unvested Shares, unless the Company agrees to waive its Reacquisition Right as to some
or all of the Unvested Shares. Any such waiver shall be exercised by the Company by written notice
to you or your representative (with a copy to the Escrow Agent, as defined below) within ninety
(90) days after the termination of your Continuous Service, and the Escrow Agent may then release
to you the number of Unvested Shares not being reacquired by the Company. If the Company does not
waive its Reacquisition Right as to all of the Unvested Shares, then upon such termination of your
Continuous Service, the Escrow Agent shall transfer to the Company the number of Unvested Shares
the Company is reacquiring. The Reacquisition Right shall expire when all of the shares have
become Vested Shares in accordance with Section 1.

     5. Change in Control. Notwithstanding any other provisions of the Plan to the
contrary, in the event of a Change in Control before your Continuous Service terminates, the shares
subject to this award shall become fully vested upon the effective date of the Change in Control.

     6. Escrow of Unvested Common Stock. As security for your faithful performance of the
terms of this Agreement and to insure the availability for delivery of your Common Stock in
connection with the Reacquisition Right provided in Section 4 above, you agree to the following
“Joint Escrow” and “Joint Escrow Instructions,” and you and the Company hereby authorize and direct
the Secretary of the Company (“Escrow Agent”) to make arrangements with respect to all Unvested
Shares awarded pursuant to the terms of this Agreement and of your Grant Notice, in accordance with
the following Joint Escrow Instructions:

          (a) In the event your Continuous Service terminates, the Company shall, pursuant to the
Reacquisition Right in Section 4 above, automatically reacquire for no consideration all Unvested
Shares, within the meaning of Section 1 above, as of the date of such termination, unless the
Company elects to waive such right as to some or all of the Unvested Shares. If the Company (or
its assignee) elects to waive the Reacquisition Right, the Company or its assignee will give you
and Escrow Agent a written notice specifying the number of Unvested Shares not to be reacquired.
You and the Company hereby irrevocably authorize and direct Escrow Agent to close the transaction
contemplated by such notice as soon as practicable following the date of termination of your
Continuous Service in accordance with the terms of this Agreement and the notice of waiver, if any.

          (b) Vested Shares shall be delivered to you electronically upon vesting.

          (c) At any closing involving the transfer or delivery of some or all of the property subject
to the Grant Notice and this Agreement, Escrow Agent is directed (a) to date any stock assignments
necessary for the transfer in question, (b) to fill in the number of Unvested Shares being
transferred, and (c) to deliver same, together with the certificate, if any, evidencing the
Unvested Shares to be transferred, to you or the Company, as applicable.

          (d) You irrevocably authorize the Company to deposit with Escrow Agent the certificates, if
any, evidencing the Unvested Shares to be held by Escrow Agent hereunder and

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any additions and substitutions to the Unvested Shares as specified in this Agreement. You do
hereby irrevocably constitute and appoint Escrow Agent as your attorney-in-fact and agent for the
term of this escrow to execute with respect to such securities and other property all documents of
assignment and/or transfer and all stock certificates, if any, necessary or appropriate to make all
securities negotiable and complete any transaction herein contemplated.

          (e) This escrow shall terminate upon the expiration or application in full of the
Reacquisition Right, whichever occurs first, and the completion of the tasks contemplated by these
Joint Escrow Instructions; provided, however, that this escrow shall not terminate with respect to
any Unvested Shares that vest, but for which you have not satisfied any applicable federal, state,
local and foreign tax withholding obligation of the Company or an Affiliate which arise in
connection with vesting of the Unvested Shares.

          (f) If, at the time of termination of this escrow, Escrow Agent should have in its possession
any documents, securities, or other property belonging to you, Escrow Agent shall deliver all of
same to you and shall be discharged of all further obligations hereunder.

          (g) Except as otherwise provided in these Joint Escrow Instructions, Escrow Agent’s duties
hereunder may be altered, amended, modified, or revoked only by a writing signed by all of the
parties hereto.

          (h) Escrow Agent shall be obligated only for the performance of such duties as are
specifically set forth herein and may rely and shall be protected in relying or refraining from
acting on any instrument reasonably believed by Escrow Agent to be genuine and to have been signed
or presented by the proper party or parties or their assignees. Escrow Agent shall not be
personally liable for any act Escrow Agent may do or omit to do hereunder as Escrow Agent or as
attorney-in-fact for you while acting in good faith and any act done or omitted by Escrow Agent
pursuant to the advice of Escrow Agent’s own attorneys shall be conclusive evidence of such good
faith.

          (i) Escrow Agent is hereby expressly authorized to disregard any and all warnings given by any
of the parties hereto or by any other person or corporation, excepting only orders or process of
courts of law, and is hereby expressly authorized to comply with and obey orders, judgments, or
decrees of any court. In case Escrow Agent obeys or complies with any such order, judgment, or
decree of any court, Escrow Agent shall not be liable to any of the parties hereto or to any other
person, firm, or corporation by reason of such compliance, notwithstanding any such order,
judgment, or decree being subsequently reversed, modified, annulled, set aside, vacated, or found
to have been entered without jurisdiction.

          (j) Escrow Agent shall not be liable in any respect on account of the identity, authority, or
rights of the parties executing or delivering or purporting to execute or deliver this Agreement or
any documents or papers deposited or called for hereunder.

          (k) Escrow Agent shall not be liable for the outlawing of any rights under any statute of
limitations with respect to these Joint Escrow Instructions or any documents deposited with Escrow
Agent.

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          (l) Escrow Agent’s responsibilities as Escrow Agent hereunder shall terminate if Escrow Agent
shall cease to be the Secretary of the Company or if Escrow Agent shall resign by written notice to
each party. In the event of any such termination, the Company may appoint any officer or assistant
officer of the Company or other person who in the future assumes the position of Secretary of the
Company as successor Escrow Agent and you hereby confirm the appointment of such successor or
successors as your attorney-in-fact and agent to the full extent of such successor Escrow Agent’s
appointment.

          (m) If Escrow Agent reasonably requires other or further instruments in connection with these
Joint Escrow Instructions or obligations in respect hereto, the necessary parties hereto shall join
in furnishing such instruments.

          (n) It is understood and agreed that should any dispute arise with respect to the delivery
and/or ownership or right of possession of the securities, Escrow Agent is authorized and directed
to retain in its possession without liability to anyone all or any part of said securities until
such dispute shall have been settled either by mutual written agreement of the parties concerned or
by a final order, decree, or judgment of a court of competent jurisdiction after the time for
appeal has expired and no appeal has been perfected, but Escrow Agent shall be under no duty
whatsoever to institute or defend any such proceedings.

          (o) By signing this Agreement below, Escrow Agent becomes a party hereto only for the purpose
of said Joint Escrow Instructions in this Section 6; Escrow Agent does not become a party to any
other rights and obligations of this Agreement apart from those in this Section 6.

          (p) Escrow Agent shall be entitled to employ such legal counsel and other experts as Escrow
Agent may deem necessary properly to advise Escrow Agent in connection with Escrow Agent’s
obligations hereunder. Escrow Agent may rely upon the advice of such counsel, and may pay such
counsel reasonable compensation therefor. The Company shall be responsible for all fees generated
by such legal counsel in connection with Escrow Agent’s obligations hereunder.

          (q) These Joint Escrow Instructions set forth in this Section 6 shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and permitted assigns.
It is understood and agreed that references to “Escrow Agent” or “Escrow Agent’s” herein refer to
the original Escrow Agent and to any and all successor Escrow Agents. It is understood and agreed
that the Company may at any time or from time to time assign its rights under the Agreement and
these Joint Escrow Instructions in whole or in part.

     7. Execution of Documents. You hereby acknowledge and agree that the manner selected
by the Company by which you indicate your consent to your Grant Notice is also deemed to be your
execution of your Grant Notice and of this Agreement. You further agree that such manner of
indicating consent may be relied upon as your signature for establishing your execution of any
documents to be executed in the future in connection with your Award.

     8. Irrevocable Power of Attorney.  You constitute and appoint the Secretary of the
Company as attorney-in-fact and agent to transfer said Common Stock on the books of the

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Company with full power of substitution in the premises, and to execute with respect to such
securities and other property all documents of assignment and/or transfer and all stock
certificates necessary or appropriate to make all securities negotiable and complete any
transaction herein contemplated. This is a special power of attorney coupled with an interest
(specifically, the Company’s underlying security interest in retaining the shares of Common Stock
in the event you do not perform the associated services for the Company), and is irrevocable and
shall survive your death or legal incapacity. This power of attorney is limited to the matters
specified in this Agreement.

     9. Rights as Stockholder. Subject to the provisions of this Agreement, you shall
have the right to exercise all rights and privileges of a stockholder of the Company with respect
to the shares deposited in the Joint Escrow. You shall be deemed to be the holder of the
shares for purposes of receiving any dividends that may be paid with respect to such shares and for
purposes of exercising any voting rights relating to such shares, even if some or all of the shares
are Unvested Shares.

     10. Limitations on Transfer of the Common Stock. In addition to any other limitation
on transfer created by applicable securities laws, you shall not transfer, sell, assign,
hypothecate, donate, encumber, or otherwise dispose of any interest in the Common Stock while such
shares of Common Stock are Unvested Shares or continue to be held in the Joint Escrow. After any
Common Stock has been released from the Joint Escrow, you shall not transfer, sell, assign,
hypothecate, donate, encumber, or otherwise dispose of any interest in the Common Stock except in
compliance with the provisions herein and applicable securities laws.

     11. Restrictive Legends. The certificates representing the Common Stock shall have
endorsed thereon appropriate legends as determined by the Company.

     12. Non-transferability of the Award. Your Award is not transferable except by will
or by the laws of descent and distribution.

     13. Award not a Service Contract. Your Award is not an employment or service
contract, and nothing in your Award shall be deemed to create in any way whatsoever any obligation
on your part to continue in the employ of the Company or an Affiliate, or of the Company or an
Affiliate to continue your employment. In addition, nothing in your Award shall obligate the
Company or an Affiliate, their respective stockholders, Boards of Directors, Officers or Employees
to continue any relationship that you might have as a Director or Consultant for the Company or an
Affiliate.

     14. Withholding Obligations.

          (a) At the time your Award is granted, or at any time thereafter as requested by the Company,
you hereby authorize withholding from payroll and any other amounts payable to you, and otherwise
agree to make adequate provision in cash for, as determined by the Company, any sums required to
satisfy the federal, state, local and foreign tax withholding obligations of the Company or an
Affiliate, if any, which arise in connection with your Award. In the Company’s sole discretion,
the Company may elect, and you hereby authorize the Company, to withhold Vested Shares in such
amounts as the Company determines are necessary to satisfy your obligation pursuant to the
preceding sentence.

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          (b) Unless the tax withholding obligations of the Company or any Affiliate are timely
satisfied as reasonably determined by the Company, then the Company shall have no obligation to
issue a certificate for, or otherwise deliver, such shares or release such shares from any escrow
provided for herein and any shares held in escrow shall be automatically reacquired by the Company
for no consideration.

     15. Tax Consequences. You have reviewed with your own tax advisors the federal,
state, local and foreign tax consequences of this investment and the transactions contemplated by
this Agreement. You are relying solely on such advisors and not on any statements or
representations of the Company or any of its agents. You understand that you (and not the Company)
shall be responsible for your own tax liability that may arise as a result of this investment or
the transactions contemplated by this Agreement. You understand that Section 83 of the Code taxes
as ordinary income to you the fair market value of the shares of Common Stock as of the date any
restrictions on the shares lapse (that is, as of the date on which part or all of the shares vest).
In this context, “restriction” includes the right of the Company to reacquire the shares pursuant
to its Reacquisition Right.

     16. Notices. Any notice or request required or permitted hereunder shall be given in
writing to each of the other parties hereto and shall be deemed effectively given on the earlier of
(a) the date of personal delivery, including delivery by express courier, or (b) the date that is
five days after deposit in the United States Post Office (whether or not actually received by the
addressee), by registered or certified mail with postage and fees prepaid, addressed at the
following addresses, or at such other address(es) as a party may designate by ten days’ advance
written notice to each of the other parties hereto:

	 	 	 
	Company:

	 	Quovadx, Inc.
	 

	 	7600 E. Orchard Road
	 

	 	Suite 300-S
	 

	 	Greenwood Village, CO 80111
	 

	 	Attn: Secretary of the Company
	 
	 	 
	You:

	 	Your address as on file with the Company’s
	 

	 	Human Resources Department at the time notice is given
	 
	 	 
	Escrow Agent:

	 	Linda K. Wackwitz, Secretary of the Company
	 

	 	Quovadx, Inc.
	 

	 	7600 E. Orchard Road
	 

	 	Suite 300-S
	 

	 	Greenwood Village, CO 80111

     17. Miscellaneous.

          (a) The rights and obligations of the Company under your Award shall be transferable to any
one or more persons or entities, and all covenants and agreements hereunder shall inure to the
benefit of, and be enforceable by, the Company’s successors and assigns. Your rights and
obligations under your Award may only be assigned with the prior written consent of the Company.

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          (b) You agree upon request to execute any further documents or instruments necessary or
desirable in the sole determination of the Company to carry out the purposes or intent of your
Award.

          (c) You acknowledge and agree that you have reviewed your Award in its entirety, have had an
opportunity to obtain the advice of counsel prior to executing and accepting your Award and fully
understand all provisions of your Award.

     18. Governing Plan Document. Your Award is subject to all the provisions of the
Plan, the provisions of which are hereby made a part of your Award, and is further subject to all
interpretations, amendments, rules and regulations which may from time to time be promulgated and
adopted pursuant to the Plan. In the event of any conflict between the provisions of your Award
and those of the Plan, the provisions of the Plan shall control.

* * * * *

     This Restricted Stock Award Agreement shall be deemed to be signed by the Company and the
Participants upon the signing by the Participant of the Restricted Stock Grant Notice to which it
is attached.

     The Escrow Agent hereby acknowledges and accepts its rights and responsibilities pursuant to
Section 6 above.

 

	 	 	 
	 

Linda K. Wackwitz

	 	 
	Secretary of the Company
	 	 
	Escrow Agent
	 	 

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Exhibit 4.4  

SECURITY AGREEMENT  

        SECURITY AGREEMENT dated September 6, 2005, made by Lightspace Corporation, a Delaware corporation, with its principal offices located at
125 CambridgePark Drive, 4th Floor, Cambridge, MA 02140 (the "Grantor"), and AIGH Investment Partners, LLC, a Delaware limited liability company, or assigns, having an office located at
6006 Berkeley Ave., Baltimore, MD 21209, as agent for the Lenders (as defined herein) ("Secured Party"), in connection with the Notes (as hereinafter defined). 

PRELIMINARY STATEMENT:  

        The Grantor has issued to the parties listed on the attached Schedule I (each a "Lender", and collectively the "Lenders") the secured term notes listed
opposite the respective Lender's name on Schedule I, in the aggregate amount of $700,000, each dated as of the date hereof (collectively, the "Notes"). The parties desire to provide security
for the obligations of the Grantor to the Lenders under the Notes. 

        NOW,
THEREFORE, in consideration of the premises, and in order to induce the Lenders to make the loan under the Notes, the parties hereby agree as follows: 

        Section 1.    Grant of Security.    The Grantor hereby grants to Secured Party, for its benefit and for the
ratable benefit of each Lender, a continuing security interest in all of the Grantor's right, title and interest in and to the following, whether now owned or hereafter acquired (the "Collateral"): 

        (1)   All
accounts receivable in all forms, wherever located, now or hereafter existing, including, but not limited to: (a) all accounts, instruments, documents,
chattel paper and general intangibles, whether secured or unsecured, whether now existing or hereafter created or arising, and whether or not specifically assigned hereunder (any and all such items
being "Receivables") and any other items of real or personal property in which Grantor may grant a security interest in the future, (b) all right, title and interest in and to the goods or
other property represented by, or which by sale have resulted in, or securing any part of the Receivables, including, without limitation, all returned, reclaimed or
repossessed goods or other property, (c) all of Grantor's rights and remedies as an unpaid vendor or lienor, including stoppage in transit, replevin, repossession and reclamation,
(d) all amounts due to Grantor from any account debtor or obligor irrespective of whether such amounts have been assigned to Secured Party, (e) all of Grantor's right, title and interest
in and to, and all of Grantor's rights, remedies, security interests and liens under, guaranties or other contracts of suretyship, security agreements or mortgages on real property, deposits, leases
or other agreements or property securing or relating to any of the items referred to in subparagraph (a) hereof, or acquired for the purpose of securing and enforcing any of such items,
(f) all monies, securities and other property and the proceeds thereof, now or hereafter held or received, or in transit to the Secured Party from the Grantor, whether for safekeeping, pledge,
custody, transmission, collection or otherwise, (g) all books, records, ledged cards, and other property and general intangibles any time evidencing or relating to the Receivables ("Records"),
and (h) all proceeds of any of the foregoing in whatever form, including, without limitation, any claim against third parties for loss or damage to, or destruction of any or all of the
foregoing and cash, negotiable instruments and other instruments for the payment of money, chattel paper, security agreements of other documents; 

        (2)   All
equipment, machinery, fixtures, furniture, office machinery, vehicles, implements, tools, and other tangible personal property of every kind and description, now
owned or hereafter acquired by the Grantor in substitution or replacement thereof; 

 

        (3)   the
"IP Collateral", which consists of: 

        (a)   any
and all copyright rights, copyright applications, copyright registrations and like protections in each work or authorship and derivative work thereof, whether
published or unpublished and whether or not the same also constitutes a trade secret (collectively the "Copyrights"); 

        (b)   Any
and all trade secrets, and any and all intellectual property rights in computer software and computer software products (collectively, the "Trade Secrets"); 

        (c)   All
patents and patent applications as set forth on Exhibit A attached hereto (collectively the "Patents"); and 

        (d)   Any
trademark and service mark rights as set forth on Exhibit A attached hereto (collectively, the "Trademarks"); 

        (4)   All
proceeds of any and all of the foregoing (including, without limitation, proceeds which constitute property of the types described in clause (1) of this
Section 1), and, to the extent not otherwise included, all: (a) payments under insurance (whether or not the Secured Party is the loss payee thereof), or any indemnity, warranty, or
guaranty, payable by reason of loss or damage to or otherwise with respect to any of the foregoing, and this Agreement and (b) cash. 

        Section 2.    Security for Obligations.    This Agreement secures the payment and performance of all
obligations of the Grantor to Secured Party and the Lenders now or hereafter existing under this Agreement and the Notes, whether for principal, interest, fees, expenses, or otherwise (all such
obligations of the Grantor being the "Obligations"). 

        Section 3.    Grantor Remains Liable.    Anything herein to the contrary notwithstanding the exercise by the
Lenders or Secured Party of any rights hereunder shall not release the Grantor from any of its duties or obligations under the contracts and agreements included in the Collateral. 

        Section 4.    Collateral Assignment of IP Collateral.    

        (1)   Concurrently
and in connection with the security interest in the IP Collateral granted by Grantor to Secured Party (for itself and as agent for the Lenders), Grantor
also assigns and conveys to Secured Party all of Grantors' right, title and interest in, to and under the IP Collateral, provided,  however, that Secured
Party (for itself and as agent for the Lenders) and Grantor acknowledge and agree that the interest in the IP Collateral being
assigned hereby shall not be construed as a current assignment, but as a collateral assignment only, in order to secure the Grantor's obligations. 

        (2)   The
assignment and security interest granted hereby (the "Assignment") constitutes a first senior security interest in and lien on all of the IP Collateral. 

        (3)   The
Grantor authorizes and requests that the Register of Copyrights and the Commissioner of Patents and Trademarks record the Assignment. Without limitation on any other
representation or warranty of the Grantor set forth in this Agreement, the Grantor represents, warrants, covenants and agrees as follows: 

        (a)   Performance
of this Assignment does not conflict with or result in a breach of any agreement to which the Grantor is party or by which the Grantor is bound, except to
the extent that certain intellectual property agreements, listed on Exhibit B hereto, prohibit the assignment of the rights
thereunder to a third party without the licensor's or other party's consent and this Assignment constitutes an assignment; 

        (b)   During
the term of this Agreement, the Grantor will not transfer or otherwise encumber any interest in the IP Collateral, except for licenses granted by the Grantor in
the ordinary course of business or as set forth in this Agreement; 

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        (c)   The
Grantor shall (i) protect, defend and maintain the validity and enforceability of the IP Collateral, (ii) use its best efforts to detect infringements
of the IP Collateral and promptly advise Secured Party in writing of material infringements detected and (iii) not allow any of the IP Collateral to be abandoned, forfeited or dedicated to the
public without the written consent of the Secured Party, which shall not be unreasonably withheld, unless the Grantor determines that reasonable business practices suggest that abandonment is
appropriate. 

        (d)   The
Grantor shall register as the Grantor ordinarily would in the ordinary course of business the most recent version of any of the Grantor's Copyrights, if not so
already registered, and shall, from time to time, execute and file such other instruments, and take such further actions as Secured Party may reasonably request from time to time to perfect or
continue the perfection of the Secured Party' interest in the IP Collateral; 

        (e)   This
Assignment creates in favor of the Secured Party a valid and perfected first priority security interest in the IP Collateral in the United States securing the
payment and performance of the obligations evidenced by the Notes upon making appropriate filings, if any are required in the reasonable discretion of Secured Party, with the United States Patent and
Trademark Office, Registrar of Copyrights and the Delaware Secretary of State. 

        (f)    The
Grantor shall not enter into any agreement that would materially impair or conflict with the Grantor's obligations hereunder without the Secured Party's prior
written consent, which consent shall not be unreasonably withheld. The Grantor shall not permit the inclusion in any material contract to which it becomes a party of any provisions that could or might
in any way prevent the creation of a security interest in the Grantor's rights and interests in any property included within the definition of the IP Collateral acquired under such contracts, except
that certain contracts may contain anti-assignment provisions that could in effect prohibit the creation of a security interest in such contracts. 

        (g)   Upon
any executive officer of the Grantor obtaining actual knowledge thereof, the Grantor will promptly notify the Secured Party in writing of any event that materially
adversely affects the value of
any IP Collateral, the ability of the Grantor to dispose of any IP Collateral or the rights and remedies of the Secured Party in relation thereto, including the levy of any legal process against any
of the IP Collateral. 

        Section 5.    Representations, Warranties and Covenants.    The Grantor represents, warrants and covenants as
follows: 

        (1)   The
Company will notify the Secured Party immediately in writing of any change in its address, name, or state or form of organization. 

        (2)   The
Grantor is the legal and beneficial owner of the Collateral free and clear of any Lien except for the security interest created by this Agreement. No effective
financing statement or other document similar in effect covering all or any part of the Collateral is on file in any recording office. 

        (3)   The
Grantor has exclusive and absolute right to collect the Collateral. 

        (4)   None
of the Receivables is evidenced by a promissory note or other instrument. 

        (5)   This
Agreement creates a valid security interest in the Collateral, securing payment of the Obligations, and all filings and other actions necessary or desirable to
perfect and protect such security interest have been duly taken, or shall be taken promptly upon execution hereof. 

        (6)   The
Grantor is a corporation duly incorporated, validly existing, and in good standing under the laws of the State of Delaware; has the corporate power and authority to
own its assets 

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and
to transact its business, and is duly qualified and in good standing under the laws of each jurisdiction in which qualification is required 

        (7)   The
execution and performance by the Grantor of this Agreement have been duly authorized by all necessary corporate action and do not and will not (a) require any
consent or approval of the stockholders of such corporation; (b) contravene such corporation's character or bylaws; (c) violate any provision of any law, rule, or regulation; or
(d) result in a breach of or constitute a default under, any indenture or loan or credit agreement or any other agreement, lease, or instrument to which such corporation is a party or by which
it or its properties may be bound or affected. 

        (8)   This
Agreement is the legal, valid, and binding obligation of the Grantor, enforceable in accordance with its terms, except to the extent that such enforcement may be
limited by applicable bankruptcy, insolvency, and other similar laws affecting creditor's rights generally. 

        (9)   No
consent of any other person or entity and no authorization, approval, or other action by, and no notice to or filing with, any governmental authority or regulatory
body is required (a) for the grant by the Grantor of the assignment and security interest granted hereby or for the execution, delivery, or performance of this Agreement by the Grantor;
(b) for the perfection or maintenance of the assignment, and security interest created hereby (including the first priority nature of such assignment, and security interest); or (c) for
the exercise by the Secured Party of the rights provided for in this Agreement or the remedies in respect of the Collateral pursuant to this Agreement. 

        (10) There
are no conditions precedent to the effectiveness of this Agreement that have not been satisfied or waived. 

        (11) Grantor
shall not pledge, sell, assign, transfer, create or suffer to exist any security interest in or other lien or encumbrance on any part of the Collateral or grant
or suffer to exist any security interest in or other lien or encumbrance on any of Grantor's inventory or other assets to anyone other than Secured Party, without Secured Party's prior written
consent. Grantor hereby agrees to defend the same against any and all persons whatsoever. 

        Section 6.    Certain Grantor Covenants.    

        (1)   The
Grantor, at its sole expense, will take any and all actions as may be necessary or appropriate to facilitate the perfection and preservation of the security interest
granted herein, or to enable the Secured Party to exercise and enforce its rights and remedies hereunder with respect to any Collateral. 

        (2)   The
Grantor hereby authorizes the Secured Party to file one or more financing or continuation statements, and amendments thereto, relating to all or any part of the
Collateral without the signature of the Grantor where permitted by law. A photocopy or other reproduction of this Agreement or any financing statement covering the Collateral or any part thereof shall
be sufficient as a financing statement where permitted by law. 

        (3)   The
Grantor 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 Secured Party may reasonably request, all in reasonable detail. 

        (4)   The
Grantor hereby irrevocably appoints the Secured Party the Grantor's attorney-in-fact, with full authority in the place and stead of the
Grantor and in the name of the Grantor or otherwise, from time to time in the Secured Party's discretion, to take any action and to execute any instrument which the Secured Party may deem necessary or
advisable to accomplish the purposes of this Agreement. 

        (5)   The
Grantor has represented that its trade payables on the date hereof do not exceed $641,000 and has agreed that the proceeds of the Notes will be sufficient to fund
Grantor's salary 

4

 

requirements
and key vendors for at least 30 days without legal action commencing against Grantor by any of holders of such trade payables. 

        Section 7.    The Secured Party's Duties.    The powers conferred on the Secured Party hereunder are solely to
protect the Lenders' interest in the Collateral and shall not impose any duty upon them to exercise any such powers. Except for the safe custody of any Collateral in their possession and the
accounting for moneys actually received by them hereunder, the Secured Party shall have no duty as to any Collateral, as to ascertaining or taking action with respect to any Collateral, whether or not
the Secured Party have or are deemed to have knowledge of such matters, or as to the taking of any necessary steps to preserve rights against prior parties or any other rights pertaining to any
Collateral. The Secured Party shall be deemed to have exercised reasonable care in the custody and preservation of any Collateral in their possession if such Collateral is accorded treatment
substantially equal to that which it accords its own property. 

        Section 8.    Events of Default.    It shall be an event of default (an "Event of Default") hereunder if: 

        (a)   The
Grantor breaches any of the representations, warranties or covenants under the Notes, this Agreement, or any other agreements between the Lenders and the Grantor, of
even date herewith, or there occurs an Event of Default under the Note; 

        (b)   The
Grantor becomes insolvent, admits its inability to pay its debts as they mature, or is in any form of bankruptcy, arrangement or reorganization proceeding (whether
governed by Federal, state or common law); 

        (c)   The
Grantor fails to comply with, or defaults under, any term of any present or future agreement between it and any of the Lenders. 

        Section 9.    Remedies.    If any Event of Default shall have occurred and be continuing the Secured Party may
exercise in respect of the Collateral, in addition to any other rights and remedies provided for herein or otherwise available to it, all the rights and remedies of a secured party on default under
the Uniform Commercial Code (the "Code") (whether or not the Code applies to the affected Collateral), and also may (a) require the Grantor to, and the Grantor hereby agrees that it will, at
its expense and upon request of the Secured Party forthwith, assemble all or part of the Collateral as directed by the Secured Party and make it available to the Secured Party at a place to be
designated by the Secured Party which is convenient to the parties and (b) without notice except as specified below, sell the Collateral or any part thereof in one or more parcels at public or
private sale, at any of the Secured Party' offices or elsewhere, for cash, on credit or for future delivery, and upon such other terms as the Secured Party may deem commercially reasonable. The
Grantor agrees that, to the extent notice of sale shall be required by law, at least ten (10) days notice to the Grantor of the time and place of any public sale or the time after which any
private sale is to be made shall constitute reasonable notification. The Secured Party shall not be obligated to make any sale of Collateral regardless of notice of sale having been given. The Secured
Party may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to which
it was adjourned. All proceeds of Collateral shall be applied in the following order of priority: (i) fees and expenses incurred by the Secured Party as described in Section 10(2) until
paid and satisfied in full, (ii) fees and expenses incurred by any Lender as described in Section 10(2) until paid and satisfied in full, (iii) due and unpaid interest on the
Notes until paid and satisfied in full, (iv) due and unpaid principal on the Notes until paid and satisfied in full, and (v) the remainder, if any, to Grantor or any other person or
entity lawfully entitled thereto. 

5

 

        Section 10.    Indemnity and Expenses.    

        (1)   The
Grantor agrees to indemnify the Secured Party and Lenders from and against any and all claims, losses, and liabilities (including, without limitation, reasonable
attorney fees) growing out of or resulting from this Agreement (including, without limitation, enforcement of this Agreement), except claims, losses, or liabilities resulting from the gross negligence
or willful misconduct of the Lenders or Secured Party. 

        (2)   The
Grantor will upon demand pay the amount of any and all reasonable expenses, including, without limitation, the reasonable fees and expenses of its counsel and of any
experts and agents, which the Lenders or Secured Party may incur in connection with (a) the preparation and administration of this Agreement and the Note; (b) the custody, preservation,
use or operation of, or the sale of, collection from, or other realization upon, any of the Collateral; (c) the exercise or enforcement of any of the rights of the Lenders or Secured Party
hereunder; or (d) the failure by the Grantor to perform or observe any of the provisions hereof. 

        Section 11.    Amendments; Etc.    No amendment, modification, termination, or waiver of any provision of this
Agreement, and no consent to any departure by the Grantor here from, shall in any event be
effective unless the same shall be in writing and signed by Secured Party and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. 

        Section 12.    Addresses for Notices.    All notices and other communications provided for hereunder shall be
in writing (including telegraphic, telex, and facsimile transmissions) and mailed or transmitted or delivered to the address for each such party set forth above or, as to either party, at such other
address as shall be designated by such party in a written notice to the other party. All such notices and other communications shall be effective when deposited in the mails or delivered to the
telegraph company, or sent, answer back received, respectively. 

        Section 13.    Waiver of Rights.    The Grantor waives the right to assert against any of the Lenders or
Secured Party or other holder any defense, counterclaim or set-off which it could assert against such person in any action brought by such holder upon the Company's obligations hereunder. 

        Section 14.    Continuing Security Interest; Assignments Under The Notes.    This Agreement shall create a
continuing security interest in the Collateral and shall: (1) remain in full force and effect until the payment in full of the Obligations and all other amounts payable under this Agreement;
(2) be binding upon the Grantor, its successors and assigns; and (3) inure to the benefit of, and be enforceable by, each of the Secured Party and Lenders and their respective
successors, transferees, and assigns. Without limiting the generality of the foregoing clause (3) the Secured Party and Lenders may assign or otherwise transfer all or any portion of their
rights and Obligations to any other person or entity, and such other person or entity shall thereupon become vested with all the benefits in respect thereof granted to the respective Secured Party or
Lender therein or otherwise. Upon the payment in full of the Obligations and all other amounts payable under this Agreement, the security interest granted hereby shall terminate and all rights to the
Collateral shall revert to the Grantor. Upon any such termination, the Secured Party will, at the Grantor's expense, execute and deliver to the Grantor such documents as the Grantor shall reasonably
request to evidence such termination. 

        Section 15.    Governing Law; Terms.    This Agreement shall be governed by and construed in accordance with
the laws of the State of New York, except to the extent that the validity or perfection of the security interest hereunder, or remedies hereunder, in respect of any particular Collateral are governed
by the laws of a jurisdiction other than the State of New York. 

        Section 16.    Submission to Jurisdiction.    The Grantor hereby submits to the non-exclusive
jurisdiction of the United States District Court for the Southern District of New York and of any State court sitting in New York County for purposes of all legal proceedings which may arise hereunder
or under the Note. The Grantor irrevocably waives to the fullest extent permitted by law, any objection 

6

 

which
it may have or hereafter have to the laying of the venue of any such proceeding brought in such a court, any claim that any such proceeding brought in such a court has been brought in an
inconvenient forum and trial by jury. The Grantor hereby consents to process being served in any such proceeding by the mailing of a copy thereof by registered or certified mail, postage prepaid, to
its address specified above or in any other manner permitted by law. 

THE
SECURED PARTY AND THE GRANTOR HEREBY WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM, WHETHER IN CONTRACT OR TORT, AT LAW OR IN EQUITY, ARISING OUT OF OR IN ANY WAY RELATED TO
THIS AGREEMENT. NO OFFICER OF THE SECURED PARTY HAS AUTHORITY TO WAIVE, CONDITION, OR MODIFY THIS PROVISION. 

        Section 17.    Agency; Action by Secured Party.    Each Lender hereby appoints the Secured Party as its agent
hereunder with respect to the Collateral and the creation, perfection, priority, preservation, protection and enforcement of a security interest therein in accordance with the terms of this Agreement.
Each Lender hereby authorizes the Secured Party to take such actions with respect to the Collateral, for the pro-rata benefit of the Lenders in accordance with Section 9, as the
Secured Party determines to take in its sole discretion, and each Lender agrees to indemnify and hold harmless the Secured Party for all costs, claims or expenses (including without limitation
attorneys' fees and expenses) in connection with such actions taken or omitted to be taken, except to the extent resulting from the gross negligence or willful misconduct of Secured Party. The Secured
Party shall provide prompt notice of any material action under this Agreement to the Lenders. 

7

 
SIGNATURE PAGE

SECURITY AGREEMENT

Lightspace Corporation

September 6, 2005  

        IN WITNESS WHEREOF, the Grantor, Secured Party and the Lenders have caused this Agreement to be duly executed and delivered by duly authorized representative as
of the date first above written. 

	

THE GRANTOR:	
 	

 	

 
	

 	
 	

Lightspace Corporation

a Delaware corporation
	

 	
 	

By:	

 Name: Ken Lang

Title: President
 Address for Notices:

125 CambridgePark Drive, 4th Floor

Cambridge, MA 02140

Fax: [617-868-1799]
	

SECURED PARTY:	
 	

 	

 
	

 	
 	

AIGH INVESTMENT PARTNERS, LLC
	

 	
 	

By:	

 Name: Orin Hirschman

Title: Manager

8

 
SIGNATURE PAGE

SECURITY AGREEMENT

Lightspace Corporation

September 6, 2005  

	

THE LENDERS:	
 	

 	

 
	

 	
 	

AIGH INVESTMENT PARTNERS LLC
	

 	
 	

By:	

 Name:

Title:
	

 	
 	

PRIME RESOURCE INC.
	

 	
 	

By:	

 Name:

Title:
	

 	
 	

 	

 Steven Antebi
	

 	
 	

 	

 Terry Deru
	

 	
 	

 	

 Lowell Anderson
	

 	
 	

 	

 Matthew Limpert
	

 	
 	

 	

 Branden Vernon
	

 	
 	

 	

 Tiffany Limpert

9

  

 
 

SCHEDULE I
  LENDERS    
    

	Name and Address
 
	 	Principal

Amount of Notes

	AIGH Investment Partners, LLC

6006 Berkeley Ave.

Baltimore, MD 21209	 	$	200,000.00
	

Prime Resource, Inc

1245 East Brickyard Rd, #590

Salt Lake City, Utah 84106	
 	
$	

100,000.00
	

Terry Deru

99 Cove lane

Layton, Utah 84040	
 	
$	

50,000.00
	

Tiffany Limpert

8395 S Parkhurst Circle

Sandy, Utah 84094	
 	
$	

50,000.00
	

Matthew Limpert

2551 S Fillmore Street

Salt Lake City, Utah 84106	
 	
$	

50,000.00
	

Lowell Anderson

7138 S 2000 E, #211

Salt Lake City Utah 84121	
 	
$	

75,000.00
	

Branden Vernon

13043 S 2950 W

Riverton, Utah 84065	
 	
$	

25,000.00
	

Steven Antebi

11601 Wilshire Blvd

Suite 2040

Los Angeles, CA 90025	
 	
$	

150,000.00
	
TOTAL	
 	
$	

700,000.00

10

 
 
 

EXHIBIT A    
    

        [Schedule all patents (by number), patent applications (by number), trademarks, URL's, copyrights, etc.] 

LS001US, UTILITY PATENT

Title: INTERACTIVE MODULAR SYSTEM

Application Serial #: 10/285342 

Foreign
Patent Filings based on LS001US

PCT Application Serial #: PCT/US03/16280 

LS003US, UTILITY PATENT

Title: INTERACTIVE SYSTEM

Application Serial #: 10/779089 

Foreign
Patent Filings based on LS003US

PCT Application Serial #: PCT/US04/04127 

LS004US, UTILITY PATENT

Application Serial #: 60/565133 

Foreign
Patent Filings based on LS004US

PCT Application Serial #: TBD 

LS005PUS, PROVISIONAL PATENT

Application Serial #: 60/602701

Trademark filed for:

"LIGHTSPACE"  

11

  

 
 

EXHIBIT B    
    

        Excluded Intellectual Property licenses, agreements, etc.: 

        NONE

12

 
 
 

EXHIBIT C    
    

Lightspace Corporation

Summary of Receivables and Factored
  September 5, 2005 

	Receivables

Accounts:
 
	 	Amount of Receivable

	Lightworks Interactive(*1)	 	$	264,000.00
	Old Navy(*2)	 	$	30,000.00
	 	 	

	Total	 	$	294,000.00
	 	 	

	Receivables that have been Factored

(sold off to raise money or meet past obligations)

Accounts:
 
	 	Factored Payment

	Japan Dealership	 	$	45,000.00
	Korea FEC Sale	 	$	15,000.00
	 	 	

	 	 	$	60,000.00
	 	 	

	(*1)
	These
receivables are tied to a reseller agreement in which the reseller has committed to a specific amount of sales. If no sales are made, the commitment stands and is divided up
into two quarterly payments.

	(*2)
	Signed
paperwork expected in present week. 

        This
Exhibit C is included to make explicit any remaining payments (the factored ones) expected by customers that are not subject to this security agreement as they have been sold
off already. 

13

 
 
 

FIRST AMENDMENT TO SECURITY AGREEMENT    
    

        FIRST AMENDMENT, dated as of September 6, 2005 (the "Amendment"), to the Security Agreement, dated
September 6, 2005 (the "Security Agreement"), each made by Lightspace Corporation, a Delaware corporation, with its principal offices located at
125 Cambridgepark Drive, 4th Floor, Cambridge, MA 02140 (the "Grantor"), and AIGH Investment Partners, LLC, a Delaware limited liability company, or
assigns, having an office located at 6006 Berkeley Ave., Baltimore, MD 21209, as agent for the Lenders (as defined in the Security Agreement) (the "Secured
Party"). Capitalized terms used but not defined herein shall have the respective meanings ascribed thereto in the Security Agreement. 

 
 

PRELIMINARY STATEMENT:    
    

        WHEREAS, certain Lenders have transferred their Notes to certain other Lenders; 

        WHEREAS,
the Grantor and Secured Party wish to amend the Security Agreement to accurately reflect the Notes issued to the Lenders; and 

        WHEREAS,
Section 11 of the Security Agreement provides that no amendment to the Security Agreement shall be effective unless it is in writing and signed by the Secured Party; 

        NOW,
THEREFORE, in consideration of the mutual covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties to the Security Agreement hereby agree as follows: 

        Section 1.    Amendments to the Security Agreement.    The Security Agreement is hereby amended as follows: 

        (1)   The
number "$700,000" in the Preliminary Statement is hereby deleted and replaced with the following: "$750,000"; and 

        (2)   Schedule I
to the Security Agreement is hereby deleted in its entirety and replaced by Schedule I attached to this Amendment. 

        Section 2.    Effect of Amendment.    Except as expressly provided in this Amendment, each of the terms and
provisions of the Security Agreement shall remain in full force and effect. 

        Section 3.    Counterparts.    This Amendment may be executed in one or more counterparts, each of which shall
be deemed to be an original, but all of which taken together shall constitute one and the same instrument. 

        Section 4.    Governing Law.    This Agreement shall be governed by and construed in accordance with the laws
of the State of New York, without giving effect to principles of conflicts of law. 

14

 
SIGNATURE PAGE

FIRST AMENDMENT TO SECURITY AGREEMENT

Lightspace Corporation

October     , 2005  

        IN WITNESS WHEREOF, the Grantor and the Secured Party have caused this Amendment to be duly executed and delivered by duly authorized representative as of the
date first above written. 

	THE GRANTOR:	 	 	 
	 	 	Lightspace Corporation

a Delaware corporation
	

 	
 	

By:	

 
	 	 	 	
 Name: Ken Lang

Title: President
 Address for Notices:
 125 Cambridgepark Drive, 4th Floor

Cambridge, MA 02140

Fax: [617-868-1799]
	

SECURED PARTY:	
 	

 	

 
	 	 	AIGH INVESTMENT PARTNERS, LLC
	

 	
 	

By:	

 
	 	 	 	
 Name: Orin Hirschman

Title: Manager

15

 
SIGNATURE PAGE

SECURITY AGREEMENT

Lightspace Corporation

September 6, 2005  

	THE LENDERS:	 	 	 
	 	 	AIGH INVESTMENT PARTNERS LLC
	

 	
 	

By:	

 
	 	 	 	
 Name:

Title:
	

 	
 	

PRIME RESOURCE INC.
	

 	
 	

By:	

 
	 	 	 	
 Name:

Title:
	

 	
 	

 	

 Steven Antebi
	

 	
 	

 	

 Terry Deru
	

 	
 	

 	

 Lowell Anderson
	

 	
 	

 	

 Matthew Limpert
	

 	
 	

 	

 Branden Vernon
	

 	
 	

 	

 Tiffany Limpert

16

  

 
 

SCHEDULE I
  
    LENDERS    
    

	Name and Address
 
	 	Principal

Amount of Notes

	AIGH Investment Partners, LLC

6006 Berkeley Ave.

Baltimore, MD 21209	 	$200,000.00
	Terry Deru

99 Cove lane

Layton, Utah 84040	 	$100,000.00
	Tiffany Limpert

8395 S Parkhurst Circle

Sandy, Utah 84094	 	$100,000.00
	Matthew Limpert

2551 S Fillmore Street

Salt Lake City, Utah 84106	 	$50,000.00
	Lowell Anderson

7138 S 2000 E, #211

Salt Lake City Utah 84121	 	$75,000.00
	Branden Vernon

13043 S 2950 W

Riverton, Utah 84065	 	$25,000.00
	Steven Antebi

11601 Wilshire Blvd

Suite 2040

Los Angeles, CA 90025	 	$200,000.00
	TOTAL	 	$750,000.00

17

 
 
 

SECOND AMENDMENT TO SECURITY AGREEMENT    
    

        SECOND AMENDMENT, dated as of November 15, 2005 (the "Amendment"), to the Security Agreement, dated
September 6, 2005, as amended, (the "Security Agreement"), each made by Lightspace Corporation, a Delaware corporation, with its principal
offices located at 125 Cambridgepark Drive, 4th Floor, Cambridge, MA 02140 (the "Grantor"), and AIGH Investment Partners, LLC, a Delaware limited
liability company, or assigns, having an office located at 6006 Berkeley Ave., Baltimore, MD 21209, as agent for the Lenders (as defined in the Security Agreement) (the
"Secured Party"). Capitalized terms used but not defined herein shall have the respective meanings ascribed thereto in the Security Agreement. 

        WHEREAS,
the Grantor borrowed (i) an additional amount of $150,000 pursuant to Senior Secured Notes of similar tenor to the Original Note (the "Other Note") and
(ii) $250,000 from Prime Resource, Inc. pursuant to a Secured and Guaranteed Note, dated June 15, 2005 (the "Prime Note"); 

        WHEREAS,
Prime has agreed to extend and restate the Prime Note in the form of a Senior Secured Note of similar tenor to the Original Note, and the parties wish to admit Prime as a Lender
under the Security Agreement; 

        WHEREAS,
the Grantor and Secured Party wish to amend the Security Agreement to accurately reflect the Notes issued to the Lenders; and 

        WHEREAS,
Section 11 of the Security Agreement provides that no amendment to the Security Agreement shall be effective unless it is in writing and signed by the Secured Party; 

        NOW,
THEREFORE, in consideration of the mutual covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties to the Security Agreement hereby agree as follows: 

        Section 1.    Amendments to the Security Agreement.    The Security Agreement is hereby amended as follows: 

        (1)   The
number "$750,000" in the Preliminary Statement is hereby deleted and replaced with the following: "$1,150,000 and such other amounts as may be loaned to the Grantor
from time to time by the Lenders pursuant to notes of similar tenor to the Senior Secured Notes"; 

        (2)   Schedule I
to the Security Agreement is hereby deleted in its entirety and replaced by Schedule I attached to this Amendment; and 

        (3)   The
parties agree to include the obligations of the Grantor under the Prime Note, as restated in the form of a Senior Secured Note, as Obligations under the Security
Agreement. 

        Section 2.    Effect of Amendment.    Except as expressly provided in this Amendment, each of the terms and
provisions of the Security Agreement shall remain in full force and effect. 

        Section 3.    Counterparts.    This Amendment may be executed in one or more counterparts, each of which shall
be deemed to be an original, but all of which taken together shall constitute one and the same instrument. 

        Section 4.    Governing Law.    This Agreement shall be governed by and construed in accordance with the laws
of the State of New York, without giving effect to principles of conflicts of law. 

        Section 5.    Conflicts.    The parties (i) recognize that Hahn & Hessen LLP represents AIGH
Investment Partners LLC in this and other matters and may continue to do so, (ii) recognize that Hahn & Hessen represents all the Lenders in the transactions contemplated by this
Amendment and (iii) waive any conflicts that may arise from such representation. 

        [balance
of page intentionally left blank] 

18

 
 
 

SIGNATURE PAGE
  SECOND AMENDMENT TO SECURITY AGREEMENT
  Lightspace Corporation
  November 15, 2005    
    

        IN WITNESS WHEREOF, the Grantor and the Secured Party have caused this Amendment to be duly executed and delivered by duly authorized representative as of the
date first above written. 

	THE GRANTOR:	 	 	 
	 	 	Lightspace Corporation

a Delaware corporation
	

 	
 	

By:	

 
	 	 	 	
 Name: Ken Lang

Title: President
 Address for Notices:

125 Cambridgepark Drive, 4th Floor

Cambridge, MA 02140

Fax: 617-868-1799
	

SECURED PARTY:	
 	

 	

 
	 	 	AIGH INVESTMENT PARTNERS, LLC
	

 	
 	

By:	

 
	 	 	 	
 Name: Orin Hirschman

Title: Manager

19

 
 
 

SIGNATURE PAGE
  SECURITY AGREEMENT
  Lightspace Corporation
  November 15, 2005    
    

THE
LENDERS: 

	 	 	AIGH INVESTMENT PARTNERS LLC
	

 	
 	

By:	

 
	 	 	 	
 Name:

Title:
	

 	
 	

PRIME RESOURCE INC.
	

 	
 	

By:	

 
	 	 	 	
 Name:

Title:
	

 	
 	

BLUE & GOLD ENTERPRISES, LLC
	

 	
 	

By:	

 
	 	 	 	
 Steven Antebi
	

 	
 	

 	

 Terry Deru
	

 	
 	

 	

 Lowell Anderson
	

 	
 	

 	

 Matthew Limpert
	

 	
 	

 	

 Branden Vernon
	

 	
 	

 	

 Tiffany Limpert

20

  

 
 

SCHEDULE I
  
    LENDERS    
    

	Name and Address
 
	 	Principal

Amount of Notes

	AIGH Investment Partners, LLC

6006 Berkeley Ave.

Baltimore, MD 21209	 	$	350,000.00
	

Prime Resource, Inc

1245 East Brickyard Rd, #590

Salt Lake City, Utah 84106	
 	
$	

350,000.00
	

Terry Deru

99 Cove lane

Layton, Utah 84040	
 	
$	

50,000.00
	

Tiffany Limpert

8395 S Parkhurst Circle

Sandy, Utah 84094	
 	
$	

50,000.00
	

Matthew Limpert

2551 S Fillmore Street

Salt Lake City, Utah 84106	
 	
$	

50,000.00
	

Lowell Anderson

7138 S 2000 E, #211

Salt Lake City Utah 84121	
 	
$	

75,000.00
	

Branden Vernon

13043 S 2950 W

Riverton, Utah 84065	
 	
$	

25,000.00
	

Blue & Gold Enterprises, LLC

Attn: Steven Antebi

11601 Wilshire Blvd

Suite 2040

Los Angeles, CA 90025	
 	
$	

200,000.00
	
TOTAL	
 	
$	

1,150,000.00

21

  

 
 

THIRD AMENDMENT TO SECURITY AGREEMENT    
    

        THIRD AMENDMENT, dated as of March 27, 2006 (this "Amendment"), to the Security Agreement, dated September 6, 2005, as
amended, (the "Security Agreement"), each made by Lightspace Corporation, a Delaware corporation, with its principal offices located at 125 Cambridgepark Drive, 4th Floor,
Cambridge, MA 02140 (the "Grantor"), and AIGH Investment Partners, LLC, a Delaware limited liability company, or assigns, having an office located at 6006 Berkeley Ave.,
Baltimore, MD 21209, as agent for the Lenders (as defined in the Security Agreement) (the "Secured Party"). Capitalized terms used but not defined herein shall have the
respective meanings ascribed thereto in the Security Agreement. 

        WHEREAS,
the Grantor borrowed (i) an aggregate principal amount of $2,400,000 pursuant to Senior Secured Notes from the Lenders and two additional Lenders and (ii) expects
to borrow additional amounts from certain Lenders pursuant to non-convertible secured notes in the form attached hereto as Exhibit A (the "Additional Notes"); 

        WHEREAS,
the Grantor and Secured Party wish to amend the Security Agreement to accurately reflect the Senior Secured Notes issued to the Lenders and the Additional Notes which may from
time to time, commencing on the date of the Amendment, be issued to certain Lenders; and 

        WHEREAS,
Section 11 of the Security Agreement provides that no amendment to the Security Agreement shall be effective unless it is in writing and signed by the Secured Party; 

        NOW,
THEREFORE, in consideration of the mutual covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties to the Security Agreement hereby agree as follows: 

        Section 1.    Amendments to the Security Agreement.    The Security Agreement is
hereby amended as follows: 

        (1)   Schedule I
to the Security Agreement is hereby deleted in its entirety and replaced by Schedule I attached to this Amendment. 

        (2)   The
parties agree to include the obligations of the Grantor under the Additional Notes as Obligations under the Security Agreement. 

        (3)   The
parties wish to admit as parties to this Agreement Hershel Berkowitz and Joshua Hirsch, and such persons shall also be deemed Lenders. 

        (4)   The
parties recognize that Additional Notes may be sold from time to time by the Grantor at par to one or more Lenders who are accredited investors (as defined under US
securities laws), and the Grantor shall not be obliged to offer such Additional Notes to any of the Lenders. 

        Section 2.    Effect of Amendment.    Except as expressly provided in this
Amendment, each of the terms and provisions of the Security Agreement shall remain in full force and effect. 

        Section 3.    Counterparts.    This Amendment may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which taken together shall constitute one and the same instrument. 

        Section 4.    Governing Law.    This Agreement shall be governed by and construed
in accordance with the laws of the State of New York, without giving effect to principles of conflicts of law. 

22

 

        Section 5.    Conflicts.    The parties (i) recognize that Hahn &
Hessen LLP represents AIGH Investment Partners LLC in this and other matters and may continue to do so, (ii) recognize that Hahn & Hessen represents all the Lenders in the transactions
contemplated by this Amendment and (iii) waive any conflicts that may arise from such representation. 

[balance
of page intentionally left blank] 

23

 
 
 

SIGNATURE PAGE
  THIRD AMENDMENT TO SECURITY AGREEMENT
  Lightspace Corporation
  March 27, 2006    
    

        IN
WITNESS WHEREOF, the Grantor and the Secured Party have caused this Amendment to be duly executed and delivered by duly authorized representative as of the date first above written. 

	THE GRANTOR:	 	 	 
	 	 	Lightspace Corporation

a Delaware corporation
	

 	
 	

By:	

 
	 	 	 	
 Name:

Title:
 Address for Notices:
 125 Cambridgepark Drive, 4th Floor

Cambridge, MA 02140

Fax: 617-868-1799
	

SECURED PARTY:	
 	

 	

 
	 	 	AIGH INVESTMENT PARTNERS, LLC
	

 	
 	

By:	

 
	 	 	 	
 Name: Orin Hirschman

Title: Manager

24

 
 
 

SIGNATURE PAGE
  SECURITY AGREEMENT
  Lightspace Corporation
  March 27, 2006    
    

	THE LENDERS:	 	AIGH INVESTMENT PARTNERS LLC
	

 	
 	

By:	
 	

 
	 	 	 	 	
 Name:

Title:
	

 	
 	

PRIME RESOURCE INC.
	

 	
 	

By:	
 	

 
	 	 	 	 	
 Name:

Title:
	

 	
 	

BLUE & GOLD ENTERPRISES, LLC
	

 	
 	

By:	
 	

 
	

 	
 	

           Steven Antebi
	

 	
 	

           Terry Deru
	

 	
 	

           Lowell Anderson
	

 	
 	

           Matthew Limpert
	

 	
 	

           Branden Vernon
	

 	
 	

           Tiffany Limpert
	

 	
 	

           Hershel Berkowitz
	

 	
 	

           Joshua Hirsch

25

  

 
 

SCHEDULE I    
    

 
  LENDERS    
    

	Name and Address
 
	 	Principal Amount of Senior Secured Notes
	 	Principal Amount of Additional Notes

	AIGH Investment Partners, LLC

6006 Berkeley Ave.

Baltimore, MD 21209	 	$	1,250,000.00	 	$	820,000.00
	

Prime Resource, Inc

1245 East Brickyard Rd, #590

Salt Lake City, Utah 84106	
 	
$	

350,000.00	
 	
 	

 
	

Terry Deru

99 Cove lane

Layton, Utah 84040	
 	
$	

50,000.00	
 	
 	

 
	

Tiffany Limpert

8395 S Parkhurst Circle

Sandy, Utah 84094	
 	
$	

50,000.00	
 	
 	

 
	

Matthew Limpert

2551 S Fillmore Street

Salt Lake City, Utah 84106	
 	
$	

50,000.00	
 	
 	

 
	

Lowell Anderson

7138 S 2000 E, #211

Salt Lake City, Utah 84121	
 	
$	

75,000.00	
 	
 	

 
	

Branden Vernon

13043 S 2950 W

Riverton, Utah 84065	
 	
$	

25,000.00	
 	
 	

 
	

Blue & Gold Enterprises, LLC

Attn: Steven Antebi

11601 Wilshire Blvd

Suite 2040

Los Angeles, CA 90025	
 	
$	

300,000.00	
 	
 	

 
	

Hershel Berkowitz

410 Yeshiva Lane

Baltimore, MD 21208	
 	
$	

200,000.00	
 	
 	

 
	

Joshua Hirsch

1 Longfellow Place, Suite 3407

Boston, MA 02114	
 	
$	

50,000.00	
 	
 	

 
	
TOTAL	
 	
$	

2,400,000.00	
 	
$	

820,000.00
	 	 	
	 	

26

QuickLinks

SCHEDULE I LENDERS

EXHIBIT A

EXHIBIT B

EXHIBIT C

FIRST AMENDMENT TO SECURITY AGREEMENT

PRELIMINARY STATEMENT

SCHEDULE I LENDERS

SECOND AMENDMENT TO SECURITY AGREEMENT

SIGNATURE PAGE SECOND AMENDMENT TO SECURITY AGREEMENT Lightspace Corporation November 15, 2005

SIGNATURE PAGE SECURITY AGREEMENT Lightspace Corporation November 15, 2005

SCHEDULE I LENDERS

THIRD AMENDMENT TO SECURITY AGREEMENT

SIGNATURE PAGE THIRD AMENDMENT TO SECURITY AGREEMENT Lightspace Corporation March 27, 2006

SIGNATURE PAGE SECURITY AGREEMENT Lightspace Corporation March 27, 2006

SCHEDULE I

LENDERS

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