Document:

EXHIBIT 10.3

                                                        Dated: December 23, 2005

      NEITHER THIS  DEBENTURE NOR THE  SECURITIES  INTO WHICH THIS  DEBENTURE IS
      CONVERTIBLE   HAVE  BEEN  REGISTERED  WITH  THE  SECURITIES  AND  EXCHANGE
      COMMISSION OR THE  SECURITIES  COMMISSION OF ANY STATE IN RELIANCE UPON AN
      EXEMPTION FROM  REGISTRATION  UNDER THE SECURITIES ACT OF 1933, AS AMENDED
      (THE  "SECURITIES  ACT"),  AND,  ACCORDINGLY,  MAY NOT BE  OFFERED OR SOLD
      EXCEPT  PURSUANT  TO  AN  EFFECTIVE   REGISTRATION   STATEMENT  UNDER  THE
      SECURITIES  ACT  OR  PURSUANT  TO AN  AVAILABLE  EXEMPTION  FROM,  OR IN A
      TRANSACTION  NOT  SUBJECT  TO,  THE   REGISTRATION   REQUIREMENTS  OF  THE
      SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.

No. CCP-3                                                               $800,000

                          SENSOR SYSTEM SOLUTIONS, INC.

                          Secured Convertible Debenture

                              Due December 23, 2006

      This Secured  Convertible  Debenture (the "Debenture") is issued by SENSOR
SYSTEM SOLUTIONS, INC., a Nevada corporation (the "Obligor"), to CORNELL CAPITAL
PARTNERS,  LP (the  "Holder"),  pursuant  to that  certain  Securities  Purchase
Agreement (the "Securities Purchase Agreement") of even date herewith.

      FOR VALUE  RECEIVED,  the Obligor hereby  promises to pay to the Holder or
its successors and assigns the principal sum of Eight Hundred  Thousand  Dollars
($800,000)  together with accrued but unpaid  interest on or before December 23,
2006 (the "Maturity Date") in accordance with the following terms:

      Interest.  Interest  shall  accrue on the  outstanding  principal  balance
hereof  at an  annual  rate  equal  to ten  percent  (10%).  Interest  shall  be
calculated on the basis of a 360-day year and the actual number of days elapsed,
to the extent  permitted by applicable law.  Interest  hereunder will be paid to
the  Holder  or its  assignee  (as  defined  in  Section  5) in whose  name this
Debenture is registered on the records of the Obligor regarding registration and
transfers of Debentures (the "Debenture Register").

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      Right of Redemption.  The Obligor at its option shall have the right, with
three (3) business days advance  written notice (the  "Redemption  Notice"),  to
redeem a portion or all amounts  outstanding  under this Debenture  prior to the
Maturity Date provided that the Closing Bid Price of the of the Obligor's Common
Stock, as reported by Bloomberg,  LP, is less than the Fixed Conversion Price at
the time of the Redemption  Notice. The Obligor shall pay an amount equal to the
principal amount being redeemed plus a redemption premium ("Redemption Premium")
equal to twenty  percent  (20%) of the  principal  amount  being  redeemed,  and
accrued interest,  (collectively  referred to as the "Redemption  Amount").  The
Obligor  shall  deliver to the Holder the  Redemption  Amount on the third (3rd)
business day after the Redemption Notice.

            In the event the Obligor  exercises a redemption  of either all or a
portion of the  outstanding  principal  amounts  plus  accrued  interest due and
outstanding under this debenture as outlined herein,  the Holder shall receive a
warrant to purchase one hundred  thousand  (100,000)  shares of Common Stock for
every  One  Hundred  Thousand  Dollars  ($100,000)  redeemed,   pro  rata.  (the
"Warrant")  The  Warrant  shall be  exercisable  on a "cash  basis"  and have an
exercise  price  equal to the  Fixed  Conversion  Price in effect at the time of
issuance. The Warrant shall have "piggy-back" and demand registration rights and
shall survive for five (5) years from the Closing Date.

      Notwithstanding the foregoing in the event that the Obligor has elected to
redeem a portion of the outstanding  principal amount and accrued interest under
this  Debenture  the Holder  shall be permitted to convert all or any portion of
this Debenture during such three business day period.

      Security  Agreements.  This  Debenture is secured by an Insider Pledge and
Escrow Agreement  ("Insider  Pledge  Agreement") of even date herewith among the
Obligor,  the  Holder,  Michael  Young,  and the  Escrow  Agent  and a  Security
Agreement (the "Security  Agreement") of even date herewith  between the Obligor
and the Holder.

      This Debenture is subject to the following additional provisions:

      Section 1. This Debenture is exchangeable for an equal aggregate principal
amount of Debentures of different authorized denominations,  as requested by the
Holder  surrendering  the  same.  No  service  charge  will  be  made  for  such
registration of transfer or exchange.

      Section 2.  Events of Default.

      (a) An "Event of  Default",  wherever  used  herein,  means any one of the
following  events  (whatever  the reason and  whether it shall be  voluntary  or
involuntary or effected by operation of law or pursuant to any judgment,  decree
or order of any court, or any order, rule or regulation of any administrative or
governmental body):

            (i) Any default in the payment of the principal  of,  interest on or
other charges in respect of this Debenture,  free of any claim of subordination,
as and when the same shall become due and payable  (whether on a Conversion Date
or the Maturity Date or by acceleration or otherwise);

            (ii)  The  Obligor  shall  fail to  observe  or  perform  any  other
covenant,  agreement or warranty contained in, or otherwise commit any breach or
default of any provision of this Debenture  (except as may be covered by Section
2(a)(i) hereof) or any  Transaction  Document (as defined in Section 5) which is
not cured with in the time prescribed;

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            (iii) The Obligor or any  subsidiary of the Obligor shall  commence,
or there shall be commenced against the Obligor or any subsidiary of the Obligor
under any applicable bankruptcy or insolvency laws as now or hereafter in effect
or any  successor  thereto,  or the  Obligor or any  subsidiary  of the  Obligor
commences any other proceeding under any reorganization, arrangement, adjustment
of debt,  relief of debtors,  dissolution,  insolvency or liquidation or similar
law of any  jurisdiction  whether  now or  hereafter  in effect  relating to the
Obligor or any  subsidiary  of the  Obligor or there is  commenced  against  the
Obligor or any  subsidiary  of the Obligor any such  bankruptcy,  insolvency  or
other  proceeding  which  remains  undismissed  for a period of 61 days;  or the
Obligor or any subsidiary of the Obligor is  adjudicated  insolvent or bankrupt;
or any order of relief or other order  approving  any such case or proceeding is
entered; or the Obligor or any subsidiary of the Obligor suffers any appointment
of any custodian,  private or court appointed receiver or the like for it or any
substantial part of its property which continues  undischarged or unstayed for a
period of sixty one (61) days;  or the Obligor or any  subsidiary of the Obligor
makes a general  assignment for the benefit of creditors;  or the Obligor or any
subsidiary of the Obligor shall fail to pay, or shall state that it is unable to
pay, or shall be unable to pay,  its debts  generally as they become due; or the
Obligor or any  subsidiary  of the Obligor shall call a meeting of its creditors
with a view to  arranging a  composition,  adjustment  or  restructuring  of its
debts;  or the  Obligor or any  subsidiary  of the  Obligor  shall by any act or
failure to act expressly indicate its consent to, approval of or acquiescence in
any of the  foregoing;  or any corporate or other action is taken by the Obligor
or any  subsidiary  of the  Obligor  for the  purpose  of  effecting  any of the
foregoing;

            (iv) The Obligor or any  subsidiary  of the Obligor shall default in
any of its  obligations  under  any  other  debenture  or any  mortgage,  credit
agreement or other facility,  indenture agreement,  factoring agreement or other
instrument under which there may be issued,  or by which there may be secured or
evidenced any  indebtedness  for borrowed money or money due under any long term
leasing or factoring arrangement of the Obligor or any subsidiary of the Obligor
in an amount exceeding  $100,000,  whether such indebtedness now exists or shall
hereafter be created and such default shall result in such indebtedness becoming
or being declared due and payable prior to the date on which it would  otherwise
become due and payable;

            (v) The Common  Stock shall cease to be quoted for trading or listed
for trading on either the Nasdaq OTC  Bulletin  Board  ("OTC"),  Nasdaq  Capital
Market, New York Stock Exchange,  American Stock Exchange or the Nasdaq National
Market (each, a "Subsequent Market") and shall not again be quoted or listed for
trading thereon within five (5) Trading Days of such delisting;

            (vi) The Obligor or any  subsidiary  of the Obligor shall be a party
to any Change of Control Transaction (as defined in Section 5);

            (vii)  The  Obligor  shall  fail  to  file  the  Underlying   Shares
Registration Statement (as defined in Section 5) with the Commission (as defined
in Section 5), or the Underlying  Shares  Registration  Statement shall not have
been declared effective by the Commission,  in each case within the time periods
set forth in the Investor  Registration Rights Agreement  ("Registration  Rights
Agreement") of even date herewith between the Obligor and the Holder;

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            (viii) If the  effectiveness of the Underlying  Shares  Registration
Statement  lapses for any reason or the Holder  shall not be permitted to resell
the shares of Common Stock underlying this Debenture under the Underlying Shares
Registration  Statement,  in either  case,  for more  than five (5)  consecutive
Trading  Days  or an  aggregate  of  eight  Trading  Days  (which  need  not  be
consecutive Trading Days);

            (ix) The Obligor  shall fail for any reason to deliver  Common Stock
certificates to a Holder prior to the fifth (5th) Trading Day after a Conversion
Date or the Obligor  shall  provide  notice to the Holder,  including  by way of
public  announcement,  at any time, of its intention not to comply with requests
for conversions of this Debenture in accordance with the terms hereof;

            (x) The Obligor  shall fail for any reason to deliver the payment in
cash pursuant to a Buy-In (as defined herein) within three (3) days after notice
is claimed delivered hereunder;

       (b) During the time that any portion of this Debenture is outstanding, if
any Event of Default has occurred,  the full principal amount of this Debenture,
together with interest and other amounts owing in respect  thereof,  to the date
of  acceleration  shall become at the  Holder's  election,  immediately  due and
payable in cash,  provided  however,  the Holder may request  (but shall have no
obligation to request) payment of such amounts in Common Stock of the Obligor. .
In addition to any other remedies,  the Holder shall have the right (but not the
obligation)  to convert this Debenture at any time after (x) an Event of Default
or (y) the Maturity Date at the Conversion Price then in-effect. The Holder need
not provide and the Obligor hereby waives any  presentment,  demand,  protest or
other notice of any kind, and the Holder may immediately and without  expiration
of any grace period enforce any and all of its rights and remedies hereunder and
all other remedies available to it under applicable law. Such declaration may be
rescinded and annulled by Holder at any time prior to payment hereunder. No such
rescission or annulment  shall affect any subsequent  Event of Default or impair
any right  consequent  thereon.  Upon an Event of Default,  notwithstanding  any
other provision of this Debenture or any Transaction Document,  the Holder shall
have no obligation to comply with or adhere to any  limitations,  if any, on the
conversion of this Debenture or the sale of the Underlying Shares.

      Section 3.  Conversion.

      (a) Conversion at Option of Holder.

            (i) This Debenture shall be convertible  into shares of Common Stock
at the  option of the  Holder,  in whole or in part at any time and from time to
time,  after the  Original  Issue Date (as defined in Section 5) (subject to the
limitations  on  conversion  set forth in Section  3(b)  hereof).  The number of
shares of Common Stock issuable upon a conversion  hereunder equals the quotient
obtained  by  dividing  (x)  the  outstanding  amount  of this  Debenture  to be
converted  by (y) the  Conversion  Price (as  defined in Section  3(c)(i)).  The
Obligor shall deliver Common Stock certificates to the Holder prior to the Fifth
(5th) Trading Day after a Conversion Date.

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            (ii)  Notwithstanding  anything to the contrary contained herein, if
on any  Conversion  Date:  (1) the number of shares of Common  Stock at the time
authorized, unissued and unreserved for all purposes, or held as treasury stock,
is  insufficient  to pay  principal  and interest  hereunder in shares of Common
Stock; (2) the Common Stock is not listed or quoted for trading on the OTC or on
a  Subsequent  Market;  (3)  the  Obligor  has  failed  to  timely  satisfy  its
conversion; or (4) the issuance of such shares of Common Stock would result in a
violation of Section 3(b),  then, at the option of the Holder,  the Obligor,  in
lieu of delivering  shares of Common Stock  pursuant to Section  3(a)(i),  shall
deliver,  within three (3) Trading Days of each applicable  Conversion  Date, an
amount in cash equal to the product of the  outstanding  principal  amount to be
converted  plus any interest  due therein  divided by the  Conversion  Price and
multiplied by the highest closing price of the stock from date of the conversion
notice till the date that such cash payment is made.

      Further,  if the Obligor shall not have  delivered any cash due in respect
of conversion of this  Debenture or as payment of interest  thereon by the fifth
(5th) Trading Day after the  Conversion  Date,  the Holder may, by notice to the
Obligor, require the Obligor to issue shares of Common Stock pursuant to Section
3(c), except that for such purpose the Conversion Price applicable thereto shall
be the lesser of the Conversion  Price on the Conversion Date and the Conversion
Price on the date of such Holder demand.  Any such shares will be subject to the
provisions of this Section.

            (iii) The Holder  shall  effect  conversions  by  delivering  to the
Obligor  a  completed  notice  in the  form  attached  hereto  as  Exhibit  A (a
"Conversion Notice").  The date on which a Conversion Notice is delivered is the
"Conversion  Date." Unless the Holder is converting the entire  principal amount
outstanding  under this  Debenture,  the Holder is not  required  to  physically
surrender  this  Debenture  to the  Obligor  in  order  to  effect  conversions.
Conversions  hereunder  shall  have  the  effect  of  lowering  the  outstanding
principal  amount of this Debenture plus all accrued and unpaid interest thereon
in an amount  equal to the  applicable  conversion.  The Holder and the  Obligor
shall maintain  records showing the principal  amount  converted and the date of
such conversions. In the event of any dispute or discrepancy, the records of the
Holder shall be controlling and determinative in the absence of manifest error.

      (b) Certain Conversion Restrictions.

            (i) A Holder may not convert  this  Debenture  or receive  shares of
Common Stock as payment of interest  hereunder to the extent such  conversion or
receipt of such interest  payment would result in the Holder,  together with any
affiliate thereof, beneficially owning (as determined in accordance with Section
13(d) of the Exchange  Act and the rules  promulgated  thereunder)  in excess of
4.9% of the then issued and outstanding shares of Common Stock, including shares
issuable upon  conversion of, and payment of interest on, this Debenture held by
such Holder  after  application  of this  Section.  Since the Holder will not be
obligated  to report to the Obligor the number of shares of Common  Stock it may
hold at the time of a conversion hereunder, unless the conversion at issue would
result in the  issuance of shares of Common  Stock in excess of 4.9% of the then
outstanding  shares of Common Stock without regard to any other shares which may
be beneficially  owned by the Holder or an affiliate  thereof,  the Holder shall
have the authority and obligation to determine whether the restriction contained
in this Section will limit any particular conversion hereunder and to the extent
that  the  Holder  determines  that the  limitation  contained  in this  Section
applies,  the  determination  of which portion of the  principal  amount of this
Debenture is  convertible  shall be the  responsibility  and  obligation  of the
Holder.  If the Holder has delivered a Conversion  Notice for a principal amount
of this  Debenture  that,  without regard to any other shares that the Holder or
its affiliates may  beneficially  own, would result in the issuance in excess of
the permitted amount hereunder, the Obligor shall notify the Holder of this fact
and shall honor the conversion for the maximum  principal amount permitted to be
converted on such Conversion  Date in accordance  with the periods  described in
Section  3(a)(i) and, at the option of the Holder,  either  retain any principal
amount tendered for conversion in excess of the permitted  amount  hereunder for
future  conversions or return such excess  principal  amount to the Holder.  The
provisions  of this Section may be waived by a Holder (but only as to itself and
not to any other Holder) upon not less than 65 days prior notice to the Obligor.
Other Holders shall be unaffected by any such waiver.

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            (ii)  Unless  waived by the  Obligor,  in no event shall the Holder,
together with its affiliates,  be entitled to convert,  at the Market Conversion
Price,  more than an aggregate of $100,000 of principal amount of this Debenture
together with all other  debentures  issued to the Holder in connection with the
Securities Purchase Agreement in any thirty (30) day period. Upon the occurrence
of an Event of Default,  the  restriction  set forth in this  section  shall not
apply.

      (c) Conversion Price and Adjustments to Conversion Price.

            (i) The Holder shall be entitled to convert,  at its sole option, at
any time a portion or all amounts of principal and interest due and  outstanding
under this Debenture into shares of the Obligor's  Common Stock at the lesser of
(i) a price equal to $0.35 (the "Fixed Conversion Price") or (ii) ninety percent
(90%) of the lowest Volume Weighted Average Price of the Common Stock during the
fifteen (15) trading days immediately preceding the Conversion Date as quoted by
Bloomberg,  LP (the "Market Conversion  Price").  The Fixed Conversion Price and
the Market  Conversion  Price are  collectively  referred to as the  "Conversion
Price." The Conversion Price may be adjusted pursuant to the other terms of this
Debenture.

             (ii)  If  the  Obligor,   at  any  time  while  this  Debenture  is
outstanding,  shall (a) pay a stock dividend or otherwise make a distribution or
distributions  on  shares  of its  Common  Stock or any  other  equity or equity
equivalent   securities  payable  in  shares  of  Common  Stock,  (b)  subdivide
outstanding  shares of Common Stock into a larger number of shares,  (c) combine
(including  by way of reverse  stock split)  outstanding  shares of Common Stock
into a smaller number of shares, or (d) issue by  reclassification  of shares of
the  Common  Stock any shares of capital  stock of the  Obligor,  then the Fixed
Conversion  Price shall be multiplied by a fraction of which the numerator shall
be the number of shares of Common  Stock  (excluding  treasury  shares,  if any)
outstanding  before such event and of which the denominator  shall be the number
of shares of Common Stock  outstanding  after such event.  Any  adjustment  made
pursuant to this Section  shall become  effective  immediately  after the record
date for the determination of stockholders  entitled to receive such dividend or
distribution and shall become effective  immediately after the effective date in
the case of a subdivision, combination or re-classification.

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            (iii)  If  the  Obligor,   at  any  time  while  this  Debenture  is
outstanding,  shall issue  rights,  options or warrants to all holders of Common
Stock (and not to the Holder) entitling them to subscribe for or purchase shares
of Common Stock at a price per share less than the Fixed Conversion  Price, then
the Fixed  Conversion  Price shall be  multiplied  by a  fraction,  of which the
denominator  shall be the  number  of  shares  of the  Common  Stock  (excluding
treasury  shares,  if any) outstanding on the date of issuance of such rights or
warrants  (plus the number of  additional  shares of Common  Stock  offered  for
subscription  or purchase),  and of which the  numerator  shall be the number of
shares of the Common Stock (excluding  treasury  shares,  if any) outstanding on
the date of issuance of such rights or warrants, plus the number of shares which
the  aggregate  offering  price of the total  number of shares so offered  would
purchase at the Fixed Conversion  Price.  Such adjustment shall be made whenever
such rights or warrants are issued, and shall become effective immediately after
the record date for the  determination of stockholders  entitled to receive such
rights,  options or warrants.  However,  upon the  expiration of any such right,
option or warrant to purchase  shares of the Common  Stock the issuance of which
resulted  in an  adjustment  in the  Fixed  Conversion  Price  pursuant  to this
Section,  if any such right,  option or warrant  shall expire and shall not have
been  exercised,   the  Fixed  Conversion  Price  shall  immediately  upon  such
expiration  be  recomputed  and effective  immediately  upon such  expiration be
increased  to the  price  which it would  have been  (but  reflecting  any other
adjustments  in the Fixed  Conversion  Price made pursuant to the  provisions of
this Section after the issuance of such rights or warrants)  had the  adjustment
of the Fixed Conversion Price made upon the issuance of such rights,  options or
warrants  been made on the basis of offering for  subscription  or purchase only
that number of shares of the Common Stock  actually  purchased upon the exercise
of such rights, options or warrants actually exercised.

            (iv) If the Obligor or any subsidiary thereof, as applicable, at any
time while this Debenture is outstanding,  shall issue shares of Common Stock or
rights, warrants,  options or other securities or debt that are convertible into
or  exchangeable  for  shares  of  Common  Stock  ("Common  Stock  Equivalents")
entitling  any Person to acquire  shares of Common  Stock,  at a price per share
less  than the Fixed  Conversion  Price (if the  holder of the  Common  Stock or
Common Stock  Equivalent  so issued  shall at any time,  whether by operation of
purchase price adjustments, reset provisions,  floating conversion,  exercise or
exchange  prices or otherwise,  or due to warrants,  options or rights per share
which is issued in connection with such issuance,  be entitled to receive shares
of Common  Stock at a price per  share  which is less than the Fixed  Conversion
Price,  such  issuance  shall be deemed to have occurred for less than the Fixed
Conversion Price),  then, at the sole option of the Holder, the Fixed Conversion
Price shall be adjusted to mirror the conversion, exchange or purchase price for
such Common Stock or Common Stock  Equivalents  (including any reset  provisions
thereof) at issue.  Such adjustment  shall be made whenever such Common Stock or
Common  Stock  Equivalents  are issued.  The Obligor  shall notify the Holder in
writing, no later than one (1) business day following the issuance of any Common
Stock or Common Stock Equivalent subject to this Section, indicating therein the
applicable  issuance  price,  or of  applicable  reset  price,  exchange  price,
conversion price and other pricing terms. No adjustment under this Section shall
be made as a result of issuances and exercises of options to purchase  shares of
Common Stock issued for compensatory  purposes  pursuant to any of the Obligor's
stock option or stock purchase plans.

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            (v) If the Obligor, at any time while this Debenture is outstanding,
shall  distribute  to all  holders  of  Common  Stock  (and  not to the  Holder)
evidences of its  indebtedness  or assets or rights or warrants to subscribe for
or purchase any security,  then in each such case the Fixed  Conversion Price at
which this  Debenture  shall  thereafter be  convertible  shall be determined by
multiplying the Fixed Conversion Price in effect immediately prior to the record
date  fixed  for   determination  of  stockholders   entitled  to  receive  such
distribution  by a fraction  of which the  denominator  shall be the Closing Bid
Price  determined  as of the  record  date  mentioned  above,  and of which  the
numerator shall be such Closing Bid Price on such record date less the then fair
market  value at such  record  date of the portion of such assets or evidence of
indebtedness so distributed  applicable to one  outstanding  share of the Common
Stock as determined by the Board of Directors in good faith.  In either case the
adjustments  shall be  described  in a  statement  provided to the Holder of the
portion  of  assets  or  evidences  of   indebtedness  so  distributed  or  such
subscription  rights  applicable to one share of Common Stock.  Such  adjustment
shall be made whenever any such  distribution is made and shall become effective
immediately after the record date mentioned above.

            (vi) In case of any  reclassification  of the  Common  Stock  or any
compulsory  share exchange  pursuant to which the Common Stock is converted into
other securities,  cash or property,  the Holder shall have the right thereafter
to, at its option, (A) convert the then outstanding  principal amount,  together
with all accrued but unpaid  interest and any other amounts then owing hereunder
in respect of this Debenture into the shares of stock and other securities, cash
and property receivable upon or deemed to be held by holders of the Common Stock
following  such  reclassification  or share  exchange,  and the  Holder  of this
Debenture  shall  be  entitled  upon  such  event  to  receive  such  amount  of
securities,  cash or property  as the shares of the Common  Stock of the Obligor
into which the then outstanding principal amount,  together with all accrued but
unpaid  interest and any other  amounts then owing  hereunder in respect of this
Debenture could have been converted  immediately prior to such  reclassification
or share exchange would have been entitled, or (B) require the Obligor to prepay
the outstanding principal amount of this Debenture,  plus all interest and other
amounts due and payable  thereon.  The entire  prepayment price shall be paid in
cash. This provision shall  similarly apply to successive  reclassifications  or
share exchanges.

            (vii) The Obligor shall at all times reserve and keep  available out
of its  authorized  Common  Stock the full  number  of  shares  of Common  Stock
issuable upon  conversion of all outstanding  amounts under this Debenture;  and
within  three (3)  Business  Days  following  the  receipt  by the  Obligor of a
Holder's  notice  that  such  minimum  number  of  Underlying  Shares  is not so
reserved,  the Obligor shall promptly  reserve a sufficient  number of shares of
Common Stock to comply with such requirement.

            (viii) All calculations  under this Section 3 shall be rounded up to
the nearest $0.001 or whole share.

            (ix) Whenever the Conversion Price is adjusted pursuant to Section 3
hereof, the Obligor shall promptly mail to the Holder a notice setting forth the
Conversion  Price after such  adjustment and setting forth a brief  statement of
the facts requiring such adjustment.

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            (x) If (A) the  Obligor  shall  declare  a  dividend  (or any  other
distribution)  on the Common  Stock;  (B) the  Obligor  shall  declare a special
nonrecurring  cash  dividend on or a  redemption  of the Common  Stock;  (C) the
Obligor  shall  authorize the granting to all holders of the Common Stock rights
or warrants to  subscribe  for or  purchase  any shares of capital  stock of any
class or of any  rights;  (D) the  approval of any  stockholders  of the Obligor
shall be required in connection with any  reclassification  of the Common Stock,
any  consolidation  or  merger  to which  the  Obligor  is a party,  any sale or
transfer  of all or  substantially  all of the  assets  of the  Obligor,  of any
compulsory  share  exchange  whereby the Common  Stock is  converted  into other
securities,  cash or property;  or (E) the Obligor shall authorize the voluntary
or  involuntary  dissolution,  liquidation  or winding up of the  affairs of the
Obligor;  then, in each case, the Obligor shall cause to be filed at each office
or agency maintained for the purpose of conversion of this Debenture,  and shall
cause to be mailed to the Holder at its last address as it shall appear upon the
stock books of the  Obligor,  at least  twenty (20)  calendar  days prior to the
applicable record or effective date hereinafter  specified, a notice stating (x)
the date on which a record  is to be taken  for the  purpose  of such  dividend,
distribution, redemption, rights or warrants, or if a record is not to be taken,
the date as of which the holders of the Common Stock of record to be entitled to
such  dividend,  distributions,   redemption,  rights  or  warrants  are  to  be
determined  or (y)  the  date on  which  such  reclassification,  consolidation,
merger,  sale,  transfer or share  exchange is expected to become  effective  or
close,  and the date as of which it is expected that holders of the Common Stock
of record  shall be entitled to exchange  their  shares of the Common  Stock for
securities,  cash or other  property  deliverable  upon  such  reclassification,
consolidation,  merger,  sale,  transfer or share exchange,  provided,  that the
failure to mail such  notice or any defect  therein  or in the  mailing  thereof
shall not affect the validity of the corporate  action  required to be specified
in such  notice.  The Holder is entitled to convert  this  Debenture  during the
20-day calendar period  commencing the date of such notice to the effective date
of the event triggering such notice.

            (xi) In case of any (1) merger or  consolidation  of the  Obligor or
any  subsidiary of the Obligor with or into another  Person,  or (2) sale by the
Obligor or any  subsidiary of the Obligor of more than one-half of the assets of
the Obligor in one or a series of related transactions,  a Holder shall have the
right to (A) exercise any rights under Section  2(b),  (B) convert the aggregate
amount of this  Debenture  then  outstanding  into the shares of stock and other
securities, cash and property receivable upon or deemed to be held by holders of
Common Stock following such merger, consolidation or sale, and such Holder shall
be entitled  upon such event or series of related  events to receive such amount
of  securities,  cash and property as the shares of Common Stock into which such
aggregate   principal  amount  of  this  Debenture  could  have  been  converted
immediately  prior to such  merger,  consolidation  or  sales  would  have  been
entitled, or (C) in the case of a merger or consolidation, require the surviving
entity to issue to the Holder a convertible  Debenture  with a principal  amount
equal to the  aggregate  principal  amount of this  Debenture  then held by such
Holder,  plus all accrued and unpaid  interest and other amounts owing  thereon,
which such  newly  issued  convertible  Debenture  shall  have  terms  identical
(including with respect to conversion) to the terms of this Debenture, and shall
be entitled to all of the rights and  privileges of the Holder of this Debenture
set forth  herein and the  agreements  pursuant  to which this  Debentures  were
issued. In the case of clause (C), the conversion price applicable for the newly
issued shares of convertible preferred stock or convertible  Debentures shall be
based upon the amount of securities, cash and property that each share of Common
Stock  would  receive in such  transaction  and the  Conversion  Price in effect
immediately prior to the effectiveness or closing date for such transaction. The
terms of any such merger,  sale or consolidation  shall include such terms so as
to  continue to give the Holder the right to receive  the  securities,  cash and
property set forth in this Section upon any  conversion or redemption  following
such event. This provision shall similarly apply to successive such events.

                                       9
<PAGE>

      (d) Other Provisions.

            (i) The Obligor covenants that it will at all times reserve and keep
available out of its authorized  and unissued  shares of Common Stock solely for
the  purpose of  issuance  upon  conversion  of this  Debenture  and  payment of
interest on this Debenture, each as herein provided, free from preemptive rights
or any other actual contingent purchase rights of persons other than the Holder,
not less than such number of shares of the Common Stock as shall (subject to any
additional  requirements  of the  Obligor as to  reservation  of such shares set
forth in this  Debenture) be issuable  (taking into account the  adjustments and
restrictions  of Sections 2(b) and 3(c)) upon the conversion of the  outstanding
principal  amount of this  Debenture  and  payment of  interest  hereunder.  The
Obligor  covenants  that all shares of Common  Stock  that shall be so  issuable
shall,  upon  issue,  be duly and  validly  authorized,  issued and fully  paid,
nonassessable  and, if the  Underlying  Shares  Registration  Statement has been
declared  effective  under the  Securities  Act,  registered  for public sale in
accordance with such Underlying Shares Registration Statement.

            (ii) Upon a conversion  hereunder  the Obligor shall not be required
to issue  stock  certificates  representing  fractions  of shares of the  Common
Stock,  but may if  otherwise  permitted,  make a cash payment in respect of any
final  fraction of a share  based on the Closing Bid Price at such time.  If the
Obligor elects not, or is unable, to make such a cash payment,  the Holder shall
be  entitled  to receive,  in lieu of the final  fraction of a share,  one whole
share of Common Stock.

            (iii) The issuance of certificates for shares of the Common Stock on
conversion of this Debenture  shall be made without charge to the Holder thereof
for any documentary stamp or similar taxes that may be payable in respect of the
issue or delivery of such  certificate,  provided  that the Obligor shall not be
required to pay any tax that may be payable in respect of any transfer  involved
in the issuance and delivery of any such  certificate  upon conversion in a name
other than that of the Holder of such  Debenture  so  converted  and the Obligor
shall not be required to issue or deliver such certificates  unless or until the
person or persons requesting the issuance thereof shall have paid to the Obligor
the  amount of such tax or shall have  established  to the  satisfaction  of the
Obligor that such tax has been paid.

            (iv) Nothing  herein shall limit a Holder's  right to pursue  actual
damages  or declare  an Event of  Default  pursuant  to Section 2 herein for the
Obligor 's failure to deliver  certificates  representing shares of Common Stock
upon conversion  within the period  specified  herein and such Holder shall have
the right to pursue all remedies  available to it at law or in equity including,
without limitation,  a decree of specific  performance and/or injunctive relief,
in each case  without  the need to post a bond or provide  other  security.  The
exercise  of any such  rights  shall not  prohibit  the Holder  from  seeking to
enforce damages pursuant to any other Section hereof or under applicable law.

                                       10
<PAGE>

            (v) In addition to any other rights available to the Holder,  if the
Obligor fails to deliver to the Holder such certificate or certificates pursuant
to Section 3(a)(i) by the fifth (5th) Trading Day after the Conversion Date, and
if after such fifth (5th)  Trading Day the Holder  purchases  (in an open market
transaction or otherwise)  Common Stock to deliver in  satisfaction of a sale by
such Holder of the Underlying Shares which the Holder anticipated receiving upon
such  conversion  (a  "Buy-In"),  then the Obligor  shall (A) pay in cash to the
Holder (in addition to any  remedies  available to or elected by the Holder) the
amount by which (x) the  Holder's  total  purchase  price  (including  brokerage
commissions,  if any) for the Common Stock so purchased  exceeds (y) the product
of (1) the  aggregate  number  of  shares  of  Common  Stock  that  such  Holder
anticipated  receiving from the conversion at issue multiplied by (2) the market
price of the Common  Stock at the time of the sale giving rise to such  purchase
obligation  and (B) at the option of the Holder,  either  reissue a Debenture in
the principal amount equal to the principal  amount of the attempted  conversion
or deliver  to the  Holder the number of shares of Common  Stock that would have
been issued had the Obligor timely complied with its delivery requirements under
Section  3(a)(i).  For example,  if the Holder  purchases  Common Stock having a
total  purchase  price of $11,000 to cover a Buy-In with respect to an attempted
conversion  of  Debentures  with  respect  to  which  the  market  price  of the
Underlying  Shares on the date of conversion was a total of $10,000 under clause
(A) of the immediately preceding sentence,  the Obligor shall be required to pay
the  Holder  $1,000.  The  Holder  shall  provide  the  Obligor  written  notice
indicating the amounts payable to the Holder in respect of the Buy-In.

      Section 4. Notices. Any notices, consents, waivers or other communications
required or  permitted to be given under the terms hereof must be in writing and
will be  deemed  to have  been  delivered:  (i)  upon  receipt,  when  delivered
personally;  (ii) upon receipt, when sent by facsimile (provided confirmation of
transmission is mechanically or electronically generated and kept on file by the
sending  party);  or (iii) one (1) trading day after  deposit  with a nationally
recognized  overnight  delivery service,  in each case properly addressed to the
party to  receive  the  same.  The  addresses  and  facsimile  numbers  for such
communications shall be:

If to the Company, to:          Sensor System Solutions, Inc.
                                45 Parker Avenue, Suite A
                                Irvine, CA 92618
                                Attention:  Michael Young, CEO
                                Telephone:  (949) 855-6688
                                Facsimile:  (949) 855-6685

With a copy to:                 Kirkpatrick & Lockhart Nicholson Graham, LLP
                                201 South Biscayne Boulevard, Suite 2000
                                Miami, Florida 33131
                                Attention:  Clayton E. Parker, Esq.
                                Telephone:  (305) 539-3306

If to the Holder:               Cornell Capital Partners, LP
                                101 Hudson Street, Suite 3700
                                Jersey City, NJ  07303
                                Attention:  Mark Angelo
                                Telephone:  (201) 985-8300

                                       11
<PAGE>

With a copy to:                 David Gonzalez, Esq.
                                101 Hudson Street - Suite 3700
                                Jersey City, NJ 07302
                                Telephone:  (201) 985-8300
                                Facsimile:  (201) 985-8266

or at such other address and/or facsimile number and/or to the attention of such
other person as the  recipient  party has  specified by written  notice given to
each other  party three (3)  business  days prior to the  effectiveness  of such
change.  Written  confirmation  of receipt  (i) given by the  recipient  of such
notice,   consent,   waiver  or  other   communication,   (ii)  mechanically  or
electronically  generated by the sender's facsimile machine containing the time,
date,  recipient  facsimile  number  and an  image  of the  first  page  of such
transmission  or (iii) provided by a nationally  recognized  overnight  delivery
service, shall be rebuttable evidence of personal service,  receipt by facsimile
or receipt from a nationally recognized overnight delivery service in accordance
with clause (i), (ii) or (iii) above, respectively.

      Section 5. Definitions. For the purposes hereof, the following terms shall
have the following meanings:

      "Business  Day"  means any day except  Saturday,  Sunday and any day which
shall be a federal  legal holiday in the United States or a day on which banking
institutions  are  authorized or required by law or other  government  action to
close.

      "Change of Control Transaction" means the occurrence of (a) an acquisition
after the date hereof by an  individual or legal entity or "group" (as described
in Rule  13d-5(b)(1)  promulgated  under the Exchange Act) of effective  control
(whether through legal or beneficial  ownership of capital stock of the Obligor,
by  contract or  otherwise)  of in excess of fifty  percent  (50%) of the voting
securities of the Obligor (except that the  acquisition of voting  securities by
the Holder  shall not  constitute a Change of Control  Transaction  for purposes
hereof), (b) a replacement at one time or over time of more than one-half of the
members of the board of  directors  of the  Obligor  which is not  approved by a
majority of those  individuals  who are members of the board of directors on the
date hereof (or by those  individuals who are serving as members of the board of
directors on any date whose nomination to the board of directors was approved by
a majority of the members of the board of directors  who are members on the date
hereof), (c) the merger, consolidation or sale of fifty percent (50%) or more of
the assets of the Obligor or any subsidiary of the Obligor in one or a series of
related  transactions  with or into another entity,  or (d) the execution by the
Obligor of an agreement to which the Obligor is a party or by which it is bound,
providing for any of the events set forth above in (a), (b) or (c).

      "Commission" means the Securities and Exchange Commission.

      "Common Stock" means the common stock,  par value $.01, of the Obligor and
stock of any other  class  into which such  shares may  hereafter  be changed or
reclassified.

                                       12
<PAGE>

      "Conversion  Date"  shall mean the date upon  which the  Holder  gives the
Obligor  notice of their  intention to effectuate a conversion of this Debenture
into shares of the Company's Common Stock as outlined herein.

      "Closing Bid Price" means the price per share in the last  reported  trade
of the Common Stock on the OTC or on the exchange which the Common Stock is then
listed as quoted by Bloomberg, LP.

      "Exchange Act" means the Securities Exchange Act of 1934, as amended.

      "Original  Issue Date"  shall mean the date of the first  issuance of this
Debenture  regardless of the number of transfers and regardless of the number of
instruments, which may be issued to evidence such Debenture.

      "Person" means a corporation, an association, a partnership, organization,
a business,  an individual,  a government or political  subdivision thereof or a
governmental agency.

       "Securities  Act" means the Securities  Act of 1933, as amended,  and the
rules and regulations promulgated thereunder.

      "Trading  Day" means a day on which the shares of Common  Stock are quoted
on the OTC or quoted or traded on such Subsequent  Market on which the shares of
Common  Stock are then  quoted or listed;  provided,  that in the event that the
shares of Common  Stock are not listed or quoted,  then Trading Day shall mean a
Business Day.

      "Transaction  Documents"  means the Securities  Purchase  Agreement or any
other agreement  delivered in connection with the Securities Purchase Agreement,
including,  without  limitation,  the Insider  Pledge  Agreement,  the  Security
Agreement.  the Irrevocable  Transfer Agent  Instructions,  and the Registration
Rights Agreement.

      "Underlying  Shares"  means  the  shares  of Common  Stock  issuable  upon
conversion of this  Debenture or as payment of interest in  accordance  with the
terms hereof.

      "Underlying Shares Registration  Statement" means a registration statement
meeting  the  requirements  set  forth  in the  Registration  Rights  Agreement,
covering among other things the resale of the  Underlying  Shares and naming the
Holder as a "selling stockholder" thereunder.

      Section 6. Except as  expressly  provided  herein,  no  provision  of this
Debenture  shall  alter or impair  the  obligations  of the  Obligor,  which are
absolute and unconditional,  to pay the principal of, interest and other charges
(if any) on, this  Debenture at the time,  place,  and rate,  and in the coin or
currency,  herein  prescribed.  This  Debenture  is a direct  obligation  of the
Obligor.  This  Debenture  ranks  pari passu  with all other  Debentures  now or
hereafter issued under the terms set forth herein.  As long as this Debenture is
outstanding,  the Obligor shall not and shall cause their  subsidiaries  not to,
without the consent of the Holder,  (i) amend its certificate of  incorporation,
bylaws or other  charter  documents so as to adversely  affect any rights of the
Holder;  (ii)  repay,  repurchase  or offer to repay,  repurchase  or  otherwise
acquire shares of its Common Stock or other equity  securities  other than as to
the Underlying  Shares to the extent permitted or required under the Transaction
Documents;  or  (iii)  enter  into  any  agreement  with  respect  to any of the
foregoing.

                                       13
<PAGE>

      Section  7. This  Debenture  shall not  entitle  the  Holder to any of the
rights of a stockholder of the Obligor,  including without limitation, the right
to vote, to receive dividends and other distributions,  or to receive any notice
of, or to attend,  meetings  of  stockholders  or any other  proceedings  of the
Obligor,  unless  and to the extent  converted  into  shares of Common  Stock in
accordance with the terms hereof.

      Section 8. If this Debenture is mutilated,  lost, stolen or destroyed, the
Obligor shall  execute and deliver,  in exchange and  substitution  for and upon
cancellation of the mutilated Debenture,  or in lieu of or in substitution for a
lost, stolen or destroyed Debenture, a new Debenture for the principal amount of
this Debenture so mutilated,  lost, stolen or destroyed but only upon receipt of
evidence  of such  loss,  theft or  destruction  of such  Debenture,  and of the
ownership hereof, and indemnity,  if requested,  all reasonably  satisfactory to
the Obligor.

      Section 9. No  indebtedness  of the Obligor is senior to this Debenture in
right of payment, whether with respect to interest,  damages or upon liquidation
or dissolution or otherwise.  Without the Holder's consent, the Obligor will not
and will not permit any of their subsidiaries to, directly or indirectly,  enter
into, create,  incur, assume or suffer to exist any indebtedness of any kind, on
or with respect to any of its property or assets now owned or hereafter acquired
or any  interest  therein or any income or profits  there from that is senior in
any respect to the obligations of the Obligor under this Debenture.

      Section  10.  This  Debenture  shall  be  governed  by  and  construed  in
accordance  with the laws of the State of New Jersey,  without  giving effect to
conflicts of laws thereof.  Each of the parties  consents to the jurisdiction of
the Superior  Courts of the State of New Jersey  sitting in Hudson  County,  New
Jersey and the U.S.  District  Court for the  District of New Jersey  sitting in
Newark,  New Jersey in connection  with any dispute arising under this Debenture
and hereby  waives,  to the maximum  extent  permitted  by law,  any  objection,
including  any  objection  based on forum non  conveniens to the bringing of any
such proceeding in such jurisdictions.

      Section 11. If the Obligor fails to strictly comply with the terms of this
Debenture,  then the Obligor shall  reimburse the Holder  promptly for all fees,
costs and expenses, including, without limitation,  attorneys' fees and expenses
incurred  by the  Holder  in any  action  in  connection  with  this  Debenture,
including, without limitation, those incurred: (i) during any workout, attempted
workout,  and/or in  connection  with the  rendering  of legal  advice as to the
Holder's rights, remedies and obligations, (ii) collecting any sums which become
due  to the  Holder,  (iii)  defending  or  prosecuting  any  proceeding  or any
counterclaim to any proceeding or appeal;  or (iv) the protection,  preservation
or enforcement of any rights or remedies of the Holder.

      Section 12. Any waiver by the Holder of a breach of any  provision of this
Debenture  shall  not  operate  as or be  construed  to be a waiver of any other
breach  of such  provision  or of any  breach  of any  other  provision  of this
Debenture. The failure of the Holder to insist upon strict adherence to any term
of this Debenture on one or more  occasions  shall not be considered a waiver or
deprive that party of the right  thereafter  to insist upon strict  adherence to
that term or any other term of this Debenture. Any waiver must be in writing.

                                       14
<PAGE>

      Section 13. If any  provision  of this  Debenture  is invalid,  illegal or
unenforceable,  the balance of this Debenture shall remain in effect, and if any
provision is inapplicable to any person or circumstance,  it shall  nevertheless
remain applicable to all other persons and  circumstances.  If it shall be found
that any interest or other amount deemed  interest due  hereunder  shall violate
applicable laws governing  usury,  the applicable rate of interest due hereunder
shall  automatically be lowered to equal the maximum permitted rate of interest.
The Obligor  covenants  (to the extent that it may lawfully do so) that it shall
not at any time insist upon,  plead, or in any manner  whatsoever  claim or take
the benefit or advantage of, any stay, extension or usury law or other law which
would  prohibit  or forgive  the  Obligor  from paying all or any portion of the
principal of or interest on this  Debenture  as  contemplated  herein,  wherever
enacted,  now or at any time  hereafter  in  force,  or  which  may  affect  the
covenants or the performance of this  indenture,  and the Obligor (to the extent
it may lawfully do so) hereby  expressly waives all benefits or advantage of any
such law,  and  covenants  that it will not, by resort to any such law,  hinder,
delay or impeded the  execution of any power herein  granted to the Holder,  but
will  suffer and permit  the  execution  of every such as though no such law has
been enacted.

      Section 14.  Whenever any payment or other  obligation  hereunder shall be
due on a day other than a Business  Day,  such payment shall be made on the next
succeeding Business Day.

      Section 15. THE PARTIES HEREBY  KNOWINGLY,  VOLUNTARILY AND  INTENTIONALLY
WAIVE  THE  RIGHT  ANY OF THEM  MAY HAVE TO A TRIAL  BY JURY IN  RESPECT  OF ANY
LITIGATION  BASED  HEREON OR ARISING OUT OF,  UNDER OR IN  CONNECTION  WITH THIS
AGREEMENT  OR ANY  TRANSACTION  DOCUMENT  OR ANY  COURSE OF  CONDUCT,  COURSE OF
DEALING,  STATEMENTS  (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY.  THIS
PROVISION  IS  A  MATERIAL  INDUCEMENT  FOR  THE  PARTIES'  ACCEPTANCE  OF  THIS
AGREEMENT.

                    [REMAINDER OF PAGE INTENTIONLLY LEFT BLANK]

                                       15
<PAGE>

      IN WITNESS  WHEREOF,  the  Obligor  has caused  this  Secured  Convertible
Debenture to be duly  executed by a duly  authorized  officer as of the date set
forth above.

                                         SENSOR SYSTEM SOLUTIONS, INC.

                                         By:
                                            ---------------------------
                                         Name: Michael Young
                                         Title: Chief Executive Officer

                                       16
<PAGE>

                                   EXHIBIT "A"

                              NOTICE OF CONVERSION

        (To be executed by the Holder in order to convert the Debenture)

TO:

      The  undersigned  hereby  irrevocably  elects to convert  $_______  of the
principal  amount of the above  Debenture  into Shares of Common Stock of Sensor
System Solutions,  Inc.,  according to the conditions stated therein,  as of the
Conversion Date written below.

Conversion Date:
                              --------------------------------------------------
Applicable Conversion Price:
                              --------------------------------------------------
Signature:
                              --------------------------------------------------
Name:
                              --------------------------------------------------
Address:
                              --------------------------------------------------
Amount to be converted:       $
                              --------------------------------------------------
Amount     of      Debenture
unconverted:                  $
                              --------------------------------------------------
Conversion Price per share:   $
                              --------------------------------------------------
Number  of  shares of Common
Stock to be issued:
                              --------------------------------------------------
Please  issue the  shares of
Common    Stock    in    the
following  name  and  to the
following address:
                              --------------------------------------------------
Issue to:
                              --------------------------------------------------
Authorized Signature:
                              --------------------------------------------------
Name:
                              --------------------------------------------------
Title:
                              --------------------------------------------------
Phone Number:
                              --------------------------------------------------
Broker DTC Participant Code:
                              --------------------------------------------------
Account Number:
                              --------------------------------------------------EXHIBIT 10.4

                               SECURITY AGREEMENT

      THIS  SECURITY  AGREEMENT  (the  "Agreement"),  is  entered  into and made
effective as of December 23, 2005, by and between SENSOR SYSTEM SOLUTIONS, INC.,
a Nevada  corporation  with its principal place of business located at 45 Parker
Avenue,  Suite A, Irvine,  CA 92618 (the "Company"),  and the BUYER(S) listed on
Schedule I attached to the Securities  Purchase  Agreement dated the date hereof
(the "Secured Party").

      WHEREAS,  the  Company  shall  issue  and sell to the  Secured  Party,  as
provided in the Securities  Purchase Agreement of even date herewith between the
Company and the Secured Party (the  "Securities  Purchase  Agreement"),  and the
Secured Party shall purchase up to One Million  Dollars  ($1,000,000) of secured
convertible   debentures  (the   "Convertible   Debentures"),   which  shall  be
convertible  into shares of the  Company's  common  stock,  par value $0.01 (the
"Common  Stock") (as  converted,  the  "Conversion  Shares")  in the  respective
amounts  set forth  opposite  each  Buyer(s)  name on Schedule I attached to the
Securities Purchase Agreement;

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

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

                                   ARTICLE 1.

                         DEFINITIONS AND INTERPRETATIONS

      Section 1.1.      Recitals.

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

<PAGE>

      Section 1.2.      Interpretations.

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

      Section 1.3.      Obligations Secured.

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

                                   ARTICLE 2.

                 PLEDGED PROPERTY, ADMINISTRATION OF COLLATERAL
                      AND TERMINATION OF SECURITY INTEREST

      Section 2.1.      Pledged Property.

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

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

      Section 2.2.      Rights; Interests; Etc.

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

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

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

                                       2
<PAGE>

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

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

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

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

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

                                   ARTICLE 3.

                          ATTORNEY-IN-FACT; PERFORMANCE

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

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

                                       3
<PAGE>

      Section 3.2.      Secured Party May Perform.

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

                                   ARTICLE 4.

                         REPRESENTATIONS AND WARRANTIES

      Section 4.1.      Authorization; Enforceability.
                        -----------------------------

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

      Section 4.2.      Ownership of Pledged Property.
                        -----------------------------

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

                                   ARTICLE 5.

                    DEFAULT; REMEDIES; SUBSTITUTE COLLATERAL

      Section 5.1.      Default and Remedies.

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

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

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

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

                                       4
<PAGE>

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

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

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

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

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

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

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

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

      Section 5.3.      Proofs of Claim.

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

                                       5
<PAGE>

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

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

      Section 5.4.      Duties Regarding Pledged Property.

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

                                   ARTICLE 6.

                              AFFIRMATIVE COVENANTS

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

      Section 6.1.      Existence, Properties, Etc.

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

                                       6
<PAGE>

      Section 6.2.      Financial Statements and Reports.

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

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

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

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

      Section 6.3.      Accounts and Reports.

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

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

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

                                       7
<PAGE>

      Section 6.4.      Maintenance of Books and Records; Inspection.

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

      Section 6.5.      Maintenance and Insurance.

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

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

      Section 6.6.      Contracts and Other Collateral.

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

      Section 6.7.      Defense of Collateral, Etc.

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

      Section 6.8.      Payment of Debts, Taxes, Etc.

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

                                       8
<PAGE>

      Section 6.9.      Taxes and Assessments; Tax Indemnity.

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

      Section 6.10.     Compliance with Law and Other Agreements.

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

      Section 6.11.     Notice of Default.

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

      Section 6.12.     Notice of Litigation.

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

                                       9
<PAGE>

                                   ARTICLE 7.

                               NEGATIVE COVENANTS

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

      Section 7.1.      Indebtedness.

      The  Company  shall not  directly or  indirectly  permit,  create,  incur,
assume, permit to exist,  increase,  renew or extend on or after the date hereof
any indebtedness on its part,  including  commitments,  contingencies and credit
availabilities, or apply for or offer or agree to do any of the foregoing.

      Section 7.2.      Liens and Encumbrances.

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

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

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

      Section 7.4.      Management, Ownership.

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

                                       10
<PAGE>

      Section 7.5.      Dividends, Etc.

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

      Section 7.6.      Guaranties; Loans.

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

      Section 7.7.      Debt.

      The  Company  shall  not  create,  incur,  assume  or  suffer to exist any
additional  indebtedness of any description whatsoever in an aggregate amount in
excess of $25,000  (excluding  any  indebtedness  of the  Company to the Secured
Party,  trade  accounts  payable and accrued  expenses  incurred in the ordinary
course of business and the endorsement of negotiable  instruments payable to the
Company,  respectively  for  deposit or  collection  in the  ordinary  course of
business).

      Section 7.8.      Conduct of Business.

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

      Section 7.9.      Places of Business.

      The location of the Company's chief place of business is 45 Parker Avenue,
Suite A,  Irvine,  CA 92618.  The Company  shall not change the  location of its
chief  place of  business,  chief  executive  office  or any  place of  business
disclosed  to the  Secured  Party or move any of the Pledged  Property  from its
current  location  without thirty (30) days' prior written notice to the Secured
Party in each instance.

                                       11
<PAGE>

                                   ARTICLE 8.

                                  MISCELLANEOUS

      Section 8.1.      Notices.

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

If to the Secured Party:     Cornell Capital Partners, LP
                             101 Hudson Street-Suite 3700
                             Jersey City, New Jersey 07302
                             Attention:  Mark Angelo
                                         Portfolio Manager
                             Telephone:  (201) 986-8300
                             Facsimile:  (201) 985-8266

With a copy to:              David Gonzalez, Esq.
                             101 Hudson Street, Suite 3700
                             Jersey City, NJ 07302
                             Telephone:  (201) 985-8300
                             Facsimile:  (201) 985-8266

And if to the Company:       Sensor System Solutions, Inc.
                             45 Parker Avenue, Suite A
                             Irvine, CA 92618
                             Attention:  Michael Young, CEO
                             Telephone:  (949) 855-6688
                             Facsimile:  (949) 855-6685

With a copy to:              Kirkpatrick & Lockhart Nicholson Graham, LLP
                             201 South Biscayne Boulevard, Suite 2000
                             Miami, Florida 33131
                             Attention:  Clayton E. Parker, Esq.
                             Telephone:  (305) 539-3306
                             Facsimile:  (305) 328-7095

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

      Section 8.2.      Severability.

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

                                       12
<PAGE>

      Section 8.3.      Expenses.

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

      Section 8.4.      Waivers, Amendments, Etc.

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

      Section 8.5.      Continuing Security Interest.

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

      Section 8.6.      Independent Representation.

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

      Section 8.7.      Applicable Law:  Jurisdiction.

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

                                       13
<PAGE>

      Section 8.8.      Waiver of Jury Trial.

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

      Section 8.9.      Entire Agreement.

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

                 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       14
<PAGE>

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

                                        COMPANY:
                                        SENSOR SYSTEM SOLUTIONS, INC.

                                        By:
                                           ---------------------------
                                        Name: Michael Young
                                        Title: Chief Executive Officer

                                        SECURED PARTY:
                                        CORNELL CAPITAL PARTNERS, LP

                                        By:   Yorkville Advisors, LLC
                                        Its:  General Partner

                                        By:
                                           ---------------------------
                                        Name: Mark Angelo
                                        Title: Portfolio Manager

                                       15
<PAGE>

                                    EXHIBIT A
                         DEFINITION OF PLEDGED PROPERTY

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

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

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

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

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

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

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

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

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