Document:

Exhibit 10.23

    SECURITY
      AGREEMENT

    

    SECURITY
      AGREEMENT (this “Agreement”),
      dated
      as of February 10, 2006, by and among Eagle Broadband, Inc., a Texas corporation
      (“Company”),
      and
      Dutchess Private Equities Fund, LP, a Delaware Limited partnership, as the
      secured parties signatory hereto and their respective endorsees, transferees
      and
      assigns (collectively, the “Secured
      Party”).
      

    

    W
      I T N E
      S S E T H:

    

    WHEREAS,
      pursuant to Subscription Agreement, dated the date hereof between Company and
      the Secured Party (the “Subscription
      Agreement”),
      Company has agreed to issue to the Secured Party and the Secured Party has
      agreed to purchase from Company certain of Company’s twelve percent (12%)
      Secured Convertible Debentures, due five years from the date of issue (the
      “Debentures”),
      which
      are convertible into shares of Company’s Common Stock, par value $.001 per share
      (the “Common
      Stock”).
      In
      connection therewith, Company shall issue the Secured Party certain Common
      Stock
      purchase warrants dated as of the date hereof to purchase the number of shares
      of Common Stock (the “Warrants”);
      and

    

    WHEREAS,
      in order to induce the Secured Party to purchase the Debentures, Company has
      agreed to execute and deliver to the Secured Party this Agreement for the
      benefit of the Secured Party and to grant to it a first priority security
      interest in certain property of Company to secure the prompt payment,
      performance and discharge in full of all of Company’s obligations under the
      Debentures and exercise and discharge in full of Company’s obligations under the
      Warrants.

    

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

    

    1.  Certain
      Definitions.
      As used
      in this Agreement, the following terms shall have the meanings set forth in
      this
      Section 1. Terms used but not otherwise defined in this Agreement that are
      defined in Article 9 of the UCC (such as “general
      intangibles”
and
      “proceeds”)
      shall
      have the respective meanings given such terms in Article 9 of the
      UCC.

    (a)  “Collateral”
means
      the collateral in which the Secured Party is granted a security interest by
      this
      Agreement and which shall include the following, whether presently owned or
      existing or hereafter acquired or coming into existence, and all additions
      and
      accessions thereto and all substitutions and replacements thereof, and all
      proceeds, products and accounts thereof, including, without limitation, all
      proceeds from the sale or transfer of the Collateral and of insurance covering
      the same and of any tort claims in connection therewith, excluding ONLY the
      assets of D.S.S Security, Inc. and the lease agreement with Aerovision
      Technologies, Inc. (the "Exclusions")

    (i)  All
      Goods
      of the Company, including, without limitations, all machinery, equipment,
      computers, motor vehicles, trucks, tanks, boats, ships, appliances, furniture,
      special and general tools, fixtures, test and quality control devices and other
      equipment of every kind and nature and wherever situated, together with all
      documents of title and documents representing the same, all additions and
      accessions thereto, replacements therefor, all parts therefor, and all
      substitutes for any of the foregoing and all other items used and useful in
      connection with the Company’s businesses and all improvements thereto
      (collectively, the “Equipment”);
      and

    

     

    (ii)  All
      Inventory of the Company; and

    

     

    (iii)  All
      of
      the Company’s contract rights and general intangibles, including, without
      limitation, all partnership interests, stock or other securities, licenses,
      distribution and other agreements, computer software development rights, leases,
      franchises, customer lists, quality control procedures, grants and rights,
      goodwill, trademarks, service marks, trade styles, trade names, patents, patent
      applications, copyrights, deposit accounts, and income tax refunds
      (collectively, the “General
      Intangibles”);
      and

    

     

    (iv)  All
      Receivables of the Company including all insurance proceeds, and rights to
      refunds or indemnification whatsoever owing, together with all instruments,
      all
      documents of title representing any of the foregoing, all rights in any
      merchandising, goods, equipment, motor vehicles and trucks which any of the
      same
      may represent, and all right, title, security and guaranties with respect to
      each Receivable, including any right of stoppage in transit; and

    

     

    (v)  All
      of
      the Company’s documents, instruments and chattel paper, files, records, books of
      account, business papers, computer programs and the products and proceeds of
      all
      of the foregoing Collateral set forth in clauses (i)-(iv) above.

    

     

    (b)  “Company”
shall
      mean, collectively, Company and all of the subsidiaries of Company, a list
      of
      which is contained in Schedule
      A,
      attached hereto.

    

     

    (c)  “Obligations”
means
      all of the Company’s obligations under this Agreement and the Debentures, in
      each case, whether now or hereafter existing, voluntary or involuntary, direct
      or indirect, absolute or contingent, liquidated or unliquidated, whether or
      not
      jointly owed with others, and whether or not from time to time decreased or
      extinguished and later decreased, created or incurred, and all or any portion
      of
      such obligations or liabilities that are paid, to the extent all or any part
      of
      such payment is avoided or recovered directly or indirectly from the Secured
      Party as a preference, fraudulent transfer or otherwise as such obligations
      may
      be amended, supplemented, converted, extended or modified from time to
      time.

    

     

    (d)  “UCC”
means
      the Uniform Commercial Code, as currently in effect in the Commonwealth of
      Massachusetts.

    

     

    2.  Grant
      of Security Interest.
      As an
      inducement for the Secured Party to purchase the Debentures and to secure the
      complete and timely payment, performance and discharge in full, as the case
      may
      be, of all of the Obligations, the Company hereby, unconditionally and
      irrevocably, pledges, grants and hypothecates to the Secured Party, a continuing
      security interest in, a continuing first lien upon, an unqualified right to
      possession and disposition of and a right of set-off against, in each case
      to
      the fullest extent permitted by law, all of the Company’s right, title and
      interest of whatsoever kind and nature in and to the Collateral (the
“Security
      Interest”).

    

     

    3.  Representations,
      Warranties, Covenants and Agreements of the Company.
      The
      Company represents and warrants to, and covenants and agrees with, the Secured
      Party as follows: 

    

     

    (a)  The
      Company has the requisite corporate power and authority to enter into this
      Agreement and otherwise to carry out its obligations thereunder. The execution,
      delivery and performance by the Company of this Agreement and the filings
      contemplated therein have been duly authorized by all necessary action on the
      part of the Company and no further action is required by the Company. This
      Agreement constitutes a legal, valid and binding obligation of the Company
      enforceable in accordance with its terms, except as enforceability may be
      limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
      affecting the enforcement of creditor’s rights generally.

    

     

    (b)  The
      Company represents and warrants that it has no place of business or offices
      where its respective books of account and records are kept (other than
      temporarily at the offices of its attorneys or accountants) or places where
      Collateral is stored or located, except as set forth on Schedule
      A
      attached
      hereto;

    

     

    (c)  The
      Company is the sole owner of the Collateral (except for non-exclusive licenses
      granted by the Company in the ordinary course of business), free and clear
      of
      any liens (except for the liens identified in the Investment Agreement),
      security interests, encumbrances, rights or claims, and is fully authorized
      to
      grant the Security Interest in and to pledge the Collateral. There is not on
      file in any governmental or regulatory authority, agency or recording office
      an
      effective financing statement, security agreement, license or transfer or any
      notice of any of the foregoing (other than those that have been filed in favor
      of the Secured Party pursuant to this Agreement) covering or affecting any
      of
      the Collateral. So long as this Agreement shall be in effect, the Company shall
      not execute and shall not knowingly permit to be on file in any such office
      or
      agency any such financing statement or other document or instrument (except
      to
      the extent filed or recorded in favor of the Secured Party pursuant to the
      terms
      of this Agreement).

    

     

    (d)  No
      part
      of the Collateral has been judged invalid or unenforceable. No written claim
      has
      been received that any Collateral or the Company’s use of any Collateral
      violates the rights of any third party. There has been no adverse decision
      to
      the Company’s claim of ownership rights in or exclusive rights to use the
      Collateral in any jurisdiction or to the Company’s right to keep and maintain
      such Collateral in full force and effect, and there is no proceeding involving
      said rights pending or, to the best knowledge of the Company, threatened before
      any court, judicial body, administrative or regulatory agency, arbitrator or
      other governmental authority. 

    

     

    (e)  The
      Company shall at all times maintain its books of account and records relating
      to
      the Collateral at its principal place of business and its Collateral at the
      locations set forth on Schedule
      A
      attached
      hereto and may not relocate such books of account and records or tangible
      Collateral unless it delivers to the Secured Party at least 30 days prior to
      such relocation (i) written notice of such relocation and the new location
      thereof (which must be within the United States) and (ii) evidence that
      appropriate financing statements and other necessary documents have been filed
      and recorded and other steps have been taken to perfect the Security Interest
      to
      create in favor of the Secured Party valid, perfected and continuing first
      priority liens in the Collateral. 

    

     

    (f)  This
      Agreement creates in favor of the Secured Party a valid security interest in
      the
      Collateral securing the payment and performance of the Obligations and, upon
      making the filings described in the immediately following sentence, a perfected
      first priority security interest in such Collateral. Except for the filing
      of
      financing statements on Form-1 under the UCC with the jurisdictions indicated
      on
Schedule
      B,
      attached hereto, no authorization or approval of or filing with or notice to
      any
      governmental authority or regulatory body is required either (i) for the grant
      by the Company of, or the effectiveness of, the Security Interest granted hereby
      or for the execution, delivery and performance of this Agreement by the Company
      or (ii) for the perfection of or exercise by the Secured Party of its rights
      and
      remedies hereunder. 

    

     

    (g)  On
      the
      date of execution of this Agreement, the Company will deliver to the Secured
      Party one or more executed UCC financing statements on Form-1 with respect
      to
      the Security Interest for filing with the jurisdictions indicated on
Schedule
      B,
      attached hereto and in such other jurisdictions as may be requested by the
      Secured Party.

    

     

    (h)  The
      execution, delivery and performance of this Agreement does not conflict with
      or
      cause a breach or default, or an event that with or without the passage of
      time
      or notice, shall constitute a breach or default, under any agreement to which
      the Company is a party or by which the Company is bound. No consent (including,
      without limitation, from stock holders or creditors of the Company) is required
      for the Company to enter into and perform its obligations
      hereunder.

    

     

    (i)  The
      Company shall at all times maintain the liens and Security Interest provided
      for
      hereunder as valid and perfected first priority liens and security interests
      in
      the Collateral in favor of the Secured Party until this Agreement and the
      Security Interest hereunder shall terminate pursuant to Section 11. The Company
      hereby agrees to defend the same against any and all persons. The Company shall
      safeguard and protect all Collateral for the account of the Secured Party.
      At
      the request of the Secured Party, the Company will sign and deliver to the
      Secured Party at any time or from time to time one or more financing statements
      pursuant to the UCC (or any other applicable statute) in form reasonably
      satisfactory to the Secured Party and will pay the cost of filing the same
      in
      all public offices wherever filing is, or is deemed by the Secured Party to
      be,
      necessary or desirable to effect the rights and obligations provided for herein.
      Without limiting the generality of the foregoing, the Company shall pay all
      fees, taxes and other amounts necessary to maintain the Collateral and the
      Security Interest hereunder, and the Company shall obtain and furnish to the
      Secured Party from time to time, upon demand, such releases and/or
      subordinations of claims and liens which may be required to maintain the
      priority of the Security Interest hereunder. 

    

     

    (j)  The
      Company will not transfer, pledge, hypothecate, encumber, license (except for
      non-exclusive licenses granted by the Company in the ordinary course of
      business), sell or otherwise dispose of any of the Collateral (except in the
      ordinary course of business) without the prior written consent of the Secured
      Party.

    

     

    (k)  The
      Company shall keep and preserve its Equipment, Inventory and other tangible
      Collateral in good condition, repair and order and shall not operate or locate
      any such Collateral (or cause to be operated or located) in any area excluded
      from insurance coverage.

    

     

    (l)  The
      Company shall, within ten (10) days of obtaining knowledge thereof, advise
      the
      Secured Party promptly, in sufficient detail, of any substantial change in
      the
      Collateral, and of the occurrence of any event which would have a material
      adverse effect on the value of the Collateral or on the Secured Party’s security
      interest therein.

    

     

    (m)  The
      Company shall promptly execute and deliver to the Secured Party such further
      deeds, mortgages, assignments, security agreements, financing statements or
      other instruments, documents, certificates and assurances and take such further
      action as the Secured Party may from time to time request and may in its sole
      discretion deem necessary to perfect, protect or enforce its security interest
      in the Collateral including, without limitation, the execution and delivery
      of a
      separate security agreement with respect to the Company’s intellectual property
      (“Intellectual
      Property Security Agreement”)
      in
      which the Secured Party has been granted a security interest hereunder,
      substantially in a form acceptable to the Secured Party, which Intellectual
      Property Security Agreement, other than as stated therein, shall be subject
      to
      all of the terms and conditions hereof.

    

     

    (n)  The
      Company shall permit the Secured Party and its representatives and agents to
      inspect the Collateral at any time, and to make copies of records pertaining
      to
      the Collateral as may be requested by the Secured Party from time to
      time.

    

     

    (o)  The
      Company will take all steps reasonably necessary to diligently pursue and seek
      to preserve, enforce and collect any rights, claims, causes of action and
      accounts receivable in respect of the Collateral.

    

     

    (p)  The
      Company shall promptly notify the Secured Party in sufficient detail upon
      becoming aware of any attachment, garnishment, execution or other legal process
      levied against any Collateral and of any other information received by the
      Company that may materially affect the value of the Collateral, the Security
      Interest or the rights and remedies of the Secured Party hereunder.

    

     

    (q)  All
      information heretofore, herein or hereafter supplied to the Secured Party by
      or
      on behalf of the Company with respect to the Collateral is accurate and complete
      in all material respects as of the date furnished.

    

     

    (r)  Schedule
      A
      attached
      hereto contains a list of all of the subsidiaries of Company.

    

     

    4.  Defaults.
      The
      following events shall be “Events
      of Default”:

    

     

    (a)  The
      occurrence of an Event of Default (as defined in the Transaction Documents)
      under the Transaction Documents, or breach of the terms of the Transaction
      Documents.

    

     

    (b)  Any
      representation or warranty of the Company in this Agreement shall prove to
      have
      been incorrect in any material respect when made; 

    

     

    (c)  The
      failure by the Company to observe or perform any of its obligations hereunder
      for five (5) days after receipt by the Company of notice of such failure from
      the Secured Party.

    

     

    5.  Duty
      To Hold In Trust.
      Upon
      the occurrence of any Event of Default and at any time thereafter, the Company
      shall, upon receipt by it of any revenue, income or other sums subject to the
      Security Interest, whether payable pursuant to the Debentures or otherwise,
      or
      of any check, draft, note, trade acceptance or other instrument evidencing
      an
      obligation to pay any such sum, hold the same in trust for the Secured Party
      and
      shall forthwith endorse and transfer any such sums or instruments, or both,
      to
      the Secured Party for application to the satisfaction of the
      Obligations.

    

     

    6.  Rights
      and Remedies Upon Default.
      Upon
      occurrence of any Event of Default and at any time thereafter, the Secured
      Party
      shall have the right to exercise all of the remedies conferred hereunder and
      under the Debentures, and the Secured Party shall have all the rights and
      remedies of a secured party under the UCC and/or any other applicable law
      (including the Uniform Commercial Code of any jurisdiction in which any
      Collateral is then located). Without limitation, the Secured Party shall have
      the following rights and powers:

    

     

    (a)  The
      Secured Party shall have the right to take possession of the Collateral
      including the Exclusions set forth in Section 1(a), and, for that purpose,
      enter, with the aid and assistance of any person, any premises where the
      Collateral, or any part thereof, is or may be placed and remove the same, and
      the Company shall assemble the Collateral and make it available to the Secured
      Party at places which the Secured Party shall reasonably select, whether at
      the
      Company’s premises or elsewhere, and make available to the Secured Party,
      without rent, all of the Company’s respective premises and facilities for the
      purpose of the Secured Party taking possession of, removing or putting the
      Collateral in saleable or disposable form.

    

     

    (b)  The
      Secured Party shall have the right to operate the business of the Company using
      the Collateral and the Exclusions and shall have the right to assign, sell,
      lease or otherwise dispose of and deliver all or any part of the Collateral,
      at
      public or private sale or otherwise, either with or without special conditions
      or stipulations, for cash or on credit or for future delivery, in such parcel
      or
      parcels and at such time or times and at such place or places, and upon such
      terms and conditions as the Secured Party may deem commercially reasonable,
      all
      without (except as shall be required by applicable statute and cannot be waived)
      advertisement or demand upon or notice to the Company or right of redemption
      of
      the Company, which are hereby expressly waived. Upon each such sale, lease,
      assignment or other transfer of Collateral, the Secured Party may, unless
      prohibited by applicable law which cannot be waived, purchase all or any part
      of
      the Collateral being sold, free from and discharged of all trusts, claims,
      right
      of redemption and equities of the Company, which are hereby waived and
      released.

    

     

    7.  Applications
      of Proceeds.
      The
      proceeds of any such sale, lease or other disposition of the Collateral or
      the
      Exclusions hereunder shall be applied first, to the expenses of retaking,
      holding, storing, processing and preparing for sale, selling, and the like
      (including, without limitation, any taxes, fees and other costs incurred in
      connection therewith) of the Collateral, to the reasonable attorneys’ fees and
      expenses incurred by the Secured Party in enforcing its rights hereunder and
      in
      connection with collecting, storing and disposing of the Collateral, and then
      to
      satisfaction of the Obligations, and to the payment of any other amounts
      required by applicable law, after which the Secured Party shall pay to the
      Company any surplus proceeds. If, upon the sale, license or other disposition
      of
      the Collateral, the proceeds thereof are insufficient to pay all amounts to
      which the Secured Party is legally entitled, the Company will be liable for
      the
      deficiency, together with interest thereon, at the rate of 18% per annum (the
      “Default
      Rate”),
      and
      the reasonable fees of any attorneys employed by the Secured Party to collect
      such deficiency. To the extent permitted by applicable law, the Company waives
      all claims, damages and demands against the Secured Party arising out of the
      repossession, removal, retention or sale of the Collateral, unless due to the
      gross negligence or willful misconduct of the Secured Party.

    

     

    8.  Costs
      and Expenses.The
      Company agrees to pay all out-of-pocket fees, costs and expenses incurred in
      connection with any filing required hereunder, including without limitation,
      any
      financing statements, continuation statements, partial releases and/or
      termination statements related thereto or any expenses of any searches
      reasonably required by the Secured Party. The Company shall also pay all other
      claims and charges which in the reasonable opinion of the Secured Party might
      prejudice, imperil or otherwise affect the Collateral or the Security Interest
      therein. The Company will also, upon demand, pay to the Secured Party the amount
      of any and all reasonable expenses, including the reasonable fees and expenses
      of its counsel and of any experts and agents, which the Secured Party may incur
      in connection with (i) the enforcement of this Agreement, (ii) the custody
      or
      preservation of, or the sale of, collection from, or other realization upon,
      any
      of the Collateral, or (iii) the exercise or enforcement of any of the rights
      of
      the Secured Party under the Debentures. Until so paid, any fees payable
      hereunder shall be added to the principal amount of the Debentures and shall
      bear interest at the Default Rate.

    

     

    9.  Responsibility
      for Collateral.
      The
      Company assumes all liabilities and responsibility in connection with all
      Collateral, and the obligations of the Company hereunder or under the
      Transaction Documents shall in no way be affected or diminished by reason of
      the
      loss, destruction, damage or theft of any of the Collateral or its
      unavailability for any reason. 

    

     

    10.  Security
      Interest Absolute.
      All
      rights of the Secured Party and all Obligations of the Company hereunder, shall
      be absolute and unconditional, irrespective of: (a) any lack of validity or
      enforceability of this Agreement, the Debentures, the Warrants or any agreement
      entered into in connection with the foregoing, or any portion hereof or thereof;
      (b) any change in the time, manner or place of payment or performance of, or
      in
      any other term of, all or any of the Obligations, or any other amendment or
      waiver of or any consent to any departure from the Debentures, the Warrants
      or
      any other agreement entered into in connection with the foregoing; (c) any
      exchange, release or nonperfection of any of the Collateral, or any release
      or
      amendment or waiver of or consent to departure from any other collateral for,
      or
      any guaranty, or any other security, for all or any of the Obligations; (d)
      any
      action by the Secured Party to obtain, adjust, settle and cancel in its sole
      discretion any insurance claims or matters made or arising in connection with
      the Collateral; or (e) any other circumstance which might otherwise constitute
      any legal or equitable defense available to the Company, or a discharge of
      all
      or any part of the Security Interest granted hereby. Until the Obligations
      shall
      have been paid and performed in full, the rights of the Secured Party shall
      continue even if the Obligations are barred for any reason, including, without
      limitation, the running of the statute of limitations or bankruptcy. The Company
      expressly waives presentment, protest, notice of protest, demand, notice of
      nonpayment and demand for performance. In the event that at any time any
      transfer of any Collateral or any payment received by the Secured Party
      hereunder shall be deemed by final order of a court of competent jurisdiction
      to
      have been a voidable preference or fraudulent conveyance under the bankruptcy
      or
      insolvency laws of the United States, or shall be deemed to be otherwise due
      to
      any party other than the Secured Party, then, in any such event, the Company’s
      obligations hereunder shall survive cancellation of this Agreement, and shall
      not be discharged or satisfied by any prior payment thereof and/or cancellation
      of this Agreement, but shall remain a valid and binding obligation enforceable
      in accordance with the terms and provisions hereof. The Company waives all
      right
      to require the Secured Party to proceed against any other person or to apply
      any
      Collateral which the Secured Party may hold at any time, or to marshal assets,
      or to pursue any other remedy. The Company waives any defense arising by reason
      of the application of the statute of limitations to any obligation secured
      hereby.

    

     

    11.  Term
      of Agreement.
      This
      Agreement and the Security Interest shall terminate on the date on which all
      payments under the Debentures have been made in full and all other Obligations
      of the Company have been paid or discharged. Upon such termination, the Secured
      Party, at the request and at the expense of the Company, will join in executing
      any termination statement with respect to any financing statement executed
      and
      filed pursuant to this Agreement. 

    

     

    12.  Power
      of Attorney; Further Assurances.

    

     

    (a)  The
      Company authorizes the Secured Party, and does hereby make, constitute and
      appoint it, and its respective officers, agents, successors or assigns with
      full
      power of substitution, as the Company’s true and lawful attorney-in-fact, with
      power, in its own name or in the name of the Company, to, after the occurrence
      and during the continuance of an Event of Default (i) endorse any notes, checks,
      drafts, money orders, or other instruments of payment (including payments
      payable under or in respect of any policy of insurance) in respect of the
      Collateral that may come into possession of the Secured Party; (ii) to sign
      and
      endorse any UCC financing statement or any invoice, freight or express bill,
      bill of lading, storage or warehouse receipts, drafts against debtors,
      assignments, verifications and notices in connection with accounts, and other
      documents relating to the Collateral; (iii) to pay or discharge taxes, liens,
      security interests or other encumbrances at any time levied or placed on or
      threatened against the Collateral; (iv) to demand, collect, receipt for,
      compromise, settle and sue for monies due in respect of the Collateral; and
      (v)
      generally, to do, at the option of the Secured Party, and at the Company’s
      expense, at any time, or from time to time, all acts and things which the
      Secured Party deems necessary to protect, preserve and realize upon the
      Collateral and the Security Interest granted therein in order to effect the
      intent of this Agreement, the Debentures and the Warrants, all as fully and
      effectually as the Company might or could do; and the Company hereby ratifies
      all that said attorney shall lawfully do or cause to be done by virtue hereof.
      This power of attorney is coupled with an interest and shall be irrevocable
      for
      the term of this Agreement and thereafter as long as any of the Obligations
      shall be outstanding.

    

     

    (b)  On
      a
      continuing basis, the Company will make, execute, acknowledge, deliver, file
      and
      record, as the case may be, in the proper filing and recording places in any
      jurisdiction, including, without limitation, the jurisdictions indicated on
      Schedule
      B,
      attached hereto, all such instruments, and take all such action as may
      reasonably be deemed necessary or advisable, or as reasonably requested by
      the
      Secured Party, to perfect the Security Interest granted hereunder and otherwise
      to carry out the intent and purposes of this Agreement, or for assuring and
      confirming to the Secured Party the grant or perfection of a security interest
      in all the Collateral.

    

     

    (c)  The
      Company hereby irrevocably appoints the Secured Party as the Company’s
      attorney-in-fact, with full authority in the place and stead of the Company
      and
      in the name of the Company, from time to time in the Secured Party’s discretion,
      to take any action and to execute any instrument which the Secured Party may
      deem necessary or advisable to accomplish the purposes of this Agreement,
      including the filing, in its sole discretion, of one or more financing or
      continuation statements and amendments thereto, relative to any of the
      Collateral without the signature of the Company where permitted by
      law.

    

     

    13.  Notices.
      All
      notices, requests, demands and other communications hereunder shall be in
      writing, with copies to all the other parties hereto, and shall be deemed to
      have been duly given when (i) if delivered by hand, upon receipt, (ii) if sent
      by facsimile, upon receipt of proof of sending thereof, (iii) if sent by
      nationally recognized overnight delivery service (receipt requested), the next
      business day or (iv) if mailed by first-class registered or certified mail,
      return receipt requested, postage prepaid, four days after posting in the U.S.
      mails, in each case if delivered to the following addresses:

    

     

    If
      to the
      Company: David
      Micek

    Eagle
      Broadband, Inc. Corp

    101
      COURAGEOUS DRIVE

    LEAGUE
      CITY, TEXAS 77573

    Telephone:
      (281) 538-6000

    Facsimile:
      (281) 538-4730

    

    If
      to the
      Secured Party: Dutchess
      Capital Management, LLC 

    Douglas
      Leighton

    50
      Commonwealth Ave, Suite 2

    Boston,
      MA 02116

    (617)
      301-4700

    (617)
      249-0947

    

    14.  Other
      Security.
      To the
      extent that the Obligations are now or hereafter secured by property other
      than
      the Collateral or by the guarantee, endorsement or property of any other person,
      firm, corporation or other entity, then the Secured Party shall have the right,
      in its sole discretion, to pursue, relinquish, subordinate, modify or take
      any
      other action with respect thereto, without in any way modifying or affecting
      any
      of the Secured Party’s rights and remedies hereunder.

    

     

    15.  Miscellaneous.

    

     

    (a)  No
      course
      of dealing between the Company and the Secured Party, nor any failure to
      exercise, nor any delay in exercising, on the part of the Secured Party, any
      right, power or privilege hereunder or under the Debentures shall operate as
      a
      waiver thereof; nor shall any single or partial exercise of any right, power
      or
      privilege hereunder or thereunder preclude any other or further exercise thereof
      or the exercise of any other right, power or privilege.

    

     

    (b)  All
      of
      the rights and remedies of the Secured Party with respect to the Collateral,
      whether established hereby or by the Debentures or by any other agreements,
      instruments or documents or by law shall be cumulative and may be exercised
      singly or concurrently.

    

     

    (c)  This
      Agreement constitutes the entire agreement of the parties with respect to the
      subject matter hereof and is intended to supersede all prior negotiations,
      understandings and agreements with respect thereto. Except as specifically
      set
      forth in this Agreement, no provision of this Agreement may be modified or
      amended except by a written agreement specifically referring to this Agreement
      and signed by the parties hereto.

    

     

    (d)  In
      the
      event that any provision of this Agreement is held to be invalid, prohibited
      or
      unenforceable in any jurisdiction for any reason, unless such provision is
      narrowed by judicial construction, this Agreement shall, as to such
      jurisdiction, be construed as if such invalid, prohibited or unenforceable
      provision had been more narrowly drawn so as not to be invalid, prohibited
      or
      unenforceable. If, notwithstanding the foregoing, any provision of this
      Agreement is held to be invalid, prohibited or unenforceable in any
      jurisdiction, such provision, as to such jurisdiction, shall be ineffective
      to
      the extent of such invalidity, prohibition or unenforceability without
      invalidating the remaining portion of such provision or the other provisions
      of
      this Agreement and without affecting the validity or enforceability of such
      provision or the other provisions of this Agreement in any other
      jurisdiction.

    

     

    (e)  No
      waiver
      of any breach or default or any right under this Agreement shall be considered
      valid unless in writing and signed by the party giving such waiver, and no
      such
      waiver shall be deemed a waiver of any subsequent breach or default or right,
      whether of the same or similar nature or otherwise.

    

     

    (f)  This
      Agreement shall be binding upon and inure to the benefit of each party hereto
      and its successors and assigns.

    

     

    (g)  Each
      party shall take such further action and execute and deliver such further
      documents as may be necessary or appropriate in order to carry out the
      provisions and purposes of this Agreement.

    

     

    (h)  The
      validity, terms, performance and enforcement of this Debenture shall be governed
      and construed by the provisions hereof and in accordance with the laws of the
      Commonwealth of Massachusetts applicable to agreements that are negotiated,
      executed, delivered and performed solely in the
      Commonwealth of Massachusetts.

    

     

    (i)  All
      disputes arising under this agreement shall be governed by and interpreted
      in
      accordance with the laws of the Commonwealth of Massachusetts, without regard
      to
      principles of conflict of laws. The parties to this agreement will submit all
      disputes arising under this agreement to arbitration in Boston, Massachusetts
      before a single arbitrator of the American Arbitration Association (“AAA”). The
      arbitrator shall be selected by application of the rules of the AAA, or by
      mutual agreement of the parties, except that such arbitrator shall be an
      attorney admitted to practice law in the Commonwealth of Massachusetts. No
      party
      to this agreement will challenge the jurisdiction or venue provisions as
      provided in this section. 

    

     

    (j)  This
      Agreement may be executed in any number of counterparts, each of which when
      so
      executed shall be deemed to be an original and, all of which taken together
      shall constitute one and the same Agreement. In the event that any signature
      is
      delivered by facsimile transmission, such signature shall create a valid binding
      obligation of the party executing (or on whose behalf such signature is
      executed) the same with the same force and effect as if such facsimile signature
      were the original thereof.

    

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK]

    

    *.*.*

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the parties hereto have caused this Security Agreement to
      be
      duly executed on the day and year first above written.

    

    

    EAGLE
      BROADBAND, INC.

    

    By:
      /s/David Micek      

    Name: David
      Micek

    Title: President
      and Chief Executive Officer

    

    

    By:
      /s/Richard Sanger, Jr.      

    Name: Richard
      Sanger, Jr.

    Title:
       Vice
      President of Administration

    

    

    

    DUTCHESS
      PRIVATE EQUITIES FUND, L.P.

    BY
      ITS
      GENERAL PARTNER DUTCHESS

    CAPITAL
      MANAGEMENT, LLC

    

    

    By:
      /s/Douglas H. Leighton      

    Name: Douglas
      H. Leighton

    Title: A
      Managing Member

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SCHEDULE
      A

    Principal
      Place of Business of the Company:

    

    101
      Courageous Drive

    League
      City, Texas 77573

    

    Locations
      Where Collateral is Located or Stored:

    

    101
      Courageous Drive

    League
      City, Texas 77573

    

    In
      the
      following subdivisions located in Harris County, Texas:

    
      	·  	
              Canyon
                Gate at Northpointe

            

    

    
      	·  	
              Lakes
                of Eldridge

            

    

    
      	·  	
              Rock
                Creek

            

    

    
      	·  	
              Canyon
                Gate at StoneGate

            

    

    

    In
      the
      following subdivision located in Galveston County, Texas:

    
      	·  	
              Victory
                Lakes

            

    

    

    In
      the
      following subdivision located in Fort Bend County, Texas:

    
      	·  	
              Canyon
                Gate at Brazos

            

    

    

    Including
      the fiber optic networks interconnecting these locations

    

    List
      of Subsidiaries of the Company including EIN:

    

    Atlantic
      Pacific Communications, Inc. (17606387219)

    Avery
      Telecom Services, L.L.C. (32003915165)

    Clearworks
      Communications, Inc. (32001289712)

    Clearworks
      Home Systems, Inc. (17606451247)

    Clearworks
      Integration Services, Inc. (17605145006)

    Clearworks
      Land Development, Inc. (32002033408)

    Clearworks
      Structured Wiring Services, Inc. (17605486475)

    Clearworks.Net,
      Inc. (17605765423)

    Contact
      Wireless, Inc. (14605064527)

    Eagle
      Home Systems, Inc. (32007753133)

    Etoolz,
      Inc. (17429390937)

    Link-Two
      Communications, Inc. (17605130081)

    Northpointe
      Telecom Services, L.L.C. (32001445991)

    Stonegate
      Telecom, L.L.C. (32001898132)

    Teravista
      Telecom Services, L.L.C. (32002199365)

    UCGI
      Corporation (13522018970)

    United
      Computing Group, Inc. (17605778038)

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SCHEDULE
      B

    

    

    Jurisdictions:

    

    State
      of
      TexasExhibit 10.24

    WARRANT
      AGREEMENT

    

    THESE
      SECURITIES AND THE SECURITIES ISSUABLE UPON THEIR EXERCISE HAVE NOT BEEN
      REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE TRANSFERRED UNLESS
      COVERED BY AN EFFECTIVE REGISTRATION STATEMENT UNDER SAID ACT, A “NO ACTION”
LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION WITH RESPECT TO SUCH
      TRANSFER, A TRANSFER MEETING THE REQUIREMENTS OF RULE 144 OF THE SECURITIES
      AND
      EXCHANGE COMMISSION, OR AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER TO
      THE
      EFFECT THAT ANY SUCH TRANSFER IS EXEMPT FROM SUCH
      REGISTRATION.

     

    Eagle
      Broadband, Inc.

    

    WARRANT
      NO. February 101

    

    Dated:
      February 10, 2006

     

    Eagle
      Broadband, Inc.,
      a
      corporation organized under the laws of the State of Texas (the “Company”),
      hereby certifies that, for value received from Dutchess Private Equities Fund,
      L.P. (the “Holder”), is entitled, subject to the terms set forth below, to
      purchase from the Company up to a total of two hundred and forty-six thousand
      seven hundred and fifty dollars ($246,750) of Common Stock, $.001 par value
      per
      share (the “Common Stock”), of the Company (each such share, a “Warrant Share”
and all such shares, the “Warrant Shares”) at an exercise price equal to the
      Fixed Conversion Price (as defined in the Debenture Agreement of this date
      between the Company and the original Holder). The Warrant may be exercised
      on a
      cashless basis anytime after issuance through and including the fifth (5th)
      anniversary of its original issuance (the “Expiration Date”), subject to the
      following terms and conditions:

    

    1. Registration
      of Warrant.
      The
      Company shall register this Warrant, upon records to be maintained by the
      Company for that purpose (the “Warrant Register”), in the name of the record
      Holder hereof from time to time. The Company may deem and treat the registered
      Holder of this Warrant as the absolute owner hereof for the purpose of any
      exercise hereof or any distribution to the Holder, and for all other purposes,
      and the Company shall not be affected by notice to the contrary.

    

    2. Registration
      of Transfers and Exchanges.

    

    (a) The
      Company or the transfer agent shall enter or record the transfer of any portion
      of this Warrant in the Warrant Register, upon surrender of this Warrant to
      the
      Company at the office specified in or pursuant to Section 3(b). Upon any such
      registration or transfer, a new warrant to purchase Common Stock, in
      substantially the form of this Warrant (any such new warrant, a “New Warrant”),
      evidencing the portion of this Warrant so transferred shall be issued to the
      transferee and a New Warrant evidencing the remaining portion of this Warrant
      not so transferred, if any, shall be issued to the transferring Holder. The
      acceptance of the New Warrant by the transferee thereof shall be deemed the
      acceptance of such transferee of all of the rights and obligations of a holder
      of a Warrant.

    

    (b) This
      Warrant is exchangeable, upon the surrender hereof by the Holder to the office
      of the Company specified in or pursuant to Section 3(b) for one or more New
      Warrants, evidencing in the aggregate the right to purchase the number of
      Warrant Shares which may then be purchased hereunder. Any such New Warrant
      will
      be dated the date of such exchange.

    

    3. Duration
      and Exercise of Warrants.
      

    

    (a) This
      Warrant shall be exercisable by the registered Holder on any business day before
      5:00 P.M., Boston time, at any time and from time to time on or after the date
      hereof to and including the Expiration Date. At 5:00 P.M., Boston time on the
      Expiration Date, the portion of this Warrant not exercised prior thereto shall
      be and become void and of no value. Prior to the Expiration Date, the Company
      may not call or otherwise redeem this Warrant without the prior written consent
      of the Holder.

    

    (b) Subject
      to Sections 2(b), 6 and 10, upon surrender of this Warrant, with the Form of
      Election to Purchase attached hereto duly completed and signed, to the Company
      at its address for notice set forth in Section 11 and upon payment of the
      Exercise Price multiplied by the number of Warrant Shares that the Holder
      intends to purchase hereunder, in the manner provided hereunder, all as
      specified by the Holder in the Form of Election to Purchase, the Company shall
      promptly (but in no event later than 5 business days after the Date of Exercise
      (as defined herein)) issue or cause to be issued and cause to be delivered
      to or
      upon the written order of the Holder and in such name or names as the Holder
      may
      designate, a certificate for the Warrant Shares issuable upon such exercise,
      free of restrictive legends except (i) either in the event that a registration
      statement covering the resale of the Warrant Shares and naming the Holder as
      a
      selling stockholder thereunder is not then effective or the Warrant Shares
      are
      not freely transferable without volume restrictions pursuant to Rule 144(k)
      promulgated under the Securities Act of 1933, as amended (the “Securities Act”),
      or (ii) if this Warrant shall have been issued pursuant to a written agreement
      between the original Holder and the Company, as required by such agreement.
      In
      the case of (i) above, the Warrant Shares will bear a Securities Act restrictive
      legend. Any person so designated by the Holder to receive Warrant Shares shall
      be deemed to have become holder of record of such Warrant Shares as of the
      Date
      of Exercise (as defined in this subsection) of this Warrant. A “Date of
      Exercise” means the date on which the Company shall have received (i) this
      Warrant (or any New Warrant, as applicable), with the Form of Election to
      Purchase attached hereto (or attached to such New Warrant) appropriately
      completed and duly signed, and (ii) payment of the Exercise Price for the number
      of Warrant Shares so indicated by the holder hereof to be
      purchased.

    

    (c) This
      Warrant shall be exercisable, either in its entirety or, from time to time,
      for
      a portion of the number of Warrant Shares. If less than all of the Warrant
      Shares which may be purchased under this Warrant are exercised at any time,
      the
      Company shall issue or cause to be issued, at its expense, a New Warrant
      evidencing the right to purchase the remaining number of Warrant Shares for
      which no exercise has been evidenced by this Warrant. In the event the Common
      Stock representing the Warrant Shares is not delivered per the written
      instructions of the Purchaser, within ten (10) business days after the Notice
      of
      Election and Warrant is received by the Company (the “Delivery Date”), then in
      such event the Company shall pay to Holder two percent (2.0%) in cash, of the
      dollar value of the Warrant Shares to be issued per each day after the Delivery
      Date that the Warrant Shares are not delivered. The Company acknowledges that
      its failure to deliver the Warrant Shares by the Delivery Date will cause the
      Holder to suffer damages in an amount that will be difficult to ascertain.
      Accordingly, the parties agree that it is appropriate to include in this Warrant
      a provision for liquidated damages. The parties acknowledge and agree that
      the
      liquidated damages provision set forth in this section represents the parties’
good faith effort to quantify such damages and, as such, agree that the form
      and
      amount of such liquidated damages are reasonable and will not constitute a
      penalty. The payment of liquidated damages shall not relieve the Company from
      its obligations to deliver the Common Stock pursuant to the terms of this
      Warrant. The Company shall make any payments incurred under this Section 3
      in
      immediately available funds within five (5) business days from the date of
      issuance of the applicable Warrant Shares. Nothing herein shall limit Holder’s
      right to pursue actual damages or cancel the Notice of Election for the
      Company’s failure to issue and deliver Common Stock to the Holder within seven
      (7) business days following the Delivery Date.

    

    4. Registration
      Rights.
      During
      the term of this Warrant, the Company agrees to use its best efforts to file,
      within ten (10) calendar days of the Closing, a registration statement with
      the
      Securities and Exchange Commission covering the resale of the Warrant Shares
      and
      naming the Holder as a selling stockholder thereunder (unless the Warrant Shares
      are otherwise freely transferable without volume restrictions pursuant to Rule
      144(k) or Rule 144A promulgated under the Act). The registration rights granted
      to the Holder pursuant to this Section shall continue until all of the Holder’s
      Warrant Shares have been sold in accordance with an effective registration
      statement or upon the Expiration Date, or as otherwise provided in the Debenture
      Registration Rights Agreement entered into between the Company and the original
      Holder as of the original issuance date hereof. The Company will pay all
      registration expenses in connection therewith. 

    

    5.
      Payment
      of Taxes.
      The
      Company will pay all documentary stamp taxes attributable to the issuance of
      Warrant Shares upon the exercise of this Warrant; provided, however, that the
      Company shall not be required to pay any tax that may be payable in respect
      of
      any transfer involved in the registration of any certificates for Warrant Shares
      or Warrants in a name other than that of the Holder. The Holder shall be
      responsible for all other tax liability that may arise as a result of holding
      or
      transferring this Warrant or receiving Warrant Shares upon exercise
      hereof.

    

    6. Replacement
      of Warrant.
      If this
      Warrant is mutilated, lost, stolen or destroyed, the Company shall issue or
      cause to be issued in exchange and substitution for and upon cancellation
      hereof, or in lieu of and substitution for this Warrant, a New Warrant, but
      only
      upon receipt of evidence reasonably satisfactory to the Company of such loss,
      theft or destruction and indemnity, if requested, satisfactory to it. Applicants
      for a New Warrant under such circumstances shall also comply with such other
      reasonable regulations and procedures and pay such other reasonable charges
      as
      the Company may prescribe.

    

    7. Reservation
      of Warrant Shares.
      The
      Company covenants that it will at all times reserve and keep available out
      of
      the aggregate of its authorized but unissued Common Stock, solely for the
      purpose of enabling it to issue Warrant Shares upon exercise of this Warrant
      as
      herein provided, the number of Warrant Shares which are then issuable and
      deliverable upon the exercise of this entire Warrant, free from preemptive
      rights or any other actual contingent purchase rights of persons other than
      the
      Holder (taking into account the adjustments and restrictions of Section 8).
      The
      Company covenants that all Warrant Shares that shall be so issuable and
      deliverable shall, upon issuance and the payment of the applicable Exercise
      Price in accordance with the terms hereof, be duly and validly authorized,
      issued and fully paid and nonassessable. If the Company does not have a
      sufficient amount of Common Stock authorized to reserve for the Warrant Shares,
      it shall use its best efforts to place before shareholder vote a proposal to
      increase the number of its authorized shares as soon as reasonably
      practicable.

    

    8. Certain
      Adjustments.
      The
      Exercise Price and number of Warrant Shares issuable upon exercise of this
      Warrant are subject to adjustment from time to time as set forth in this Section
      8. Upon each such adjustment of the Exercise Price pursuant to this Section
      8,
      the Holder shall thereafter prior to the Expiration Date be entitled to
      purchase, at the Exercise Price resulting from such adjustment, the number
      of
      Warrant Shares obtained by multiplying the Exercise Price in effect immediately
      prior to such adjustment by the number of Warrant Shares issuable upon exercise
      of this Warrant immediately prior to such adjustment and dividing the product
      thereof by the Exercise Price resulting from such adjustment. 

    

    (a) If
      the
      Company, at any time while this Warrant is outstanding, (i) shall pay a stock
      dividend (except scheduled dividends paid on outstanding preferred stock as
      of
      the date hereof which contain a stated dividend rate) or otherwise make a
      distribution or distributions on shares of its Common Stock or on any other
      class of capital stock and not the Common Stock payable in shares of Common
      Stock, (ii) subdivide outstanding shares of Common Stock into a larger number
      of
      shares, or (iii) combine outstanding shares of Common Stock into a smaller
      number of shares, the Exercise 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 (excluding treasury shares, if any)
      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
      or
      combination, and shall apply to successive subdivisions and
      combinations.

    

    (b) In
      case
      of any reclassification of the Common Stock, any consolidation or merger of
      the
      Company with or into another person, the sale or transfer of all or
      substantially all of the assets of the Company or any compulsory share exchange
      pursuant to which the Common Stock is converted into other securities, cash
      or
      property, then the Holder shall have the right thereafter to exercise this
      Warrant only into the shares of stock and other securities and property
      receivable upon or deemed to be held by holders of Common Stock following such
      reclassification, consolidation, merger, sale, transfer or share exchange,
      and
      the Holder shall be entitled upon such event to receive such amount of
      securities or property equal to the amount of Warrant Shares such Holder would
      have been entitled to had such Holder exercised this Warrant immediately prior
      to such reclassification, consolidation, merger, sale, transfer or share
      exchange. The terms of any such consolidation, merger, sale, transfer or share
      exchange shall include such terms so as to continue to give to the Holder the
      right to receive the securities or property set forth in this Section 8(b)
      upon
      any exercise following any such reclassification, consolidation, merger, sale,
      transfer or share exchange. 

    

    (c) 
      If the
      Company, at any time while this Warrant is outstanding, shall distribute to
      all
      holders of Common Stock (and not to holders of this Warrant) evidences of its
      indebtedness or assets or rights or warrants to subscribe for or purchase any
      security (excluding those referred to in Sections 8(a), (b) and (d)), then
      in
      each such case the Exercise Price shall be determined by multiplying the
      Exercise 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 Exercise Price determined as
      of
      the record date mentioned above, and of which the numerator shall be such
      Exercise 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 Common Stock as determined
      by
      the Company’s independent certified public accountants that regularly examines
      the financial statements of the Company (an “Appraiser”). 

    

    (d) If,
      at
      any time while this Warrant is outstanding, the Company shall issue or cause
      to
      be issued rights or warrants to acquire or otherwise sell or distribute shares
      of Common Stock for a consideration per share less than the lower of the
      Exercise Price then in effect and the then fair market value of the Common
      Stock, then, forthwith upon such issue or sale, the Exercise Price shall be
      reduced to the price (calculated to the nearest one hundredth of a cent)
      determined by multiplying the Exercise Price in effect immediately prior thereto
      by a fraction, the numerator of which shall be the sum of (i) the number of
      shares of Common Stock outstanding immediately prior to such issuance, and
      (ii)
      the number of shares of Common Stock which the aggregate consideration received
      (or to be received, assuming exercise or conversion in full of such rights,
      warrants and convertible securities) for the issuance of such additional shares
      of Common Stock would purchase at the Exercise Price, and the denominator of
      which shall be the sum of the number of shares of Common Stock outstanding
      immediately after the issuance of such additional shares. Such adjustment shall
      be made successively whenever such an issuance is made.

    

    (e) For
      the
      purposes of this Section 8, the following clauses shall also be
      applicable:

    

    (i)
      Record
      Date.
      In case
      the Company shall take a record of the holders of its Common Stock for the
      purpose of entitling them (A) to receive a dividend or other distribution
      payable in Common Stock or in securities convertible or exchangeable into shares
      of Common Stock, or (B) to subscribe for or purchase Common Stock or securities
      convertible or exchangeable into shares of Common Stock, then such record date
      shall be deemed to be the date of the issue or sale of the shares of Common
      Stock deemed to have been issued or sold upon the declaration of such dividend
      or the making of such other distribution or the date of the granting of such
      right of subscription or purchase, as the case may be.

    

    (ii)
      Treasury
      Shares.
      The
      number of shares of Common Stock outstanding at any given time shall not include
      shares owned or held by or for the account of the Company, and the disposition
      of any such shares shall be considered an issue or sale of Common
      Stock.

    

    (f) All
      calculations under this Section 8 shall be made to the nearest cent or the
      nearest 1/100th of a share, as the case may be.

    

    (g) Whenever
      the Exercise Price is adjusted pursuant to Section 8(c) above, the Holder,
      after
      receipt of the determination by the Appraiser, shall have the right to select
      an
      additional appraiser (which shall be a nationally recognized accounting firm),
      in which case the adjustment shall be equal to the average of the adjustments
      recommended by each of the Appraiser and such appraiser. The Holder shall
      promptly mail or cause to be mailed to the Company, a notice setting forth
      the
      Exercise Price after such adjustment and setting forth a brief statement of
      the
      facts requiring such adjustment. Such adjustment shall become effective
      immediately after the record date mentioned above.

    

    If:

    

    (i) the
      Company shall declare a dividend (or any other distribution) on its Common
      Stock; or

    

    (ii) the
      Company shall declare a special nonrecurring cash dividend on or a redemption
      of
      its Common Stock; or

    

    (iii) the
      Company 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; or

    

    (iv) the
      approval of any stockholders of the Company shall be required in connection
      with
      any reclassification of the Common Stock of the Company, any consolidation
      or
      merger to which the Company is a party, any sale or transfer of all or
      substantially all of the assets of the Company, or any compulsory share exchange
      whereby the Common Stock is converted into other securities, cash or property;
      or

    

    (v) the
      Company shall authorize the voluntary dissolution, liquidation or winding up
      of
      the affairs of the Company, then the Company shall cause to be mailed to each
      Holder at their last addresses as they shall appear upon the Warrant Register,
      at least 30 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
      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 Common Stock of record shall be entitled to exchange
      their shares of Common Stock for securities, cash or other property deliverable
      upon such reclassification, consolidation, merger, sale, transfer, share
      exchange, dissolution, liquidation or winding up; provided,
      however,
      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. 

    

    9. Payment
      of Exercise Price.
      The
      Holder, at its sole election, may pay the Exercise Price in one of the following
      manners:

    

    (a) Cash
      Exercise.
      The
      Holder shall deliver immediately available funds; or

    (b) Cashless
      Exercise.
      If at
      any time after one year from the date of issuance of this Warrant there is
      no
      effective Registration Statement registering the resale of the Warrant Shares
      by
      the Holder at such time, this Warrant may also be exercised at such time by
      means of a “cashless exercise.” The Holder shall surrender this Warrant to the
      Company together with a notice of cashless exercise, in which event the Company
      shall issue to the Holder the number of Warrant Shares determined as
      follows:

    

    X
      = Y
      (A-B)/A

    where:

    X
      = the
      number of Warrant Shares to be issued to the Holder.

    

    Y
      = the
      number of Warrant Shares with respect to which this Warrant is being
      exercised.

    

    A
      = the
      average closing bid price of the Common Stock for the five (5) trading days
      immediately prior to the Date of Exercise.

    

    B
      = the
      Exercise Price.

    

    For
      purposes of Rule 144 promulgated under the Securities Act, it is intended,
      understood and acknowledged that the Warrant Shares issued in a cashless
      exercise transaction shall be deemed to have been acquired by the Holder, and
      the holding period for the Warrant Shares shall be deemed to have been
      commenced, on the issue date.

    

    (c) The
      Holder is limited in the amount of this Warrant it may exercise. In no event
      shall the Holder be entitled to exercise any amount of this Warrant in excess
      of
      that amount upon exercise of which the sum of (1) the number of shares of Common
      Stock beneficially owned (as such term is defined under Section 13(d) and Rule
      13d-3 of the Securities Exchange Act of 1934 (the 1934 Act”)) by the Holder, and
      (2) the number of Warrant Shares issuable upon the exercise of any Warrants
      then
      owned by Holder, would result in beneficial ownership by the Holder of more
      than
      9.9% of the outstanding shares of Common Stock of the Company, as determined
      in
      accordance with Rule13d-1(j). Furthermore, the Company shall not process any
      exercise that would result in beneficial ownership by the Holder of more than
      9.9% of the outstanding shares of Common Stock of the Company. 

    

    10. Fractional
      Shares.
      The
      Company shall not be required to issue or cause to be issued fractional Warrant
      Shares on the exercise of this Warrant. The number of full Warrant Shares which
      shall be issuable upon the exercise of this Warrant shall be computed on the
      basis of the aggregate number of Warrant Shares purchasable on exercise of
      this
      Warrant so presented. If any fraction of a Warrant Share would, except for
      the
      provisions of this Section 10, be issuable on the exercise of this Warrant,
      the
      Company shall pay an amount in cash equal to the Exercise Price multiplied
      by
      such fraction.

    

    11. Notices.
      Any and
      all notices or other communications or deliveries hereunder shall be in writing
      and shall be deemed given and effective on the earliest of (i) the date of
      transmission, if such notice or communication is delivered via facsimile at
      the
      facsimile telephone number specified in this Section prior to 5:00 p.m. (Boston
      time) on a business day, (ii) the business day after the date of transmission,
      if such notice or communication is delivered via facsimile at the facsimile
      telephone number specified in this Section later than 5:00 p.m. (Boston time)
      on
      any date and earlier than 11:59 p.m. (Boston time) on such date, (iii) the
      business day following the date of mailing, if sent by nationally recognized
      overnight courier service, or (iv) upon actual receipt by the party to whom
      such
      notice is required to be given. The addresses for such communications shall
      be:
      (i) if to the Company, to:

    

    David
      Micek

    Eagle
      Broadband, Inc. Corp

    101
      COURAGEOUS DRIVE 

    LEAGUE
      CITY, TEXAS 77573 

    Telephone:
      (281) 538-6000 

    Facsimile:
      (281) 538-4730

    

    or
      (ii)
      if to the Holder, to the Holder at the address or facsimile number appearing
      on
      the Warrant Register or such other address or facsimile number as the Holder
      may
      provide to the Company in accordance with this Section 11.

    

    12. Warrant
      Agent.
      The
      Company shall serve as warrant agent under this Warrant. Upon thirty (30) days
      notice to the Holder, the Company may appoint a new warrant agent. Any
      corporation into which the Company or any new warrant agent may be merged or
      any
      corporation resulting from any consolidation to which the Company or any new
      warrant agent shall be a party or any corporation to which the Company or any
      new warrant agent transfers substantially all of its corporate trust or
      shareholders services business shall be a successor warrant agent under this
      Warrant without any further act. Any such successor warrant agent shall promptly
      cause notice of its succession as warrant agent to be mailed (by first class
      mail, postage prepaid) to the Holder at the Holder’s last address as shown on
      the Warrant Register.

    

    13. Miscellaneous.

    

    (a) This
      Warrant shall be binding on and inure to the benefit of the parties hereto.
      This
      Warrant may be amended only in writing signed by the Company and the
      Holder.

    

    (b) Subject
      to Section 13(a), above, nothing in this Warrant shall be construed to give
      to
      any person or corporation other than the Company and the Holder any legal or
      equitable right, remedy or cause under this Warrant. This Warrant shall inure
      to
      the sole and exclusive benefit of the Company and the Holder.

    

    (c) This
      Warrant shall be governed by and construed and enforced in accordance with
      the
      laws of the Commonwealth of Massachusetts without regard to the principles
      of
      conflicts of law thereof. 

    (d) The
      headings herein are for convenience only, do not constitute a part of this
      Warrant and shall not be deemed to limit or affect any of the provisions
      hereof.

    

    (e) In
      case
      any one or more of the provisions of this Warrant shall be invalid or
      unenforceable in any respect, the validity and enforceability of the remaining
      terms and provisions of this Warrant shall not in any way be affected or
      impaired thereby and the parties will attempt in good faith to agree upon a
      valid and enforceable provision which shall be a commercially reasonable
      substitute therefor, and upon so agreeing, shall incorporate such substitute
      provision in this Warrant.

    

    14.
      Disputes Under This Agreement.

    

    All
      disputes arising under this agreement shall be governed by and interpreted
      in
      accordance with the laws of the Commonwealth of Massachusetts, without regard
      to
      principles of conflict of laws. The parties to this agreement will submit all
      disputes arising under this agreement to arbitration in Boston, Massachusetts
      before a single arbitrator of the American Arbitration Association (“AAA”). The
      arbitrator shall be selected by application of the rules of the AAA, or by
      mutual agreement of the parties, except that such arbitrator shall be an
      attorney admitted to practice law in the Commonwealth of Massachusetts. No
      party
      to this agreement will challenge the jurisdiction or venue provisions as
      provided in this section. 

    

    Nothing
      in this section shall limit the Holder’s right to obtain an injunction for a
      court-of-laws.

    
      
         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by
      its
      authorized officer as of the date first indicated above.

    

    

    Eagle
      Broadband, Inc.

    

     

    

    By:
      /s/David Micek      

    Name: David
      Micek

    Title:
       President
      and Chief Executive Officer

    

    

    By:
      /s/Richard Sanger, Jr.      

    Name:
      Richard Sanger, Jr.

    Title:
       Vice
      President of Administration

    

    

    
      
        
           

        

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      A
      FORM OF ELECTION TO PURCHASE

    

    (To
      be
      executed by the Holder to exercise the right to purchase shares of Common Stock
      under the foregoing Warrant)

    

    To:
      Eagle
      Broadband, Inc.

    

    In
      accordance with the Warrant enclosed with this Form of Election to Purchase,
      the
      undersigned hereby irrevocably elects to purchase _____________ shares of Common
      Stock (“Common Stock”), $.001 par value per share, of Eagle
      Broadband, Inc. and,
      if
      such Holder is not utilizing the cashless exercise provisions set forth in
      this
      Warrant, encloses herewith $________ in cash, certified or official bank check
      or checks, which sum represents the aggregate Exercise Price (as defined in
      the
      Warrant) for the number of shares of Common Stock to which this Form of Election
      to Purchase relates, together with any applicable taxes payable by the
      undersigned pursuant to the Warrant.

    

    The
      undersigned requests that certificates for the shares of Common Stock issuable
      upon this exercise be issued in the name of

    

    

    PLEASE
      INSERT SOCIAL SECURITY OR

    TAX
      IDENTIFICATION NUMBER

    

    (Please
      print name and address)

    

    If
      the
      number of shares of Common Stock issuable upon this exercise shall not be all
      of
      the shares of Common Stock which the undersigned is entitled to purchase in
      accordance with the enclosed Warrant, the undersigned requests that a New
      Warrant (as defined in the Warrant) evidencing the right to purchase the shares
      of Common Stock not issuable pursuant to the exercise evidenced hereby be issued
      in the name of and delivered to:

     

    (Please
      print name and address)

    

     

    Dated:
      _____________, _____   Name
      of
      Holder:

    

    (Print)     

    

    (By:)     

    (Name:)

    (Title:)

    (Signature
      must conform in all respects to name of holder as specified on the face of
      the
      Warrant)

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