Document:

Exhibit 10.2

 

FORBEARANCE AGREEMENT

 

THIS FORBEARANCE AGREEMENT (this
“Agreement”), is made as of April 1, 2016, by and between EFACTOR GROUP CORP., a Nevada corporation, with its
principal offices located at 340 West 42nd Street, Suite 880, New York, NY 10108 (the “Company”), MAGNA
EQUITIES II, LLC, a New York corporation, with its address at 40 Wall Street, New York, New York 10005 (“Magna”)
and Increasive Ventures B.V. with its principal address at Stevensweg 2, 2141 VL Vijfhuizen, The Netherlands (“IV”,
each a “Lender” and together with Magna, collectively, the “Lenders”).

 

RECITALS

 

A.           The
Company and Lenders entered into that certain Securities Purchase Agreement dated as of April 1, 2016 (the “Purchase Agreement”),
that certain Security Agreement, dated as of April 1, 2016 (the “Security Agreement”) and that certain Stock Pledge
and Security Agreement, dated as of April 1, 2016 (the “Pledge Agreement”). Capitalized terms used and not otherwise
defined in this Agreement shall have the meaning set forth or provided for in the Purchase Agreement.

 

B.           The
Company issued to Lenders the promissory notes, on the dates and upon the terms as set forth on Exhibit A hereto (the “Prior
Notes”).

 

C.           The
Company hereby acknowledges and confirms that events of default have occurred and are continuing for
each of the Prior Notes by reason of the Company’s failure to (collectively, the “Specified Events of Default”)
pay in full upon the respective maturity dates the outstanding principal balance of each of the Prior Notes together with accrued
and unpaid interest and other amounts thereon. The Company further acknowledges and confirms that the Specified Events
of Default have not been waived by the Lenders.

 

D.           The
Company acknowledges and agrees that, as a result of the existence of the Specified
Events of Default, the Lenders have the right to exercise their rights and remedies under the Prior Notes. The Company
has requested, notwithstanding that the Specified Events of
Default exist and are continuing under the Prior Notes and have not been waived or cured, that the Lenders forbear from
exercising remedial rights on account of such Specified Events
of Default during the period of time (hereinafter,
the “Forbearance Period”) commencing as
of the date hereof and ending on the Termination Date (as defined below).

 

E.           Solely
with respect to the Specified Events of Default, the
Lenders have agreed to forbear from exercising remedial rights under the Prior Notes, applicable law and otherwise, but only subject
to and in accordance with the terms and conditions set forth herein. Except as expressly set forth in this Agreement, the agreements
of the Lenders to forbear in the exercise of their respective rights and remedies under the Prior Notes in respect of the Specified
Events of Default during the Forbearance Period do not in any manner whatsoever limit any right of the Lenders to insist
upon strict compliance with this Agreement or the Prior Notes during the Forbearance Period or thereafter.

 

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F.           Nothing
has occurred that constitutes or otherwise can be construed or interpreted as a waiver of, or otherwise impair, modify or limit
in any respect, any rights or remedies the Lenders have or may have, arising as the result of any defaults or events of default
under the Prior Notes (including the Specified Events of Default)
applicable law or in equity. The Lenders’ actions in entering into this Agreement are without prejudice to the rights of
the Lenders to pursue any and all remedies under the Prior Notes, pursuant to applicable law or in equity available to them in
their sole discretion upon the termination (whether upon expiration thereof or otherwise) of the Forbearance Period and thereafter.

 

G.           Identification
of the Specified Events of Default in this Agreement
does not constitute an agreement by the Lenders that there are no other defaults or events of default currently existing under
the Prior Notes, and the Lenders have reserved all rights and remedies with respect to any such other defaults or events of default
under the Prior Notes.

 

NOW, THEREFORE, in consideration
of the premises and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the
Company and each of the Lenders agree as follows:

 

AGREEMENTS

 

1.           Incorporation
of Recitals; Extension of Maturity Date; Forbearance.

 

(a)           Incorporation of Recitals. The Recitals to this Agreement
are hereby incorporated by reference as fully set forth herein and the Company represents, warrants, and acknowledges that such
Recitals are true and correct. The Company hereby acknowledges and confirms (i) the occurrence and continuance of the Specified
Events of Default, (ii) that the Specified Events of Default are material in
nature, (iii) that the Specified Events of Default have not been waived by the Lenders
or cured by the Company, and (iv) that the Lenders are entitled to exercise all rights and remedies under the Prior Notes.

 

(b)          Forbearance Period. Subject to the terms
and conditions herein set forth and in reliance upon the Company’s representations, acknowledgments, agreements and warranties
herein contained and contained in the Purchase Agreement, the Lenders, without waiving the Specified Events of Default or the Lenders’
rights and remedies at law, or in equity relating thereto, and subject to the terms and conditions set forth herein, agree to forbear
in the exercise of their rights and remedies under the Prior Notes based on the Specified Events of Default until the earlier to
occur of (the “Termination Date”): (a) 5 p.m. prevailing Eastern Time on April 1, 2017; or (b) a Forbearance Event
of Default (as defined hereinafter) under this Agreement. On the Termination Date, the agreement of the Lenders to forbear from
exercising their respective rights and remedies under the Prior Notes based on the Specified Events of Default will automatically
and immediately terminate. The Lenders’ agreement to forbear is conditional, temporary and limited in nature and shall not
be deemed: (i) to preclude or prevent the Lenders from exercising any rights and remedies under the Prior Notes, applicable law
or otherwise arising on account of (A) any default or event of default under the Prior Notes other than the Specified Events of
Default, or (B) the Specified Events of Default from and after the Termination Date, (ii) to effect any amendment of the Prior
Notes, which shall remain in full force and effect in accordance with their terms; (iii) to constitute a waiver of the Specified
Events of Default or any other default or event of default under the Prior Notes (whether now existing or hereafter occurring)
(each default or event of default other than any Default, an “Other Default”) or any term or provision of the Prior
Notes; or (iv) to establish a custom or course of dealing among the Company and the Lenders. The Company further acknowledges and
agrees that interest on the Prior Notes will continue to accrue in accordance with the terms of the Prior Notes.

 

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(c)          No
Waiver. Nothing in this Agreement should in any way be deemed (i) a waiver of the Specified
Events of Default or any Other Default or any term or provision of the Prior Notes or (ii) an agreement to forbear from
exercising any rights or remedies with respect to the Specified Events of Default
(except as expressly set forth herein) or any Other Default. The Lenders have not waived or released, are not by this Agreement
waiving or releasing, and have no present intention of waiving or releasing, the Defaults or any Other Default, or any remedies
or rights of the Lenders with respect thereto, all of which are hereby expressly reserved. Any waiver of the Specified
Events of Default or any Other Default shall be effective only if set forth in a written instrument executed by each Lender
and the Company.

 

(d)          Forbearance
Events of Default. Each of the following constitutes an immediate default and event of default (a “Forbearance Event of
Default”) under this Agreement and, notwithstanding anything contained in any Prior Notes, including any provisions requiring
any Lender to provide the Company or any other person with prior notice or an opportunity to cure:

 

		(i)	Any
                                         representation or warranty made by the Company in this Agreement or any document or statement
                                         furnished or to be furnished by or on behalf of the Company in connection with this Agreement
                                         is false or misleading in any material respect as of the date made.

 

		(ii)	Failure
of the Company to observe any term, condition, or covenant set forth in this Agreement.

 

		(iii)	The
validity, binding nature of, or enforceability of any material term or provision of this Agreement is disputed by, on behalf of,
or in the right or name of the Company or any material term or provision of this Agreement is found or declared to be invalid,
avoidable, or unenforceable by any court of competent jurisdiction.

 

		(iv)	The
occurrence of an Other Default; and,

 

		(v)	The filing of a
petition under any bankruptcy or insolvency law either by or against the Company or any Subsidiary.

 

2.           Acknowledgment
of and Reaffirmation of Obligations. The Company hereby acknowledges, confirms and agrees that as of the date of this Agreement,
the unpaid principal balance of each of the Prior Notes is as set forth on Exhibit A hereto and the accrued and unpaid interest
due and owing to the Lenders on the Prior Notes is as set forth on Exhibit A hereto. The principal balanced and accrued and unpaid
interest on the Prior Notes as set forth on Exhibit A hereto shall be referred to as the “Obligations.”

 

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3.           Consideration;
Grant of Security Interests. As partial consideration for the Lenders’ forbearance and to ensure the complete and timely
payment of the Obligations of the Company under the Prior Notes, now or hereafter existing from time to time, the Company has
entered into the Security Agreement, pursuant to which the Company granted to the Lenders a valid and continuing first priority
security interest and Lien on the Collateral (as such terms are defined in the Security Agreement) and the Pledge Agreement, pursuant
to which the Company pledged all of the issued and outstanding capital stock of its Subsidiaries (as such term is defined in the
Pledge Agreement) to the Lenders.

 

4.           Authority
to File. The Company, with respect to any Collateral in which it has an interest, by this Agreement irrevocably authorizes
Lenders at any time and from time to time to file in any jurisdiction any initial financing statements and amendments thereto
that (i) indicate the Collateral as the collateral covered thereby, regardless of whether any particular asset comprised in the
Collateral falls within the scope of Article 9 of the Uniform Commercial Code of the applicable jurisdiction, (ii) describes the
Collateral in generic terms such as “all assets” or similar description, and (iii) contain any other information required
by Article 9 of the applicable Uniform Commercial Code for the sufficiency or filing office acceptance of any financing statement
or amendment. The Company also ratifies its authorization for Lenders to have filed in any jurisdiction any like initial financing
statements or amendments thereto if filed prior to the date of this Agreement.

 

5.           Representations
and Warranties. In order to induce Lenders to enter into this Agreement, the Company, hereby acknowledges, represents, warrants
to Lenders that:

 

(a)          Each
of the representations and warranties made by the Company to the Lenders in each of the Purchase Agreement, the Security Agreement
and the Pledge Agreement are incorporated herein by reference and remain accurate, true and correct as of the date hereof.

 

(b)          The
Company: (i) is a corporation duly organized, validly existing and in good standing, under the laws of the State of Nevada, (ii)
has all requisite corporate power and authority to own its properties and assets and to carry on its business as now being conducted,
(iii) has all requisite legal and corporate power and authority to enter into this Agreement and to carry out and perform its
obligations under the terms hereof.

 

(c)          The
Company’s execution, delivery and performance of this Agreement will not violate, or conflict with or constitute a default
under, the terms of (i) the Company’s certificate of incorporation or bylaws (ii), any statute, regulation, ordinance, rule
of law, or (iii) agreement, contract, mortgage, indenture, bond, bill, note, judgment, order or decree of any court or arbitrator
to which the Company is a party or other instrument or writing binding upon the Company or to which the Company is subject, except
in the case of (iii) as would not result in a material adverse effect on the business, operations, assets, financial condition
or prospects of the Company or its subsidiaries, if any, taken as a whole.

 

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(d)          All
corporate action on the part of the Company, its officers and directors necessary for the Company’s authorization, execution
and delivery of, and the performance of Company’s obligations under this Agreement has been taken, including the approval
by the disinterested directors of the Company. The Company has duly executed and delivered this Agreement. This Agreement constitutes
a valid and legally binding obligation of the Company, enforceable in accordance with its terms, except as enforceability may
be limited by (i) applicable bankruptcy, insolvency, reorganization or other similar laws of general application relating to or
affecting the enforcement of creditors’ rights generally and (ii) the effect of rules of law governing the availability
of equitable remedies.

 

6.           Miscellaneous.

 

(a)          Assignment.
The provisions of this Agreement shall be binding upon and inure to the benefit of the respective successors, assigns, heirs,
beneficiaries and representatives of the Company and each of the Lenders; provided, however, that no party hereto may assign or
transfer any of its rights or obligations under this Agreement without the prior written consent of the other parties and any
prohibited assignment shall be void.

 

(b)          Headings.
Section and subsection headings in this Agreement are included herein for convenience of reference only and shall not constitute
a part of this Agreement for any other purpose or be given any substantive effect.

 

(c)          Reservation
of Rights. This Agreement is not (a) a waiver of or consent to a modification of any term of the Prior Notes, and (b) except
as expressly set forth herein, does not prejudice any right or rights which the Lenders now have or may have in the future. The
Lenders hereby reserve and preserve, and the Company hereby acknowledges and agrees that the Lenders have not waived, the Lenders’
rights and remedies under the Prior Notes, at law, and in equity with respect to the Specified Events of Default, any Forbearance
Event of Default, or any other matters

 

(d)          Choice
of Law. THIS AGREEMENT SHALL BE GOVERNED BY, CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
EXCEPT AS REQUIRED BY MANDATORY PROVISIONS OF LAW AND EXCEPT TO THE EXTENT THAT THE VALIDITY AND PERFECTION OR THE PERFECTION
AND THE EFFECT OF PERFECTION OR NON-PERFECTION OF THE SECURITY INTEREST CREATED HEREBY, OR REMEDIES HEREUNDER, IN RESPECT OF ANY
PARTICULAR COLLATERAL ARE GOVERNED BY THE LAW OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.

 

(e)          Consent
to Forum. ANY LEGAL ACTION, SUIT OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY DOCUMENT RELATED THERETO SHALL BE BROUGHT
IN THE COURTS OF THE STATE OF NEW YORK IN THE COUNTY OF NEW YORK OR THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF
NEW YORK, AND APPELLATE COURTS THEREOF, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH PARTY HERETO HEREBY ACCEPTS FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. EACH PARTY HERETO
HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION, INCLUDING, WITHOUT LIMITATION,
ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE
TO THE BRINGING OF ANY SUCH ACTION, SUIT OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS AND CONSENTS TO THE GRANTING OF SUCH LEGAL
OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY THE COURT.

 

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(f)          Waiver
of Jury Trial. EACH GRANTOR AND (BY ITS ACCEPTANCE OF THE BENEFITS OF THIS AGREEMENT) THE COMPANY WAIVES ANY RIGHT IT MAY
HAVE TO TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY
OF THE OTHER TRANSACTION DOCUMENTS, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, VERBAL OR WRITTEN STATEMENT OR OTHER ACTION OF
THE PARTIES HERETO.

 

(g)          Counterparts;
Effectiveness. This Agreement and any amendments, waivers, consents, or supplements may be executed in any number of counterparts
in separate counterparts, each of which when so executed and delivered shall be deemed an original, but all of which counterparts
together shall constitute but one and the same instrument. This Agreement shall become effective upon the execution of a counterpart
hereof by each of the parties hereto. Delivery of an executed counterpart of a signature page to this Agreement, any amendments,
waivers, consents or supplements by Facsimile shall be as effective as delivery of a manually executed counterpart thereof.

 

[Remainder of page intentionally left blank]

 

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IN WITNESS WHEREOF, this Agreement is executed
and delivered as of the date first written above.

 

	EFACTOR GROUP CORP.	 
	 	 
	By:	 /s/ Mark Noffke	 
	 	Name: Mark Noffke	 
	 	Title: Chief Financial Officer	 
	 	 	 
	MAGNA EQUITIES II, LLC	 
	 	 	 
	By:	 /s/ Joshua Sason	 
	 	Name:  Joshua Sason	 
	 	Title:  Managing Member	 
	 	 	 
	 	INCREASIVE VENTURES B.V.	 
	 	 	 
	 	By:	/s/ Ad Prins	 
	 	Name: Ad Prins	 
	 	Title: Managing Director	 

 

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EXHIBIT A

 

	Note	 	Issue Date	 	Principal Amount	 	 	Maturity Date
	Increasive Ventures BV	 	7/31/2015	 	 	1,250,000.00	 	 	12/31/2015
	Magna Tranche I Convertible Note	 	3/2/2015	 	 	175,000.00	 	 	3/1/2016
	Magna Tranche I Third Party Note Purchase	 	3/2/2015	 	 	200,000.00	 	 	3/1/2016
	Magna Tranche II Convertible Note	 	3/15/2015	 	 	15,000.00	 	 	3/14/2016
	Magna Tranche III Convertible Note	 	3/27/2015	 	 	29,500.00	 	 	3/26/2016
	Magna Tranche IV Third Party Note Purchase	 	4/8/2015	 	 	200,000.00	 	 	4/7/2016
	Magna Tranche V Convertible Note	 	5/1/2015	 	 	53,000.00	 	 	4/30/2016
	Magna Tranche VI Third Party Note Purchase	 	5/22/2015	 	 	200,000.00	 	 	5/21/2016
	Magna Tranche VII Convertible Note	 	5/27/2015	 	 	85,000.00	 	 	5/26/2016Exhibit 10.3

 

SECURITY AGREEMENT

 

This SECURITY AGREEMENT,
is made as of April 1, 2016 (this “Agreement”), by and among EFACTOR GROUP CORP., a Nevada corporation (“Efactor”),
and each of the subsidiaries of Efactor (the “Subsidiaries” and together with Efactor, collectively, the “Grantor”),
in favor of each of MAGNA EQUITIES II, LLC (“Magna”) and INCREASIVE VENTURES B.V., a Netherlands
limited company (“Increasive” and together with Magna, each a “Secured Party” and collectively, the “Secured
Parties”).

 

WITNESSETH:

 

WHEREAS, pursuant
to the Securities Purchase Agreement, dated as of the date hereof (as amended, restated or otherwise modified from time to time,
including all schedules and exhibits thereto, the “Purchase Agreement”), by and between the Grantor and the Secured
Parties, the Grantor agreed to sell, and the Secured Parties agreed to purchase, the Notes (as defined in the Purchase Agreement);

 

WHEREAS, prior to
the date hereof, the Secured Parties have purchased from the Company the unsecured notes set forth on Exhibit A hereto (the “Prior
Notes”), which such Prior Notes are in default;

 

WHEREAS, pursuant
to the Forbearance Agreement, dated as of the date hereof (as amended, restated or otherwise modified from time to time, including
all schedules and exhibits thereto, the “Forbearance Agreement”), the Secured Parties agreed to forbear from exercising
their remedial rights under the Prior Notes;

 

WHEREAS, as partial
consideration for and to induce the Secured Parties to enter into the Purchase Agreement and to purchase the Notes, and to enter
into the Forbearance Agreement, the Grantors have agreed to grant to the Secured Parties first priority security interests in all
of Grantors’ Collateral (as defined below) to secure all of the Company’s Obligations to the Securities Parties;

 

NOW, THEREFORE, in
consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are by this
Agreement acknowledged by the parties, the parties hereto agree as follows:

 

1.            Certain
Definitions, Construction.

 

(a)          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 8 or Article 9 of the UCC shall have the respective
meanings given such terms in Article 8 or Article 9 of the UCC, as applicable. All capitalized terms not otherwise defined herein
or in the UCC sections provided above, shall have the meaning ascribed to them in the Purchase Agreement.

 

     

     

    

 

(i)          “Collateral”
shall have the meaning set forth in Section 2 hereof.

 

(ii)         “Event
of Default” means (i) an Event of Default as defined in the Note, (ii) any event of default under any one or more of
the Prior Notes, or (iii) the breach of any representation, warranty, agreement or covenant by any Grantor under this Agreement.

 

(iii)        “GAAP”
shall have the meaning set forth in Section 4(e) hereof.

 

(iv)        “Insolvency
Proceeding” means any proceeding commenced by or against any Person under any provision of the Bankruptcy Code (Chapter
11 of Title 11 of the United States Code) or under any other bankruptcy or insolvency law, assignments for the benefit of creditors,
formal or informal moratoria, compositions, or extensions generally with creditors, or proceedings seeking reorganization, arrangement,
or other similar relief.

 

(v)         “Lien”
means any mortgage, deed of trust, pledge, lien (statutory or otherwise), security interest, charge or other encumbrance or security
or preferential arrangement of any nature, including, without limitation, any conditional sale or title retention arrangement,
any capitalized lease and any assignment, deposit arrangement or financing lease intended as, or having the effect of, security.

 

(vi)        “Obligations”
means all advances, debts, liabilities, obligations, covenants and duties owing, arising, due or payable from Grantor, or any Subsidiary
of Grantor, to any of the Secured Parties of any kind or nature, existing or future, whether or not evidenced by any note, letter
of credit, reimbursement agreement, or other instrument or document, whether arising under this Agreement, the Note, the Prior
Notes, the Purchase Agreement, or any of the other Transaction Documents or otherwise and whether direct or indirect (including
those acquired by assignment), absolute or contingent, primary or secondary, due or to become due, existing on or after the date
hereof and however acquired, and all amendments, renewals, restatements, replacements, consolidations or other modifications of
the foregoing from time to time. The term includes all principal, interest, fees, expenses, attorneys’ fees, and any other
sums owed to any Secured Party.

 

(vii)       “Permitted
Liens” has the meaning set forth in the Notes.

 

(viii)      “Person”
means any individual, sole proprietorship, partnership, joint venture, trust, unincorporated organization, association, corporation,
limited liability company, institution, public benefit corporation, other entity or government (whether federal, state, county,
city, municipal, local, foreign, or otherwise, including any instrumentality, division, agency, body or department thereof.

 

(ix)         “Proceeds”
means “proceeds,” as such term is defined in the UCC, including (a) any and all proceeds of any insurance, indemnity,
warranty or guaranty payable to any Secured Party from time to time with respect to any of the Collateral, (b) all amounts collected
on, or distributed on account of the Collateral, and (c) any and all amounts, rights to payment or other property acquired upon
sale, lease license, exchange or other disposition of Collateral and all rights arising out of Collateral.

 

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(x)          “UCC”
means the Uniform Commercial Code, as the same may, from time to time, be in effect in the State of New York; provided, however,
in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection or priority of the Secured
Parties’ security interest in any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other
than the State of New York, the term “UCC” shall mean the Uniform Commercial Code as in effect in such other jurisdiction
for purposes of the provisions hereof relating to such attachment, perfection of priority and for purposes of definitions related
to such provisions.

 

2.           Grant
of Security Interest. To secure the complete and timely payment of all of the Obligations of the Company now or hereafter existing
from time to time, Grantor hereby grants to the Secured Parties a continuing first priority security interest in all of Grantor’s
rights, title and interest in and to each of the following of the Grantor and each of Grantor’s Subsidiaries (collectively,
the “Collateral”):

 

(a)          All
accounts and accounts receivable, including present and future rights to payment for goods, merchandise or inventory sold or leased
or for services rendered, including those which are not evidenced by instruments or chattel paper, and whether or not they have
been earned by performance, whether or not the same are listed on any schedules, reports or assignments furnished to the Secured
Parties from time to time, whether now existing or created at any time hereafter, accounts, proceeds of any letters of credit on
which Grantor is named as beneficiary, contract rights, chattel paper, instruments, documents, insurance proceeds, and all such
obligations whatsoever owing to Issuer, together with all instruments and all documents of title representing any of the foregoing,
all rights in any goods, merchandise or inventory that any of the same may represent, all rights in any returned or repossessed
goods, merchandise and inventory, and all right, title, security and guaranties with respect to each of the foregoing, including
any right of stoppage in transit, replevin and reclamation and all other rights and remedies of an unpaid vendor or lienor, and
any liens held by Issuer as a mechanic, contractor, subcontractor, processor, materialman, machinist, manufacturer, artisan or
otherwise;

 

(b)          All
equipment, machinery, tools, fittings, furniture and fixtures, and all parts and accessions relating to any of the foregoing;

 

(c)          All
inventory, general intangibles relating to or arising out of inventory, goods manufactured or acquired for sale or lease, and any
piece of goods, raw materials, work in process and finished merchandise goods, incidentals, office supplies, packaging materials,
and any and all items, including machinery and equipment used or consumed in the operation of the business of Issuer and which
contribute to the finished product or to the sale, promotion and shipment thereof, in which Issuer now or at any time hereafter
may have an interest whether or not such inventory is listed in any agreement with or reports furnished to Purchaser from time
to time;

 

(d)          All
general intangibles, contract rights, claims and causes of action (including claims and causes of action arising in tort), tax
refunds, insurance proceeds, rights to receive money or property generally, books, records (in whatever form maintained by or on
behalf of Issuer), customer and supplier lists, ledgers, invoices, drawings, copyrights, plans, specifications, trade names, trademarks,
service marks, goodwill, licenses, franchises, trade secrets, computer programs, object codes, source codes, manuals, know-how,
inventions, designs, patents, patent applications, and all other intellectual property of any nature or description whatsoever;

 

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(e)          All
investment property, securities (whether certificated or uncertificated), security entitlements, securities accounts, commodity
contracts, commodity accounts and all other financial assets;

 

(f)          All
instruments, including all promissory notes, guarantees, liens, and all writings that evidence a right to the payment of money;

 

(g)          All
chattel paper, including all writings that evidence both a monetary obligation and a security interest in or a lease of specific
goods;

 

(h)          All
deposit accounts, including any demand, time or like account with a financial institution (whether or not maintained with Purchaser)
and the balances thereof, and all certificates of deposit;

 

(i)          All
property (other than that described in subsections (a) through (h) above) in which a security interest may now or hereafter attach
or otherwise be created under the Uniform Commercial Code or other applicable law; and

 

(j)          All
additions and accessions to, replacements and substitutions for, products and proceeds of, and rents, offspring, revenues, and
profits from, the property and the use or operation of the property described in subsections (a) through (i) above, whether tangible
or intangible, and, to the extent not otherwise included, all payments under any insurance policy (whether or not Purchaser is
the loss payee thereof) and under any indemnity, warranty or guaranty, payable by reason of loss or damage to or otherwise with
respect to any of the foregoing Collateral.

 

To the extent that the UCC does not apply to any item of the
Collateral, it is the intention of the parties and this Agreement that Secured Parties have a common law pledge or collateral assignment
of such item of Collateral.

 

3.           Security
for Obligations. The security interest created hereby in the Collateral constitutes continuing collateral security for all
of the Obligations, whether now existing or hereafter incurred, 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 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 Parties as a preference, fraudulent transfer or otherwise as such obligations
may be amended, supplemented, converted, extended or modified from time to time or hereafter incurred.

 

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4.            Representations
and Warranties. Grantor represents and warrants as follows:

 

(a)          
Grantor has rights in and the power to transfer each item of the Collateral upon which it purports to grant a Lien hereunder free
and clear of any and all Liens other than Permitted Liens.

 

(b)          EFactor
is a corporation duly incorporated in the State of Nevada.

 

(c)          This
Security Agreement is effective to create a valid and continuing Lien on and, upon the filing of the appropriate financing statement
with the State of Nevada, a perfected Lien in favor of Secured Parties, on the Collateral with respect to which a Lien may be perfected
by filing pursuant to the UCC. Such Lien is prior to all other Liens, except Permitted Liens that would be prior to Liens in favor
of Secured Parties as a matter of law, and is enforceable as such as against any and all creditors of and purchasers from any Grantor.
All action by any Grantor necessary or desirable to protect and perfect such Lien on each item of the Collateral has been duly
taken.

 

(d)          There
is no pending or written notice threatening any action, suit, proceeding or claim affecting such Grantor before any governmental
authority or any arbitrator, or any order, judgment or award by any governmental authority or arbitrator, that may adversely affect
the grant by such Grantor, or the perfection, of the security interest purported to be created hereby in the Collateral, or the
exercise by the Secured Parties of any of its rights or remedies hereunder.

 

(e)          All
Federal, state and local tax returns and other reports required by applicable law to be filed by such Grantor have been filed,
or extensions have been obtained, and all taxes, assessments and other governmental charges imposed upon such Grantor or any property
of such Grantor (including, without limitation, all federal income and social security taxes on employees’ wages) and which
have become due and payable on or prior to the date hereof have been paid, except to the extent contested in good faith by proper
proceedings which stay the imposition of any penalty, fine or Lien resulting from the non-payment thereof and with respect to which
adequate reserves have been set aside for the payment thereof in accordance with United States generally accepted accounting principles
consistently applied (“GAAP”).

 

(f)          Grantor
is and will be at all times the sole and exclusive owner of, or otherwise has and will have adequate rights in, the Collateral
free and clear of any Liens, except for Permitted Liens on any Collateral. No effective financing statement or other instrument
similar in effect covering all or any part of the Collateral is on file in any recording or filing office except (i) such as may
have been filed in favor of the Collateral Agent relating to this Agreement, and (ii) such as may have been filed to perfect any
Permitted Liens.

 

(g)          The
exercise by the Secured Parties of any of its rights and remedies hereunder will not contravene any law or any contractual restriction
binding on or otherwise affecting such Grantor or any of its properties and will not result in or require the creation of any Lien,
upon or with respect to any of its properties.

 

(h)          No
authorization or approval or other action by, and no notice to or filing with, any governmental authority or other regulatory body,
or any other Person, is required for (i) the grant by such Grantor, or the perfection, of the security interest purported to be
created hereby in the Collateral, or (ii) the exercise by the Secured Parties of any of its rights and remedies hereunder, except
for the filing under the Uniform Commercial Code as in effect in the applicable jurisdiction of the financing statements, all of
which financing statements, have been duly filed and are in full force and effect.

 

    	 	5	 

     

    

 

(i)          Each
of the Grantor’s Subsidiaries is a wholly-owned Subsidiary of the Grantor and are the only Subsidiaries of the Company, as
of the date hereof.

 

(j)          Grantor
has not taken, directly or indirectly, any action (or refrained from taking any action), prior to entering into this Agreement
and/or any other Transaction Document, that could reasonably be expected to have an adverse consequence or effect on Secured Parties’
rights hereunder or to secure the Obligations of the Grantor to the Secured Parties.

 

(k)          Efactor
has the right, power and ability under law and/or otherwise, to execute this Agreement and take any and all actions required hereunder
for itself and for each of its Subsidiaries, and the execution of this Agreement by Efactor and any actions taken by Efactor hereunder,
shall be binding on Efactor and each Subsidiary as if each such Subsidiary actually signed this Agreement.

 

5.           Covenants
as to the Collateral. So long as any of the Obligations shall remain outstanding, unless the Secured Parties shall otherwise
consent in writing:

 

(a)          Further
Assurances. Grantor will at its expense, at any time and from time to time, promptly execute and deliver all further instruments
and documents and take all further action that the Secured Parties may reasonably request in order to: (i) perfect and protect
the security interest created hereby; (ii) enable the Secured Parties to exercise and enforce its rights and remedies hereunder
in respect of the Collateral; or (iii) otherwise effect the purposes of this Agreement, including, without limitation: (A) executing
and filing (to the extent, if any, that such Grantor’s signature is required thereon) or authenticating the filing of, such
financing or continuation statements, or amendments thereto, as may be necessary or desirable or that the Secured Parties may request
in order to perfect and preserve the security interest created hereby, (B) furnishing to the Secured Parties from time to time
statements and schedules further identifying and describing the Collateral and such other reports in connection with the Collateral
in each case as the Secured Parties may reasonably request, all in reasonable detail, (C) if any Collateral shall be in the possession
of a third party, notifying such Person of the Secured Parties’s security interest created hereby and obtaining a written
acknowledgment from such Person that such Person holds possession of the Collateral for the benefit of the Secured Parties, which
such written acknowledgement shall be in form and substance satisfactory to the Secured Parties, and (D) taking all actions required
by any earlier versions of the UCC or by other law, as applicable, in any relevant UCC jurisdiction, or by other law as applicable
in any foreign jurisdiction.

 

(b)          Taxes,
Etc. Grantor agrees to pay promptly when due all property and other taxes, assessments and governmental charges or levies imposed
upon, and all claims (including claims for labor, materials and supplies) against, the Inventory, except to the extent the validity
thereof is being contested in good faith by proper proceedings which stay the imposition of any penalty, fine or Lien resulting
from the non-payment thereof and with respect to which adequate reserves in accordance with GAAP have been set aside for the payment
thereof.

 

    	 	6	 

     

    

 

(c)          Insurance.

 

(i)          Grantor
will, at its own expense, maintain insurance (including, without limitation, commercial general liability and property insurance)
with respect to the Inventory in such amounts, against such risks, in such form and with responsible and reputable insurance companies
or associations as is required by any governmental authority having jurisdiction with respect thereto or as is carried by such
Grantor as of the date hereof and in any event, in amount, adequacy and scope reasonably satisfactory to the Secured Parties. Unless
otherwise agreed to by the Secured Parties, each such policy for liability insurance shall provide for all losses to be paid on
behalf of the Secured Parties and such Grantor as their respective interests may appear, and each policy for property damage insurance
shall provide for all losses to be adjusted with, and paid directly to, the Secured Parties. Unless otherwise agreed to by the
Secured Parties, each such policy shall in addition (A) name the Secured Parties as an additional insured party thereunder (without
any representation or warranty by or obligation upon the Secured Parties) as their interests may appear, (B) contain an agreement
by the insurer that any loss thereunder shall be payable to the Secured Parties on its own account notwithstanding any action,
inaction or breach of representation or warranty by such Grantor, (C) provide that there shall be no recourse against the Secured
Parties for payment of premiums or other amounts with respect thereto, and (D) provide that at least thirty (30) days’ prior
written notice of cancellation, lapse, expiration or other adverse change shall be given to the Secured Parties by the insurer.
Such Grantor will, if so requested by the Secured Parties, deliver to the Secured Parties original or duplicate policies of such
insurance and, as often as the Secured Parties may reasonably request, a report of a reputable insurance broker with respect to
such insurance. Such Grantor will also, at the request of the Secured Parties, execute and deliver instruments of assignment of
such insurance policies and cause the respective insurers to acknowledge notice of such assignment.

 

(ii)         Reimbursement
under any liability insurance maintained by a Grantor pursuant to this Section 5(c) may be paid directly to the Person who
shall have incurred liability covered by such insurance. In the case of any loss involving damage to Inventory, any proceeds of
insurance maintained by a Grantor pursuant to this Section 5(c) shall be paid to the Secured Parties, such Grantor will
make or cause to be made the necessary repairs to or replacements of such Inventory, and any proceeds of insurance maintained by
such Grantor pursuant to this Section 5(c) shall be paid by the Secured Parties to such Grantor as reimbursement for the
costs of such repairs or replacements. 

 

(iii)        All
insurance payments in respect of such Inventory shall be paid to the Secured Parties and applied as specified in Section 9(b)
hereof.

 

(d)      Notice
of Changes. Grantor will (A) give the Secured Parties at least thirty (30) days’ prior written notice of any change in
such Grantor’s name, identity or organizational structure, (B) maintain its jurisdiction of formation as Nevada and (C) immediately
notify the Secured Parties upon obtaining an organizational identification number, if on the date hereof such Grantor did not have
such identification number.

 

    	 	7	 

     

    

 

(e)          Transfers
and Other Liens.

 

(i)          No
Grantor will sell, assign (by operation of law or otherwise), lease, license, exchange or otherwise transfer or dispose of any
of the Inventory except in the ordinary course of business.

 

(ii)         No
Grantor will create, suffer to exist or grant any Lien upon or with respect to any Collateral other than a Permitted Lien.

 

(f)          Inspection
and Reporting. Grantor shall permit the Secured Parties, or any agent or representatives thereof or such professionals or other
Persons as the Secured Parties may designate, not more than once a month in the absence of an Event of Default, (i) to examine
and make copies of and abstracts from such Grantor’s records and books of account, (ii) to visit and inspect its properties,
(iii) to verify Inventory and other Collateral of such Grantor from time to time, (iii) to conduct audits, physical counts, appraisals
and/or valuations, examinations at the locations of such Grantor. Grantor shall also permit the Secured Parties, or any agent or
representatives thereof or such professionals or other Persons as the Secured Parties may designate to discuss such Grantor’s
affairs, finances and accounts with any of its officers subject to the execution by the Secured Parties or its designee(s) of a
mutually agreeable confidentiality agreement.

 

6.           Additional
Grantors. The initial Grantors hereunder shall include the Company and any Subsidiaries of Company as of the date hereof. From
time to time subsequent to the date hereof, additional Persons may become parties hereto, as additional Grantors (each, an “Additional
Grantor”), by executing a counterpart of this Agreement. Upon delivery of any such counterpart to the Secured Parties, notice
of which is hereby waived by the Grantors, each Additional Grantor shall be a Grantor and shall be as fully a party hereto as if
such Additional Grantor were an original signatory hereto. Grantor expressly agrees that its obligations arising hereunder shall
not be affected or diminished by the addition or release of any other Grantor hereunder nor by any election of Secured Parties
not to cause any Person to become an Additional Grantor hereunder. This Agreement shall be fully effective as to any Grantor that
is or becomes a party hereto regardless of whether any other Person becomes or fails to become or ceases to be a Grantor hereunder.

 

7.           Additional
Provisions Concerning the Collateral.

 

(a)          Grantor
hereby (i) authorizes the Secured Parties to file one or more UCC financing or continuation statements, and amendments thereto,
relating to the Collateral (including, without limitation, financing statements describing the Collateral as “all inventory”
or words of similar effect) and (ii) ratifies such authorization to the extent that the Secured Parties has filed any such financing
or continuation statements, or amendments thereto, prior to the date hereof. A photocopy or other reproduction of this Agreement
or any financing statement covering the Collateral or any part thereof shall be sufficient as a financing statement where permitted
by law.

 

    	 	8	 

     

    

 

(b)          Grantor
hereby irrevocably appoints the Secured Parties as its attorney-in-fact and proxy, with full authority in the place and stead of
such Grantor and in the name of such Grantor or otherwise, from time to time in the Secured Parties’ discretion, so long
as an Event of Default shall have occurred and is continuing, to take any action and to execute any instrument which the Secured
Parties may deem necessary or advisable to accomplish the purposes of this Agreement (subject to the rights of such Grantor under
Section 5 hereof), including, without limitation, (i) to obtain and adjust insurance required to be paid to the Secured
Parties pursuant to Section 5(c) hereof, (ii) to ask, demand, collect, sue for, recover, compound, receive and give acquittance
and receipts for moneys due and to become due under or in respect of any Collateral, (iii) to receive, endorse, and collect any
drafts or other instruments, documents and chattel paper in connection with clause (i) or (ii) above, (iv) to file any claims or
take any action or institute any proceedings which the Secured Parties may deem necessary or desirable for the collection of any
Collateral or otherwise to enforce the rights of the Secured Parties with respect to any Collateral, and (v) to execute assignments,
licenses and other documents to enforce the rights of the Secured Parties with respect to any Collateral. This power is coupled
with an interest and is irrevocable until the complete conversion of all of the Company’s obligations under the Note to equity
securities of the Company and/or indefeasible payment in full in cash of all obligations under the Note (together with any matured
indemnification obligations as of the date of such conversion and/or payment, but excluding any inchoate or unmatured contingent
indemnification obligations).

 

(c)          If
a Grantor fails to perform any agreement contained herein, the Secured Parties may itself perform, or cause performance of, such
agreement or obligation, in the name of such Grantor or the Secured Parties, and the expenses of the Secured Parties incurred in
connection therewith shall be payable by such Grantor pursuant to Section 9 hereof and shall be secured by the Collateral.

 

(d)          The
powers conferred on the Secured Parties hereunder are solely to protect its interest in the Collateral and shall not impose any
duty upon it to exercise any such powers. Except for the safe custody of any Collateral in its possession and the accounting for
moneys actually received by it hereunder, the Secured Parties shall have no duty as to any Collateral or as to the taking of any
necessary steps to preserve rights against prior parties or any other rights pertaining to any Collateral.

 

(e)          Anything
herein to the contrary notwithstanding (i) Grantor shall remain liable with respect to the Collateral to the extent set forth therein
to perform all of its obligations thereunder to the same extent as if this Agreement had not been executed, (ii) the exercise by
the Secured Parties of any of its rights hereunder shall not release such Grantor from any of its obligations in respect of the
Collateral, and (iii) the Secured Parties shall not have any obligation or liability by reason of this Agreement with respect to
any of the other Collateral, nor shall the Secured Parties be obligated to perform any of the obligations or duties of such Grantor
thereunder or to take any action to collect or enforce any claim for payment assigned hereunder.

 

8.           Remedies
Upon Event of Default.

 

(a)          If
any Event of Default shall have occurred and be continuing, the Secured Parties may jointly exercise in respect of the Collateral,
in addition to any other rights and remedies provided for herein or otherwise available to it, all of the rights and remedies of
a secured party upon default under the Code (whether or not the Code applies to the affected Collateral) thereof, in form suitable
for filing, recording or registration in any country.

 

    	 	9	 

     

    

 

(b)          Upon
the exercise of any rights and remedies by Secured Parties hereunder with respect to the Collateral after an Event of Default shall
have occurred and be continuing, any and all Proceeds received by Secured Parties with respect to such Collateral shall be applied
and distributed; (1) to interest on the Prior Notes ratably in proportion to the interest accrued thereon; (2) to principal of
the Prior Notes ratably in proportion to the outstanding principal amounts thereof; and (3) to all other Obligations of the Grantors
to the Secured Parties ratably in proportion to the unpaid amount thereof.

 

9.           Indemnity
and Expenses.

 

(a)          Grantor
agrees, jointly and severally, to defend, protect, indemnify and hold the Secured Parties, jointly and severally, harmless from
and against any and all claims, damages, losses, liabilities, obligations, penalties, fees, costs and expenses (including, without
limitation, reasonable legal fees, costs, expenses, and disbursements of such Person’s counsel) to the extent that they arise
out of or otherwise result from this Agreement (including, without limitation, enforcement of this Agreement), except claims, losses
or liabilities resulting solely and directly from such Person’s gross negligence or willful misconduct, as determined by
a final judgment of a court of competent jurisdiction.

 

(b)          Grantor
agrees, jointly and severally, to, upon demand, pay to the Secured Parties the amount of any and all costs and expenses, including
the reasonable fees, costs, expenses and disbursements of counsel for the Secured Parties and of any experts and agents (including,
without limitation, any collateral trustee which may act as agent of the Secured Parties), which the Secured Parties may incur
in connection with (i) the preparation, negotiation, execution, delivery, recordation, administration, amendment, waiver or other
modification or termination of this Agreement, (ii) the custody, preservation, use or operation of, or the sale of, collection
from, or other realization upon, any Collateral, (iii) the exercise or enforcement of any of the rights of the Secured Parties
hereunder, or (iv) the failure by any Grantor to perform or observe any of the provisions hereof.

 

10.         Notices,
Etc. All notices and other communications provided for hereunder shall be in writing and shall be mailed (by certified mail,
postage prepaid and return receipt requested), telecopied or delivered, if to a Grantor at its address specified below and if to
the Secured Parties to it, at its address specified below; or as to any such Person, at such other address as shall be designated
by such Person in a written notice to such other Person complying as to delivery with the terms of this Section 9. All such
notices and other communications shall be effective (a) if sent by certified mail, return receipt requested, when received or five
(5) days after deposited in the mails, whichever occurs first, (b) if telecopied or sent by electronic mail, when transmitted (during
normal business hours), or (c) if delivered, upon delivery.

 

    	 	10	 

     

    

 

11.         Miscellaneous.

 

(a)          No
amendment of any provision of this Agreement shall be effective unless it is in writing and signed by Grantor and the Secured Parties,
and no waiver of any provision of this Agreement, and no consent to any departure by a Grantor therefrom, shall be effective unless
it is in writing and signed by the Secured Parties, and then such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given.

 

(b)          No
failure on the part of the Secured Parties to exercise, and no delay in exercising, any right hereunder or under any of the other
Documents shall operate as a waiver thereof; nor shall any single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The rights and remedies of the Secured Parties provided herein and in the
other Documents are cumulative and are in addition to, and not exclusive of, any rights or remedies provided by law. The rights
of the Secured Parties under any of the other Documents against any party thereto are not conditional or contingent on any attempt
by such Person to exercise any of its rights under any of the other Documents against such party or against any other Person, including
but not limited to, any Grantor.

 

(c)          To
the extent permitted by applicable law, Grantor hereby waives promptness, diligence, notice of acceptance and any other notice
with respect to any of the Obligations and this Agreement and any requirement that the Secured Parties exhaust any right or take
any action against any other Person or any Collateral. Grantor acknowledges that it will receive direct and indirect benefits from
the financing arrangements contemplated herein and that the waiver set forth in this Section 11(c) is knowingly made in
contemplation of such benefits. The Grantors hereby waive any right to revoke this Agreement, and acknowledge that this Agreement
is continuing in nature and applies to all Obligations, whether existing now or in the future.

 

(d)          No
Grantor may exercise any rights that it may now or hereafter acquire against any other Grantor that arise from the existence, payment,
performance or enforcement of any Grantor’s obligations under this Agreement, including, without limitation, any right of
subrogation, reimbursement, exoneration, contribution or indemnification and any right to participate in any claim or remedy of
the Secured Parties against any Grantor or any Collateral, whether or not such claim, remedy or right arises in equity or under
contract, statute or common law, including, without limitation, the right to take or receive from any Grantor, directly or indirectly,
in cash or other property or by set-off or in any other manner, payment or security solely on account of such claim, remedy or
right, unless and until the complete conversion of all of the Company’s obligations under the Note to equity securities of
the Company and/or indefeasible payment in full in cash of all obligations of the Company and the other Grantors to the Secured
Parties under the Note and/or other Documents (together with any matured indemnification obligations as of the date of such conversion
and/or payment, but excluding any inchoate or unmatured contingent indemnification obligations). If any amount shall be paid to
a Grantor in violation of the immediately preceding sentence at any time prior to the complete conversion of all of the Company’s
and other Grantors obligations under the Note to equity securities of the Company and/or indefeasible payment in full in cash of
all obligations of the Company and the other Grantors to the Secured Parties under the Note and the other Documents (together with
any matured indemnification obligations as of the date of such conversion and/or payment, but excluding any inchoate or unmatured
contingent indemnification obligations), such amount shall be held in trust for the benefit of the Secured Parties and shall forthwith
be paid to the Secured Parties to be credited and applied to the Obligations and all other amounts payable under the Documents,
whether matured or unmatured, in accordance with the terms of the Documents, or to be held as Collateral for any Obligations or
other amounts payable under the Documents thereafter arising.

 

    	 	11	 

     

    

 

(e)          Any
provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the remaining portions hereof or thereof or affecting
the validity or enforceability of such provision in any other jurisdiction.

 

(f)          This
Agreement shall create a continuing security interest in the Collateral and shall (i) remain in full force and effect until the
complete conversion of all of the Company’s obligations under the Note to equity securities of the Company and/or indefeasible
payment in full in cash of all obligations under the Note (together with any matured indemnification obligations as of the date
of such conversion and/or payment, but excluding any inchoate or unmatured contingent indemnification obligations), and (ii) be
binding on Grantor and all other Persons who become bound as debtor to this Agreement in accordance with Section 9-203(d) of the
UCC and shall inure, together with all rights and remedies of the Secured Parties hereunder, to the benefit of the Secured Parties
and their respective permitted successors, transferees and assigns. Without limiting the generality of clause (ii) of the immediately
preceding sentence, without notice to any Grantor, the Secured Parties may assign or otherwise transfer their rights and obligations
under this Agreement and any of the other Documents, to any other Person and such other Person shall thereupon become vested with
all of the benefits in respect thereof granted to the Secured Parties herein or otherwise. Upon any such assignment or transfer,
all references in this Agreement to the Secured Parties shall mean the assignee of the Secured Parties. None of the rights or obligations
of any Grantor hereunder may be assigned or otherwise transferred without the prior written consent of the Secured Parties, and
any such assignment or transfer without the consent of the Secured Parties shall be null and void.

 

(g)          Upon
the complete conversion of all of the Company’s obligations under the Note to equity securities of the Company and/or indefeasible
payment in full in cash of all Obligations of the Grantor to the Secured Parties under the Prior Notes, the Notes and other Transaction
Documents (together with any matured indemnification obligations as of the date of such conversion and/or payment, but excluding
any inchoate or unmatured contingent indemnification obligations), (i) this Agreement and the security interests created hereby
shall terminate and all rights to the Collateral shall revert to the respective Grantor that granted such security interests hereunder,
and (ii) the Secured Parties will, upon such Grantor’s request and at such Grantor’s expense, (A) return to such Grantor
such of the Collateral as shall not have been sold or otherwise disposed of or applied pursuant to the terms hereof, and (B) execute
and deliver to such Grantor such documents as such Grantor shall reasonably request to evidence such termination, all without any
representation, warranty or recourse whatsoever.

 

(h)          THIS
AGREEMENT SHALL BE GOVERNED BY, CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, EXCEPT AS REQUIRED
BY MANDATORY PROVISIONS OF LAW AND EXCEPT TO THE EXTENT THAT THE VALIDITY AND PERFECTION OR THE PERFECTION AND THE EFFECT OF PERFECTION
OR NON-PERFECTION OF THE SECURITY INTEREST CREATED HEREBY, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED
BY THE LAW OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.

 

    	 	12	 

     

    

 

(i)          ANY
LEGAL ACTION, SUIT OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY DOCUMENT RELATED THERETO SHALL BE BROUGHT IN THE COURTS
OF THE STATE OF NEW YORK IN THE COUNTY OF NEW YORK OR THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND APPELLATE
COURTS THEREOF, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH GRANTOR HEREBY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. EACH GRANTOR HEREBY EXPRESSLY AND IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION, INCLUDING, WITHOUT LIMITATION, ANY OBJECTION TO THE LAYING OF VENUE
OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION,
SUIT OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS AND CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED
APPROPRIATE BY THE COURT.

 

(j)          EACH
GRANTOR AND (BY ITS ACCEPTANCE OF THE BENEFITS OF THIS AGREEMENT) THE COMPANY WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY JURY IN
RESPECT OF ANY LITIGATION BASED ON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER TRANSACTION
DOCUMENTS, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, VERBAL OR WRITTEN STATEMENT OR OTHER ACTION OF THE PARTIES HERETO.

 

(k)          Nothing
contained herein shall affect the right of the Secured Parties to serve process in any other manner permitted by law or commence
legal proceedings or otherwise proceed against any Grantor or any property of such Grantor in any other jurisdiction.

 

(l)          Grantor
irrevocably and unconditionally waives any right it may have to claim or recover in any legal action, suit or proceeding referred
to in this Section any special, exemplary, punitive or consequential damages.

 

(m)          Section
headings herein are included for convenience of reference only and shall not constitute a part of this Agreement for any other
purpose.

 

(n)          This
Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which
shall be deemed to be an original, but all of which taken together constitute one in the same Agreement.

 

12.         Actions.
Notwithstanding anything to the contrary provided herein or elsewhere, no Secured Party can take any action under this Agreement
without the express written consent of both Secured Parties to any such action.

 

[REMAINDER OF THIS PAGE INTENTIONALLY
LEFT BLANK]

 

    	 	13	 

     

    

 

 IN WITNESS WHEREOF,
Grantor has caused this Agreement to be executed and delivered by its officer thereunto duly authorized, as of the date first above
written.

 

	EFACTOR GROUP CORP. (signing on 

behalf of itself and all of its Subsidiaries)	 
	 	 
	By:	/s/ Mark Noffke	 
	 	Name: Mark Noffke	 
	 	Title: Chief Financial Officer	 
	 	 	 
	MAGNA EQUITIES II, LLC	 
	 	 	 
	By:	/s/ Joshua Sason	 
	 	Name:  Joshua Sason	 
	 	Title: Managing Director	 
	 	 	 
	INCREASIVE VENTURES B.V.	 
	 	 	 
	By:	/s/ Ad Prins	 
	 	
        Name: Ad Prins

        Title: Managing Director
	 

 

    	 	14	 

     

    

 

EXHIBIT A

 

PRIOR NOTES PREVIOUSLY ISSUED BY THE
GRANTOR TO THE SECURED PARTIES

 

	Note	 	Issue Date	 	Principal Amount	 	 	Maturity Date
	Increasive Ventures BV	 	7/31/2015	 	 	1,250,000.00	 	 	12/31/2015
	Magna Tranche I Convertible Note	 	3/2/2015	 	 	175,000.00	 	 	3/1/2016
	Magna Tranche I Third Party Note Purchase	 	3/2/2015	 	 	200,000.00	 	 	3/1/2016
	Magna Tranche II Convertible Note	 	3/15/2015	 	 	15,000.00	 	 	3/14/2016
	Magna Tranche III Convertible Note	 	3/27/2015	 	 	29,500.00	 	 	3/26/2016
	Magna Tranche IV Third Party Note Purchase	 	4/8/2015	 	 	200,000.00	 	 	4/7/2016
	Magna Tranche V Convertible Note	 	5/1/2015	 	 	53,000.00	 	 	4/30/2016
	Magna Tranche VI Third Party Note Purchase	 	5/22/2015	 	 	200,000.00	 	 	5/21/2016
	Magna Tranche VII Convertible Note	 	5/27/2015	 	 	85,000.00	 	 	5/26/2016

 

    	 	15

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