Document:

Exhibit 10.3

 

THE ISSUANCE AND SALE OF THE SECURITIES
REPRESENTED BY THIS DEBENTURE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE
SELECTED BY THE HOLDER), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT
TO RULE 144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA
FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES

 

INVENTERGY GLOBAL, INC. 

 

SENIOR SECURED, CONVERTIBLE, REDEEMABLE
DEBENTURE

(FEE DEBENTURE)

 

	Dated as of:  	December 29, 2017	Principal Amount: $3,500,000.00
	Effective Date:  	December 29, 2017	 
	Maturity Date: 	December 29, 2020	 

 

This SENIOR SECURED,
CONVERTIBLE REDEEMABLE DEBENTURE (the “Debenture”) is issued, dated and effective as of December 29, 2017 (the
“Effective Date”), by INVENTERGY GLOBAL, INC., a corporation
incorporated under the laws of the State of Delaware (the “Company”), to TCA GLOBAL CREDIT MASTER FUND, LP,
a limited partnership organized and existing under the laws of the Cayman Islands (together with its permitted successors and assigns,
the “Holder”) pursuant to exemptions from registration under the Securities Act of 1933, as amended. This Debenture
is the “Fee Debenture” issued in connection with that certain Securities Purchase Agreement, dated as of the date hereof,
by and between the Company and the Holder (the “Purchase Agreement”). This Debenture
is being issued in consideration of advisory services fully rendered by the Holder as of the date hereof. All capitalized terms
used in this Debenture and not otherwise defined herein shall have the meanings assigned to them in the Purchase Agreement

 

ARTICLE I

 

Section 1.01     Principal
and Interest. For value received, the Company hereby promises to pay to the order of the Holder, by no later than December
29, 2020 (the “Maturity Date”), in immediately available and lawful money of the United States of America, Three
Million Five Hundred Thousand and No/100 United States Dollars ($3,500,000), together with interest on the outstanding principal
amount under this Debenture, at the rate of ten percent (8%) per annum simple interest (the “Interest Rate”)
from the Effective Date, until paid, as more specifically provided below.

 

    	 	1	 

     

    

 

Section 1.02     Optional
Redemption Prior to Maturity. The Company, at its option, shall have the right to redeem this Debenture in full and for cash,
at any time prior to the Maturity Date, with three (3) business days’ advance written notice (the “Redemption Notice”)
to the Holder. The amount required to redeem this Debenture in full pursuant to this Section 1.02 shall be equal to: (i) the aggregate
principal amount then outstanding under this Debenture; plus all accrued and unpaid interest due under this Debenture as of the
redemption date; plus (ii) all other costs, fees and charges due and payable hereunder or under any other “Transaction Documents”
(as hereinafter defined) (collectively, the “Redemption Amount”). The Company shall deliver the Redemption Amount
to the Holder on the third (3rd) business day after the date of the Redemption Notice.

 

Section 1.03      Mandatory
Redemption at Maturity. On the Maturity Date, the Company shall redeem this Debenture for the Redemption Amount, which Redemption
Amount shall be due and payable to the Holder by no later than 2:00 P.M., EST, on the Maturity Date.

 

Section 1.04      Payments.

 

(1)       Payments.
The Company shall make monthly payments of principal and interest to the Holder, while this Debenture is outstanding, until the
Maturity Date, based on the payment and amortization schedule attached hereto as Schedule A. In the event such day is not
a Business Day, then said payment shall be due on the first Business Day thereafter occurring. The Company shall make payment of
all outstanding principal and interest to the Holder by no later than the Maturity Date.

 

(2)       Interest
Calculations; Payment Application. Interest shall be calculated on the basis of a 360-day year, and shall accrue daily on the
outstanding principal amount outstanding from time to time for the actual number of days elapsed, commencing on the Effective Date
until payment in full of the outstanding principal, together with all accrued and unpaid interest and other amounts which may become
due hereunder, has been made. All payments received and actually collected by Holder hereunder shall be applied first to any costs
and expenses due or incurred hereunder, second to accrued and unpaid interest hereunder, and last to reduce the outstanding principal
balance of this Debenture.

 

(3)       Late
Fee. If all or any portion of the payments of principal, interest or other charges due hereunder are not received by the Holder
within five (5) days of the date such payment is due, then the Company shall pay to the Holder a late charge (in addition to any
other remedies that Holder may have) equal to five percent (5%) of each such unpaid payment or sum. Any payments returned to Holder
for any reason must be covered by wire transfer of immediately available funds to an account designated by Holder, plus a $100.00
administrative fee charge. Holder shall have no responsibility or liability for payments purportedly made hereunder but not actually
received by Holder; and the Company shall not be discharged from the obligation to make such payments due to loss of same in the
mails or due to any other excuse or justification ultimately involving facts where such payments were not actually received by
Holder.

 

    	 	2	 

     

    

 

Section 1.05.     Manner
of Payments. All sums payable to the order of Holder hereunder shall be payable by ACH transfer of lawful dollars of the United
States of America to the ACH instructions set forth below, or at such place as Holder, from time to time, may designate in writing.
ACH Instructions for all sums due and payable hereunder are as follows:

 

	Bank Name:  	Bank of America
	Bank Address:  	100 W. 33rd Street, New York, NY 10001
	Beneficiary Account Name:  	TCA Fund Mgmt Group
	Beneficiary Account Number: 	898052439174
	ACH Transfer/Routing Number:  	063100277
	SWIFT:  	BOFAUS3N

 

ARTICLE II

 

Section 2.01     Secured
Nature of Debenture. This Debenture is being issued in connection with the Purchase Agreement. The indebtedness evidenced by
this Debenture is also secured by all of the assets and property of the Credit Parties and various other instruments and documents
referred to in the Purchase Agreement as the “Transaction Documents”. All of the agreements, conditions, covenants,
provisions, representations, warranties and stipulations contained in any of the Transaction Documents which are to be kept and
performed by the Credit Parties are hereby made a part of this Debenture to the same extent and with the same force and effect
as if they were fully set forth herein, and the Company covenants and agrees to keep and perform them, or cause them to be kept
or performed, strictly in accordance with their terms.

 

ARTICLE III

 

Section
3.01     Events of Default. The occurrence of any of the following events shall constitute an “Event of Default”
hereunder: (i) the Company shall fail to pay any interest, principal or other charges due under this Debenture or any other Transaction
Documents on the date when any such payment shall be due and payable; (ii) the Company makes an assignment for the benefit of creditors;
(iii) any order or decree is rendered by a court which appoints or requires the appointment of a receiver, liquidator or trustee
for the Company, and the order or decree is not vacated within thirty (30) days from the date of entry thereof; (iv) any order
or decree is rendered by a court adjudicating the Company insolvent, and the order or decree is not vacated within thirty (30)
days from the date of entry thereof; (v) the Company files a petition in bankruptcy under the provisions of any bankruptcy law
or any insolvency act; (vi) the Company admits, in writing, its inability to pay its debts as they become due; (vii) a proceeding
or petition in bankruptcy is filed against the Company and such proceeding or petition is not dismissed within thirty (30) days
from the date it is filed; (viii) the Company files a petition or answer seeking reorganization or arrangement under the bankruptcy
laws or any law or statute of the United States or any other foreign country or state; (ix) any written warranty, representation,
certificate or statement of the Company and/or Guarantors in this Debenture, the Purchase Agreement or any other Transaction Document
or any other agreement with Holder shall be false or misleading in any material respect when made or deemed made; and
(x) the Company shall fail to perform, comply with or abide by any of the material stipulations, agreements, conditions and/or
covenants contained in this Debenture, the Purchase Agreement or any of the other Transaction Documents on the part of the Company
to be performed complied with or abided by, and such failure continues or remains uncured for ten (10) Business Days following
written notice from the Holder to the Company.

 

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Section 3.02     Remedies.
Upon the occurrence of an Event of Default that is not timely cured within an applicable cure period hereunder (or, as to clause
(ix) thereunder, on the tenth (10th) Trading Day following notice from the Holder if the Company is unable to provide
an explanation satisfactory to the Holder), the interest on this Debenture shall immediately accrue at an interest rate equal to
the lesser of (i) twenty-four percent (24%) per annum or (ii) the maximum interest rate allowable by law, and, in addition to all
other rights or remedies the Holder may have, at law or in equity, the Holder may, in its sole discretion, accelerate full repayment
of all principal amounts outstanding hereunder, together with accrued interest thereon, together with all attorneys’ fees,
paralegals’ fees and costs and expenses incurred by the Holder in collecting or enforcing payment hereof (whether such fees,
costs or expenses are incurred in negotiations, all trial and appellate levels, administrative proceedings, bankruptcy proceedings
or otherwise), and together with all other sums due by the Company hereunder and under the Transaction Documents, all without any
relief whatsoever from any valuation or appraisement laws, and payment thereof may be enforced and recovered in whole or in part
at any time by one or more of the remedies provided to the Holder at law, in equity, or under this Debenture or any of the other
Transaction Documents. In connection with the Holder’s rights hereunder upon an Event of Default, the Holder need not provide,
and the Company hereby waives, any presentment, demand, protest or other notice of any kind, and the Holder may immediately enforce
any and all of its rights and remedies hereunder and all other remedies available to it in equity or under applicable law.

 

ARTICLE IV

 

Section 4.01     Usury
Savings Clause. Notwithstanding any provision in this Debenture or the other Transaction Documents to the contrary, the total
liability for payments of interest and payments in the nature of interest, including, without limitation, all charges, fees, exactions,
or other sums which may at any time be deemed to be interest, shall not exceed the limit imposed by the usury laws of the jurisdiction
governing this Debenture or any other applicable law. In the event the total liability of payments of interest and payments in
the nature of interest, including, without limitation, all charges, fees, exactions or other sums which may at any time be deemed
to be interest, shall, for any reason whatsoever, result in an effective rate of interest, which for any month or other interest
payment period exceeds the limit imposed by the usury laws of the jurisdiction governing this Debenture, all sums in excess of
those lawfully collectible as interest for the period in question shall, without further agreement or notice by, between, or to
any party hereto, be applied to the reduction of the outstanding principal balance due hereunder immediately upon receipt of such
sums by the Holder hereof, with the same force and effect as though the Company had specifically designated such excess sums to
be so applied to the reduction of the principal balance then outstanding, and the Holder hereof had agreed to accept such sums
as a penalty-free payment of principal; provided, however, that the Holder may, at any time and from time to time, elect, by notice
in writing to the Company, to waive, reduce, or limit the collection of any sums in excess of those lawfully collectible as interest,
rather than accept such sums as a prepayment of the principal balance then outstanding. It is the intention of the parties that
the Company does not intend or expect to pay, nor does the Holder intend or expect to charge or collect any interest under this
Debenture greater than the highest non-usurious rate of interest which may be charged under applicable law.

 

    	 	4	 

     

    

 

ARTICLE V

 

Section 5.01     No
Exemption. The Company hereby waives and releases all benefit that might accrue to the Company by virtue of any present or
future laws exempting any property that may serve as security for this Debenture, or any other property, real or personal, or any
part of the proceeds arising from any sale of any such property, from attachment, levy, or sale under execution, exemption from
civil process, or extension of time for payment; and the Company agrees that any property that may be levied upon pursuant to a
judgment obtained by virtue hereof, on any writ of execution issued thereon, may be sold upon any such writ in whole or in part
in any order or manner desired by Holder.

 

Section 5.02     Exercise
of Remedies. The remedies of the Holder as provided herein and in any of the other Transaction Documents shall be cumulative
and concurrent and may be pursued singly, successively or together, at the sole discretion of the Holder, and may be exercised
as often as occasion therefor shall occur; and the failure to exercise any such right or remedy shall in no event be construed
as a waiver or release thereof.

 

Section 5.03     Waivers.
The Company and all others who are, or may become liable for the payment hereof: (i) severally waive presentment for payment, demand,
notice of nonpayment or dishonor, protest and notice of protest of this Debenture or any other Transaction Documents, and all other
notices in connection with the delivery, acceptance, performance, default, or enforcement of the payment of this Debenture and
the other Transaction Documents, except as specifically provided in this Debenture or any other Transaction Document; (ii) expressly
consent to all extensions of time, renewals or postponements of time of payment of this Debenture and any other Transaction Documents
from time to time prior to or after the maturity of this Debenture without notice, consent or further consideration to any of the
foregoing; (iii) expressly agree that the Holder shall not be required first to institute any suit, or to exhaust its remedies
against the Company or any other person or party to become liable hereunder or against any collateral that may secure this Debenture
in order to enforce the payment of this Debenture; and (iv) expressly agree that, notwithstanding the occurrence of any of the
foregoing (except the express written release by the Holder of any such person), the undersigned shall be and remain, directly
and primarily liable for all sums due under this Debenture.

 

Section 5.04      No
Waiver. Holder shall not be deemed, by any act of omission or commission, to have waived any of its rights or remedies hereunder
unless such waiver is in writing and signed by Holder, and then only to the extent specifically set forth in the writing. A waiver
on one event shall not be construed as continuing or as a bar to or waiver of any right or remedy to a subsequent event.

 

ARTICLE VI

 

Section 6.01      Notice.
Any notices, consents, waivers, or other communications required or permitted to be given under the terms of this Debenture shall
be made in accordance with the terms of the Purchase Agreement.

 

    	 	5	 

     

    

 

Section 6.02      Governing
Law and Venue. The Company and Holder each irrevocably agrees that any dispute arising under, relating to, or in connection
with, directly or indirectly, this Debenture or related to any matter which is the subject of or incidental to this Debenture (whether
or not such claim is based upon breach of contract or tort) shall be subject to the exclusive jurisdiction and venue of the state
and/or federal courts located in Broward County, Florida; provided, however, Holder may, at the Holder’s sole option, elect
to bring any action in any other jurisdiction. This provision is intended to be a “mandatory” forum selection clause
and governed by and interpreted consistent with Florida law. The Company and Holder each hereby consents to the exclusive jurisdiction
and venue of any state or federal court having its situs in said county, and each waives any objection based on forum non conveniens.
The Company hereby waives personal service of any and all process and consent that all such service of process may be made by certified
mail, return receipt requested, directed to the Company, as set forth herein in the manner provided by applicable statute, law,
rule of court or otherwise. Except for the foregoing mandatory forum selection clause, all terms and provisions hereof and the
rights and obligations of the Company and Holder hereunder shall be governed, construed and interpreted in accordance with the
laws of the State of Nevada, without reference to conflict of laws principles.

 

Section 6.03     Severability.
In the event any one or more of the provisions of this Debenture shall for any reason be held to be invalid, illegal, or unenforceable,
in whole or in part, in any respect, or in the event that any one or more of the provisions of this Debenture operates or would
prospectively operate to invalidate this Debenture, then and in any of those events, only such provision or provisions shall be
deemed null and void and shall not affect any other provision of this Debenture. The remaining provisions of this Debenture shall
remain operative and in full force and effect and shall in no way be affected, prejudiced, or disturbed thereby.

 

Section 6.04     Entire
Agreement and Amendments. This Debenture, together with the other Transaction Documents represents the entire agreement between
the parties hereto with respect to the subject matter hereof and thereof, and there are no representations, warranties or commitments,
except as set forth herein and therein. This Debenture may be amended only by an instrument in writing executed by the parties
hereto.

 

Section 6.05     Binding
Effect. This Debenture shall be binding upon the Company and the successors and assigns of the Company and shall inure to the
benefit of the Holder and the successors and assigns of the Holder.

 

Section 6.06     Assignment.
The Holder may from time to time sell or assign, in whole or in part, or grant participations in, this Debenture and/or the obligations
evidenced hereby without the consent of the Company. The holder of any such sale, assignment or participation, if the applicable
agreement between Holder and such holder so provides, shall be: (i) entitled to all of the rights obligations and benefits of Holder
(to the extent of such holder’s interest or pa1ticipation); and (ii) deemed to hold and may exercise the rights of setoff
or banker’s lien with respect to any and all obligations of such holder to the Company (to the extent of such holder’s
interest or participation), in each case as fully as though the Company was directly indebted to such holder. Holder may in its
discretion give notice to the Company of such sale, assignment or participation; however, the failure to give such notice shall
not affect any of Holder’s or such holder’s rights hereunder.

 

    	 	6	 

     

    

 

Section 6.07     Lost
or Mutilated Debenture. If this Debenture shall be mutilated, lost, stolen or destroyed the Company shall execute and deliver,
in exchange and substitution for and upon cancellation of a mutilated Debenture or in lieu of or in substitution for a lost, stolen
or destroyed Debenture a new Debenture for the principal amount of this Debenture so mutilated, lost stolen or destroyed, but only
upon receipt of evidence of such loss, theft or destruction of such Debenture, and of the ownership hereof, reasonably satisfactory
to the Company.

 

Section 6.08     WAIVER
OF JURY TRIAL. THE COMPANY HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY AND IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY
WITH RESPECT TO ANY LITIGATION BASED ON THIS DEBENTURE, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH, THIS DEBENTURE OR ANY OTHER
TRANSACTION DOCUMENTS, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF OR BETWEEN
ANY PARTY HERETO, AND THE COMPANY AGREES AND CONSENTS TO THE GRANTING TO HOLDER OF RELIEF FROM ANY STAY ORDER WHICH MIGHT BE ENTERED
BY ANY COURT AGAINST HOLDER AND TO ASSIST HOLDER IN OBTAINING SUCH RELIEF. THIS PROVISION IS A MATERIAL INDUCEMENT FOR HOLDER ACCEPTING
THIS DEBENTURE FROM THE COMPANY. THE COMPANY’S REASONABLE RELIANCE UPON SUCH INDUCEMENT IS HEREBY ACKNOWLEDGED.

 

Section 6.09     NON-US
STATUS. THE HOLDER IS A NON-US PERSON AS THAT TERM IS DEFINED IN THE UNITED STATES INTERNAL REVENUE CODE. IT IS HEREBY AGREED
AND UNDERSTOOD THAT THE OBLIGATIONS HEREUNDER MAY BE SOLD ONLY TO NON-U.S. PERSON. THE INTEREST PAYABLE HEREUNDER IS PAYABLE ONLY
OUTSIDE THE UNITED STATES. ANY U.S. PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME
TAX LAW. BY ACCEPTING THIS OBLIGATION, THE HOLDER REPRESENTS AND WARRANTS THAT IT IS NOT A UNITED STATES PERSON (OTHER THAN AN
EXEMPT RECIPIENT DESCRIBED IN SEC 6049(8)(4) OF THE INTERNAL REVENUE CODE AND REGULATIONS THEREUNDER) AND THAT IT IS NOT ACTING
FOR OR ON BEHALF OF A UNITED STATES PERSON (OTHER THAN AN EXEMPT RECIPIENT DESCRIBED IN SEC. 6049(B)(4) OF THE INTERNAL REVENUE
CODE AND THE REGULATIONS THEREUNDER).

 

ARTICLE VII

 

Section 7.01     Conversion
of Debenture. At any time and from time to time while this Debenture is outstanding on or after the Closing Date, upon the
occurrence of an Event of Default at the sole option of the Holder, this Debenture may be, convertible into shares of the Company’s
common stock, $0.001 par value per share (the “Common Stock”) in accordance with the terms and conditions set
forth in this Article VII.

 

    	 	7	 

     

    

 

(1)       Voluntary
Conversion. At any time while this Debenture is outstanding on or after the Closing Date, at the sole option of the Holder
upon the occurrence of an Event of Default, the Holder may convert all or any portion of the outstanding principal, accrued and
unpaid interest, and any other sums due and payable hereunder or under any of the other Transaction Documents (such total amount,
the “Conversion Amount”) into shares of Common Stock of the Company (the “Conversion Shares”)
in an amount of shares equal to: (i) the Conversion Amount (the numerator); divided by (ii) eighty-five percent (85%) of
the lowest of the volume weighted average price of the Company’s Common Stock during the five (5) trading days immediately
prior to the Conversion Date (as defined below), as indicated in the conversion notice (in the form attached hereto as Exhibit
“A” the “Conversion Notice”) (the denominator) (the “Conversion Price”). The
Holder shall submit a Conversion Notice indicating the amount of the Debenture being converted and the number of Conversion Shares
issuable upon such conversion, and where the Conversion Shares should be delivered.

 

(2)       The
Holder’s Conversion Limitations. The Company shall not affect any conversion of this Debenture, and the Holder shall
not have the right to convert any portion of this Debenture, to the extent that after giving effect to the conversion set forth
on the Conversion Notice submitted by the Holder, the Holder (together with the Holder’s affiliates (as defined herein) and
any Persons acting as a group together with the Holder or any of the Holder’s affiliates) would beneficially own in excess
of the Beneficial Ownership Limitation (as defined herein). To ensure compliance with this restriction, prior to delivery of any
Conversion Notice, the Holder shall have the right to request that the Company provide to the Holder a written statement of the
percentage ownership of the Company’s Common Stock that would by beneficially owned by the Holder and its affiliates in the
Company if the Holder converted such portion of this Debenture then intended to be converted by Holder. The Company shall, within
three (3) business days of such request, provide Holder with the requested information in a written statement, and the Holder shall
be entitled to rely on such written statement from the Company in issuing its Conversion Notice and ensuring that its ownership
of the Company’s Common Stock is not in excess of the Beneficial Ownership Limitation. The restriction described in this
Section may be waived by Holder, in whole or in part, upon notice from the Holder to the Company. For purposes of this Debenture,
the “Beneficial Ownership Limitation” shall be 4.99% of the number of shares of Common Stock outstanding immediately
after giving effect to the issuance of shares of Common Stock issuable upon conversion of this Debenture. The limitations contained
in this Section shall apply to any successor holder of this Debenture. For purposes of this Debenture, “Person”
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization
or a government or any department or agency thereof.

 

(3)      Mechanics
of Conversion.The conversion of this Debenture shall be conducted in the following manner:

 

(a)       Holder’s
Delivery Requirements. To convert this Debenture into shares of Common Stock on any date set forth in the Conversion Notice
by the Holder (the “Conversion Date”), the Holder shall transmit by facsimile or electronic mail (or otherwise
deliver) a copy of the fully executed Conversion Notice to the Company (or, under certain circumstances as set forth below, by
delivery of the Conversion Notice to the Company’s transfer agent).

 

    	 	8	 

     

    

 

(b)       Company’s
Response. Upon receipt by the Company of a copy of a Conversion Notice, the Company shall as soon as practicable, but in no
event later than three (3) Business Days after receipt of such Conversion Notice, send, via facsimile or electronic mail (or otherwise
deliver) a confirmation of receipt of such Conversion Notice (the “Conversion Confirmation”) to the Holder indicating
that the Company will process such Conversion Notice in accordance with the terms herein. In the event the Company fails to issue
its Conversion Confirmation within said three (3) Business Day time period, the Holder shall have the absolute and irrevocable
right and authority to deliver the fully executed Conversion Notice to the Company’s transfer agent, and pursuant to the
terms of the Purchase Agreement, the Company’s transfer agent shall issue the applicable Conversion Shares to Holder as hereby
provided. Within five (5) Business Days after the date of the Conversion Confirmation (or the date of the Conversion Notice, if
the Company fails to issue the Conversion Confirmation), provided that the Company’s transfer agent is participating in the
Depository Trust Company (“DTC”) Fast Automated Securities Transfer (“FAST”) program, the
Company shall cause the transfer agent to (or, if for any reason the Company fails to instruct or cause its transfer agent to so
act, then pursuant to the Purchase Agreement, the Holder may request and require the Company’s transfer agent to) electronically
transmit the applicable Conversion Shares to which the Holder shall be entitled by crediting the account of the Holder’s
prime broker with DTC through its Deposit Withdrawal Agent Commission (“DWAC”) system, and provide proof satisfactory
to the Holder of such delivery. In the event that the Company’s transfer agent is not participating in the DTC FAST program
and is not otherwise DWAC eligible (or in the event the Holder otherwise requests), within five (5) Business Days after the date
of the Conversion Confirmation (or the date of the Conversion Notice, if the Company fails to issue the Conversion Confirmation),
the Company shall instruct and cause its transfer agent to (or, if for any reason the Company fails to instruct or cause its transfer
agent to so act, then pursuant to the Purchase Agreement, the Holder may request and require the Company’s transfer agent
to) issue and surrender to a nationally recognized overnight courier for delivery to the address specified in the Conversion Notice,
a certificate, registered in the name of the Holder or its nominee, for the number of Conversion Shares to which the Holder shall
be entitled. To effect conversions hereunder, the Holder shall not be required to physically surrender this Debenture to the Company
unless the entire principal amount of this Debenture, plus all accrued and unpaid interest thereon and other sums due hereunder,
has been so converted. Conversions hereunder shall have the effect of lowering the outstanding principal amount of this Debenture
in an amount equal to the applicable Conversion Amount. The Holder and the Company shall maintain records showing the principal
amount(s) converted and the date of such conversion(s). The Holder, and any assignee by acceptance of this Debenture, acknowledge
and agree that, by reason of the provisions of this paragraph, following conversion of a portion of this Debenture, the unpaid
and unconverted principal amount of this Debenture may be less than the amount stated on the face hereof.

 

(c)       Record
Holder. The Person(s) entitled to receive the shares of Common Stock issuable upon a conversion of this Debenture shall be
treated for all purposes as the record holder(s) of such shares of Common Stock as of the Conversion Date.

 

(d)       Failure
to Deliver Certificates. If in the case of any Conversion Notice, the certificate or certificates are not delivered to or as
directed by the Holder by the date required hereby, the Holder shall be entitled to elect by written notice to the Company at any
time on or before its receipt of such certificate or certificates, to rescind such Conversion Notice, in which event the Company
shall promptly return to the Holder any original Debenture delivered to the Company and the Holder shall promptly return to the
Company the Common Stock certificates representing the principal amount of this Debenture unsuccessfully tendered for conversion
to the Company.

 

    	 	9	 

     

    

 

(e)       Obligation
Absolute; Partial Liquidated Damages. The Company’s obligations to issue and deliver the Conversion Shares upon conversion
of this Debenture in accordance with the terms hereof are absolute and unconditional, irrespective of any action or inaction by
the Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against
any person or entity or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination, or
any breach or alleged breach by the Holder or any other person or entity of any obligation to the Company or any violation or alleged
violation of law by the Holder or any other person or entity, and irrespective of any other circumstance which might otherwise
limit such obligation of the Company to the Holder in connection with the issuance of such Conversion Shares; provided, however,
that such delivery shall not operate as a waiver by the Company of any such action the Company may have against the Holder . In
the event the Holder of this Debenture shall elect to convert any or all of the outstanding principal amount hereof and accrued
but unpaid interest thereon in accordance with the terms of this Debenture, the Company may not refuse conversion based on any
claim that the Holder or anyone associated or affiliated with the Holder has been engaged in any violation of law, agreement or
for any other reason, unless an injunction from a court, on notice to Holder, restraining and or enjoining conversion of all or
part of this Debenture shall have been sought and obtained, and the Company posts a surety bond for the benefit of the Holder in
the amount of 150% of the outstanding principal amount of this Debenture being converted, which is subject to the injunction, which
bond shall remain in effect until the completion of arbitration/litigation of the underlying dispute and the proceeds of which
shall be payable to such Holder to the extent it obtains judgment. In the absence of such injunction, the Company shall issue Conversion
Shares upon a properly noticed conversion. If the Company fails for any reason to deliver to the Holder such certificate or certificates
representing Conversion Shares pursuant to timing and delivery requirements of this Debenture, the Company shall pay to such Holder,
in cash, as liquidated damages and not as a penalty, for each $1,000 of principal amount being converted, $1.00 per day for each
day after the date by which such certificates should have been delivered until such certificates are delivered. Nothing herein
shall limit a Holder’s right to pursue actual damages or declare an Event of Default pursuant to this Debenture or any agreement
securing the indebtedness under this Debenture for the Company’s failure to deliver Conversion Shares within the period specified
herein and such Holder shall have the right to pursue all remedies available to it hereunder, at law or in equity, including, without
limitation, a decree of specific performance and/or injunctive relief. The exercise of any such rights shall not prohibit the Holder
from seeking to enforce damages pursuant to any other Section hereof or under applicable law. Nothing herein shall prevent the
Holder from having the Conversion Shares issued directly by the Company’s transfer agent in accordance with the Purchase
Agreement, in the event for any reason the Company fails to issue or deliver, or cause its transfer agent to issue and deliver,
the Conversion Shares to the Holder upon exercise of Holder’s conversion rights hereunder.

 

(f)       Transfer
Taxes. The issuance of certificates for shares of the Common Stock on conversion of this Debenture shall be made without charge
to the Holder hereof for any documentary stamp or similar taxes, or any other issuance or transfer fees of any nature or kind that
may be payable in respect of the issue or delivery of such certificates, any such taxes or fees, if payable, to be paid by the
Company.

 

    	 	10	 

     

    

 

(4)       Reservation
of Common Stock. The Company shall take all action necessary to at all times have authorized, and reserved for the purpose
of issuance, three (3) times such number of shares of Common Stock as shall be necessary to effect the full conversion of the Debenture
in accordance with its terms (the “Share Reserve”).  If upon receipt of a conversion notice from the Holder,
the Share Reserve is insufficient to effect the full conversion of the Debenture then outstanding, the Company shall increase the
Share Reserve accordingly.  If the Company does not have sufficient authorized and unissued shares of Common Stock available
to increase the Share Reserve, the Company shall cause its authorized and unissued shares to be increased within forty-five (45)
days to an amount of shares equal to two (2) times the Conversion Shares. The Company’s management shall recommend to the
shareholders to vote in favor of increasing the number of shares of Common Stock authorized.

 

(5)       Make-Whole
Rights. Upon liquidation by the Holder of Conversion Shares issued pursuant to a Conversion Notice, provided that the Holder
realizes a net amount from such liquidation equal to less than the Conversion Amount specified in the relevant Conversion Notice
(such net realized amount, the “Realized Amount”), the Company shall issue to the Holder additional shares of
the Company’s Common Stock equal to: (i) the Conversion Amount specified in the relevant Conversion Notice; minus (ii)
the Realized Amount, as evidenced by a reconciliation statement from the Holder (a “Sale Reconciliation”) showing
the Realized Amount from the sale of the Conversion Shares; divided by (iii) the average volume weighted average price of
the Company’s Common Stock during the five (5) Business Days immediately prior to the date upon which the Holder delivers
notice (the “Make-Whole Notice”) to the Company that such additional shares are requested by the Holder (the
“Make-Whole Stock Price”) (such number of additional shares to be issued, the “Make-Whole Shares”).
Upon receiving the Make-Whole Notice and Sale Reconciliation evidencing the number of Make-Whole Shares requested, the Company
shall instruct its transfer agent to issue certificates representing the Make-Whole Shares, which Make-Whole Shares shall be issued
and delivered in the same manner and within the same time frames as set forth herein. The Make-Whole Shares, when issued, shall
be deemed to be validly issued, fully paid, and non-assessable shares of the Company’s Common Stock. Following the sale of
the Make-Whole Shares by the Holder: (i) in the event that the Holder receives net proceeds from such sale which, when added to
the Realized Amount from the prior relevant Conversion Notice, is less than the Conversion Amount specified in the relevant Conversion
Notice, the Holder shall deliver an additional Make-Whole Notice to the Company following the procedures provided previously in
this paragraph, and such procedures and the delivery of Make-Whole Notices and issuance of Make-Whole Shares shall continue until
the Conversion Amount has been fully satisfied; and (ii) in the event that the Holder received net proceeds from the sale of Make-Whole
Shares in excess of the Conversion Amount specified in the relevant Conversion Notice, such excess amount shall be applied to satisfy
any and all amounts owed hereunder in excess of the Conversion Amount specified in the relevant Conversion Notice.

 

(6)       Adjustments
to Conversion Price.

 

    	 	11	 

     

    

 

(a)       Stock
Dividends and Stock Splits. If the Company, at any time while this Debenture is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions payable in shares of Common Stock on outstanding shares of Common Stock, (ii) subdivides
outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of a reverse stock split) outstanding
shares of Common Stock into a smaller number of shares, or (iv) issues, in the event of a reclassification of shares of Common
Stock, any shares of capital stock of the Company, then the Conversion Price shall be multiplied by a fraction, the numerator of
which shall be the number of shares of Common Stock (excluding any treasury shares of the Company) outstanding immediately before
such event, and the denominator of which shall be the number of shares of Common Stock outstanding immediately after such event.
Any adjustment made pursuant to this Section shall become effective immediately after the record date for the determination of
stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date
in the case of a subdivision, combination, or re-classification.

 

(b)       Fundamental
Transaction. If, at any time while this Debenture is outstanding: (i) the Company effects any merger or consolidation of the
Company with or into another Person, (ii) the Company effects any sale of all or substantially all of its assets in one transaction
or a series of related transactions, (iii) any tender offer or exchange offer (whether by the Company or another Person) is completed
pursuant to which holders of Common Stock are permitted to tender or exchange their shares for other securities, cash or property,
or (iv) the Company effects any reclassification of the Common Stock or any compulsory share exchange pursuant to which the Common
Stock is effectively converted into or exchanged for other securities, cash or property (in any such case, a “Fundamental
Transaction”), then upon any subsequent conversion of this Debenture, the Holder shall have the right to receive, for
each Conversion Share that would have been issuable upon such conversion immediately prior to the occurrence of such Fundamental
Transaction, the same kind and amount of securities, cash or property as it would have been entitled to receive upon the occurrence
of such Fundamental Transaction if it had been, immediately prior to such Fundamental Transaction, the holder of one (1) share
of Common Stock (the “Alternate Consideration”). For purposes of any such conversion, the determination of the
Conversion Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration
issuable in respect of one (1) share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Conversion
Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the
Alternate Consideration. If holders of Common Stock are given any choice as to the securities, cash or property to be received
in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon
any conversion of this Debenture following such Fundamental Transaction. To the extent necessary to effectuate the foregoing provisions,
any successor to the Company or surviving entity in such Fundamental Transaction shall issue to the Holder a new note consistent
with the foregoing provisions and evidencing the Holder’s right to convert such note into Alternate Consideration. The terms
of any agreement pursuant to which a Fundamental Transaction is effected shall include terms requiring any such successor or surviving
entity to comply with the provisions of this Section and insuring that this Debenture (or any such replacement security) will be
similarly adjusted upon any subsequent transaction analogous to a Fundamental Transaction.

 

    	 	12	 

     

    

 

(c)       Adjustment
to Conversion Price. Whenever the Conversion Price is adjusted pursuant to any provision of this Debenture, the Company shall
promptly deliver to Holder a notice setting forth the Conversion Price after such adjustment and setting forth a brief statement
of the facts requiring such adjustment.

 

(d)       Notice
to Allow Conversion by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on
the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C)
the Company shall authorize the granting to all holders of the Common Stock of rights or warrants to subscribe for or purchase
any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required
in connection with any reclassification of the Common Stock, 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, of any compulsory share exchange whereby the Common Stock
is converted into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution,
liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be filed at each office
or agency maintained for the purpose of conversion of this Debenture, and shall cause to be delivered to the Holder at its last
address as it shall appear upon the Company’s records, at least twenty (20) calendar days prior to the applicable record
or effective date hereinafter specified, a notice stating: (x) the date on which a record is to be taken for the purpose of such
dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of
the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined,
or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective
or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their
shares of the Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger,
sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders
of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property
deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange, provided that the failure to deliver
such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to
be specified in such notice. The Holder is entitled to convert this Debenture during the 10-day period commencing on the date of
such notice through the effective date of the event triggering such notice.

 

[signature page follows]

 

    	 	13	 

     

    

 

IN WITNESS WHEREOF
with the intent to be legally bound hereby, the Company has executed this Senior Secured, Convertible, Redeemable Debenture
as of the date first written above.

 

INVENTERGY GLOBAL, INC.

 

	By:	/s/ Joe Beyers	 
	Name:	Joe Beyers	 
	Title:	Chief Executive Officer	 

 

	STATE OF 	 	)	 
	 	 	)   SS.	 
	COUNTY OF 	 	)	 

   

The undersigned, a
Notary Public in and for the said County, in the State aforesaid, DOES HEREBY CERTIFY that Joe Beyers, the Chief Executive Officer
of Inventergy Global, Inc., a Delaware corporation, who is personally known to me to be the same person whose name is subscribed
to the foregoing instrument, appeared before me this day in person and acknowledged that he/she signed and delivered the said instrument
as his/her own free and voluntary act and as the free and voluntary act of said corporation, for the uses and purposes therein
set forth.

 

GIVEN under my hand and notarial seal this
_____ day of ________________, 20____.

 

	 	 	 
	 	Notary Public	 
	 	 	 
	 	My Commission Expires:	 
	 	 	 

 

[Signature Page to Fee Debenture]

 

     

     

    

 

CONSENT AND AGREEMENT

 

The undersigned, referred to in the foregoing
securities purchase agreement as a guarantor, hereby consents and agrees to said securities purchase agreement and to the payment
of the amounts contemplated therein, documents contemplated thereby and to the provisions contained therein relating to conditions
to be fulfilled and obligations to be performed by it pursuant to or in connection with said securities purchase agreement to the
same extent as if the undersigned were a party to said securities purchase agreement.

 

GUARANTOR:

 

INVENTERGY, INC.

 

	By:	/s/ Joe Beyers	 
	Name:	Joe Beyers	 
	Title:	Chief Executive Officer	 

 

	STATE OF 	 	)	 
	 	 	)   SS.	 
	COUNTY OF 	 	)	 

  

The undersigned, a
Notary Public in and for the said County, in the State aforesaid, DO HEREBY CERTIFY that Joe Beyers, Chief Executive Officer of
Inventergy Inc., a Delaware corporation who is personally known to me to be the same person whose name is subscribed to the foregoing
instrument, appeared before me this day in person and acknowledged that he/she signed and delivered the said instrument as his/her
own free and voluntary act and as the free and voluntary act of said corporation, for the uses and purposes therein set forth.

 

GIVEN under my hand and notarial seal this
_____ day of ________________, 20____.

 

	 	 	 
	 	Notary Public	 
	 	 	 
	 	My Commission Expires:	 
	 	 	 

 

[Signature Page to Fee Debenture]

 

     

     

    

 

CONSENT AND AGREEMENT

 

The undersigned, referred to in the foregoing
securities purchase agreement as a guarantor, hereby consents and agrees to said securities purchase agreement and to the payment
of the amounts contemplated therein, documents contemplated thereby and to the provisions contained therein relating to conditions
to be fulfilled and obligations to be performed by it pursuant to or in connection with said securities purchase agreement to the
same extent as if the undersigned were a party to said securities purchase agreement.

 

GUARANTOR:

 

EON COMMUNICATIONS SYSTEMS, INC.

 

	By:	/s/ Joe Beyers	 
	Name:	Joe Beyers	 
	Title:	Chief Executive Officer	 

 

	STATE OF 	 	)	 
	 	 	)   SS.	 
	COUNTY OF 	 	)	 

 

The undersigned, a
Notary Public in and for the said County, in the State aforesaid, DO HEREBY CERTIFY that Joe Beyers, Chief Executive Officer of
eOn Communications Systems, Inc., a Delaware corporation who is personally known to me to be the same person whose name is subscribed
to the foregoing instrument, appeared before me this day in person and acknowledged that he/she signed and delivered the said instrument
as his/her own free and voluntary act and as the free and voluntary act of said corporation, for the uses and purposes therein
set forth.

 

GIVEN under my hand and notarial seal this
_____ day of ________________, 20____.

 

	 	 	 
	 	Notary Public	 
	 	 	 
	 	My Commission Expires:	 
	 	 	 

 

[Signature Page to Fee Debenture]

 

     

     

    

 

CONSENT AND AGREEMENT

 

The undersigned, referred to in the foregoing
securities purchase agreement as a guarantor, hereby consents and agrees to said securities purchase agreement and to the payment
of the amounts contemplated therein, documents contemplated thereby and to the provisions contained therein relating to conditions
to be fulfilled and obligations to be performed by it pursuant to or in connection with said securities purchase agreement to the
same extent as if the undersigned were a party to said securities purchase agreement.

 

GUARANTOR:

 

INVENTERGY HOLDING, LLC

 

	By:	/s/ Joe Beyers	 
	Name:	Joe Beyers	 
	Title:	Chief Executive Officer	 

 

	STATE OF 	 	)	 
	 	 	)   SS.	 
	COUNTY OF 	 	)	 

 

The undersigned, a
Notary Public in and for the said County, in the State aforesaid, DO HEREBY CERTIFY that Joe Beyers, Chief Executive Officer of
Inventergy Holding, LLC, a Delaware limited liability company who is personally known to me to be the same person whose name is
subscribed to the foregoing instrument, appeared before me this day in person and acknowledged that he/she signed and delivered
the said instrument as his/her own free and voluntary act and as the free and voluntary act of said limited liability company,
for the uses and purposes therein set forth.

 

GIVEN under my hand and notarial seal this
_____ day of ________________, 20____.

 

	 	 	 
	 	Notary Public	 
	 	 	 
	 	My Commission Expires:	 
	 	 	 

 

[Signature Page to Fee Debenture]

 

     

     

    

 

CONSENT AND AGREEMENT

 

The undersigned, referred to in the foregoing
securities purchase agreement as a guarantor, hereby consents and agrees to said securities purchase agreement and to the payment
of the amounts contemplated therein, documents contemplated thereby and to the provisions contained therein relating to conditions
to be fulfilled and obligations to be performed by it pursuant to or in connection with said securities purchase agreement to the
same extent as if the undersigned were a party to said securities purchase agreement.

 

GUARANTOR:

 

INVENTERGY INNOVATIONS, LLC

 

	By:	/s/ Joe Beyers	 
	Name:	Joe Beyers	 
	Title:	Chief Executive Officer	 

 

	STATE OF 	 	)	 
	 	 	)   SS.	 
	COUNTY OF 	 	)	 

 

The undersigned, a
Notary Public in and for the said County, in the State aforesaid, DO HEREBY CERTIFY that Joe Beyers, Chief Executive Officer of
Inventergy Innovations, LLC, a Delaware limited liability company who is personally known to me to be the same person whose name
is subscribed to the foregoing instrument, appeared before me this day in person and acknowledged that he/she signed and delivered
the said instrument as his/her own free and voluntary act and as the free and voluntary act of said limited liability company,
for the uses and purposes therein set forth.

 

GIVEN under my hand and notarial seal this
_____ day of ________________, 20____.

 

	 	 	 
	 	Notary Public	 
	 	 	 
	 	My Commission Expires:	 
	 	 	 

 

[Signature Page to Fee Debenture]

 

     

     

    

 

CONSENT AND AGREEMENT

 

The undersigned, referred to in the foregoing
securities purchase agreement as a guarantor, hereby consents and agrees to said securities purchase agreement and to the payment
of the amounts contemplated therein, documents contemplated thereby and to the provisions contained therein relating to conditions
to be fulfilled and obligations to be performed by it pursuant to or in connection with said securities purchase agreement to the
same extent as if the undersigned were a party to said securities purchase agreement.

 

GUARANTOR:

 

INVENTERGY LBS, LLC

 

	By:	/s/ Joe Beyers	 
	Name:	Joe Beyers	 
	Title:	Chief Executive Officer	 

 

	STATE OF 	 	)	 
	 	 	)   SS.	 
	COUNTY OF 	 	)	 

 

The undersigned, a
Notary Public in and for the said County, in the State aforesaid, DO HEREBY CERTIFY that Joe Beyers, Chief Executive Officer of
Inventergy LBS LLC, a Delaware limited liability company who is personally known to me to be the same person whose name is subscribed
to the foregoing instrument, appeared before me this day in person and acknowledged that he/she signed and delivered the said instrument
as his/her own free and voluntary act and as the free and voluntary act of said limited liability company, for the uses and purposes
therein set forth.

 

GIVEN under my hand and notarial seal this
_____ day of ________________, 20____.

 

	 	 	 
	 	Notary Public	 
	 	 	 
	 	My Commission Expires:	 
	 	 	 

 

[Signature Page to Fee Debenture]

 

     

     

    

 

SCHEDULE A

 

PAYMENT SCHEDULE

 

Payable monthly in an amount equal to Ninety
Two and One Tenth Percent (92.1%) of the total amount which is otherwise payable to the holders of the Class B Shares of INVT SPE,
LLC, a Delaware limited liability company.

 

     

     

    

 

EXHIBIT A

 

NOTICE OF CONVERSION

 

The undersigned
hereby elects to convert principal and/or interest under the Senior Secured, Convertible, Redeemable Debenture (the “Debenture”)
issued by Inventergy Global, Inc., a corporation incorporated under the laws of the State of Delaware (the “Company”),
into shares of common stock, par value $0.001 per share (the “Common Shares”), of the Company in accordance
with the conditions of the Debenture, as of the date written below.

 

Based solely
on information provided by the Company to Holder, the undersigned represents and warrants to the Company that its ownership of
the Common Shares does not exceed the Beneficial Ownership Limitation as specified under the Note.

 

	Conversion Calculations 

Effective Date of Conversion:	 	 
	Principal Amount and/or Interest to be Converted:	 	 
	 	 	 
	Number of Common Shares to be Issued:	 	 

 

	 	[HOLDER]	 
	 	 	 
	 	By:	 
	 	 	 
	 	Name:	 
	 	 	 
	 	Title:	 
	 	 	 
	 	Address:Exhibit 10.4

 

SECURITY AGREEMENT

 

This SECURITY AGREEMENT
(“Agreement”) is made and effective as of December 29, 2017, is executed by and between _______________,
a ___________ under the laws of the State of Delaware (the “Company”), in favor of TCA GLOBAL CREDIT MASTER
FUND, LP, a limited partnership organized and existing under the laws of the Cayman Islands (the “Secured Party”).

 

WHEREAS, pursuant
to a Securities Purchase Agreement dated and effective as of even date herewith by and between Company and the Secured Party (the
“Purchase Agreement”), the Company has agreed to issue to the Secured Party and the Secured Party has agreed
to purchase from Company certain senior secured convertible redeemable debentures (the “Debentures”), as more
specifically set forth in the Purchase Agreement; 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 Secured Party an unconditional and continuing, first priority security interest
in all of the assets and property of the Company to secure the prompt payment, performance and discharge in full of all of Company’s
obligations under the Debentures, the Purchase Agreement and the other Transaction Documents.

 

NOW, THEREFORE, in
consideration of the mutual covenants and agreements of the parties hereinafter set forth and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the parties each intending to be legally bound, hereby do agree as
follows:

 

1.            Recitals.
The recitations set forth in the preamble of this Agreement are true and correct and incorporated herein by this reference.

 

2.            Construction
and Definition of Terms. In this Agreement, unless the express context otherwise requires: (i) the words “herein,”
“hereof’ and “hereunder” and words of similar import refer to this Agreement as a whole and not to any
particular provision of this Agreement; (ii) references to the words “Section” or “Subsection” refer to
the respective Sections and Subsections of this Agreement, and references to “Exhibit” or “Schedule” refer
to the respective Exhibits and Schedules attached hereto; (iii) wherever the word “include,” “includes”
or “including” is used in this Agreement, it will be deemed to be followed by the words “without limitation.”
All capitalized terms used in this Agreement that are defined in the Purchase Agreement or otherwise defined in Articles 8 or 9
of the Code shall have the meanings assigned to them in the Purchase Agreement or the Code, respectively and as applicable, unless
the context of this Agreement requires otherwise. In addition to the capitalized terms defined in the Code and the Purchase Agreement,
unless the context otherwise requires, when used herein, the following capitalized terms shall have the following meanings (provided
that if a capitalized term used herein is defined in the Purchase Agreement and separately defined in this Agreement, the meaning
of such term as defined in this Agreement shall control for purposes of this Agreement):

 

    	1

     

    

 

(a)          “Agreement”
means this Security Agreement and all amendments, modifications and supplements hereto.

 

(b)          “Bankruptcy
Code” means the United States Bankruptcy Code, as amended from time to time, or any other similar laws, codes, rules
or regulations relating to bankruptcy, insolvency or the protection of creditors.

 

(c)          “Business
Premises” shall mean the Company’s offices located at 19925 Stevens Creek Blvd., #100, Cupertino, CA 95014.

 

(d)          “Closing”
shall mean the date on which this Agreement is fully executed by both parties.

 

(e)          “Code”
shall mean the Uniform Commercial Code as in effect from time to time in the State of Nevada, provided that terms used herein which
are defined in the Code as in effect in the State of Nevada on the date hereof shall continue to have the same meaning notwithstanding
any replacement or amendment of such statute, except as the Secured Party may otherwise agree.

 

(f)          “Collateral”
shall mean any and all property of the Company, of any kind or description, tangible or intangible, real, personal or mixed, wheresoever
located and whether now existing or hereafter arising or acquired, including the following: (i) all property of, or for the account
of, the Company now or hereafter coming into the possession, control or custody of, or in transit to, Secured Party or any agent
or bailee for Secured Party or any parent, affiliate or subsidiary of Secured Party or any participant with Secured Party in the
Obligations (whether for safekeeping, deposit, collection, custody, pledge, transmission or otherwise), including all cash, earnings,
dividends, interest, or other rights in connection therewith and the products and proceeds therefrom, including the proceeds of
insurance thereon; (ii) the following additional property of the Company, whether now existing or hereafter arising or acquired,
and wherever now or hereafter located, together with all additions and accessions thereto, substitutions, betterments and replacements
therefor, products and Proceeds therefrom, and all of the Company’s books and records and recorded data relating thereto
(regardless of the medium of recording or storage), together with all of the Company’s right, title and interest in and to
all computer software required to utilize, create, maintain and process any such records or data on electronic media, including
all: (A) Accounts, and all goods whose sale, lease or other disposition by the Company has given rise to Accounts and have been
returned to, or repossessed or stopped in transit by, the Company, or rejected or refused by an Account debtor; (B) As-extracted
Collateral; (C) Chattel Paper (whether tangible or electronic); (D) Commodity Accounts; (E) Commodity Contracts; (F) Deposit Accounts,
including all cash and other property from time to time deposited therein and the monies and property in the possession or under
the control of the Secured Party or any affiliate, representative, agent, designee or correspondent of the Secured Party; (G) Documents;
(H) Equipment; (I) Farm Products; (J) Fixtures; (K) General Intangibles (including all Payment Intangibles); (L) Goods, and all
accessions thereto and goods with which the Goods are commingled; (M) Health-Care Insurance Receivables; (N) Instruments; (O) Inventory,
including raw materials, work-in-process and finished goods; (P) Investment Property; (Q) Letter-of-Credit Rights; (R) Promissory
Notes; (S) Software; (T) all Supporting Obligations; (U) all commercial tort claims hereafter arising; (V) all other tangible and
intangible personal property of the Company (whether or not subject to the Code), including, all bank and other accounts and all
cash and all investments therein, all proceeds, products, offspring, accessions, rents, profits, income, benefits, substitutions
and replacements of and to any of the property of the Company described within the definition of Collateral (including, any proceeds
of insurance thereon and all causes of action, claims and warranties now or hereafter held by the Company in respect of any of
the items listed within the definition of Collateral), and all books, correspondence, files and other Records, including, all tapes,
desks, cards, Software, data and computer programs in the possession or under the control of the Company or any other Person from
time to time acting for the Company, in each case, to the extent of the Company’s rights therein, that at any time evidence
or contain information relating to any of the property described or listed within the definition of Collateral or which are otherwise
necessary or helpful in the collection or realization thereof; (W) all real property interests of the Company and the interest
of the Company in fixtures related to such real property interests; and (X) Proceeds, including all Cash Proceeds and Noncash Proceeds,
and products of any or all of the foregoing, in each case howsoever the Company’s interest therein may arise or appear (whether
by ownership, security interest, claim or otherwise).

 

    	2

     

    

 

(g)          “Event
of Default” shall mean any of the events described in Section 4 hereof.

 

(h)          “Obligations”
shall have the meaning given to it in the Purchase Agreement.

 

3.           Security.

 

(a)          Grant
of Security Interest. As security for the full payment and performance of all of the Obligations, whether or not any instrument
or agreement relating to any Obligation specifically refers to this Agreement or the security interest created hereunder, the Company
hereby assigns, pledges and grants to Secured Party an unconditional, continuing, first priority security interest in all of the
Collateral. Secured Party’s security interest shall continually exist until all Obligations have been indefeasibly satisfied
and/or paid in full.

 

(b)          Representations,
Warranties. Covenants and Agreement of the Company. The Company covenants, warrants and represents, for the benefit of the
Secured Party, as follows:

 

(i)          The
Company has the requisite corporate power and authority to enter into this Agreement and otherwise to carry out its obligations
hereunder. The execution, delivery and performance by the Company of this Agreement and the filings contemplated herein 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.

 

    	3

     

    

 

(ii)         The
Company represents and warrants that it has no place of business or offices where its respective books of account and records are
kept or places where Collateral is stored or located, except for the Business Premises.

 

(iii)        The
Company is the sole owner of the Collateral (except for non-exclusive licenses granted by the Company in the Company’s Ordinary
Course of Business), free and clear of any and all Encumbrances. The Company is fully authorized to grant the security interests
in and to pledge the Collateral to Secured Party. There is not on file in any agency, land records or other office of any Governmental
Authority, 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 permit to be on file in any such agency, land records or other office 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).

 

(iv)        No
part of the Collateral has been judged invalid or unenforceable. No Claim, Proceeding or other notice or other similar item has
been received by the Company that any Collateral or the Company’s use of any Collateral violates the rights of any Person.
There has been no adverse decision or claim to the Company’s 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 Claim or Proceeding of any nature involving said rights pending or, to the best knowledge of the Company, threatened, before
any Governmental Authority.

 

(v)         The
Company shall at all times maintain its books of account and records relating to the Collateral and maintain the Collateral at
the Business Premises, and the Company shall not relocate such books of account and records or Collateral, except and unless: (A)
Secured Party first approves of such relocation, which approval may be withheld in Secured Party’s sole and absolute discretion;
(B) evidence that appropriate financing statements and other necessary documents have been filed and recorded and other steps have
been taken to create in favor of the Secured Party valid, perfected and continuing liens in the Collateral; or (C) Collateral is
moved or relocated in the Company’s Ordinary Course of Business, provided, however, that any permanent relocation of any
of the Collateral shall require Secured Party’s prior written approval in accordance with Subsection 3(b)(v)(A) above.

 

(vi)        Upon
making the filings described in the immediately following sentence or by possession or control of such Collateral by Secured Party
or delivery of such Collateral to Secured Party, this Agreement creates, in favor of the Secured Party, a valid, perfected, security
interest in the Collateral. Except for the filing of financing statements on Form UCC-1 under the Code with the State of Delaware,
no authorization or approval of, or filing with, or notice to any Governmental Authority is required either: (A) 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 (B) for the perfection of or exercise by the Secured Party of its rights and remedies hereunder.

 

    	4

     

    

 

(vii)       Simultaneous
with the execution of this Agreement, the Company hereby authorizes the Secured Party to file one or more UCC financing statements,
and any continuations, amendments, or assignments thereof with respect to the security interests on the Collateral granted hereby,
with the State of Delaware and in such other jurisdictions as may be requested or desired by the Secured Party.

 

(viii)      The
execution, delivery and performance of this Agreement, and the granting of the security interests contemplated hereby, will not:
(A) constitute a violation of or conflict with the Certificate of Incorporation, Bylaws or any other organizational or governing
documents of the Company; (B) constitute a violation of, or a default or breach under (either immediately, upon notice, upon lapse
of time, or both), or conflicts with, or gives to any other Person any rights of termination, amendment, acceleration or cancellation
of, any provision of any Contract or agreement to which Company is a party or by which any of the Collateral may be bound; (C)
constitute a violation of, or a default or breach under (either immediately, upon notice, upon lapse of time, or both), or conflicts
with, any Judgment of any Governmental Authority; (D) constitute a violation of, or conflict with, any Law; or (E) result in the
loss or adverse modification of, or the imposition of any fine, penalty or other Encumbrance with respect to, any Permit granted
or issued to, or otherwise held by or for the use of, the Company or any of the Collateral. No Consent (including from stockholders
or creditors of the Company) is required for the Company to enter into and perform its obligations hereunder.

 

(ix)         The
Company shall at all times maintain the liens and security interests provided for hereunder as valid and perfected liens and security
interests in the Collateral in favor of the Secured Party until this Agreement and the security interests hereunder shall terminate
pursuant to Section 8(o) below. The Company shall at all times safeguard and protect all Collateral, at its own expense, 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 Code (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 interests granted 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 interests
hereunder.

 

(x)          The
Company will not transfer, pledge, hypothecate, encumber, license, sell or otherwise dispose of any of the Collateral without the
prior written consent of the Secured Party, which consent may be withheld in the Secured Party’s sole and absolute discretion,
except for transfers, sales or licenses made in the Company’s Ordinary Course of Business.

 

    	5

     

    

 

(xi)         The
Company shall keep, maintain and preserve all of the Collateral in good condition, repair and order and the Company will use, operate
and maintain the Collateral in compliance with all Laws, and in compliance with all applicable insurance requirements and regulations.

 

(xii)        The
Company shall, within five (5) days of obtaining knowledge thereof, advise the Secured Party promptly, in sufficient detail, of
any substantial or material change in the Collateral, and of the occurrence of any event which would have a Material Adverse Effect.

 

(xiii)       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, placing legends on Collateral or on books and records pertaining to Collateral stating that Secured
Party has a security interest therein.

 

(xiv)      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.

 

(xv)       The
Company shall promptly notify the Secured Party in sufficient detail upon becoming aware of any Claim, Proceeding, or any other
litigation, attachment, garnishment, execution or other legal process levied against any Collateral or of any Claim, Proceeding
or any other litigation, attachment, garnishment, execution or other legal process which Company knows or has reason to believe
is pending or threatened against it or the Collateral, and of any other information received by the Company that may materially
affect the value of the Collateral, the security interests granted hereunder or the rights and remedies of the Secured Party hereunder.

 

(xvi)      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.

 

(xvii)     Company
will promptly pay when due all Taxes and all transportation, storage, warehousing and all other charges and fees affecting or arising
out of or relating to the Collateral and shall defend the Collateral, at Company’s expense, against all claims of any Persons
claiming any interest in the Collateral adverse to Company or Secured Party.

 

(xviii)    During
normal business hours and subject to prior reasonable notice from Secured Party to the Company (which notice may be e-mail or telephonic
notice), Secured Party and its agents and designees may enter the Business Premises and any other premises of the Company and inspect
the Collateral and all books and records of the Company (in whatever form), and the Company shall pay the reasonable costs of such
inspections.

 

    	6

     

    

 

(xix)       The
Company shall maintain comprehensive casualty insurance on the Collateral against such risks, in such amounts, with such loss deductible
amounts and with such companies as may be reasonably satisfactory to the Secured Party, and each such policy shall contain a clause
or endorsement satisfactory to Secured Party naming Secured Party as loss payee and a clause or endorsement satisfactory to Secured
Party that such policy may not be canceled or altered and Secured Party may not be removed as loss payee without at least thirty
(30) days prior written notice to Secured Party. In all events, the amounts of such insurance coverages shall conform to prudent
business practices and shall be in such minimum amounts that Company will not be deemed a co-insurer under applicable insurance
laws, policies or practices. The Company hereby assigns to Secured Party and grants to Secured Party a security interest in any
and all proceeds of such policies and authorizes and empowers Secured Party to adjust or compromise any loss under such policies
and to collect and receive all such proceeds. The Company hereby authorizes and directs each insurance company to pay all such
proceeds directly and solely to Secured Party and not to the Company and Secured Party jointly. The Company authorizes and empowers
Secured Party to execute and endorse in Company’s name all proofs of loss, drafts, checks and any other documents or instruments
necessary to accomplish such collection, and any persons making payments to Secured Party under the terms of this subsection are
hereby relieved absolutely from any obligation or responsibility to see to the application of any sums so paid. After deduction
from any such proceeds of all costs and expenses (including attorney’s fees) incurred by Secured Party in the collection
and handling of such proceeds, the net proceeds shall be applied as follows: if no Event of Default shall have occurred and be
continuing, such net proceeds may be applied, at Company’s option, either toward replacing or restoring the Collateral, in
a manner and on terms satisfactory to Secured Party, or as a credit against such of the Obligations, whether matured or unmatured,
as Secured Party shall determine in Secured Party’s sole discretion. In the event that Company may and does elect to replace
or restore any of the Collateral as aforesaid, then such net proceeds shall be deposited in a segregated account opened in the
name and for the benefit of Secured Party, and such net proceeds shall be disbursed therefrom by Secured Party in such manner and
at such times as Secured Party deems appropriate to complete and insure such replacement or restoration; provided, however, that
if an Event of Default shall occur at any time before or after replacement or restoration has commenced, then thereupon Secured
Party shall have the option to apply all remaining net proceeds either toward replacing or restoring the Collateral, in a manner
and on terms satisfactory to Secured Party, or as a credit against such of the Obligations, whether matured or unmatured, as Secured
Party shall determine in Secured Party’s sole discretion. If an Event of Default shall have occurred prior to such deposit
of the net proceeds, then Secured Party may, in its sole discretion, apply such net proceeds either toward replacing or restoring
the Collateral, in a manner and on terms satisfactory to Secured Party, or as a credit against such of the Obligations, whether
matured or unmatured, as Secured Party shall determine in Secured Party’s sole discretion.

 

(xx)        The
Company shall cooperate with Secured Party to obtain and keep in effect one or more control agreements in Deposit Accounts, Electronic
Chattel Paper, Investment Property and Letter-of-Credit Rights Collateral. In addition, the Company, at the Company’s expense,
shall promptly: (A) execute all notices of security interest for each relevant type of Software and other General Intangibles in
forms suitable for filing with any United States or foreign office handling the registration or filing of patents, trademarks,
copyrights and other intellectual property and any successor office or agency thereto; and (B) take all commercially reasonable
steps in any Proceeding before any such office or any similar office or agency in any other country or any political subdivision
thereof, to diligently prosecute or maintain, as applicable, each application and registration of any Software, General Intangibles
or any other intellectual property rights and assets that are part of the Collateral, including filing of renewals, affidavits
of use, affidavits of incontestability and opposition, interference and cancellation proceedings.

 

    	7

     

    

 

(xxi)       Company
shall not file any amendments, correction statements or termination statements concerning the Collateral without the prior written
consent of Secured Party.

 

(c)          Collateral
Collections. After an Event of Default shall have occurred, Secured Party shall have the right at any and all times to enforce
the Company’s rights against all Persons obligated on any of the Collateral, including the right to: (i) notify and/or require
the Company to notify any or all Persons obligated on any of the Collateral to make payments directly to Secured Party or in care
of a post office lock box under the sole control of Secured Party established at Company’s expense, and to take any or all
action with respect to Collateral as Secured Party shall determine in its sole discretion, including, the right to demand, collect,
sue for and receive any money or property at any time due, payable or receivable on account thereof, compromise and settle with
any Person liable thereon, and extend the time of payment or otherwise change the terms thereof, without incurring any liability
or responsibility to the Company whatsoever; and/or (ii) require the Company to segregate and hold in trust for Secured Party and,
on the day of Company’s receipt thereof, transmit to Secured Party in the exact form received by the Company (except for
such assignments and endorsements as may be required by Secured Party), all cash, checks, drafts, money orders and other items
of payment constituting any portion of the Collateral or proceeds of the Collateral. Secured Party’s collection and enforcement
of Collateral against Persons obligated thereon shall be deemed to be commercially reasonable if Secured Party exercises the care
and follows the procedures that Secured Party generally applies to the collection of obligations owed to Secured Party.

 

(d)          Care
of Collateral. Company shall have all risk of loss of the Collateral. Secured Party shall have no liability or duty, either
before or after the occurrence of an Event of Default, on account of loss of or damage to, to collect or enforce any of its rights
against, the Collateral, to collect any income accruing on the Collateral, or to preserve rights against Persons with prior interests
in the Collateral. If Secured Party actually receives any notices requiring action with respect to Collateral in Secured Party’s
possession, Secured Party shall take reasonable steps to forward such notices to the Company. The Company is responsible for responding
to notices concerning the Collateral, voting the Collateral, and exercising rights and options, calls and conversions of the Collateral.
Secured Party’s sole responsibility is to take such action as is reasonably requested by Company in writing, however, Secured
Party is not responsible to take any action that, in Secured Party’s sole judgment, would affect the value of the Collateral
as security for the Obligations adversely. While Secured Party is not required to take certain actions, if action is needed, in
Secured Party’s sole discretion, to preserve and maintain the Collateral, Company authorizes Secured Party to take such actions,
but Secured Party is not obligated to do so.

 

    	8

     

    

 

4.            Events
of Default. The occurrence of any one or more of the following events shall constitute an “Event of Default”
hereunder:

 

(a)          Failure
to Pay. The failure of Company to pay any sum due under or as part of the Obligations within three (3) days following the date
when any such payment shall be due and payable (whether by acceleration, declaration, extension or otherwise).

 

(b)          Covenants
and Agreements.         The failure of Company to perform, observe or comply
with any and all of the covenants, promises and agreements of the Company in this Agreement, the Purchase Agreement or any other
Transaction Documents, which such failure is not cured by the Company within ten (10) Business Days after receipt of written notice
thereof from Secured Party, except that there shall be no notice or cure period with respect to any failure to pay any sums due
under or as part of the Obligations.

 

(c)          Information,
Representations and Warranties. If any representation or warranty made herein, in the Purchase Agreement or any other Transaction
Documents, or if any information contained in any financial statement, application, schedule, report or any other document given
by the Company in connection with the Obligations, with the Collateral, or with any Transaction Document, is not in all respects
true, accurate and complete, or if the Company omitted to state any material fact or any fact necessary to make such information
not misleading, and the Company shall not have provided an explanation satisfactory to the Holder within ten (10) Business Days
of notice from the Holder.

 

(d)          Default
on Other Obligations. The occurrence of any default under any other borrowing, Obligation or Contract of the Company, if the
result of such default would: (i) permit any Person which is a party to any such borrowing, Obligation or Contract, to accelerate
the maturity thereof, or to cancel or terminate any such borrowing, Obligation or Contract; (ii) cause or be reasonably expected
to cause a Material Adverse Effect; or (iii) materially and adversely affect, as determined by Secured Party in good faith, but
in its sole discretion, any of the Collateral, the value thereof, Secured Party’s rights and remedies to realize upon such
Collateral as set forth herein, or the Secured Party’s ability to comply with the Transaction Documents.

 

(e)          Insolvency.
The Company admits, in writing, its inability to pay its debts as they become due.

 

(f)          Involuntary
Bankruptcy. There shall be filed against Company an involuntary petition or other pleading seeking the entry of a decree or
order for relief under the Bankruptcy Code or any similar foreign, federal or state insolvency or similar laws ordering: (i) the
liquidation of the Company; or (ii) a reorganization of Company or the business and affairs of Company; or (iii) the appointment
of a receiver, liquidator, assignee, custodian, trustee, or similar official for Company of the property of Company, and the failure
to have such petition or other pleading denied or dismissed within thirty (30) calendar days from the date of filing.

 

    	9

     

    

 

(g)          Voluntary
Bankruptcy. The commencement by the Company of a voluntary case under the Bankruptcy Code or any foreign, federal or state
insolvency or similar laws or the consent by the Company to the appointment of or taking possession by a receiver, liquidator,
assignee, trustee, custodian, or similar official for Company of any of the property of the Company or the making by the Company
of an assignment for the benefit of creditors, or the failure by the Company generally to pay its debts as the debts become due.

 

(h)          Judgments,
Awards. The entry of any final and non-appealable Judgment or other determination or adjudication against the Company and a
determination by Secured Party, in good faith but in its sole discretion, that any such Judgment or other determination or adjudication
could have a Material Adverse Effect, or could otherwise adversely affect the prospect for Secured Party to fully and punctually
realize the full benefits conferred on Secured Party by this Agreement and the other Transaction Documents, or the prospect of
repayment of all the Obligations.

 

(i)          Injunction.         The
injunction or restraint of the Company in any manner from conducting its business in whole or in part and a determination by Secured
Party, in good faith but in its sole discretion, that the same could have a Material Adverse Effect, or could otherwise adversely
affect the prospect for Secured Party to fully and punctually realize the full benefits conferred on Secured Party by this Agreement
and the other Transaction Documents, or the prospect of repayment of all the Obligations.

 

(j)          Attachment
by Other Parties. Any Assets of the Company shall be attached, levied upon, seized or repossessed, or come into the possession
of a trustee, receiver or other custodian and a determination by Secured Party, in good faith but in its sole discretion, that
the same could have a Material Adverse Effect, or could otherwise adversely affect the prospect for Secured Party to fully and
punctually realize the full benefits conferred on Secured Party by this Agreement and the other Transaction Documents, or the prospect
of repayment of all the Obligations.

 

(k)          Adverse
Change in Financial Condition.         The determination in good faith by Secured
Party that an event has occurred, either in the financial condition or operations of the Company, or the Collateral, or otherwise,
which event could have a Material Adverse Effect, or could otherwise adversely affect the prospect for Secured Party to fully and
punctually realize the full benefits conferred on Secured Party by this Agreement and the other Transaction Documents.

 

(1)         Adverse
Change in Value of Collateral.         The determination in good faith by Secured
Party that the security for the Obligations is or has become inadequate.

 

5.            Rights
and Remedies.

 

(a)          Rights
and Remedies of Secured Party. Upon and after the occurrence of an Event of Default that is not timely cured within an applicable
cure period hereunder (or, as to clause (c) thereunder, on the tenth (10th) Trading Day following notice from the Holder
if the Company is unable to provide an explanation satisfactory to the Holder), Secured Party may, without notice or demand, exercise
in any jurisdiction in which enforcement hereof is sought, the following rights and remedies, in addition to the rights and remedies
available to Secured Party under the Purchase Agreement and any other Transaction Documents, the rights and remedies of a secured
party under the Code, and all other rights and remedies available to Secured Party under applicable law or in equity, all such
rights and remedies being cumulative and enforceable alternatively, successively or concurrently:

 

    	10

     

    

 

(i)          Take
absolute control of the Collateral including transferring into the Secured Party’s name or into the name of its nominee or
nominees (to the extent the Secured Party has not theretofore done so) and thereafter receive, for the benefit of the Secured Party,
all payments made thereon, give all consents, waivers and ratifications in respect thereof and otherwise act with respect thereto
as though it were the outright owner thereof;

 

(ii)         Require the
Company to, and the Company hereby agrees that it will at its expense and upon request of the Secured Party forthwith, assemble
all or part of the Collateral as directed by the Secured Party and make it available to the Secured Party at a place or places
to be designated by the Secured Party that is convenient to Secured Party, and the Secured Party may enter into and occupy the
Business Premises or any other premises owned or leased by the Company where the Collateral or any part thereof is located or assembled
in order to effectuate the Secured Party’s rights and remedies hereunder or under law, including removing such Collateral
therefrom, without any obligation or liability to the Company in respect of such occupation, the Company HEREBY WAIVING ANY AND
ALL RIGHTS TO PRIOR NOTICE AND TO JUDICIAL HEARING WITH RESPECT TO REPOSSESSION OF COLLATERAL AND THE COMPANY HEREBY GRANTING TO
SECURED PARTY AND ITS AGENTS AND REPRESENTATIVES FULL AUTHORITY TO ENTER SUCH PREMISES;

 

(iii)        Without
notice, except as specified below, and without any obligation to prepare or process the Collateral for sale: (A) sell the Collateral
or any part thereof in one or more parcels at public or private sale, at any of the Secured Party’s offices or elsewhere,
for cash, on credit or for future delivery, and at such price or prices and upon such other terms as the Secured Party may deem
commercially reasonable; and/or (B) lease, license or dispose of the Collateral or any part thereof upon such terms as the Secured
Party may deem commercially reasonable. The Company agrees that, to the extent notice of sale or any other disposition of the Collateral
shall be required by law, at least ten (10) Business Days’ notice to the Company of the time and place of any public sale
or the time after which any private sale or other disposition of the Collateral is to be made shall constitute reasonable notification.
The Secured Party shall not be obligated to make any sale or other disposition of any Collateral regardless of notice of sale having
been given. The Secured Party may adjourn any public or private sale from time to time by announcement at the time and place fixed
therefor and such sale may, without further notice, be made at the time and place to which it was so adjourned. The Company hereby
waives any claims and actions against the Secured Party arising by reason of the fact that the price at which any of the Collateral
may have been sold at a private sale was less than the price which might have been obtained at a public sale or was less than the
aggregate amount of the Obligations, even if the Secured Party accepts the first offer received and does not offer such Collateral
to more than one offeree, and waives all rights that the Company may have to require that all or any part of such Collateral be
marshaled upon any sale (public or private) thereof. The Company hereby acknowledges that: (X) any such sale of the Collateral
by the Secured Party shall be made without warranty; (Y) the Secured Party may specifically disclaim any warranties of title, possession,
quiet enjoyment or the like; and (Z) such actions set forth in clauses (X) and (Y) above shall not adversely affect the commercial
reasonableness of any such sale of Collateral. In addition to the foregoing: (1) upon written notice to the Company from the Secured
Party after and during the continuance of an Event of Default, the Company shall cease any use of any intellectual property or
any trademark, patent or copyright similar thereto for any purpose described in such notice; (2) the Secured Party may, at any
time and from time to time after and during the continuance of an Event of Default, license, whether general, special or otherwise,
and whether on an exclusive or non-exclusive basis, any of the Company’s intellectual property, throughout the universe for
such term or terms, on such conditions, and in such manner, as the Secured arty shall in its sole discretion determine; and (3)
the Secured Party may, at any time, pursuant to the authority granted under this Agreement (such authority being effective upon
the occurrence and during the continuance of an Event of Default), execute and deliver on behalf of the Company, one or more instruments
of assignment of any intellectual property (or any application or registration thereof), in form suitable for filing, recording
or registration in any country.

 

    	11

     

    

 

(iv)        Operate,
manage and control the Collateral (including use of the Collateral and any other property or assets of Company in order to continue
or complete performance of Company’s obligations under any contracts of Company), or permit the Collateral or any portion
thereof to remain idle or store the same, and collect all rents and revenues therefrom.

 

(v)         Enforce
the Company’s rights against any Persons obligated upon any of the Collateral.

 

(vi)        The
Company hereby acknowledges that if the Secured Party complies with any applicable foreign, state, provincial or federal law requirements
in connection with a disposition of the Collateral, such compliance will not adversely affect the commercial reasonableness of
any sale or other disposition of the Collateral.

 

(vii)       The
Secured Party shall not be required to marshal any present or future collateral security (including, this Agreement and the Collateral)
for, or other assurances of payment of, the Obligations or any of them or to resort to such collateral security or other assurances
of payment in any particular order, and all of the Secured Party’s rights hereunder and in respect of such collateral security
and other assurances of payment shall be cumulative and in addition to all other rights, however existing or arising. To the extent
that the Company lawfully may, the Company hereby agrees that it will not invoke any law relating to the marshaling of collateral
which might cause delay in or impede the enforcement of the Secured Party’s rights under this Agreement or under any other
instrument creating or evidencing any of the Obligations or under which any of the Obligations is outstanding or by which any of
the Obligations is secured or payment thereof is otherwise assured, and, to the extent that it lawfully may, the Company hereby
irrevocably waives the benefits of all such laws.

 

    	12

     

    

 

(b)          Power
of Attorney. Effective upon the occurrence of an Event of Default, Company hereby designates and appoints Secured Party and
its designees as attorney-in-fact of and for the Company, irrevocably and with full power of substitution, with authority to endorse
the Company’s name on any notes, acceptances, checks, drafts, money orders, instruments or other evidences of payment or
proceeds of the Collateral that may come into Secured Party’s possession; to execute proofs of claim and loss; to adjust
and compromise any claims under insurance policies; and to perform all other acts necessary and advisable, in Secured Party’s
sole discretion, to carry out and enforce this Agreement and the rights and remedies conferred upon the Secured Party by this Agreement,
the Purchase Agreement or any other Transaction Documents. All acts of said attorney or designee are hereby ratified and approved
by the Company and said attorney or designee shall not be liable for any acts of commission or omission, nor for any error of judgment
or mistake of fact or law. This power of attorney is coupled with an interest and is irrevocable so long as any of the Obligations
remain unpaid or unperformed or there exists any commitment by Secured Party which could give rise to any Obligations.

 

(c)          Costs
and Expenses. The Company agrees to pay to the Secured Party, upon demand, the amount of any and all costs and expenses, including
the reasonable fees, costs, expenses and disbursements of counsel for the Secured Party and of any experts and agents, which the
Secured Party 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 Party hereunder; or (iv) the failure by the Company to perform or observe any of the provisions hereof. Included
in the foregoing shall be the amount of all expenses paid or incurred by Secured Party in consulting with counsel concerning any
of its rights hereunder, under the Purchase Agreement or under applicable law, as well as such portion of Secured Party’s
overhead as Secured Party shall allocate to collection and enforcement of the Obligations in Secured Party’s sole but reasonable
discretion. All such costs and expenses shall bear interest from the date of outlay until paid, at the highest rate set forth in
the Debenture, or if none is so stated, the highest rate allowed by law. The provisions of this Subsection shall survive the termination
of this Agreement and Secured Party’s security interest hereunder and the payment of all Obligations.

 

6.            Security
Interest Absolute. All rights of the Secured Party and all Obligations of the Company hereunder, shall be absolute and unconditional,
irrespective of: (i) any lack of validity or enforceability of this Agreement, the Purchase Agreement, and any other Transaction
Documents or any agreement entered into in connection with the foregoing, or any portion hereof or thereof; (ii) 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 terms and provisions of the Purchase Agreement, any other Transaction Documents,
or any other agreement entered into in connection with the foregoing; (iii) any exchange, release or non-perfection 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; (iv) 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 (v) 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 interests 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, the running of the statute of limitations or
bankruptcy. 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 Code or any other similar insolvency or bankruptcy laws of any jurisdiction , 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 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.

 

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7.            Indemnity.
The Company agrees to defend, protect, indemnify and hold the Secured Party forever harmless from and against any and all Claims
of any nature or kind (including reasonable legal fees, costs, expenses, and disbursements of counsel) to the extent that they
arise out of, or otherwise result from, this Agreement (including, enforcement of this Agreement). This indemnity shall survive
termination of this Agreement.

 

8.            Miscellaneous.

 

(a)          Performance
for Company. The Company agrees and hereby authorizes that Secured Party may, in Secured Party’s sole discretion, but
Secured Party shall not be obligated to, whether or not an Event of Default shall have occurred, advance funds on behalf of the
Company , without prior notice to the Company, in order to insure the Company’s compliance with any covenant, warranty ,
representation or agreement of the Company made in or pursuant to this Agreement, the Purchase Agreement, or any other Transaction
Documents, to continue or complete, or cause to be continued or completed, performance of the Company’s obligations under
any Contracts of the Company, or to preserve or protect any right or interest of Secured Party in the Collateral or under or pursuant
to this Agreement, the Purchase Agreement or any other Transaction Documents, including, the payment of any insurance premiums
or taxes and the satisfaction or discharge of any Claim, Obligation, Judgment or any other Encumbrance upon the Collateral or other
property or Assets of Company; provided, however, that the making of any such advance by Secured Party shall not constitute a waiver
by Secured Party of any Event of Default with respect to which such advance is made, nor relieve the Company of any such Event
of Default. The Company shall pay to Secured Party upon demand all such advances made by Secured Party with interest thereon at
the highest rate set forth in the Debenture, or if none is so stated, the highest rate allowed by law. All such advances shall
be deemed to be included in the Obligations and secured by the security interest granted Secured Party hereunder; provided, however,
that the provisions of this Subsection shall survive the termination of this Agreement and Secured Party’s security interest
hereunder and the payment of all other Obligations.

 

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(b)          Applications
of Payments and Collateral. Except as may be otherwise specifically provided in this Agreement or the Purchase Agreement, all
Collateral and proceeds of Collateral coming into Secured Party’s possession and all payments made by any Person to Secured
Party with respect to any Collateral may be applied by Secured Party (after payment of any amounts payable to the Secured Party
pursuant to Section 5(c) hereof) to any of the Obligations, whether matured or unmatured, as Secured Party shall determine in its
sole, but reasonable discretion. Any surplus held by the Secured Party and remaining after the indefeasible payment in full in
cash of all of the Obligations shall be paid over to whomsoever shall be lawfully entitled to receive the same or as a court of
competent jurisdiction shall direct. Secured Party may defer the application of Noncash Proceeds of Collateral, to the Obligations
until Cash Proceeds are actually received by Secured Party. In the event that the proceeds of any such sale, collection or realization
are insufficient to pay all amounts to which the Secured Party is legally entitled, the Company shall be liable for the deficiency,
together with interest thereon at the highest rate specified in the Debenture for interest on overdue principal thereof or such
other rate as shall be fixed by applicable law, together with the costs of collection and the reasonable fees, costs, expenses
and other client charges of any attorneys employed by the Secured Party to collect such deficiency.

 

(c)          Waivers
by Company. The Company hereby waives, to the extent the same may be waived under applicable law: (i) notice of acceptance
of this Agreement; (ii) all claims and rights of the Company against Secured Party on account of actions taken or not taken by
Secured Party in the exercise of Secured Party’s rights or remedies hereunder, under the Purchase Agreement, and other Transaction
Documents or under applicable law; (iii) all claims of the Company for failure of Secured Party to comply with any requirement
of applicable law relating to enforcement of Secured Party’s rights or remedies hereunder, under the Purchase Agreement,
under any other Transaction Documents or under applicable law; (iv) all rights of redemption of the Company with respect to the
Collateral; (v) in the event Secured Party seeks to repossess any or all of the Collateral by judicial proceedings, any bond(s)
or demand(s) for possession which otherwise may be necessary or required; (vi) presentment, demand for payment, protest and notice
of non-payment and all exemptions applicable to any of the Collateral or the Company; (vii) any and all other notices or demands
which by applicable law must be given to or made upon the Company by Secured Party; (viii) settlement, compromise or release of
the obligations of any Person primarily or secondarily liable upon any of the Obligations; (ix) all rights of the Company to demand
that Secured Party release account debtors or other Persons liable on any of the Collateral from further obligation to Secured
Party; and (x) substitution, impairment, exchange or release of any Collateral for any of the Obligations. The Company agrees that
Secured Party may exercise any or all of its rights and/or remedies hereunder, under the Purchase Agreement, the other Transaction
Documents and under applicable law without resorting to and without regard to any Collateral or sources of liability with respect
to any of the Obligations. Upon termination of this Agreement and Secured Party’s security interest hereunder and payment
of all Obligations, within ten (10) Business Days following the Company’s request to Secured Party, Secured Party shall release
control of any security interest in the Collateral perfected by control and Secured Party shall send Company a statement terminating
any financing statement filed against the Collateral.

 

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(d)          Waivers
by Secured Party. No failure or any delay on the part of Secured Party in exercising any right, power or remedy hereunder,
under this Agreement, the Purchase Agreement, and other Transaction Documents or under applicable law, shall operate as a waiver
thereof.

 

(e)          Secured
Party’s Setoff. Secured Party shall have the right, in addition to all other rights and remedies available to it, following
an Event of Default, to set off against any Obligations due Secured Party, any debt owing to the Company by Secured Party.

 

(f)        Modifications,
Waivers and Consents. No modifications or waiver of any provision of this Agreement, the Purchase Agreement, or any other Transaction
Documents, and no consent by Secured Party to any departure by the Company therefrom, shall in any event be effective unless the
same shall be in writing, and then such waiver or consent shall be effective only in the specific instance and for the purpose
for which given, and any single or partial written waiver by Secured Party of any term, provision or right of Secured Party hereunder
shall only be applicable to the specific instance to which it relates and shall not be deemed to be a continuing or future waiver
of any other right, power or remedy. No notice to or demand upon the Company in any case shall entitle Company to any other or
further notice or demand in the same, similar or other circumstances.

 

(g)          Notices.
Except as otherwise provided herein, Company waives all notices and demands in connection with the enforcement of Secured Party’s
rights hereunder. All notices, requests, demands and other communications provided for hereunder shall be made in accordance with
the terms of the Purchase Agreement.

 

(h)          Applicable
Law and Consent to Jurisdiction. The Grantor and the Secured Party each irrevocably agrees that any dispute arising under,
relating to, or in connection with, directly or indirectly, this Agreement or related to any matter which is the subject of or
incidental to this Agreement (whether or not such claim is based upon breach of contract or tort) shall be subject to the exclusive
jurisdiction and venue of the state and/or federal courts located in Broward County, Florida; provided,
however, Secured Party may, at its sole option, elect to bring any action in any other jurisdiction. This provision is intended
to be a “mandatory” forum selection clause and governed by and interpreted consistent with Florida law. The Grantor
and Secured Party each hereby consents to the exclusive jurisdiction and venue of any state or federal court having its situs in
said county, and each waives any objection based on forum non conveniens. The Grantor hereby waives personal service of any and
all process and consent that all such service of process may be made by certified mail, return receipt requested, directed to the
Grantor, as set forth herein in the manner provided by applicable statute, law, rule of court or otherwise. Except for the foregoing
mandatory forum selection clause, this Agreement shall be construed in accordance with the laws of the State of Nevada, without
regard to the principles of conflicts of laws, 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 under the Code by the law of a jurisdiction other than the State of Nevada, in which case such issues shall
be governed by the laws of the jurisdiction governing such issues under the Code.

 

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(i)          Survival:
Successors and Assigns. All covenants, agreements, representations and warranties made herein shall survive the execution and
delivery hereof, shall survive Closing and shall continue in full force and effect until all Obligations have been paid in full,
there exists no commitment by Secured Party which could give rise to any Obligations and all appropriate termination statements
have been filed terminating the security interest granted Secured Party hereunder. Whenever in this Agreement any of the parties
hereto is referred to, such reference shall be deemed to include the successors and assigns of such party. In the event that Secured
Party assigns this Agreement and/or its security interest in the Collateral, Secured Party shall give written notice to the Company
of any such assignment and such assignment shall be binding upon and recognized by the Company (provided that failure to deliver
any such written notice shall not impair, negate or otherwise adversely affect any of the Secured Party’s rights or remedies
under this Agreement or any other Transaction Documents). All covenants, agreements, representations and warranties by or on behalf
of the Company which are contained in this Agreement shall inure to the benefit of Secured Party, its successors and assigns. The
Company may not assign this Agreement or delegate any of its rights or obligations hereunder, without the prior written consent
of Secured Party, which consent may be withheld in Secured Party’s sole and absolute discretion.

 

(j)          Severability.
If any term, provision or condition, or any part thereof, of this Agreement shall for any reason be found or held invalid or unenforceable
by any court or governmental authority of competent jurisdiction, such invalidity or unenforceability shall not affect the remainder
of such term, provision or condition nor any other term, provision or condition, and this Agreement shall survive and be construed
as if such invalid or unenforceable term, provision or condition had not been contained therein.

 

(k)          Merger
and Integration. This Agreement and the attached Schedules (if any), together with the Purchase Agreement and the other Transaction
Documents, contain the entire agreement of the parties hereto with respect to the matters covered and the transactions contemplated
hereby and thereby, and no other agreement, statement or promise made by any party hereto or thereto, or by any employee, officer,
agent or attorney of any party hereto, which is not contained herein or therein shall be valid or binding.

 

(1)         WAIVER
OF JURY TRIAL. THE COMPANY HEREBY: (a) COVENANTS AND AGREES NOT TO ELECT A TRIAL BY JURY OF ANY ISSUE TRIABLE OF RIGHT BY A
JURY; AND (b) WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO WHICH THE COMPANY AND SECURED PARTY MAY BE PARTIES, ARISING OUT
OF, IN CONNECTION WITH OR IN ANY WAY PERTAINING TO THIS AGREEMENT, THE PURCHASE AGREEMENT AND/OR ANY TRANSACTIONS, OCCURRENCES,
COMMUNICATIONS, OR UNDERSTANDINGS (OR THE LACK OF ANY OF THE FOREGOING) RELATING IN ANY WAY TO DEBTOR-CREDITOR RELATIONSHIP BETWEEN
THE PARTIES. IT IS UNDERSTOOD AND AGREED THAT THIS WAIVER CONSTITUTES A WAIVER OF TRIAL BY JURY OF ALL CLAIMS AGAINST ALL PARTIES
TO SUCH ACTIONS OR PROCEEDINGS, INCLUDING CLAIMS AGAINST PARTIES WHO ARE NOT PARTIES TO THIS SECURITY AGREEMENT. THIS WAIVER OF
JURY TRIAL IS SEPARATELY GIVEN, KNOWINGLY, WILLINGLY AND VOLUNTARILY MADE BY THE COMPANY AND THE COMPANY HEREBY AGREES THAT NO
REPRESENTATIONS OF FACT OR OPINION HAVE BEEN MADE BY ANY INDIVIDUAL TO INDUCE THIS WAIVER OF TRIAL BY JURY OR TO IN ANY WAY MODIFY
OR NULLIFY ITS EFFECT. SECURED PARTY IS HEREBY AUTHORIZED TO SUBMIT THIS AGREEMENT TO ANY COURT HAYING JURISDICTION OVER THE SUBJECT
MATTER AND THE COMPANY AND SECURED PARTY, SO AS TO SERVE AS CONCLUSIVE EVIDENCE OF SUCH WAIVER OF RIGHT TO TRIAL BY JURY. THE COMPANY
REPRESENTS AND WARRANTS THAT IT HAS BEEN REPRESENTED IN THE SIGNING OF THIS AGREEMENT AND IN THE MAKING OF THIS WAIVER BY INDEPENDENT
LEGAL COUNSEL, SELECTED OF ITS OWN FREE WILL, AND/OR THAT IT HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH COUNSEL.

 

    	17

     

    

 

(m)          Execution.
This Agreement may be executed in one or more counterparts, all of which taken together shall be deemed and considered one and
the same Agreement, and same shall become effective when counterparts have been signed by each party and each party has delivered
its signed counterpart to the other party. In the event that any signature is delivered by facsimile transmission or by e-mail
delivery of a “.pdf” format file or other similar format file, such signature shall be deemed an original for all purposes
and shall create a valid and binding obligation of the party executing same with the same force and effect as if such facsimile
or “.pdf” signature page was an original thereof.

 

(n)          Headings.
The headings and sub-headings contained in the titling of this Agreement are intended to be used for convenience only and shall
not be used or deemed to limit or diminish any of the provisions hereof.

 

(o)          Termination.
This Agreement and the security interests hereunder shall terminate on the date on which all Obligations have been
indefeasibly paid or discharged in full and there are no commitments outstanding for Secured Party to advance any funds to
the Company, either under the Purchase Agreement, the Transaction Documents or any other Contract. 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.

 

(p)          Gender
and Use of Singular and Plural. All pronouns shall be deemed to refer to the masculine, feminine, neuter, singular or plural,
as the identity of the party or parties or their personal representatives, successors and assigns may require.

 

(q)          Further
Assurances. The parties hereto will execute and deliver such further instruments and do such further acts and things as may
be reasonably required to carry out the intent and purposes of this Agreement.

 

(r)          Time
is of the Essence. The parties hereby agree that time is of the essence with respect to performance of each of the parties’
obligations under this Agreement. The parties agree that in the event that any date on which performance is to occur falls on a
Saturday, Sunday or state or national holiday, then the time for such performance shall be extended until the next business day
thereafter occurring.

 

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(s)          Joint
Preparation. The preparation of this Agreement has been a joint effort of the parties and the resulting documents shall not,
solely as a matter of judicial construction, be construed more severely against one of the parties than the other.

 

(t)          Increase
in Obligations. It is the intent of the parties to secure payment of the Obligations, as the amount of such Obligations may
increase from time to time in accordance with the terms and provisions of the Purchase Agreement, and all of the Obligations, as
so increased from time to time, shall be and are secured hereby. Upon the execution hereof, the Company shall pay any and all documentary
stamp taxes and/or other charges required to be paid in connection with the execution and enforcement of the Purchase Agreement
and this Agreement, and if, as and to the extent the Obligations are increased from time to time in accordance with the terms and
provisions of the Debenture, then the Company shall immediately pay any additional documentary stamp taxes or other charges in
connection therewith.

 

[signature page follows]

 

    	19

     

    

 

IN WITNESS WHEREOF, the parties hereto
have duly executed this Security Agreement as of the day and year first above written.

 

	 	COMPANY:
	 	 
	 	 	 
	 	By: 	 
	 	Name: Joe Beyers
	 	Title:  Chief Executive Officer

 

	STATE OF ________________	)
	 	)  SS.
	COUNTY OF ______________	)

 

The undersigned, a
Notary Public in and for the said County, in the State aforesaid, DOES HEREBY CERTIFY that Joe Beyers, the ____________ of ____________,
a Delaware __________, who is personally known to me to be the same person whose name is subscribed to the foregoing instrument,
appeared before me this day in person and acknowledged that he/she signed and delivered the said instrument as his/her own free
and voluntary act and as the free and voluntary act of said corporation, for the uses and purposes therein set forth.

 

GIVEN under my hand and notarial seal this
_____ day of ________________, 20____.

 

	 	 	 
	 	Notary Public	 
	 	 	 
	 	My Commission Expires:	 
	 	 	 
	 	 	 

 

    	20

     

    

 

	 	SECURED PARTY:
	 	 
	 	TCA GLOBAL CREDIT MASTER FUND, LP
	 	 	 
	 	By:	TCA Global Credit Master Fund GP, Ltd.,
	 	Its:	General Partner
	 	 	 
	 	By:	 
	 	Name:	Robert Press
	 	Title:	Director

 

    	21

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