Document:

Security Agreement - 1/31/2003

Exhibit 4.59 
 
SECURITY AGREEMENT 
 
SECURITY AGREEMENT (as amended, restated, supplemented or otherwise modified from time to time in accordance
herewith and including all attachments, exhibits and schedules hereto, the “Agreement”), dated as of January 31, 2003, made by SPEEDCOM WIRELESS CORPORATION, a Delaware corporation (the “Grantor”), in favor of DMG
Legacy Fund LLC, DMG Legacy Institutional Fund LLC and DMG Legacy International Ltd. (collectively, the “Secured Parties”). 
 
WHEREAS, the Grantor has issued separate secured promissory notes to the Secured Parties (the “Notes”) in the aggregate
principal amount of $340,000 pursuant to a Letter Loan Agreement by and among the Grantor and the Secured Parties dated the date hereof (the “Letter Loan Agreement”); and 
 
WHEREAS, it is a condition precedent to the Grantor’s making the loan evidenced by the Letter Loan
Agreement to the Secured Parties that the Grantor execute and deliver to the Secured Parties a security agreement providing for the grant to the Secured Parties of a continuing security interest in all personal property and assets of the Grantor,
all in substantially the form hereof to secure all Obligations (hereinafter defined); 
 
NOW, THEREFORE, the parties agree as follows: 
 
ARTICLE I. Definitions 
 
Section 1.1. Definition of Terms Used Herein. All capitalized terms used herein and not defined herein have the respective meanings provided therefor in the Letter Loan Agreement. All
terms defined in the Uniform Commercial Code (hereinafter defined) as in effect from time to time and used herein and not otherwise defined herein (whether or not such terms are capitalized) have the same definitions herein as specified therein.

 
Section 1.2. Definition of Certain Terms
Used Herein. As used herein, the following terms have the following meanings: 
 
“Collateral” means all accounts receivable of the Grantor and all personal and fixture property of every kind and nature, including, without limitation, all furniture, fixtures,
equipment, raw materials, inventory, or other goods, accounts, contract rights, rights to the payment of money, insurance refund claims and all other insurance claims and proceeds, tort claims, chattel paper, documents, instruments, securities and
other investment property, deposit accounts, rights to proceeds of letters of credit and all general intangibles including, without limitation, all tax refund claims, license fees, patents, patent licenses, patent applications, trademarks, trademark
licenses, trademark applications, trade names, copyrights, copyright licenses, copyright applications, rights to sue and recover for past infringement of patents, trademarks and copyrights, computer programs, computer software, engineering drawings,
service marks, customer lists, goodwill, and all licenses, permits, agreements of any kind or nature pursuant to which the Grantor possesses, uses or has authority to possess or use property (whether tangible or intangible) of others or others
possess, use or have authority to possess or 
 

use property (whether tangible or intangible) of the Grantor, and all recorded data of any kind or nature,
regardless of the medium of recording including, without limitation, all books and records, software, writings, plans, specifications and schematics; and all proceeds and products of each of the foregoing. 
 
“Default” means any event or
circumstance which, with the giving of notice, the lapse of time, or both, would (if not cured, waived, or otherwise remedied during such time) constitute an Event of Default. 
 
“Event of Default” has the meaning specified in the Letter Loan Agreement.

 
“Indemnitees” has the
meaning specified in Section 7.5(b). 
 
“Lien” means: (i) any interest in property securing an obligation owed to, or a claim by, a Person other than the owner of the property, whether such interest is based on the common law, statute, or contract,
and including a security interest, charge, claim, or lien arising from a mortgage, deed of trust, encumbrance, pledge, hypothecation, assignment, deposit arrangement, agreement, security agreement, conditional sale or trust receipt or a lease,
consignment or bailment for security purposes; (ii) to the extent not included under clause (i), any reservation, exception, encroachment, easement, right-of-way, covenant, condition, restriction, lease or other title exception or encumbrance
affecting property; and (iii) any contingent or other agreement to provide any of the foregoing. 
 
“Notes” has the meaning assigned to such term in the first recital of this Agreement. 
 
“Obligations” means all indebtedness, liabilities, obligations, covenants and duties of the Grantor to the Secured
Parties of every kind, nature and description, direct or indirect, absolute or contingent, due or not due, contractual or tortious, liquidated or unliquidated, arising by operation of law or otherwise, now existing of hereafter arising under or in
connection with the Notes, the Letter Loan Agreement, this Agreement or the other Loan Documents. 
 
“Registered Organization” means an entity formed by filing a registration document with a United States
Governmental Authority, such as a corporation, limited partnership or limited liability company. 
 
“Revised Article 9” has the meaning specified in Section 7.14. 
 
“Security Interest” has the meaning specified in Section 2.1 of this Agreement. 
 
“Uniform Commercial Code” means the
Uniform Commercial Code from time to time in effect in the State of New York. 
 
ARTICLE II. Security Interest 
 
Section 2.1. Security Interest. As security for the payment and performance, in full of the Obligations, and any extensions, renewals, modifications or refinancings of the Obligations,
the Grantor hereby bargains, sells, conveys, assigns, sets over, mortgages, pledges, hypothecates and transfers to the Secured Parties, and hereby grants to the Secured Parties, their successors 
 

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and assigns, a security interest in, all of such Grantor’s right, title and interest in, to and under
the Collateral (the “Security Interest”). 
 
Section 2.2. No Assumption of Liability. The Security Interest is granted as security only and shall not subject the Secured Parties to, or in any way alter or modify, any obligation or liability of the Grantor with
respect to or arising out of the Collateral. 
 
ARTICLE III. Representations and Warranties 
 
The Grantor represents and warrants to the Secured Parties that: 
 
Section 3.1. Title and Authority. The Grantor has good and valid rights in and title to the Collateral with respect to which it has purported to grant a security interest hereunder and
has full power and authority to grant to the Secured Parties the Security Interest and to execute, deliver and perform its obligations in accordance with the terms of this Agreement, without the consent or approval of any other Person other than any
consent or approval which has been obtained. 
 
Section 3.2. Filings; Actions to Achieve Perfection. Fully executed Uniform Commercial Code financing statements (including fixture filings, as applicable) or other appropriate filings, recordings or registrations
containing a description of the Collateral have been delivered to the Secured Parties for filing in each United States governmental, municipal or other office specified in Schedule A, which are all the filings, recordings and registrations
that are necessary to publish notice of and protect the validity of and to establish a legal, valid and perfected security interest in favor of the Secured Parties in respect of all Collateral in which the Security Interest may be perfected by
filing, recording or registration in the United States (or any political subdivision thereof) and its territories and possessions, and no further or subsequent filing, refiling, recording, rerecording, registration or reregistration is necessary in
any such jurisdiction, except as provided under applicable law with respect to the filing of continuation statements or with respect to the filing of amendments or new filings to reflect the change of the Grantor’s name, location, identity or
corporate structure. The Grantor’s name is listed in the preamble of this Agreement identically to how it appears on its certificate of incorporation or other organizational documents. 
 
Section 3.3. Validity and Priority of Security
Interest. The Security Interest constitutes (a) a legal and valid security interest in all the Collateral securing the payment and performance of the Obligations, (b) subject only to the filings described in Section 3.2 above and other
previously perfected security interests in the Collateral listed on Schedule 3.3 to this Agreement (“Existing Liens”), a perfected security interest in all Collateral in which a security interest may be perfected by filing,
recording or registration in the United States pursuant to the Uniform Commercial Code or other applicable law in the United States (or any political subdivision thereof) and its territories and possessions or any other country, state or nation (or
any political subdivision thereof). The Security Interest is and shall be subordinate to any other Existing Lien on any of the Collateral. 
 
Section 3.4. Absence of Other Liens. The Grantor’s Collateral is owned by the Grantor free and clear of any Lien other
than Existing Liens. Without limiting the foregoing and except as set forth on Schedule 3.4 to this Agreement, the Grantor has not filed or consented to any 
 

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filing described in Schedule A in favor of any Person other than the Secured Parties, nor permitted the
granting or assignment of a security interest or permitted perfection of any security interest in the Collateral in favor of any Person other than the Secured Parties. The Grantor’s having possession of all instruments and cash constituting
Collateral from time to time and the filing of financing statements in the offices referred to in Schedule A hereto results in the perfection of such security interest. Such security interest is, or in the case of Collateral in which the
Grantor obtain rights after the date hereof, will be, a perfected, first priority security interest. Such notices, filings and all other action necessary or desirable to perfect and protect such security interest have been duly taken. 
 
Section 3.5. Valid and Binding Obligation. This
Agreement constitutes the legal, valid and binding obligation of the Grantor, enforceable against the Grantor in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of
general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies, and (iii) to the extent the indemnification
provisions contained in this Agreement may be limited by applicable federal or state securities laws. 
 
ARTICLE IV. Covenants 
 
Section 4.1. Change of Name; Location of Collateral; Place of Business, State of Formation or Organization. 
 
(a) The Grantor shall notify the Secured
Parties in writing promptly of any change (i) in its corporate name or in any trade name used to identify it in the conduct of its business or in the ownership of its properties, (ii) in the location of its chief executive office, its principal
place of business, any office in which it maintains books or records relating to Collateral owned by it (including the establishment of any such new office or facility), (iii) in its identity or corporate structure such that a filed filing made
under the Uniform Commercial Code becomes misleading or (iv) in its Federal Taxpayer Identification Number. In extension of the foregoing, the Grantor shall not effect or permit any change referred to in the preceding sentence unless all filings
have been made under the Uniform Commercial Code or otherwise that are required in order for the Secured Parties to continue at all times following such change to have a valid, legal and perfected first priority security interest in all the
Collateral. 
 
(b) Without limiting
Section 4.1(a), without the prior written consent of the Secured Parties in each instance, the Grantor shall not change its (i) principal residence, if it is an individual, (ii) place of business, if it has only one place of business and is not a
Registered Organization, (iii) principal place of business, if it has more than one place of business and is not a Registered Organization, or (iv) state of incorporation, formation or organization, if it is a Registered Organization. 
 
Section 4.2. Records. The Grantor shall
maintain, at its own cost and expense, such complete and accurate records with respect to the Collateral owned by it as is consistent with its current practices and in accordance with such prudent and standard practices used in industries that are
the same as or similar to those in which the Grantor is engaged, but in any event to include complete accounting records indicating all payments and proceeds received with respect 
 

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to any part of the Collateral, and, at such time or times as the Secured Parties may reasonably request,
promptly to prepare and deliver to the Secured Parties a duly certified schedule or schedules in form and detail satisfactory to the Secured Parties showing the identity, amount and location of any and all Collateral. 
 
Section 4.3. Periodic Certification; Notice of
Changes. In the event there should at any time be any change in the information represented and warranted herein or in the documents and instruments executed and delivered in connection herewith, the Grantor shall immediately notify the
Secured Parties in writing of such change (this notice requirement shall be in extension of and shall not limit or relieve the Grantor of any other covenants hereunder). 
 
Section 4.4. Protection of Security. The Grantor shall, at its own cost and expense, take any
and all actions necessary to defend title to the Collateral against all persons and to defend the Security Interest of the Secured Parties in the Collateral and the priority thereof against any Lien. 
 
Section 4.5. Inspection and Verification. The
Secured Parties and such persons as the Secured Parties may reasonably designate shall have the right to inspect the Collateral, all records related thereto (and to make extracts and copies from such records) and the premises upon which any of the
Collateral is located, to discuss the Grantor’s affairs with the officers of the Grantor and its independent accountants and to verify under reasonable procedures the validity, amount, quality, quantity, value, condition and status of, or any
other matter relating to, the Collateral, including, in the case of collateral in the possession of any third Person, by contacting any account debtor or third Person possessing such Collateral for the purpose of making such a verification.
Out-of-pocket expenses in connection with any inspections by representatives of the Secured Parties shall be (a) the obligations of the Grantor with respect to any inspection after the Secured Parties’ demand payment of the Notes or (b) the
obligation of the Secured Parties in any other case. 
 
Section 4.6. Taxes; Encumbrances. At their option, the Secured Parties may discharge, Liens other than Existing Liens at any time levied or placed on the Collateral and may pay for the maintenance and preservation of
the Collateral to the extent the Grantor fails to do so and the Grantor shall reimburse the Secured Parties on demand for any payment made or any expense incurred by the Secured Parties pursuant to the foregoing authorization; provided, however,
that nothing in this Section shall be interpreted as excusing the Grantor from the performance of, or imposing any obligation on the Secured Parties to cure or perform, any covenants or other obligation of the Grantor with respect to any Lien or
maintenance or preservation of Collateral as set forth herein. 
 
Section 4.7. Use and Disposition of Collateral. The Grantor shall not make or permit to be made an assignment, pledge or hypothecation of any Collateral or shall grant any other Lien in respect of the Collateral without
the prior written consent of the Secured Parties. The Grantor shall not make or permit to be made any transfer of any Collateral and the Grantor shall remain at all times in possession of the Collateral owned by it, other than with respect to
Existing Liens and other liens approved by the Secured Parties. 
 
Section 4.8. Insurance/Notice of Loss. Within a reasonable period of time following the date of this Agreement, Grantor, at its own expense, shall maintain or cause to be maintained 
 

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insurance covering physical loss or damage to the Collateral. In extension of the foregoing and without
limitation, such insurance shall be payable to the Secured Parties as loss payee under a “standard” loss payee clause, and the Secured Parties shall be listed as an “additional insured” on Grantor’s general liability
insurance. Such insurance shall not be terminated, cancelled or not renewed for any reason, including non-payment of insurance premiums, unless the insurer shall have provided the Secured Parties at least 30 days prior written notice. Grantor
irrevocably makes, constitutes and appoints the Secured Parties (and all officers, employees or agents designated by the Secured Parties) as its true and lawful agent and attorney-in-fact for the purpose, at any time following the Secured
Parties’ demand for payment of the Notes, of making, settling and adjusting claims in respect of Collateral under policies of insurance, endorsing the name of Grantor on any check, draft, instrument or other item of payment for the proceeds of
such policies of insurance and for making all determinations and decisions with respect thereto. In the event that Grantor at any time or times shall fail to obtain or maintain any of the policies of insurance required hereby or to pay any premium
in whole or part relating thereto, the Secured Parties may, without waiving or releasing any obligation or liability of Grantor hereunder, in their sole discretion, obtain and maintain such policies of insurance and pay such premium and take any
other actions with respect thereto as the Secured Parties deem advisable. All sums disbursed by the Secured Parties in connection and in accordance with this Section, including reasonable attorneys’ fees, court costs, expenses and other charges
relating thereto, shall be payable upon demand, by Grantor to the Secured Parties and shall be additional Obligations secured hereby. Grantor shall promptly notify the Secured Parties if any material portion of the Collateral owned or held by
Grantor is damaged or destroyed. The proceeds of any casualty insurance in respect of any casualty loss of any of the Collateral shall (i) so long as the Secured Parties have not demanded payment of the Notes, be disbursed to Grantor for direct
application by Grantor solely to the repair or replacement of Grantor’s property so damaged or destroyed, and (ii) in all other circumstances, be held by the Secured Parties as cash collateral for the Obligations. The Secured Parties may, at
their sole option, disburse from time to time all or any part of such proceeds so held as cash collateral, upon such terms and conditions as the Secured Parties may reasonably prescribe, for direct application by the Secured Parties solely to the
repair or replacement of Grantor’s property so damaged or destroyed, or Grantor may apply all or any part of such proceeds to the Obligations. 
 
Section 4.9. Legend. Grantor shall legend, in form and manner satisfactory to the Secured Parties, its accounts and its
books, records and documents evidencing or pertaining thereto with an appropriate reference to the fact that such accounts have been assigned to the Secured Parties and that the Secured Parties have a security interest therein. 
 
ARTICLE V. Further Assurances; Power of Attorney

 
Section 5.1. Further
Assurances. Grantor shall, at its own expense, execute, acknowledge, deliver and cause to be duly filed all such further instruments and documents and take all such actions as the Secured Parties may from time to time reasonably request to
better assure, preserve, protect and perfect the Security Interest and the rights and remedies created hereby, including the payment of any fees and taxes required in connection with the execution and delivery of this Agreement, the granting of the
Security Interest and the filing of any financing statements (including fixture filings) or other documents in connection herewith or therewith. If any amount payable under or in connection with any of the Collateral shall be or become evidenced by
any promissory note or other instrument, such note or instrument shall be 
 

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immediately pledged and delivered to the Secured Parties, duly endorsed in a manner satisfactory to the
Secured Parties. 
 
Section 5.2. Power of
Attorney. 
 
(a) Grantor
hereby irrevocably (as a power coupled with an interest) constitutes and appoints the Secured Parties (and all officers, employees or agents designated by the Secured Parties), its attorney-in-fact with full power of substitution, for the benefit of
the Secured Parties, 
 
(i) to take
all appropriate action and to execute all documents and instruments that may be necessary or desirable to accomplish the purposes of this Agreement, and without limiting the generality of the foregoing, Grantor hereby grants the power to file one or
more financing statements (including fixture filings), continuation statements, filings with the United States Patent and Trademark Office or United States Copyright Office (or any successor office or any similar office in any other country) or
other documents for the purpose of perfecting, confirming, continuing, enforcing or protecting the Security Interest granted by Grantor, without the signature of Grantor, and naming Grantor as debtor and the Secured Parties as secured party; and

 
(ii) at any time following the
Secured Parties’ demand for payment of the Notes (i) to receive, endorse, assign and/or deliver any and all notes, acceptances, checks, drafts, money orders or other evidences of payment relating to the Collateral or any part thereof; (ii) to
demand, collect, receive payment of, give receipt for and give discharges and releases of all or any of the Collateral; (iii) to sign the name of Grantor on any invoice or bill of lading relating to any of the Collateral; (iv) to send verifications
of accounts to any account debtor or any other Person liable for an account; (v) to commence and prosecute any and all suits, actions or proceedings at law or in equity in any court of competent jurisdiction to collect or otherwise realize on all or
any of the Collateral or to enforce any rights in respect of any Collateral; (vi) to settle, compromise, compound, adjust or defend any actions, suits or proceeding relating to all or any of the Collateral; and (vii) to use, sell, assign, transfer,
pledge, make any agreement with respect to or otherwise deal with all or any of the Collateral, and to do all other acts and things necessary to carry out the purposes of this Agreement, as fully and completely as though the Secured Parties were the
absolute owner of the Collateral for all purposes; provided, however, that nothing herein contained shall be construed as requiring or obligating the Secured Parties to make any commitment or to make any inquiry as to the nature or
sufficiency of any payment received by the Secured Parties, or to present or file any claim or notice, or to take any action with respect to the Collateral or any part thereof or the moneys due or to become due in respect thereof or any property
covered thereby, and no action taken or omitted to be taken by the Secured Parties with respect to the Collateral or any part thereof shall give rise to any defense, counterclaim or offset in favor of Grantor or to any claim or action against the
Secured Parties. 
 
(b) The
provisions of this Article shall in no event relieve Grantor of any of its obligations hereunder with respect to the Collateral or any part thereof or impose any obligation on the Secured Parties to proceed in any particular manner with respect to
the Collateral or any part thereof, or in any way limit the exercise by the Secured Parties of any other or further right 
 

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which it may have on the date of this Agreement or hereafter, whether
hereunder, by law or otherwise. 
 
ARTICLE VI.
Remedies 
 
Section 6.1. Remedies
upon Default. 
 
(a) Upon
the occurrence and during the continuance of an Event of Default, Grantor agrees to deliver each item of its Collateral to the Secured Parties on demand, and it is agreed that the Secured Parties shall have the right to take any of or all the
following actions at the same or different times (but at all times subject to any Existing Liens): with or without legal process and with or without prior notice or demand for performance, to take possession of the Collateral and without liability
for trespass to enter any premises where the Collateral may be located for the purpose of taking possession of or removing the Collateral, exercise Grantor’s right to bill and receive payment for completed work and, generally, to exercise any
and all rights afforded to a secured party under the Uniform Commercial Code or other applicable law. Without limiting the generality of the foregoing, Grantor agrees that the Secured Parties shall have the right, subject to the mandatory
requirements of applicable law, to sell or otherwise dispose of all or any part of the Collateral, at public or private sale or at any broker’s board or on any securities exchange, for cash, upon credit or for future delivery as the Secured
Parties shall deem appropriate. The Secured Parties shall be authorized at any such sale (if it deems it advisable to do so) to restrict the prospective bidders or purchasers to persons who will represent and agree that they are purchasing the
Collateral for their own account for investment and not with a view to the distribution or sale thereof, and upon consummation of any such sale the Secured Parties shall have the right to assign, transfer and deliver to the purchaser or purchasers
thereof the Collateral so sold. Each such purchaser at any such sale shall hold the property sold absolutely, free from any claim or right on the part of Grantor, and Grantor hereby waives (to the extent permitted by law) all rights of redemption,
stay and appraisal which Grantor now has or may at any time in the future have under any rule of law or statute now existing or hereafter enacted. 
 
(b) The Secured Parties shall give Grantor ten (10) days’ written notice (which Grantor agrees is reasonable notice
within the meaning of Section 9-504(3) of the Uniform Commercial Code) of the Secured Parties’ intention to make any sale of Collateral. Such notice, in the case of a public sale, shall state the time and place for such sale and, in the case of
a sale at a broker’s board or on a securities exchange, shall state the board or exchange at which such sale is to be made and the day on which the Collateral, or portion thereof, will first be offered for sale at such board or exchange. Any
such public sale shall be held at such time or times within ordinary business hours and at such place or places as the Secured Parties may fix and state in the notice (if any) of such sale. At any such sale, the Collateral, or portion thereof, to be
sold may be sold in one lot as an entirety or in separate parcels, as the Secured Parties may (in their sole and absolute discretion) determine. The Secured Parties shall not be obligated to make any sale of any Collateral if it shall determine not
to do so, regardless of the fact that notice of sale of such Collateral shall have been given. The Secured Parties may, without 
 

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notice or publication, adjourn any public or private sale or cause the same to be
adjourned from time to time by announcement at the time and place fixed for sale, and such sale may, without further notice, be made at the time and place to which the same was so adjourned. In case any sale of all or any part of the Collateral is
made on credit or for future delivery, the Collateral so sold may be retained by the Secured Parties until the sale price is paid by the purchaser or purchasers thereof, but the Secured Parties shall not incur any liability in case any such
purchaser or purchasers shall fail to take up and pay for the Collateral so sold and, in case of any such failure, such Collateral may be sold again upon like notice. At any public (or, to the extent permitted by law, private) sale made pursuant to
this Section, the Secured Parties may bid for or purchase, free (to the extent permitted by law) from any right of redemption, stay, valuation or appraisal on the part of Grantor (all said rights being also hereby waived and released to the extent
permitted by law), the Collateral or any part thereof offered for sale and may make payment on account thereof by using any claim then due and payable to the Secured Parties from Grantor as a credit against the purchase price, and the Secured
Parties may, upon compliance with the terms of sale, hold, retain and dispose of such property without further accountability to Grantor therefor. For purposes hereof, a written agreement to purchase the Collateral or any portion thereof shall be
treated as a sale thereof; the Secured Parties shall be free to carry out such sale pursuant to such agreement and Grantor shall not be entitled to the return of the Collateral or any portion thereof subject thereto, notwithstanding the fact that
after the Secured Parties shall have entered into such an agreement all Obligations have been paid in full. As an alternative to exercising the power of sale herein conferred upon it, the Secured Parties may proceed by a suit or suits at law or in
equity to foreclose this Agreement and to sell the Collateral or any portion thereof pursuant to a judgment or decree of a court or courts having competent jurisdiction or pursuant to a proceeding by a court-appointed receiver. 
 
Section 6.2. Application of Proceeds. The
Secured Parties shall apply the proceeds of any collection or sale of the Collateral, as well as any Collateral consisting of cash, as follows: 
 
(a) FIRST, to the payment of all costs and expenses incurred by the Secured Parties in connection with such collection or
sale or otherwise in connection with this Agreement or any of the Obligations, including all court costs and the fees and expenses of its agents and legal counsel, and any other costs or expenses incurred in connection with the exercise of any right
or remedy hereunder, under the Letter Loan Agreement, the Notes and the other Loan Documents; 
 
(b) SECOND, to the payment in full of the Obligations; and 
 
(c) THIRD, to Grantor, its successors or assigns, or to whomsoever may be lawfully entitled
to receive the same, or as a court of competent jurisdiction may otherwise direct. 
 
Subject to the foregoing, the Secured Parties shall have absolute discretion as to the time of application of such proceeds, moneys or balances in accordance with this Agreement. Upon any sale of the
Collateral by the Secured Parties (including pursuant to a power of sale granted by statute or under a judicial proceeding), the receipt of any such proceeds, moneys or balances by the Secured Parties or of the officer making the sale shall be a
sufficient discharge to the 
 

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purchaser or purchasers of the Collateral so sold and such purchaser or purchasers shall not be obligated
to see to the application of any part of the purchase money paid over to the Secured Parties or such officer or be answerable in any way for the misapplication thereof. 
 
Section 6.3. Grant of License to Use Intellectual Property. For the purpose of enabling the
Secured Parties to exercise rights and remedies under this Article at such time as the Secured Parties shall be lawfully entitled to exercise such rights and remedies, Grantor hereby grants to the Secured Parties an irrevocable, non-exclusive
license (exercisable without payment of royalty or other compensation to Grantor) to use, license or sub-license any of the Collateral consisting of intellectual property now owned or hereafter acquired by Grantor, and wherever the same may be
located, and including in such license reasonable access to all media in which any of the licensed items may be recorded or stored and to all computer software and programs used for the compilation or printout thereof. The use of such license by the
Secured Parties may be exercised, at the option of the Secured Parties, only following the Secured Parties’ demand for payment of the Notes. 
 
ARTICLE VII. Miscellaneous 
 
Section 7.1. Notices. All communications and notices hereunder to the Grantor and to the Secured Parties shall (except as
otherwise expressly permitted herein) be in writing and delivered to the Grantor or the Secured Parties, as the case may be, as provided in the Letter Loan Agreement. 
 
Section 7.2. Security Interest Absolute. All rights of the Secured Parties hereunder, the
Security Interest and all obligations of Grantor hereunder shall be absolute and unconditional irrespective of (a) any lack of validity or enforceability of the Letter Loan Agreement, the Notes, any Loan Document or any agreement with respect to any
of the Obligations or any other agreement or instrument relating to any of the foregoing, (b) any change in the time, manner or place of payment 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 Letter Loan Agreement, the Notes, any Loan Document or any other agreement or instrument, (c) any exchange, release or non-perfection of any Lien on other collateral, or any release or amendment or waiver of or
consent under or departure from any guarantee, securing or guaranteeing all or any of the Obligations, or (d) any other circumstance that might otherwise constitute a defense available to, or a discharge of, Grantor in respect of the Obligations or
this Agreement. 
 
Section 7.3. Survival of
Agreement. All covenants, agreements, representations and warranties made by Grantor herein and in the certificates or other instruments prepared or delivered in connection with or pursuant to this Agreement shall be considered to have been
relied upon by the Secured Parties and shall survive the making of the loan and the execution and delivery to the Secured Parties of the Notes, regardless of any investigation made by the Secured Parties or on their behalf; and shall continue in
full force and effect until this Agreement shall terminate. 
 
Section 7.4. Binding Effect; Several Agreement; Successors and Assigns. This Agreement shall become effective as to Grantor when a counterpart hereof executed on behalf of Grantor shall have been delivered to the
Secured Parties and a counterpart hereof shall have been executed on behalf of the Secured Parties, and thereafter shall be binding upon Grantor and the 
 

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Secured Parties and their respective successors and assigns, and shall inure to the benefit of Grantor,
the Secured Parties and their respective successors and assigns, except that Grantor shall not have the right to assign or transfer its rights or obligations hereunder or any interest herein or in the Collateral (and any such assignment or transfer
shall be void) except as expressly contemplated by this Agreement, the Letter Loan Agreement, the Notes or the other Loan Documents. 
 
Section 7.5. Secured Parties’ Fees and Expense; Indemnification. 
 
(a) Grantor agrees to pay upon demand to the
Secured Parties the amount of any and all reasonable expenses, including all reasonable fees, disbursements and other charges of its counsel and of any experts or agents, which the Secured Parties may incur in connection with (i) the administration
of this Agreement (including the customary fees and charges of the Secured Parties for any audits conducted by them or on their behalf with respect to the accounts inventory), (ii) the custody or preservation of, or the sale of, collection from or
other realization upon any of the Collateral, (iii) the exercise, enforcement or protection of any of the rights of the Secured Parties hereunder or (iv) the failure of Grantor to perform or observe any of the provisions hereof. 
 
(b) Grantor agrees to indemnify the Secured
Parties and the agent, contractors and employees of the Secured Parties (collectively, the “Indemnitees”) against, and hold each of them harmless from, any and all losses, claims, damages, liabilities and related expenses,
including reasonable fees, disbursements and other charges of counsel, incurred by or asserted against any of them arising out of, in any way connected with, or as a result of, the execution, delivery, or performance of this Agreement or any
agreement or instrument contemplated hereby or any claim, litigation, investigation or proceeding relating hereto or to the Collateral, whether or not any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee,
be available to the extent that such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of
such Indemnitee. 
 
(c) Any such
amounts payable as provided hereunder shall be additional Obligations secured hereby. The provisions of this Section shall remain operative and in full force and effect regardless of the termination of this Agreement, the Letter Loan Agreement, the
Notes or the other Loan Documents, the consummation of the transactions contemplated hereby, the repayment of any of the Obligations, the invalidity or unenforceability of any term or provision of this Agreement, the Letter Loan Agreement, the Notes
or the other Loan Documents, or any investigation made by or on behalf of the Secured Parties. All amounts due under this Section shall be payable on written demand therefor. 
 
Section 7.6. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED
BY THE LAWS OF THE STATE OF NEW YORK. 
 
Section
7.7. Waivers; Amendment. 
 

11 

(a) No failure or delay of the Secured Parties in exercising any power or
right hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or
the exercise of any other right or power. The rights and remedies of the Secured Parties hereunder and under the Letter Loan Agreement are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any
provisions of this Agreement, the Letter Loan Agreement, the Notes or the other Loan Documents or consent to any departure by Grantor therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) below, and then such
waiver or consent shall be effective only in the specific instance and for the purpose for which given. No notice to or demand on Grantor in any case shall entitle Grantor to any other or further notice or demand in similar or other circumstances.

 
(b) Neither this Agreement nor
any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements, in writing entered into by the Secured Parties and Grantor. 
 
Section 7.8. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT, THE LETTER LOAN AGREEMENT OR THE NOTES. EACH PARTY HERETO (A)
CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE
OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT, THE LETTER LOAN AGREEMENT AND THE NOTES, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION. 
 
Section 7.9. Severability. In the event any one
or more of the provisions contained in this Agreement should be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or
impaired thereby (it being understood that the invalidity of a particular provision in a particular jurisdiction shall not in and of itself affect the validity of such provision in any other jurisdiction). The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions. 
 
Section 7.10. Counterparts. This Agreement may
be executed in two or more counterparts, each of which shall constitute an original but all of which when taken together shall constitute but one contract. Each party shall be entitled to rely on a facsimile signature of any other party hereunder as
if it were an original. 
 
Section 7.11.
Jurisdiction; Consent to Service of Process. 
 
(a) Grantor hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of any New York State court or Federal court of 
 

12 

the United States of America sitting in New York City, and any appellate court from any
thereof, in any action or proceeding arising out of or relating to this Agreement, the Letter Loan Agreement or the Notes, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that the Secured Parties may otherwise have to bring
any action or proceeding relating to this Agreement, the Letter Loan Agreement, the Notes or the other Loan Documents against Grantor or its properties in the courts of any jurisdiction. 
 
(b) Grantor hereby irrevocably and unconditionally waives, to the fullest extent it may
legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement, the Letter Loan Agreement, the Notes or the other Loan Documents
in any New York State or Federal court. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

 
(c) Each party to this Agreement
irrevocably consents to service of process in the manner provided for notices in Section 7.1. Nothing in this Agreement will affect the right of any party to this Agreement to process in any other manner permitted by law. 
 
Section 7.12. Termination. This Agreement and
the Security Interest shall terminate when all the Obligations have been paid in full, at which time the Secured Parties shall execute and deliver to Grantor, at Grantor’s expense, all Uniform Commercial Code termination statements and similar
documents which Grantor shall reasonably request to evidence such termination. Any execution and delivery of termination statements or documents pursuant to this Section shall be without recourse to or warranty by the Secured Parties. 
 
Section 7.13. Prejudgment Remedy Waiver. Grantor
acknowledges that this Agreement, the Letter Loan Agreement, the Notes and the other Loan Documents evidence a commercial transaction and that it could, under certain circumstances have the right, to notice of and hearing on the right of the Secured
Parties to obtain a prejudgment remedy, such as attachment, garnishment and/or replevin, upon commencing any litigation against Grantor. Notwithstanding, Grantor hereby waives all rights to notice, judicial hearing or prior court order to which it
might otherwise have the right under any state or federal statute or constitution in connection with the obtaining by the Secured Parties of any prejudgment remedy by reason of this Agreement, the Letter Loan Agreement, the Notes, the other Loan
Documents or by reason of the Obligations or any renewals or extensions of the same. Grantor also waives any and all objection which it might otherwise assert, now or in the future, to the exercise or use by the Secured Parties of any right of
setoff, repossession or self help as may presently exist under statute or common law. 
 
Section 7.14. Concerning Revised Article 9 of the Uniform Commercial Code. The parties acknowledge and agree to the following provisions of this Agreement in anticipation of the possible
application, in one or more jurisdictions to the transactions contemplated hereby, of 
 

13 

the revised Article 9 of the Uniform Commercial Code in the form or substantially in the form approved in
1998 by the American Law Institute and the National Conference of Commissioners on Uniform State Law (“Revised Article 9”). 
 
(a) In applying the law of any jurisdiction in which Revised Article 9 is in effect, the Collateral is all assets of
Grantor, whether or not within the scope of Revised Article 9. The Collateral shall also include, without limitation, the following categories of assets as defined in Revised Article 9: goods (including inventory, equipment and any accessions
thereto), instruments (including promissory notes), documents, accounts (including health-care-insurance receivables), chattel paper (whether tangible or electronic), deposit accounts, letter-of-credit rights (whether or not the letter of credit is
evidenced by a writing), commercial tort claims, securities and all other investment property, general intangibles (including payment intangibles and software), supporting obligations and any and all proceeds of any thereof, wherever located,
whether now owned and hereafter acquired. If Grantor shall at any time, whether or not Revised Article 9 is in effect in any particular jurisdiction, acquire a commercial tort claim, as defined in Revised Article 9, Grantor shall immediately notify
the Secured Parties in a writing signed by Grantor of the brief details thereof and grant to the Secured Parties in such writing a security interest therein and in the proceeds thereof, all upon the terms of this Agreement, with such writing to be
in form and substance satisfactory to the Secured Parties. The Secured Parties may at any time and from time to time, pursuant to the provisions of Article V, file financing statements, continuation statements and amendments thereto that describe
the Collateral as all assets of Grantor or words of similar effect and which contain any other information required by Part 5 of Revised Article 9 for the sufficiency or filing office acceptance of any financing statement, continuation statement or
amendment, including whether Grantor is an organization, the type of organization and any organization identification number issued to Grantor. Grantor shall furnish any such information to the Secured Parties promptly upon request. Any such
financing statements, continuation statements or amendments may be signed by the Secured Parties on behalf of Grantor, as provided in Article V, and may be filed at any time in any jurisdiction whether or not Revised Article 9 is then in effect in
that jurisdiction. 
 
(b) Grantor
shall at any time and from time to time, whether or not Revised Article 9 is in effect in any particular jurisdiction, take such steps as the Secured Parties may reasonably request for the Secured Parties (i) to obtain an acknowledgement, in form
and substance satisfactory to the Secured Parties, of any bailee having possession of any of the Collateral that the bailee holds such Collateral for the Secured Parties, (ii) to obtain “control” of any investment property, deposit
accounts, letter-of-credit rights or electronic chattel paper (as such terms are defined in Revised Article 9 with corresponding provisions in §§ 9-104, 9-105, 9-106 and 9-107 relating to what constitutes “control” for such items
of Collateral), with any agreements establishing control to be in form and substance satisfactory to the Secured Parties, and (iii) otherwise to insure the continued perfection and priority of the Secured Parties’ security interest in any of
the Collateral and of the preservation of its rights therein, whether in anticipation and following the effectiveness of Revised Article 9 in any jurisdiction. 
 
(c) Nothing contained in this Section shall be construed to narrow the scope of the security interest granted hereby in
any of the Collateral or the perfection or priority thereof or to impair or otherwise limit any of the rights, powers, privileges or remedies of the Secured Parties hereunder except as (and then only to the extent) specifically mandated by Revised
Article 9 to the extent then applicable. 
 

14 

[Signature page follows] 
 
 

15 

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

	 SPEEDCOM WIRELESS CORPORATION

	
	 By:
	 	 
	 	

	 	 	 Name:

	 	 	 Title:

	
	 DMG LEGACY FUND LLC

	
	 By:
	 	 
	 	

	 	 	 Name:

	 	 	 Title:

	
	 DMG LEGACY INSTITUTIONAL FUND LLC

	
	 By:
	 	 
	 	

	 	 	 Name:

	 	 	 Title:

	
	 DMG LEGACY INTERNATIONAL LTD.

	
	 By:
	 	 
	 	

	 	 	 Name:

	 	 	 Title:

 
 
 

16 

SCHEDULE A 
 
Places of Business; Chief Executive Office; Filing Locations 
 
State of Incorporation: 
Delaware 
 
Chief Executive Office: 
7020 Professional Parkway East 
Sarasota, Florida 34240 
 
Filing Locations: 
Secretary of State
of the State of Delaware 
 

17 

SCHEDULE 3.3 
Existing Liens 
 
Tax Lien held by the State of Florida Department of Revenue for approximately $15,000. 
 
DMG Legacy Fund LLC, DMG Legacy Institutional Fund LLC and DMG Legacy International Ltd. hold a blanket security interest in all of the Company’s
accounts receivable and personal property pursuant to the Security Agreement dated April 26, 2002 among the parties. 
 
SDS Merchant Fund, L.P., DMG Legacy Fund LLC, DMG Legacy Institutional Fund LLC and DMG International Ltd. hold a blanket security interest in all of the
Company’s accounts receivable and personal property pursuant to the Security Agreement dated June 10, 2002 among the parties. 
 
DMG Legacy Fund LLC, DMG Legacy Institutional Fund LLC and DMG Legacy International Ltd. hold a blanket security interest in all of the Company’s
accounts receivable and personal property pursuant to the Security Agreement dated August 8, 2002 among the parties. 
 
DMG Legacy Fund LLC, DMG Legacy Institutional Fund LLC and DMG Legacy International Ltd. hold a blanket security interest in all of the Company’s
accounts receivable and personal property pursuant to the Security Agreement dated September 18, 2002 among the parties. 
 
DMG Legacy Fund LLC, DMG Legacy Institutional Fund LLC and DMG Legacy International Ltd. hold a blanket security interest in all of the Company’s
accounts receivable and personal property pursuant to the Security Agreement dated November 11, 2002 among the parties. 
 
DMG Legacy Fund LLC, DMG Legacy Institutional Fund LLC and DMG Legacy International Ltd. hold a blanket security interest in all of the Company’s
accounts receivable and personal property pursuant to the Security Agreement dated December 24, 2002 among the parties. 
 

18 

SCHEDULE 3.4 
Absence of Other Liens 
 
Tax Lien held by the State of Florida Department of Revenue for approximately $15,000. 
 
DMG Legacy Fund LLC, DMG Legacy Institutional Fund LLC and DMG Legacy International Ltd. hold a blanket security interest in all of the Company’s
accounts receivable and personal property pursuant to the Security Agreement dated April 26, 2002 among the parties. 
 
SDS Merchant Fund, L.P., DMG Legacy Fund LLC, DMG Legacy Institutional Fund LLC and DMG International Ltd. hold a blanket security interest in all of the
Company’s accounts receivable and personal property pursuant to the Security Agreement dated June 10, 2002 among the parties. 
 
DMG Legacy Fund LLC, DMG Legacy Institutional Fund LLC and DMG International Ltd. hold a blanket security interest in all of the Company’s accounts
receivable and personal property pursuant to the Security Agreement dated August 8, 2002 among the parties. 
 
DMG Legacy Fund LLC, DMG Legacy Institutional Fund LLC and DMG Legacy International Ltd. hold a blanket security interest in all of the Company’s accounts receivable and personal property pursuant
to the Security Agreement dated September 18, 2002 among the parties. 
 
DMG Legacy Fund LLC, DMG Legacy Institutional Fund LLC and DMG Legacy International Ltd. hold a blanket security interest in all of the Company’s accounts receivable and personal property pursuant to the Security Agreement dated
November 11, 2002 among the parties. 
 
DMG Legacy Fund LLC, DMG
Legacy Institutional Fund LLC and DMG Legacy International Ltd. hold a blanket security interest in all of the Company’s accounts receivable and personal property pursuant to the Security Agreement dated December 24, 2002 among the parties.

 

19Note Purchase Agreement

 
Exhibit
4.60 
 
NOTE PURCHASE AGREEMENT

 
NOTE PURCHASE AGREEMENT (this
“Agreement”), dated as of March 26, 2003, between SPEEDCOM Wireless Corporation, a corporation organized under the laws of the State of Delaware (the “Company”), and P-Com, Inc., a corporation organized under the
laws of the State of Delaware (the “Purchaser”). 
 
WHEREAS: 
 
A. The Company
and the Purchaser are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by the provisions of Regulation D (“Regulation D”), as promulgated by the United States Securities
and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “Securities Act”). 
 
B. The Company desires to issue and sell, and the Purchaser desires to purchase, upon the terms and conditions stated in this Agreement, a
convertible promissory note, in the form attached hereto as Exhibit A (the “Note”), in the principal face amount of $400,000, which Note shall be convertible into shares of the Company’s common stock, par value $0.001
per share (the “Common Stock”). The shares of Common Stock issuable upon conversion of or otherwise pursuant to the Note are referred to herein as the “Conversion Shares.” The Note and the Conversion Shares are
collectively referred to herein as the “Securities” and each of them are individually referred to herein as a “Security.” This Agreement and the Note are collectively referred to herein as the “Transaction
Documents.” 
 
NOW, THEREFORE, in
consideration of the premises and mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Purchaser hereby agree as follows: 
 
1.     PURCHASE AND SALE OF SECURITIES.

 
(a) Purchase and Sale of Securities.
Subject to the terms and conditions hereof, at the Closing (as defined in Section 1(b) below), the Company shall issue and sell to the Purchaser, and the Purchaser shall purchase from the Company, a Note in the principal face amount equal to
$400,000, in consideration for the payment by the Purchaser of a purchase price equal to such principal face amount (the “Purchase Price”). 
 
(b) The Closing. Subject to the satisfaction (or waiver) of the conditions set forth in Sections 6 and 7 below, the closing of the
transactions contemplated hereby (the “Closing”) shall take place at the offices of Purchaser, on the date hereof, or at such other time or place as the Company and the Purchaser may mutually agree (such date is hereinafter
referred to as the “Closing Date”). 

 
2.    
PURCHASER’S REPRESENTATIONS AND WARRANTIES. The Purchaser represents and warrants to the Company as follows: 
 
(a) Purchase for Own Account, Etc The Purchaser is acquiring the Note for the Purchaser’s own account and not with a present
view towards the public sale or distribution thereof, except pursuant to sales that are exempt from the registration requirements of the Securities Act and/or sales registered under the Securities Act. The Purchaser understands that the Purchaser
must bear the economic risk of this investment indefinitely, unless the Securities are registered pursuant to the Securities Act and any applicable state securities or blue sky laws or an exemption from such registration is available, and that the
Company has no present intention of registering the resale of any such Securities other than as contemplated in Section 4(o). Notwithstanding anything in this Section 2(a) to the contrary, by making the representations herein, the Purchaser does not
agree to hold the Securities for any minimum or other specific term and reserves the right to dispose of the Securities at any time in accordance with or pursuant to a registration statement or an exemption from the registration requirements under
the Securities Act. 
 
(b) Accredited Investor
Status. The Purchaser is an “Accredited Investor” as that term is defined in Rule 501(a) of Regulation D under the Securities Act. 
 
(c) Reliance on Exemptions. The Purchaser understands that the Securities are being offered and sold to the Purchaser in reliance
upon specific exemptions from the registration requirements of United States federal and state securities laws and that the Company is relying upon the truth and accuracy of, and the Purchaser’s compliance with, the representations, warranties,
agreements, acknowledgments and understandings of the Purchaser set forth herein in order to determine the availability of such exemptions and the eligibility of the Purchaser to acquire the Securities. 
 
(d) Information. The Purchaser or its counsel, if any,
have been furnished all materials relating to the business, finances and operations of the Company and materials relating to the offer and sale of the Securities which have been specifically requested by the Purchaser or its counsel. Neither such
inquiries nor any other investigation conducted by the Purchaser or its counsel or any of its representatives shall modify, amend or affect the Purchaser’s right to rely on the Company’s representations and warranties contained in Section
3 below. The Purchaser understands that the Purchaser’s investment in the Securities involves a high degree of risk. 
 
(e) Governmental Review. The Purchaser understands that no United States federal or state agency or any other government or
governmental agency has passed upon or made any recommendation or endorsement of the Securities. 
 
(f) Transfer or Resale. The Purchaser understands that (i) except as provided in Section 4(o), the sale or resale of the Securities have not been and are not being registered under the
Securities Act or any state securities laws, and the Securities may not be transferred unless (A) the transfer is made pursuant to and as set forth in an effective registration statement under the Securities Act covering the Securities; or (B) the
Purchaser shall have delivered to the Company an opinion of counsel (which opinion shall be in form, substance and scope customary for opinions of counsel in comparable transactions) to the effect that the Securities to be sold or 
 

2 

 
transferred may be sold or
transferred pursuant to an exemption from such registration; or (C) sold under and in compliance with Rule 144 promulgated under the Securities Act (or a successor rule) (“Rule 144”); or (D) sold or transferred in accordance with
applicable securities laws to an affiliate of the Purchaser who agrees to sell or otherwise transfer the Securities only in accordance with the provisions of this Section 2(f) and who is an Accredited Investor; and (ii) neither the Company nor any
other person is under any obligation to register such Securities under the Securities Act or any state securities laws (other than as provided in Section 4(o)). Notwithstanding the foregoing or anything else contained herein to the contrary, the
Securities may be pledged as collateral in connection with a bona fide margin account or other lending arrangement, provided such pledge is consistent with applicable laws, rules and regulations. 
 
(g) Legends. The Purchaser understands that, until such
time as the Conversion Shares have been registered under the Securities Act (including registration pursuant to Rule 416 thereunder) or otherwise may be sold by the Purchaser under Rule 144(k), the certificates for the Conversion Shares shall bear a
restrictive legend in substantially the following form: 
 
The securities represented by this certificate have not been registered under the Securities Act of 1933, as amended, or the securities laws of any state of the United States or in any other jurisdiction. The securities represented
hereby may not be offered, sold or transferred in the absence of an effective registration statement for the securities under applicable securities laws unless offered, sold or transferred pursuant to an available exemption from the registration
requirements of those laws. 
 
The Company agrees
that it shall, immediately prior to a registration statement covering the Securities being declared effective, deliver to its transfer agent an opinion letter of counsel, opining that at any time such registration statement is effective, the
transfer agent shall issue, in connection with the issuance of the Conversion Shares, certificates representing such Conversion Shares without the restrictive legend above, provided such Conversion Shares are to be sold pursuant to the prospectus
contained in such registration statement. Upon receipt of such opinion, the Company shall cause the transfer agent to confirm, for the benefit of the holders, that no further opinion of counsel is required at the time of transfer in order to issue
such shares without such restrictive legend. 
 
The
legend set forth above shall be removed and the Company shall issue a certificate without such legend to the holder of any Security upon which it is stamped, if (unless otherwise required by state securities laws) (i) the sale of such Security is
registered under the Securities Act (including registration pursuant to Rule 416 thereunder); (ii) such holder provides the Company with an opinion of counsel, in form, substance and scope customary for opinions of counsel in comparable
transactions, to the effect that a public sale or transfer of such Security may be made without registration under the Securities Act; or (iii) such holder provides the Company with reasonable assurances that such Security can be sold under Rule
144. In the event the above legend is removed from any Security and thereafter the effectiveness of a registration statement covering such Security is suspended or the Company determines that a supplement or amendment thereto is required by
applicable securities laws, then upon reasonable advance written notice to the Purchaser the Company may require that the above legend be 
 

3 

 
placed on any such Security
that cannot then be sold pursuant to an effective registration statement or under Rule 144 and the Purchaser shall cooperate in the replacement of such legend. Such legend shall thereafter be removed when such Security may again be sold pursuant to
an effective registration statement or under Rule 144. 
 
(h) Authorization; Enforcement. This Agreement has been duly and validly authorized, executed and delivered on behalf of the Purchaser and is a valid and binding agreement of the Purchaser enforceable against the Purchaser in
accordance with its terms. 
 
(i) Residency.
The Purchaser is a corporation organized under the laws of the State of Delaware, and its principal place of business is located within the State of California. 
 
The Purchaser’s representations and warranties made in this Article 2 are made solely for the purpose of
permitting the Company to make a determination that the transactions contemplated hereby comply with applicable U.S. federal and state securities laws and not for any other purpose. The Company may not rely on such representations and warranties for
any other purpose. 
 
3.     REPRESENTATIONS
AND WARRANTIES OF THE COMPANY. Except as set forth in the Company’s Select SEC Documents (as defined in Section 3(f) below) or on a Disclosure Schedule executed and delivered by the Company to the Purchaser within five business days
following the Closing in accordance with Section 4(p) hereof (the “Disclosure Schedule”), the Company represents and warrants to the Purchaser as follows: 
 
(a) Organization and Qualification. The Company and each of its direct or indirect subsidiaries
(collectively, the “Subsidiaries”) is a corporation duly organized and existing in good standing under the laws of the jurisdiction in which it is incorporated, and has the requisite corporate power to own its properties and to
carry on its business as now being conducted. The Company and each of its Subsidiaries is duly qualified as a foreign corporation to do business and is in good standing in every jurisdiction in which the nature of the business conducted by it makes
such qualification necessary and where the failure so to qualify has had or could reasonably be expected to have a Material Adverse Effect. “Material Adverse Effect” means any material adverse effect on (i) the Securities, (ii) the
ability of the Company to perform its obligations hereunder or under the other Transaction Documents or (iii) the business, operations, properties, prospects, financial condition or results of operations of the Company and its Subsidiaries, taken as
a whole. 
 
(b) Authorization; Enforcement.
(i) The Company has the requisite corporate power and authority to enter into and perform its obligations under this Agreement and the other Transaction Documents, to issue and sell the Note in accordance with the terms hereof and, to issue the
Conversion Shares upon conversion of the Note in accordance with the terms of such Note; (ii) the execution, delivery and performance of this Agreement and the other Transaction Documents by the Company and the consummation by it of the transactions
contemplated hereby and thereby (including, without limitation, the issuance of the Note and the issuance and reservation for issuance of the Conversion Shares) have been duly authorized by the Company’s Board of Directors and no further
consent or authorization of the Company, its Board of Directors, or any committee of the Board of Directors is required, and (iii) this Agreement 
 

4 

 
constitutes, and, upon
execution and delivery by the Company of the other Transaction Documents, such agreements will constitute, valid and binding obligations of the Company enforceable against the Company in accordance with their terms. Neither the execution, delivery
or performance by the Company of this Agreement or the other Transaction Documents nor the consummation by it of the transactions contemplated hereby or thereby (including, without limitation, the issuance of the Note or the issuance or reservation
for issuance of the Conversion Shares) requires any consent or authorization of the Company’s stockholders. 
 
(c) Capitalization. The capitalization of the Company as of the date hereof, including the authorized capital stock, the number of
shares issued and outstanding, the number of shares issuable and reserved for issuance pursuant to the Company’s stock option plans, the number of shares issuable and reserved for issuance pursuant to securities (other than the Note)
exercisable or exchangeable for, or convertible into, any shares of capital stock and the number of shares to be reserved for issuance upon conversion of the Note is set forth in Section 3(c) of the Disclosure Schedule. All of such
outstanding shares of capital stock have been, or upon issuance in accordance with the terms of any such warrants, options or preferred stock, will be, validly issued, fully paid and non-assessable. No shares of capital stock of the Company
(including the Conversion Shares) are subject to preemptive rights or any other similar rights of the stockholders of the Company or any liens or encumbrances. Except for the Securities and as set forth in Section 3(c) of the Disclosure
Schedule, as of the date of this Agreement, (i) there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into or exercisable or
exchangeable for, any shares of capital stock of the Company or any of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its
Subsidiaries, nor are any such issuances or arrangements contemplated, and (ii) there are no agreements or arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the
Securities Act (other than as provided in Section 4(o)). Section 3(c) of the Disclosure Schedule sets forth all of the Company issued securities or instruments containing antidilution or similar provisions that will be triggered by, and
all of the resulting adjustments that will be made to such securities and instruments as a result of, the issuance of the Securities in accordance with the terms of this Agreement or the Note. Except for the Demand Notes (as defined in the Note),
there are no outstanding forms of indebtedness of the Company, secured by a security interest in all or a portion of the Company’s assets. The Company has furnished to the Purchaser a true and correct copy of the Company’s Certificate of
Incorporation as in effect on the date hereof (“Certificate of Incorporation”), the Company’s Bylaws as in effect on the date hereof (the “Bylaws”), and all other instruments and agreements governing securities
convertible into or exercisable or exchangeable for capital stock of the Company. 
 
(d) Issuance of Shares. The Note is duly authorized and, upon issuance in accordance with the terms of this Agreement, will be validly issued and free from all taxes, liens, claims and
encumbrances (other than restrictions on transfer contained in this Agreement or the Note) and will not be subject to preemptive rights, rights of first refusal or other similar rights of stockholders of the Company and will not impose personal
liability on the holders thereof. The Conversion Shares are duly authorized and reserved for issuance, and, upon conversion of the Note in accordance with the terms thereof, will be validly issued, fully paid and non-assessable, and free from all
taxes, liens, claims and encumbrances (other than restrictions on transfer 
 

5 

 
contained in this Agreement)
and will not be subject to preemptive rights, rights of first refusal or other similar rights of stockholders of the Company and will not impose personal liability upon the holder thereof. 
 
(e) No Conflicts. The execution, delivery and performance of this Agreement and the other Transaction
Documents by the Company and the consummation by the Company of the transactions contemplated hereby and thereby (including, without limitation, the issuance and reservation for issuance, as applicable, of the Note and Conversion Shares) will not
(i) result in a violation of the Certificate of Incorporation or Bylaws or (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any rights of termination,
amendment (including, without limitation, the triggering of any anti-dilution provisions), acceleration or cancellation of, any agreement, indenture or instrument to which the Company or any of its Subsidiaries is a party, or result in a violation
of any law, rule, regulation, order, judgment or decree (including United States federal and state securities laws and regulations and rules or regulations of any self-regulatory organizations to which either the Company or its securities are
subject) applicable to the Company or any of its Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries is bound or affected (except, with respect to clause (ii), for such conflicts, defaults, terminations,
amendments, accelerations, cancellations and violations that have not had and could not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect). Neither the Company nor any of its Subsidiaries is in violation of
its Certificate of Incorporation, Bylaws or other organizational documents and neither the Company nor any of its Subsidiaries is in default (and no event has occurred which, with notice or lapse of time or both, would put the Company or any of its
Subsidiaries in default) under, nor has there occurred any event giving others (with notice or lapse of time or both) any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company
or any of its Subsidiaries is a party. The businesses of the Company and its Subsidiaries are not being conducted, and shall not be conducted so long as the Purchaser owns the Note, in violation of any law, ordinance or regulation of any
governmental entity, except for possible violations the sanctions for which either singly or in the aggregate have not had and could not reasonably be expected to have a Material Adverse Effect. The Company and its Subsidiaries possess all
certificates, authorizations and permits issued by the appropriate federal, state or foreign regulatory authorities which are material to conduct its business, and neither the Company nor any of its Subsidiaries has received any written notice of
any proceeding relating to the revocation or modification of any such certificate, authorization or permit. The Company and its board of directors have taken all necessary action, if any, in order to render inapplicable any control share
acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under its Certificate of Incorporation or the laws of the state of its incorporation which is or could
become applicable to the Purchaser as a result of the transactions contemplated by this Agreement, including without limitation, the Company’s issuance of the Securities and any and all Purchaser’s ownership of the Securities or the
Purchaser’s ownership of the Common Stock. Except as specifically contemplated by this Agreement, the Company is not required to obtain any consent, approval, authorization or order of, or make any filing or registration with, any court or
governmental agency or any regulatory or self regulatory agency in order for it to execute, deliver or perform any of its obligations under this Agreement or the other Transaction Documents, in each case in accordance with the terms hereof or
thereof. 
 

6 

 
(f) SEC
Documents, Financial Statements. (i) From December 31, 1997 to December 30, 2000, to the knowledge of the Company’s officers after due inquiry, and (ii) since December 31, 2000, the Company has timely filed (within applicable extension
periods) all reports, schedules, forms, statements and other documents required to be filed by it with the SEC pursuant to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (all of
the foregoing filed prior to the date hereof and all exhibits included therein and financial statements and schedules thereto and documents incorporated by reference therein, being hereinafter referred to herein as the “SEC
Documents”). As of their respective dates, the SEC Documents complied in all material respects with the requirements of the Exchange Act or the Securities Act, as the case may be, and the rules and regulations of the SEC promulgated
thereunder applicable to the SEC Documents, and none of the SEC Documents, at the time they were filed with the SEC, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which they were made, not misleading. None of the statements made in any such SEC Documents is, or has been, required to be amended or updated under applicable law (except for
such statements as have been amended or updated in subsequent filings made prior to the date hereof). As of their respective dates, the financial statements of the Company included in the SEC Documents complied as to form in all material respects
with applicable accounting requirements and the published rules and regulations of the SEC applicable with respect thereto. Such financial statements have been prepared in accordance with U.S. generally accepted accounting principles
(“GAAP”), consistently applied during the periods involved (except (i) as may be otherwise indicated in such financial statements or the notes thereto, or (ii) in the case of unaudited interim statements, to the extent they may not
include footnotes or may be condensed or summary statements) and fairly present in all material respects the consolidated financial position of the Company and its consolidated Subsidiaries as of the dates thereof and the consolidated results of
their operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to immaterial year-end audit adjustments). Except as set forth in the financial statements of the Company included in the Select SEC Documents
(as defined below), the Company has no liabilities, contingent or otherwise, other than (i) liabilities incurred in the ordinary course of business subsequent to the date of such financial statements and (ii) obligations under contracts and
commitments incurred in the ordinary course of business and not required under GAAP to be reflected in such financial statements, which liabilities and obligations referred to in clauses (i) and (ii), individually or in the aggregate, are not
material to the financial condition or operating results of the Company. As used in this Agreement, the term “Select SEC Documents” shall mean the Company’s (A) Proxy Statement for its 2002 Annual Meeting, (B) Annual Report on
Form 10-K for the fiscal year ending December 31, 2001, (C) Quarterly Reports on Form 10-Q for the quarters ended March 31, June 30 and September 30, 2002, and (D) Current Reports on Form 8-K filed since December 31, 2001. 
 
(g) Absence of Certain Changes. Since December 31,
2001, there has been no material adverse change and no material adverse development in the business, properties, operations, prospects, financial condition or results of operations of the Company and its Subsidiaries, taken as a whole. The Company
has not taken any steps, and does not currently expect to take any steps, to seek protection pursuant to any bankruptcy or receivership law nor does the Company or any of its Subsidiaries have any knowledge or reason to believe that its

 

7 

 
creditors intend to initiate
involuntary bankruptcy proceedings with respect to the Company or any of its Subsidiaries. 
 
(h) Transactions With Affiliates. None of the officers, directors, or employees of the Company is presently a party to any transaction with the Company or any of its Subsidiaries (other than for
ordinary course services solely in their capacity as employees, officers or directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or
from, or otherwise requiring payments to or from any such officer, director or employee or any corporation, partnership, trust or other entity in which any such officer, director, or employee has an ownership interest of five percent or more or is
an officer, director, trustee or partner. 
 
(i)
Absence of Litigation. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body (including, without limitation, the SEC) pending or, to the
knowledge of the Company or any of its Subsidiaries, threatened against or affecting the Company, any of its Subsidiaries, or any of their respective directors or officers in their capacities as such. There are no facts which, if known by a
potential claimant or governmental authority, could give rise to a claim or proceeding which, if asserted or conducted with results unfavorable to the Company or any of its Subsidiaries, could reasonably be expected to have a Material Adverse
Effect. 
 
(j) Intellectual Property. Each
of the Company and its Subsidiaries owns or is duly licensed to use all patents, patent applications, trademarks, trademark applications, trade names, service marks, copyrights, copyright applications, licenses, permits, inventions, discoveries,
processes, scientific, technical, engineering and marketing data, object and source codes, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures) and other similar
rights and proprietary knowledge (collectively, “Intangibles”) necessary for the conduct of its business as now being conducted. To the best knowledge of the Company, neither the Company nor any Subsidiary of the Company infringes
or is in conflict with any right of any other person with respect to any Intangibles. Neither the Company nor any of its Subsidiaries has received written notice of any pending conflict with or infringement upon such third party Intangibles. The
termination of the Company’s ownership of, or right to use, any single Intangible could reasonably be expected to have a Material Adverse Effect. Neither the Company nor any of its Subsidiaries has entered into any consent agreement,
indemnification agreement, forbearance to sue or settlement agreement with respect to the validity of the Company’s or its Subsidiaries’ ownership or right to use its Intangibles and there is no reasonable basis for any such claim to be
successful. The Intangibles are valid and enforceable and no registration relating thereto has lapsed, expired or been abandoned or canceled or is the subject of cancellation or other adversarial proceedings, and all applications therefor are
pending and in good standing. The Company and its Subsidiaries have complied, in all material respects, with their respective contractual obligations relating to the protection of the Intangibles used pursuant to licenses. No person is infringing on
or violating the Intangibles owned or used by the Company or its Subsidiaries. 
 
(k) Title. The Company and its Subsidiaries have good and marketable title in fee simple to all real property and good and merchantable title to all personal property owned by them that is
material to the business of the Company and its Subsidiaries, in each case free and 
 

8 

 
clear of all liens,
encumbrances and defects, except for such liens, encumbrances and defects as do not, individually or in the aggregate, materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such
property by the Company and its Subsidiaries. Any real property and facilities held under lease by the Company and its Subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as are not material and do not
materially interfere with the use made and proposed to be made of such property and buildings by the Company and its Subsidiaries. 
 
(l) Environmental Matters. There is no environmental litigation or other environmental proceeding pending or threatened by any
governmental regulatory authority or others with respect to the current or any former business of the Company or its Subsidiaries or any partnership or joint venture currently or at any time affiliated with the Company or its subsidiaries. No state
of facts exists as to environmental matters or Hazardous Substances (as defined below) that involves the reasonable likelihood of a material capital expenditure by the Company or its Subsidiaries or that may otherwise have a Material Adverse Effect.
No Hazardous Substances have been treated, stored or disposed of, or otherwise deposited, in or on the properties owned or leased by the Company or its Subsidiaries or by any partnership or joint venture currently or at any time affiliated with the
Company or its Subsidiaries in violation of any applicable environmental laws. The environmental compliance programs of the Company and its Subsidiaries comply in all respects with all environmental laws, whether federal, state or local, currently
in effect. As used herein, “Hazardous Substances” means any substance, waste, contaminant, pollutant or material that has been determined by any governmental authority to be capable of posing a risk of injury to health, safety,
property or the environment. 
 
(m)
Disclosure. All information relating to or concerning the Company and/or any Subsidiary or Subsidiaries set forth in this Agreement or provided to the Purchaser pursuant to Section 2(d) hereof or otherwise in connection with the transactions
contemplated hereby is true and correct in all material respects and the Company has not omitted to state any material fact necessary in order to make the statements made herein or therein, in light of the circumstances under which they were made,
not misleading. No event or circumstance has occurred or exists with respect to the Company or its Subsidiaries or their respective businesses, properties, prospects, operations or financial conditions, which has not been publicly disclosed but,
under applicable law, rule or regulation, would be required to be disclosed by the Company in a registration statement filed on the date hereof by the Company under the Securities Act with respect to a primary issuance of the Company’s
securities. 
 
(n) Acknowledgment Regarding
Purchaser’s Purchase of the Securities. The Company acknowledges and agrees that the Purchaser is not acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with respect to this Agreement or the transactions
contemplated hereby, the relationship between the Company and the Purchaser is “arms-length” and any statement made by the Purchaser or any of its representatives or agents in connection with this Agreement and the transactions
contemplated hereby is merely incidental to the Purchaser’s purchase of Securities and has not been relied upon by the Company, its officers or directors in any way. The Company further acknowledges that the Company’s decision to enter
into this Agreement has been based solely on an independent evaluation by the Company and its representatives. 
 

9 

 
(o) Form
SB-2 Eligibility. The Company is currently eligible to register the resale of its Common Stock on a registration statement filed on Form SB-2 under the Securities Act. 
 
(p) No General Solicitation. Neither the Company nor any distributor participating on the
Company’s behalf in the transactions contemplated hereby (if any) nor any person acting for the Company, or any such distributor, has conducted any “general solicitation,” as such term is defined in Regulation D, with respect to any
of the Securities being offered hereby. 
 
(q)
No Integrated Offering. Neither the Company, nor any of its affiliates, nor any person acting on its or their behalf, has directly or indirectly made any offers or sales of any security or solicited any offers to buy any security under
circumstances that would require registration of the Securities being offered hereby under the Securities Act or cause this offering of Securities to be integrated with any prior offering of securities of the Company for purposes of the Securities
Act. 
 
(r) No Brokers. The Company has
taken no action which would give rise to any claim by any person for brokerage commissions or finder’s fees or for similar payments by the Purchaser relating to this Agreement or the transactions contemplated hereby. 
 
(s) Acknowledgment Regarding Securities. The number of
Conversion Shares issuable upon conversion of the Note may increase in certain circumstances. The Company’s executive officers have studied and fully understand the nature of the Securities being sold hereunder. The Company acknowledges that
its obligation to issue Conversion Shares upon conversion of the Note in accordance with the terms of the Note is, other than as set forth in the Note, absolute and unconditional, regardless of the dilution that such issuance may have on the
ownership interests of other stockholders and the availability of remedies provided for in the Transaction Documents relating to a failure or refusal to issue Conversion Shares. Taking the foregoing into account, the Company’s Board of
Directors has determined in its good faith business judgment that the issuance of the Note hereunder and the consummation of the other transactions contemplated hereby are in the best interests of the Company and its stockholders. The Company’s
Board of Directors and executive officers fully intend to honor their obligations hereunder to issue Conversion Shares upon conversion of the Note regardless of the dilution that such issuance may have on the ownership interests of other
stockholders and the availability of remedies provided for in the Transaction Documents relating to their failure or refusal to issue Conversion Shares. 
 
4.     COVENANTS. 
 
(a) Best Efforts. The parties shall use their best efforts timely to satisfy each of the conditions described in Sections 6 and 7
of this Agreement. 
 
(b) Form D: Blue Sky
Laws. The Company shall file with the SEC a Form D with respect to the Securities as required under Regulation D and provide a copy thereof to the Purchaser promptly after such filing. The Company shall, on or before the Closing Date, take such
action as the Company shall reasonably determine is necessary to qualify the Securities for sale to the Purchaser pursuant to this Agreement under applicable securities or “blue sky” laws of the states of the United States or obtain
exemption therefrom, and shall provide evidence of 
 

10 

 
any such action so taken to
the Purchaser on or prior to the Closing Date. Within two (2) trading days after the Closing Date, the Company shall file a Form 8-K concerning this Agreement and the transactions contemplated hereby, which Form 8-K shall attach this Agreement and
its Exhibits as exhibits to such Form 8-K (the “8-K Filing”). From and after the 8-K Filing, the Company hereby acknowledges that the Purchaser shall not be in possession of any material nonpublic information received from the
Company, any of its Subsidiaries or any of its respective officers, directors, employees or agents, that is not disclosed in the 8-K Filing. The Company shall not, and shall cause each of its Subsidiaries and its and each of their respective
officers, directors, employees and agents not to, provide the Purchaser with any material nonpublic information regarding the Company or any of its Subsidiaries from and after the 8-K Filing without the express written consent of the Purchaser;
provided, however, that if the Purchaser exercises its rights under Section 4(m) it shall be deemed to have given such express written consent. In the event of a breach of the foregoing covenant by the Company, any of its Subsidiaries, or any
of its or their respective officers, directors, employees and agents, in addition to any other remedy provided herein or in the other Transaction Documents, the Purchaser shall have the right to make a public disclosure, in the form of a press
release, public advertisement or otherwise, of such material nonpublic information without the prior approval by the Company, its Subsidiaries, or any of its or their respective officers, directors, employees or agents. The Purchaser shall not have
any liability to the Company, its Subsidiaries, or any of its or their respective officers, directors, employees, shareholders or agents for any such disclosure. Subject to the foregoing, neither the Company nor the Purchaser shall issue any press
releases or any other public statements with respect to the transactions contemplated hereby; provided, however, that the Company shall be entitled, without the prior approval of the Purchaser, to make any press release or other public
disclosure with respect to such transactions (i) in substantial conformity with the 8-K Filing and contemporaneously therewith and (ii) as is required by applicable law and regulations (provided that in the case of clause (i) the Purchaser shall be
consulted by the Company in connection with any such press release or other public disclosure prior to its release). 
 
(c) Reporting Status. So long as the Purchaser beneficially owns any of the Securities, the Company shall timely file (within
applicable extension periods) all reports required to be filed with the SEC pursuant to the Exchange Act, and the Company shall not terminate its status as an issuer required to file reports under the Exchange Act even if the Exchange Act or the
rules and regulations thereunder would permit such termination. 
 
(d) Use of Proceeds. The Company shall use the proceeds from the issuance and sale of the Securities for general corporate purposes and working capital. Such proceeds shall not be used to (i) pay dividends; (ii) pay for any
increase in executive compensation or make any loan or other advance to any officer, employee, shareholder, director or other affiliate of the Company, without the express approval of the Board of Directors acting in accordance with past practice;
(iii) purchase debt or equity securities of any entity (including redeeming the Company’s own securities), except for (A) evidences of indebtedness issued or fully guaranteed by the United States of America and having a maturity of not more
than one year from the date of acquisition, (B) certificates of deposit, notes, acceptances and repurchase agreements having a maturity of not more than one year from the date of acquisition issued by a bank organized in the United States
having capital, surplus and undivided profits of at least $500,000,000, (C) the highest-rated commercial paper having a maturity of not more than one year from the date of 
 

11 

 
acquisition, and (D)
“Money Market” fund shares, or money market accounts fully insured by the Federal Deposit Insurance Corporation and sponsored by banks and other financial institutions, provided that the investments consist principally of the types of
investments described in clauses (A), (B), or (C) above; or (iv) make any investment not directly related to the current business of the Company. 
 
(e) Financial Information. The Company shall send (via electronic transmission or otherwise) the following reports to the Purchaser
until the Purchaser transfers, assigns or sells all of the Securities: (i) within ten (10) days after the filing with the SEC, a copy of its Annual Report on Form 10-K, its Quarterly Reports on Form 10-Q, its proxy statements and any Current Reports
on Form 8-K; and (ii) within one (1) day after release, copies of all press releases issued by the Company or any of its Subsidiaries. 
 
(f) Reservation of Shares. The Company shall at all times have authorized and reserved for the purpose of issuance a sufficient
number of shares of Common Stock to provide for the full conversion of the outstanding Note and issuance of the Conversion Shares in connection therewith to the extent required by the Note. 
 
(g) Listing. The Company shall promptly secure the
listing of the Conversion Shares upon each national securities exchange or automated quotation system, if any, upon which shares of Common Stock become listed or quoted (subject to official notice of issuance upon conversion of the Note) and shall
maintain, so long as any other shares of Common Stock shall be so listed or quoted, such listing of all Conversion Shares from time to time issuable upon the conversion of the Note. The Company shall comply in all material respects with the
reporting, filing and other obligations under the bylaws or rules of any such national securities exchange or automated quotation system on which its shares of Common Stock are listed or quoted. The Company shall promptly provide to the holder of
Note copies of any notices it receives regarding the continued eligibility of the Common Stock for trading on any national securities exchange or automated quotation system on which securities of the same class or series issued by the Company are
then listed or quoted, if any. 
 
(h) Corporate
Existence. So long as the Purchaser beneficially owns any Securities, the Company shall maintain its corporate existence, and in the event of a merger, consolidation or sale of all or substantially all of the Company’s assets, the Company
shall ensure that the surviving or successor entity in such transaction (i) assumes the Company’s obligations hereunder and under the other Transaction Documents and (ii) is a publicly traded corporation. 
 
(i) No Integrated Offerings. The Company shall not make
any offers or sales of any security (other than the Securities) under circumstances that would require registration of the Securities being offered or sold hereunder under the Securities Act or cause this offering of the Securities to be integrated
with any other offering of securities by the Company for purposes of any stockholder approval provision applicable to the Company or its securities. 
 
(j) Legal Compliance. The Company shall conduct its business and the business of its subsidiaries in compliance with all laws,
ordinances or regulations of governmental entities applicable to such businesses, except where the failure to do so would not have a Material Adverse Effect. 
 

12 

 
(k)
Redemptions and Dividends. So long as the Purchaser holds the Note, the Company shall not, without first obtaining the written approval of the Purchaser, repurchase, redeem or declare or pay any cash dividend or distribution on any shares of
capital stock of the Company. 
 
(l)
Information. So long as the Purchaser holds the Note, the Company shall furnish to the Purchaser: 
 
(i) concurrently with the filing with the SEC of its annual reports on Form 10-K, a certificate of the President, a Vice
President or a senior financial officer of the Company stating that, based upon such examination or investigation and review of this Agreement as in the opinion of the signer is necessary to enable the signer to express an informed opinion with
respect thereto, neither the Company nor any of its Subsidiaries is or has during such period been in default in the performance or observance of any of the terms, covenants or conditions hereof, or, if the Company or any of its Subsidiaries shall
be or shall have been in default, specifying all such defaults, and the nature and period of existence thereof, and what action the Company or such Subsidiary has taken, is taking or proposes to take with respect thereto; and 
 
(ii) the information the Company must deliver
to any holder or to any prospective transferee of Securities in order to permit the sale or other transfer of such Securities pursuant to Rule 144A of the SEC or any similar rule then in effect. 
 
The Company shall keep at its principal executive office a true copy of this
Agreement (as at the time in effect), and cause the same to be available for inspection at such office during normal business hours by any holder of Securities or any prospective transferee of Securities designated by a holder thereof. 
 
(m) Inspection of Properties and Books. So long as the
Purchaser shall beneficially own any Securities, the Purchaser and its representatives and agents (collectively, the “Inspectors”) shall have the right, at the Purchaser’s expense, to visit and inspect any of the properties of
the Company and of its Subsidiaries, to examine the books of account and records of the Company and of its Subsidiaries, to make or be provided with copies and extracts therefrom, to discuss the affairs, finances and accounts of the Company and of
its Subsidiaries with, and to be advised as to the same by, its and their officers, employees and independent public accountants (and by this provision the Company authorizes such accountants to discuss such affairs, finances and accounts, whether
or not a representative of the Company is present) all at such reasonable times and intervals and to such reasonable extent as the Purchaser may desire; provided, however, that each Inspector shall hold in confidence and shall not make any
disclosure (except to the Purchaser) of any such information which the Company determines in good faith to be confidential, and of which determination the Inspectors are so notified, unless (i) the disclosure of such information is necessary to
avoid or correct a misstatement or omission in any registration statement covering the Securities, (ii) the release of such information is ordered pursuant to a subpoena or other order from a court or government body of competent jurisdiction, or
(iii) such information has been made generally available to the public other than by disclosure in violation of this or any other agreement. The Purchaser agrees that it shall, upon learning that disclosure of such information is sought in or by a
court or governmental body of competent jurisdiction or through other means, give prompt notice to the Company and allow the 
 

13 

 
Company, at its expense, to
undertake appropriate action to prevent disclosure of, or to obtain a protective order for, the information deemed confidential. 
 
(n) Confidential Agreement. Except for any disclosure required by applicable law or rules of the SEC, the Company and the Purchaser
shall, and shall direct its respective representatives to, hold in confidence all information concerning this Agreement and the transactions contemplated hereby until the earlier of such time as (i) the Company has made a public announcement
concerning the Agreement and the transactions contemplated hereby or (ii) this Agreement is terminated. 
 
(o) Registration Rights. Promptly following the Closing, the Company and the Purchaser shall execute and deliver a registration
rights agreement in form customary for transactions of the type contemplated hereby, which registration rights agreement shall provide the Purchaser with unlimited piggyback registration rights and one demand registration right beginning one hundred
and eighty days after the Closing. 
 
(p)
Disclosure Schedule. Within five business days following the Closing, the Company shall deliver to the Purchaser the Disclosure Schedule, in form and substance satisfactory to the Purchaser in Purchaser’s sole discretion. 
 
5.     TRANSFER AGENT INSTRUCTIONS. 
 
(a) The Company shall instruct its transfer agent to issue
certificates (subject to the legend and other provisions hereof and in the Note), registered in the name of the Purchaser or its nominee, for the Conversion Shares in such amounts as specified from time to time by the Purchaser to the Company upon
conversion of the Note. To the extent and during the periods provided in Sections 2(f) and 2(g) of this Agreement, all such certificates shall bear the restrictive legend specified in Section 2(g) of this Agreement. 
 
(b) The Company warrants that no instruction other than such
instructions referred to in this Section 5 and stop transfer instructions to give effect to Section 2(f) hereof in the case of the transfer of the Conversion Shares prior to registration of the Conversion Shares under the Securities Act or without
an exemption therefrom, shall be given by the Company to its transfer agent and that the Securities shall otherwise be freely transferable on the books and records of the Company as and to the extent provided in this Agreement. Nothing in this
Section shall affect in any way the Purchaser’s obligations and agreement set forth in Section 2(g) hereof to resell the Securities pursuant to an effective registration statement or under an exemption from the registration requirements of
applicable securities law. 
 
(c) If the Purchaser
provides the Company and the transfer agent with an opinion of counsel, which opinion of counsel shall be in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect that the Securities have been sold or
transferred pursuant to an exemption from registration, or the Purchaser provides the Company with an opinion of counsel, which opinion of counsel shall be in form, substance and scope customary for opinions of counsel in comparable transactions, to
the effect that such Securities may be sold under Rule 144(k), the Company shall permit the transfer and, in the case of the 
 

14 

 
Conversion Shares, promptly
instruct its transfer agent to issue one or more certificates in such name and in such denominations as specified by the Purchaser. 
 
6.     CONDITIONS TO THE COMPANY’S OBLIGATION TO SELL. 
 
The obligation of the Company hereunder to issue and sell the Note to the Purchaser and to otherwise
consummate the transactions contemplated hereby is subject to the satisfaction, at or before the Closing, of each of the following conditions thereto, provided that these conditions are for the Company’s sole benefit and may be waived by the
Company at any time in its sole discretion. 
 
(a)
The Purchaser shall have executed this Agreement and delivered the same to the Company. 
 
(b) The Purchaser shall have delivered the amount of the Purchase Price to the Company by wire transfer in accordance with the Company’s written wiring instructions. 
 
(c) The representations and warranties of the Purchaser shall
be true and correct as of the date when made and as of the Closing Date as though made at that time (except for representations and warranties that speak as of a specific date, which representations and warranties shall be true and correct as of
such date), and the Purchaser shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Purchaser at or prior to
the Closing Date. 
 
(d) No statute, rule,
regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over the
matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement. 
 
7.     CONDITIONS TO THE PURCHASER’S OBLIGATION TO PURCHASE. The obligation of the Purchaser hereunder to purchase the
Note from the Company and to otherwise consummate the transactions contemplated hereby is subject to the satisfaction, at or before the Closing Date, of each of the following conditions, provided that such conditions are for the Purchaser’s
sole benefit and may be waived by the Purchaser at any time in the Purchaser’s sole discretion: 
 
(a) The Company shall have executed this Agreement and delivered executed original copies of the same to the Purchaser. 
 
(b) The Company shall have delivered to the Purchaser a duly
executed Note registered in the Purchaser’s name. 
 
(c) The representations and warranties of the Company shall be true and correct as of the date when made and as of the Closing Date as though made at that time (except for representations and warranties that speak as of a specific
date, which representations and warranties shall be true and correct as of such date) and the Company shall have performed, 
 

15 

 
satisfied and complied in all
material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company at or prior to the Closing Date. 
 
(d) No statute, rule, regulation, executive order, decree, ruling, injunction, action or proceeding shall
have been enacted, entered, promulgated or endorsed by any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby which questions the validity of,
challenges or prohibits the consummation of, any of the transactions contemplated by this Agreement. 
 
(e) There shall have been no material adverse changes and no material adverse developments in the business, properties, operations,
prospects, financial condition or results of operations of the Company and its subsidiaries, taken as a whole, since the date hereof, and no information, of which the Purchaser is not currently aware, shall come to the attention of the Purchaser
that is materially adverse to the Company. 
 
(f)
The Purchaser shall have received a copy of resolutions, duly adopted by the Board of Directors of the Company, which shall be in full force and effect at the time of the applicable Closing, authorizing the consummation by the Company of the
transactions contemplated hereby and by the other Transaction Documents, certified as such by the Secretary or Assistant Secretary of the Company. 
 
8.     GOVERNING LAW; MISCELLANEOUS. 
 
(a) Governing Law; Jurisdiction. This Agreement shall be governed by and construed in accordance with the laws of the State of
Delaware applicable to contracts made and to be performed in the State of Delaware. The Company and the Purchaser irrevocably consent to the jurisdiction of the United States federal courts and the state courts located in the State of Delaware in
any suit or proceeding based on or arising under this Agreement and irrevocably agree that all claims in respect of such suit or proceeding may be determined in such courts. The Company irrevocably waives the defense of an inconvenient forum to the
maintenance of such suit or proceeding. The Company further agrees that service of process upon the Company mailed by first class mail shall be deemed in every respect effective service of process upon the Company in any such suit or proceeding.
Nothing herein shall affect the right of the Purchaser to serve process in any other manner permitted by law. The Company agrees that a final non-appealable judgment in any such suit or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on such judgment or in any other lawful manner. 
 
(b) Counterparts. This Agreement may be executed in two or more counterparts, all of which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and
delivered to the other party. This Agreement, once executed by a party, may be delivered to the other parties hereto by facsimile transmission of a copy of this Agreement bearing the signature of the party so delivering this Agreement. In the event
any signature is delivered by facsimile transmission, the party using such means of delivery shall cause the manually executed execution page(s) hereof to be physically delivered to the other party within five (5) days of the execution hereof,
provided that the failure to so deliver 
 

16 

 
any manually executed
execution page shall not affect the validity or enforceability of this Agreement. 
 
(c) Construction. Whenever the context requires, the gender of any word used in this Warrant includes the masculine, feminine or neuter, and the number of any word includes the singular or
plural. Unless the context otherwise requires, all references to articles and sections refer to articles and sections of this Agreement, and all references to schedules are to schedules attached hereto, each of which is made a part hereof for all
purposes. The descriptive headings of the several articles and sections of this Agreement are inserted for purposes of reference only, and shall not affect the meaning or construction of any of the provisions hereof. 
 
(d) Severability. If any provision of this Agreement
shall be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the remainder of this Agreement or the validity or enforceability of this Agreement in any other
jurisdiction. 
 
(e) Entire Agreement;
Amendments. This Agreement and the other Transaction Documents contain the entire understanding of the Purchaser, the Company, their affiliates and persons acting on their behalf with respect to the matters covered herein and therein and, except
as specifically set forth herein or therein, neither the Company nor the Purchaser makes any representation, warranty, covenant or undertaking with respect to such matters. No provision of this Agreement may be waived other than by an instrument in
writing signed by the party to be charged with enforcement and no provision of this Agreement may be amended other than by an instrument in writing signed by the Company and the Purchaser. 
 
(f) Notices. Any notices required or permitted to be given under the terms of this Agreement shall be
sent by certified or registered mail (return receipt requested) or delivered personally, by responsible overnight carrier or by confirmed facsimile, and shall be effective five (5) days after being placed in the mail, if mailed, or upon receipt or
refusal of receipt, if delivered personally or by responsible overnight carrier or confirmed facsimile, in each case addressed to a party. The initial addresses for such communications shall be as follows, and each party shall provide notice to the
other parties of any change in such party’s address: 
 

	 	(i)	 	If to the Purchaser: 

 
P-Com, Inc. 
3175 South Winchester Blvd. 
Campbell, CA 95008

Telephone: (408) 866-3666 
Facsimile: (408) 874-4461 
Attention: Chief Executive Officer 
 
with a copy simultaneously transmitted by like means to 
(which transmittal shall not constitute notice hereunder): 
 
Sheppard Mullin Richter & Hampton LLP 
800 Anacapa Street 
 

17 

 
Santa Barbara, CA 93101 
Telephone: (805) 879-1812 
Facsimile: (805) 568-1955 
Attention: Theodore R. Maloney, Esq. 
 

	 	(ii)	 	If to the Company: 

 
SPEEDCOM Wireless Corporation 
7020 Professional Parkway East 
Sarasota, FL 34240 
Telephone: (941) 907-2300 
Facsimile: (941) 355-0219

 
(g) Successors and Assigns. This
Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns. Except as provided herein, the Company shall not assign this Agreement or any rights or obligations hereunder. The Purchaser may assign or
transfer the Securities pursuant to the terms of the Note and this Agreement, as applicable, or assign the Purchaser’s rights hereunder or thereunder to any other person or entity, except for direct competitors of the Company or persons or
entities that have publicly announced plans to compete directly with the Company. In addition, and notwithstanding anything to the contrary contained in this Agreement or the other Transaction Documents, the Securities may be pledged and all rights
of the Purchaser under this Agreement or any other Transaction Document may be assigned, without further consent of the Company, to a bona fide pledgee in connection with the Purchaser’s margin or brokerage account. 
 
(h) Third Party Beneficiaries. This Agreement is
intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other person. 
 
(i) Survival. The representations and warranties of the
Company and the agreements and covenants set forth in Sections 3, 4, 5 and 8 hereof shall survive the Closing notwithstanding any due diligence investigation conducted by or on behalf of the Purchaser. Moreover, none of the representations and
warranties made by the Company herein shall act as a waiver of any rights or remedies the Purchaser may have under applicable U.S. federal or state securities laws. 
 
(j) Publicity. The Company and the Purchaser shall have the right to approve before issuance any press
releases, SEC filings, or any other public statements with respect to the transactions contemplated hereby; provided, however, that the Company shall be entitled, without the prior approval of the Purchaser, to make any press release or SEC
filings with respect to such transactions as is required by applicable law and regulations (although the Purchaser shall be consulted by the Company in connection with any such press release and filing prior to its release and shall be provided with
a copy thereof). 
 
(k) Further Assurances.
Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably request

 

18 

 
in order to carry out the
intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby. 
 
(l) Joint Participation in Drafting. Each party to this Agreement has participated in the negotiation and drafting of this
Agreement and the other Transaction Documents. As such, the language used herein and therein shall be deemed to be the language chosen by the parties hereto to express their mutual intent, and no rule of strict construction shall be applied against
any party to this Agreement. 
 
(m) Equitable
Relief. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Purchaser by vitiating the intent and purpose of the transactions contemplated hereby. Accordingly, the Company acknowledges
that the remedy at law for a breach of its obligations hereunder (including, but not limited to, its obligations pursuant to Section 5 hereof) will be inadequate and agrees, in the event of a breach or threatened breach by the Company of the
provisions of this Agreement (including, but not limited to, its obligations pursuant to Section 5 hereof), that the Purchaser shall be entitled, in addition to all other available remedies, to an injunction restraining any breach and requiring
immediate issuance and transfer of the Securities, without the necessity of showing economic loss and without any bond or other security being required. 
 
(n) Indemnification by Company. From and after the Closing, the Company shall hold harmless and indemnify the Purchaser from and
against, and shall compensate and reimburse the Purchaser for, any damages (including reasonable attorneys fees) which are directly or indirectly suffered or incurred by the Purchaser or to which the Purchaser may otherwise become subject
(regardless of whether or not such damages relate to any third-party claim) and which arise from or as a result of, or are directly or indirectly connected with any inaccuracy in or breach of any of the Company’s representations, warranties or
covenants set forth herein. In the event of the assertion or commencement by any person of any claim or legal proceeding with respect to which the Purchaser may have indemnification rights pursuant to this Section 8(n), the Purchaser shall promptly
notify the Company thereof in writing, but the failure to so notify the Company will not limit the Purchaser’s rights to indemnification hereunder, except to the extent the Company demonstrates that the defense of such action is prejudiced by
the failure to so give such notice. 
 
(o)
Additional Acknowledgement. The Purchaser acknowledges that it has independently evaluated the merits of the transactions contemplated by this Agreement and the other Transaction Documents and that it has independently determined to enter
into the transactions contemplated hereby and thereby. 
 
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 
 
 

19 

 
IN WITNESS
WHEREOF, the Purchaser and the Company have caused this Agreement to be duly executed as of the date first above written. 
 

	
	 SPEEDCOM WIRELESS CORPORATION

	
	 By:
	 	 
	 	 	

	 Name:
	 	 
	 Title:
	 	 
	
	 P-COM, INC.

	
	 By:
	 	 
	 	 	

	 Name:
	 	 
	 Title:

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