Document:

Financial Guaranty Insurance Company
125 Park Avenue
New York, New York  10017
(212) 312-3000
(800) 352-0001

Financial Guaranty Insurance Policy
                                                                                             Policy Number:  07030010
                                                                                             Control Number:  0010001

Issuing Entity:  RASC Series 2007-EMX1 Trust

Insured Obligations:

$692,852,000 in aggregate  certificate  principal  balance of Home Equity
Mortgage Asset-Backed Pass-Through Certificates,  Series 2007-EMX1, Class
A-I-1,   Class   A-I-2,   Class  A-I-3  and  Class   A-I-4   Certificates
(collectively,  the "Class A-I Certificates") and Class A-II Certificates
(the  "Class  A-II   Certificates,"  and  together  with  the  Class  A-I
Certificates, the "Class A Certificates")

Trustee:  U.S. Bank National Association

Financial Guaranty Insurance Company ("Financial  Guaranty"),  a New York stock insurance company, in consideration
of the right of Financial  Guaranty to receive monthly premiums as provided in the Insurance  Agreement (as defined
below)  and  subject  to  the  terms  of  this  Financial  Guaranty   Insurance  Policy  (this  "Policy"),   hereby
unconditionally  and  irrevocably  agrees to pay each Insured Payment (as defined below) to the Trustee named above
or its successor,  as trustee for the Holders of the Class A  Certificates,  to the extent set forth in the Pooling
and Servicing  Agreement (as defined  below).  Capitalized  terms used and not otherwise  defined herein shall have
the meanings  assigned to such terms in the Pooling and  Servicing  Agreement as in effect and executed on the date
hereof,  without giving effect to any subsequent  amendment or modification to the Pooling and Servicing  Agreement
unless such amendment or modification has been approved in writing by Financial Guaranty.

The following terms used herein shall have the meanings assigned to them below:

"Deficiency  Amount"  shall  mean  (a)  with  respect  to any  Distribution  Date  and  each  class  of  Class  A-I
Certificates,  an amount, if any, equal to the sum of (1) the excess, if any, of the Accrued  Certificate  Interest
(without taking into account any reductions in the Accrued  Certificate  Interest in respect of Realized Losses) on
such class of Class A-I  Certificates  for that  Distribution  Date over the amounts on deposit in the  Certificate
Account  on that  Distribution  Date  available  for  distribution  to such  class of  Class  A-I  Certificates  in
accordance  with the Class A Interest  Distribution  Priority  on that  Distribution  Date  (other than any portion
thereof  consisting of an Insured  Payment  payable as interest on such class of Class A-I  Certificates),  and (2)
(i) with  respect to any  Distribution  Date that is not the  Distribution  Date in  January  2037,  the  principal
portion of any Realized Losses  allocated to each class of Class A-I  Certificates,  if any, for that  Distribution
Date and (ii) on the Distribution Date in January 2037, the aggregate  Certificate  Principal Balance of each class
of Class A-I  Certificates on that  Distribution  Date after giving effect to all  distributions to be made thereon
on that Distribution  Date other than any portion thereof  consisting of an Insured Payment payable as principal on
the Class A-I  Certificates,  and (b) with respect to any  Distribution  Date and the Class A-II  Certificates,  an
amount,  if any, equal to the sum of (1) the excess,  if any, of the Accrued  Certificate  Interest (without taking
into account any reductions in the Accrued  Certificate  Interest in respect of Realized  Losses) on the Class A-II
Certificates  for  that  Distribution  Date  over  the  amounts  on  deposit  in the  Certificate  Account  on that
Distribution  Date  available  for  distribution  to the Class A-II  Certificates  in  accordance  with the Class A
Interest  Distribution  Priority on that Distribution Date (other than any portion thereof consisting of an Insured
Payment  payable as interest on the Class A-II  Certificates),  and (2) (i) with respect to any  Distribution  Date
that is not the  Distribution  Date in January 2037, the principal  portion of any Realized Losses allocated to the
Class A-II  Certificates,  if any, for that  Distribution  Date and (ii) on the Distribution  Date in January 2037,
the aggregate  Certificate  Principal Balance of the Class A-II Certificates on that Distribution Date after giving
effect  to all  distributions  to be made  thereon  on that  Distribution  Date  other  than  any  portion  thereof
consisting of an Insured Payment payable as principal on the Class A Certificates.

"Insured  Payment"  means  with  respect  to (a) any  Distribution  Date,  (i) any  Deficiency  Amount and (ii) any
Preference Amount (as defined in this Policy) and (b) any other date, any Preference Amount.

Financial  Guaranty will pay a Deficiency  Amount with respect to the Class A  Certificates  by 12:00 noon New York
City time in  immediately  available  funds to the Trustee on the later of (i) the second  Business  Day  following
receipt in New York, New York on a Business Day by Financial  Guaranty of a Notice from the Trustee  specifying the
Deficiency  Amount which is due in respect of the Class A Certificates and (ii) the Distribution  Date on which the
related  Deficiency  Amount is payable to the  Holders of the Class A  Certificates  pursuant  to the  Pooling  and
Servicing  Agreement,  for  disbursement  to the  Holders of the Class A  Certificates  in the same manner as other
payments  with  respect to the Class A  Certificates  are  required to be made.  Any Notice  received by  Financial
Guaranty  after  12:00 noon New York City time on a given  Business  Day or on any day that is not a  Business  Day
shall be deemed to have been received by Financial  Guaranty on the next succeeding  Business Day. In addition,  if
any Notice  received by Financial  Guaranty is not in proper form or is otherwise  insufficient  for the purpose of
making a claim  under  this  Policy,  it will be deemed  not to have  been  received  by  Financial  Guaranty,  and
Financial Guaranty will promptly so advise the Trustee, and the Trustee may submit an amended Notice.

If any  portion or all of any amount  that is insured  hereunder  that was  previously  distributed  to a Holder of
Class A  Certificates  is  recoverable  and sought to be recovered  from such Holder as a voidable  preference by a
trustee in bankruptcy  pursuant to the U.S. Bankruptcy Code,  pursuant to a final  non-appealable  order of a court
exercising  proper  jurisdiction  in  an  insolvency  proceeding  (a  "Final  Order")  (such  recovered  amount,  a
"Preference  Amount"),  Financial  Guaranty will pay on the guarantee  described in the first paragraph  hereof, an
amount equal to each such  Preference  Amount by 12:00 noon New York City time on the second Business Day following
receipt by  Financial  Guaranty on a Business  Day of (w) a certified  copy of the Final  Order,  (x) an opinion of
counsel  satisfactory  to  Financial  Guaranty  that the Final  Order is final and not  subject to  appeal,  (y) an
assignment,  in form reasonably  satisfactory to Financial  Guaranty,  irrevocably  assigning to Financial Guaranty
all rights and claims of the Trustee  and/or such Holder of the Class A  Certificates  relating to or arising under
such Preference  Amount and constituting an appropriate  instrument,  in form reasonably  satisfactory to Financial
Guaranty,  appointing  Financial  Guaranty  as the agent of the  Trustee  and/or  such  Holder in  respect  of such
Preference  Amount,  including without limitation in any legal proceeding related to the Preference Amount, and (z)
a Notice  appropriately  completed  and  executed by the Trustee or such  Holder,  as the case may be. Such payment
shall be made to the  receiver,  conservator,  debtor-in-possession  or  trustee in  bankruptcy  named in the Final
Order and not to the  Trustee or Holder of the Class A  Certificates  directly  (unless  the Holder has  previously
paid such amount to such receiver,  conservator,  debtor-in-possession or trustee in bankruptcy named in such Final
Order in which case payment shall be made to the Trustee for  distribution  to the Holder upon delivery of proof of
such payment  reasonably  satisfactory to Financial  Guaranty).  Notwithstanding  the foregoing,  in no event shall
Financial  Guaranty be (i) required to make any payment  under this Policy in respect of any  Preference  Amount to
the extent such Preference  Amount is comprised of amounts  previously  paid by Financial  Guaranty  hereunder,  or
(ii) obligated to make any payment in respect of any Preference  Amount,  which payment represents a payment of the
principal  amount of any Class A  Certificates,  prior to the time  Financial  Guaranty  otherwise  would have been
required to make a payment in respect of such  principal,  in which case  Financial  Guaranty shall pay the balance
of the Preference Amount when such amount otherwise would have been required.

Any of the  documents  required  under  clauses (w) through (z) of the  preceding  paragraph  that are  received by
Financial  Guaranty  after  12:00  noon  New York  City  time on a given  Business  Day or on any day that is not a
Business Day shall be deemed to have been received by Financial  Guaranty on the next  succeeding  Business Day. If
any notice  received by Financial  Guaranty is not in proper form or is otherwise  insufficient  for the purpose of
making a claim under this Policy with respect to a Deficiency  Amount or a Preference  Amount,  as  applicable,  it
will be deemed not to have been  received by Financial  Guaranty,  and  Financial  Guaranty will promptly so advise
the Trustee,  and the Trustee may submit an amended Notice.  All payments made by Financial  Guaranty  hereunder in
respect of Preference Amounts will be made with Financial Guaranty's own funds.

Upon payment of any Insured Payment  hereunder,  Financial  Guaranty shall be fully subrogated to the rights of the
Holders of the Class A Certificates to receive the amount so paid.  Financial  Guaranty's  obligations with respect
to the Class A  Certificates  hereunder  with respect to each  Distribution  Date shall be discharged to the extent
funds  consisting  of the  related  Deficiency  Amount are  received by the Trustee on behalf of the Holders of the
Class A Certificates  for payment to such Holders,  as provided in the Pooling and Servicing  Agreement and herein,
whether or not such funds are properly applied by the Trustee.

This Policy is non-cancelable for any reason,  including  nonpayment of any premium.  The premium on this Policy is
not  refundable  for any  reason,  including  the  payment of any Class A  Certificates  prior to their  respective
maturities.  This Policy shall  expire and  terminate  without any action on the part of Financial  Guaranty or any
other  Person  on the date that is the  later of (i) the date  that is one year and one day  following  the date on
which the Class A  Certificates  shall have been paid in full and (ii) if any insolvency  proceeding  referenced in
the third  preceding  paragraph with respect to which the Depositor is the debtor has been commenced on or prior to
the date  specified  in  clause  (i)  above,  the 30th day  after  the  entry of a final,  non-appealable  order in
resolution or settlement of such proceeding.

This  Policy  does not  cover  payments  under the Swap  Agreement,  Basis  Risk  Shortfalls,  Prepayment  Interest
Shortfalls or Relief Act Shortfalls, as applicable,  with respect to the Class A Certificates,  nor does the Policy
cover  any  reductions  in the  Pass-Through  Rates  resulting  from  application  of the Net WAC Cap  Rate or Swap
Termination  Payments.  The Policy does not  guarantee to the holders of the Class A  Certificates  any  particular
rate of  principal  payment.  In  addition,  this Policy does not cover  shortfalls,  if any,  attributable  to the
liability of the Depositor,  the Issuing Entity,  any REMIC,  the Trustee or any Holder for  withholding  taxes, if
any (including  interest and penalties in respect of any liability for  withholding  taxes).  This Policy also does
not cover the failure of the Trustee to make any payment  required  under the Pooling and  Servicing  Agreement  to
any Holder of a Class A Certificate.

To the fullest extent  permitted by applicable law,  Financial  Guaranty  hereby waives,  solely for the benefit of
Holders of  the Class A  Certificates,  all defenses of any kind  (including,  without  limitation,  the defense of
fraud in  inducement  or fact,  any defense  based on any duty  claimed to arise from the  doctrine of "utmost good
faith" or any similar or related  doctrine or any other  circumstances  that would have the effect of discharging a
surety,  guarantor or any other person in law or in equity) that Financial  Guaranty  otherwise might have asserted
as a defense to its  obligation to pay in full any amounts that have become due and payable in accordance  with the
terms and conditions of this Policy.  Nothing in this  paragraph,  however,  shall be deemed to constitute a waiver
of any rights,  remedies,  claims or  counterclaims  that  Financial  Guaranty may have with respect to Residential
Funding Corporation,  the Issuing Entity, or any of their affiliates,  whether acquired by subrogation,  assignment
or otherwise.

A monthly  Premium shall be due and payable in arrears as provided in the Pooling and  Servicing  Agreement and the
Insurance Agreement.

This  Policy is subject to and shall be  governed  by the laws of the State of New York.  The proper  venue for any
action or proceeding on this Policy shall be the County of New York, State of New York.

THE  INSURANCE  PROVIDED BY THIS POLICY IS NOT COVERED BY THE NEW YORK  PROPERTY/CASUALTY  INSURANCE  SECURITY FUND
(NEW YORK INSURANCE CODE, ARTICLE 76).

"Notice"  means a  written  notice in the form of  Exhibit A to this  Policy by  registered  or  certified  mail or
telephonic or telegraphic notice,  subsequently  confirmed by written notice delivered via telecopy,  telex or hand
delivery from the Trustee to Financial  Guaranty  specifying the information set forth therein.  "Holder" means, as
to a  particular  Class A  Certificate,  the person,  other than  Residential  Asset  Securities  Corporation  (the
"Depositor"),  Residential Funding Company, LLC (the "Sponsor" and the "Master Servicer"), any subservicer retained
by the Master  Servicer  or the  Trustee  and,  in each  case,  any of their  respective  affiliates,  who,  on the
applicable  Distribution  Date,  is  entitled  under the terms of such Class A  Certificate  to a payment  thereon.
"Pooling and Servicing  Agreement" means the Pooling and Servicing  Agreement relating to the Class A  Certificates
by and among,  the  Depositor,  the Sponsor,  the Master  Servicer  and the Trustee,  dated as of February 1, 2007.
"Insurance  Agreement" means the Insurance and Indemnity Agreement,  among Financial Guaranty,  the Depositor,  the
Sponsor, the Master Servicer and the Trustee, dated as of March 12, 2007.

In the event that payments under any Class A Certificate are  accelerated,  nothing herein contained shall obligate
Financial  Guaranty to make any payment of  principal  or interest on such Class A  Certificate  on an  accelerated
basis,  unless such acceleration of payment by Financial Guaranty is at the sole option of Financial  Guaranty;  it
being  understood  that a payment  shortfall in respect of the  retirement of any Class A Certificate  by reason of
the optional  termination  of any group of Mortgage  Loans  pursuant to Section  9.01 of the Pooling and  Servicing
Agreement does not constitute acceleration for the purposes hereof.

IN WITNESS  WHEREOF,  Financial  Guaranty  has caused this Policy to be affixed with its  corporate  seal and to be
signed by its duly  authorized  officer in facsimile to become  effective  and binding upon  Financial  Guaranty by
virtue of the countersignature of its duly authorized representative.

President                                                              Authorized Representative

Effective Date:  March 12, 2007

                                                     EXHIBIT A

                                        NOTICE OF NONPAYMENT AND DEMAND FOR
                                                  INSURED PAYMENT

To:    Financial Guaranty Insurance Company
       125 Park Avenue
       New York, New York 10017
       (212) 312-3000
       Attention:  Structured Finance Surveillance - RASC - 2007-EMX1

       Telephone: (212) 312-3000
       Telecopier:  (212) 312-3220

Re:    $692,852,000 in aggregate certificate principal balance of Home Equity
       Mortgage Asset-Backed Pass-Through Certificates, Series 2007-EMX1,
       Class A-I-1, Class A-I-2, Class A-I-3 and Class A-I-4 Certificates
       (collectively, the "Class A-I Certificates") and Class A-II
       Certificates (the "Class A-II Certificates," and together with the
       Class A-I Certificates, the "Class A Certificates")

       Policy No:  07030010 (the "Policy")

Distribution Date:  ________________

We refer to that certain Pooling and Servicing  Agreement,  dated as of February 1, 2007, by and among  Residential
Asset Securities  Corporation,  as Depositor,  Residential  Funding Company,  LLC, as Master Servicer and U.S. Bank
National Association.  as Trustee (the "Pooling and Servicing  Agreement"),  relating to the above referenced Class
A  Certificates.  All  capitalized  terms  not  otherwise  defined  herein  or in the  Policy  shall  have the same
respective meanings assigned to such terms in the Pooling and Servicing Agreement.

(a)       The  Trustee  has  determined  under the Pooling  and  Servicing  Agreement  that in respect of the
          Distribution Date:

          (1)     The Deficiency  Amount on the Class A-I Certificates in respect of the Distribution  Date that
                  is due to be  received  on the  Distribution  Date  specified  above  under  the  Pooling  and
                  Servicing Agreement, is equal to $_____________, consisting of

                  (A)     $  ___________  in  respect  of  interest  on the  Class  A-I  Certificates,  which is
                          calculated as the amount by which:

                          (i)    $____________,  constituting the Accrued Certificate  Interest on the Class A-I
                                 Certificates  for  the   Distribution   Date  (without  taking  into  account  any
                                 reductions  in the Accrued  Certificate  Interest in respect of Realized  Losses);
                                 exceeds

                          (ii)    $___________,   constituting  the  amounts  on  deposit  in  the  Certificate
                                  Account on the  Distribution  Date  available for  distribution  to the Class A-I
                                  Certificates  in  accordance  with the  Class A  Interest  Distribution  Priority
                                  (other than any  portion  thereof  consisting  of an Insured  Payment  payable as
                                  interest on the Class A-I Certificates); plus

                (B)       $______________  in  respect  of  principal  of the Class A-I  Certificates  which with
                          respect  to (i) any  Distribution  Date that is not the  Distribution  Date in  January
                          2037,  constitutes the principal  portion of any Realized Losses allocated to the Class
                          A-I Certificates,  if any, for that Distribution Date and (ii) on the Distribution Date
                          in January 2037,  constitutes the aggregate  Certificate Principal Balance of the Class
                          A-I Certificates on such  Distribution Date after giving effect to all distributions to
                          be made thereon on that Distribution Date other than any portion thereof  consisting of
                          an Insured Payment payable as principal on the Class A-I Certificates.

        (2)      The Deficiency  Amount on the Class A-II Certificates in respect of the Distribution Date that
                 is due to be  received  on the  Distribution  Date  specified  above  under  the  Pooling  and
                 Servicing Agreement, is equal to $_____________, consisting of

                (A)       $  ___________  in  respect  of  interest  on the Class  A-II  Certificates,  which is
                          calculated as the amount by which:

                          (i)    $____________,  constituting  the  Accrued  Certificate  Interest  on the Class
                                 A-II  Certificates  for the  Distribution  Date  (without  taking into account any
                                 reductions  in the Accrued  Certificate  Interest in respect of Realized  Losses);
                                 exceeds

                          (ii)   $___________,  constituting the amounts on deposit in the Certificate  Account
                                 on  the   Distribution   Date  available  for   distribution  to  the  Class  A-II
                                 Certificates  in  accordance  with  the  Class A  Interest  Distribution  Priority
                                 (other  than any  portion  thereof  consisting  of an Insured  Payment  payable as
                                 interest on the Class A-II Certificates); plus

                (B)       $______________  in respect of  principal  of the Class  A-II  Certificates  which with
                          respect  to (i) any  Distribution  Date that is not the  Distribution  Date in  January
                          2037,  constitutes the principal  portion of any Realized Losses allocated to the Class
                          A-II  Certificates,  if any, for that  Distribution Date and (ii) the Distribution Date
                          in January 2037,  constitutes the aggregate  Certificate Principal Balance of the Class
                          A-II  Certificates on such  Distribution  Date after giving effect to all distributions
                          to be made thereon on that Distribution Date other than any portion thereof  consisting
                          of an Insured Payment payable as principal on the Class A-II Certificates.

         Please be advised that,  accordingly,  a Deficiency  Amount exists for the  Distribution  Date  identified
above for the Class A  Certificates  in the amount of $________.  This  Deficiency  Amount  constitutes  an Insured
Payment payable by Financial Guaranty under the Policy.

[In addition,  attached  hereto is a copy of the Final Order in connection  with a Preference  Amount in the amount
set forth therein,  together with an assignment of rights and appointment of agent and other documents  required by
the Policy in respect of the Preference  Amounts.  The amount of the  Preference  Amount is  $______________.  This
Preference Amount constitutes an Insured Payment payable by Financial Guaranty under the Policy.]

Accordingly,  pursuant to the Pooling and Servicing Agreement,  this statement  constitutes a notice for payment of
an Insured Payment by the Insurer in the amount of $__________ under the Policy.

(b)      No payment claimed hereunder is in excess of the amount payable under the Policy.
         The amount requested in this Notice should be paid to:  [Payment Instructions]

Any person who  knowingly  and with intent to defraud any  insurance  company or other person files an  application
for insurance or statement of claim  containing  any  materially  false  information or conceals for the purpose of
misleading,  information  concerning  any fact material  thereto,  commits a fraudulent  insurance  act, which is a
crime,  and shall also be subject to a civil  penalty  not to exceed  Five  Thousand  Dollars  ($5,000.00)  and the
stated value of the claim for each such violation.

         IN WITNESS  WHEREOF,  the Trustee has  executed and  delivered  this Notice of  Nonpayment  and Demand for
Insured Payments this _____ day of ______________________.

                                                     ________________________________________,
                                                     as Trustee

                                                     By:  ___________________________________

                                                     Title:  ___________________________________Exhibit 4.1 

THE SECURITIES REPRESENTED BY THIS
NOTE AND ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR UNDER THE PROVISIONS OF
ANY APPLICABLE STATE SECURITIES LAWS, BUT HAVE BEEN ACQUIRED BY THE REGISTERED HOLDER
HEREOF FOR PURPOSES OF INVESTMENT AND IN RELIANCE ON STATUTORY EXEMPTIONS UNDER THE 1933
ACT, AND UNDER ANY APPLICABLE STATE SECURITIES LAWS. THESE SECURITIES AND THE SECURITIES
ISSUED UPON EXERCISE HEREOF MAY NOT BE SOLD, PLEDGED, TRANSFERRED OR ASSIGNED, NOR MAY
THIS NOTE BE EXERCISED, EXCEPT IN A TRANSACTION WHICH IS EXEMPT UNDER THE PROVISIONS OF
THE 1933 ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT. 

CONVERTIBLE PROMISSORY
NOTE 

		
	Denver, Colorado
	As of March 26, 2007

        FOR
VALUE RECEIVED, Security With Advanced Technology, Inc., a Colorado corporation (the
“Company”), hereby promises to pay to the order of
[___________________________________________] (the “Holder”), in
lawful money of the United States at the address of the Holder set forth herein, the
principal amount of $[____________] (“Principal Amount”), together
with Interest (as defined in Section 2). This Promissory Note (this
“Note”) has been executed by the Company on the date set forth above (the
“Effective Date”) pursuant to the Securities Purchase Agreement entered
into on the Effective Date by and between the Company and the Holder (the
“Purchase Agreement”). Capitalized terms used but not defined herein
shall have the meanings assigned to such terms in the Purchase Agreement. 

        1.    Principal
Amount. The Company hereby promises to pay to the order of the           Holder, in
lawful money of the United States at the address of the Holder set           forth below,
the Principal Amount, together with Interest, which shall accrue           from the date
hereof until the date of payment in full of the aggregate           Principal Amount or
the conversion of this Note pursuant to the terms hereof.           The Principal Amount
shall be paid by the Company on the Maturity Date (as           defined in Section 3),
unless earlier paid or converted.  

        2.    Interest.
The outstanding Principal Amount shall bear simple interest           (“Interest”)
at the rate of 5.1% per annum (calculated on the           basis of the actual number of
days elapsed in a 360-day year) payable on the           Maturity Date (unless earlier
paid or converted).  

        3.    Maturity.
Unless this Note is earlier accelerated, prepaid or converted           as set forth
below, the outstanding Principal Amount and all unpaid Interest           thereon shall
be paid in full on September 30, 2007 (the “Maturity           Date”).  

        4.    Application
of Payments.  

        4.1    
Except as otherwise expressly provided herein, each payment under this Note shall be
applied (i) first to the repayment of any sums incurred by the Holder for the
payment of any expenses in enforcing the terms of this Note, (ii) then to the
payment of Interest, and (iii) then to the reduction of the Principal Amount.  

        4.2    
Upon payment in full of the Principal Amount and applicable accrued and unpaid Interest
thereon or the conversion of such amount pursuant to Section 6, this Note shall be
marked “Paid in Full”and returned to the Company.  

        5.    No
Prepayment. This Note (including the Principal Amount and all accrued
          Interest thereon) may not be prepaid in full or in part without the prior
          written consent of the Holder.  

        6.    Note
Conversion.  

        6.1    
Conversion. The outstanding Principal Amount and all accrued but unpaid Interest
thereon shall immediately, and without any action on the part of the Company or the
Holder, convert into shares of the Company’s Series A Preferred Stock, no par value
per share (“Preferred Stock”), at a conversion price per share of
Preferred Stock equal to $3.00 (the “Conversion Price”) on the date on
which the stockholders of the Company have approved such conversion of this Note as
provided in Section 8.1 hereof (the “Conversion Date”).  

        6.2    
Conversion Procedures. As promptly as practicable after the Conversion Date, the
Company, at its expense, will issue and deliver to the Holder a certificate(s) for the
number of full shares of Preferred Stock issuable upon such conversion. Upon the
conversion of this Note, the Holder shall surrender this Note, duly endorsed, at the
principal office of the Company and the Company shall be forever released from all its
obligations and liabilities under this Note. No fractional shares of the Company’s
Preferred Stock shall be issued upon conversion of this Note. In lieu of the Company
issuing any fractional shares to the Holder upon the conversion of this Note, the number
of shares of Preferred Stock to be issued shall be rounded to the nearest whole number of
shares.  

        7.    Waiver
of Notice. The Company hereby waives diligence, notice,           presentment,
protest and notice of dishonor.  

        8.    Covenants
of the Company.  

        8.1    
Stockholder Approval. The Company shall call a meeting of its stockholders at the
earliest practicable date (which meeting shall be held in no event later than September 30,
2007) and shall take all actions required to implement such meeting (including the
preparation and distribution of proxy materials in accordance with the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), in order to gain
the approval required accordance with Rule 4350(i) of The Nasdaq Stock Market to provide
for the conversion of this Note into Preferred Stock as set forth in Section 6.1 hereof,
and the conversion of such Preferred Stock into shares of Common Stock. The Company and
the Holder acknowledge and agree that Vision Opportunity Master Fund, Ltd. (“Vision”)
shall not have the right to convert the shares of Preferred Stock, and the Company shall
not effect the conversion of the shares of Preferred Stock held by Vision, to the extent
that after giving effect to such conversion Vision (together with its affiliates) would
beneficially own in excess of 9.99% of the shares of Common Stock outstanding immediately
after giving effect to such conversion; provided, however, that upon Vision providing the
Company with 61 days notice (the “Waiver Notice”) that Vision would like
to waive this restriction with regard to any or all securities issuable upon conversion
of the shares of Preferred Stock, this restriction will be of no force or effect with
regard to all or a portion of the shares of Preferred Stock referenced in the Waiver
Notice.  

2 

        8.2    
     No Amendment of Preferred  Stock.  The Company shall not amend the terms of the
 Preferred  Stock prior to the Conversion Date without the written approval of the Holder. 

        8.3    
Notice of Certain Events. Prior to the earlier of (a) the conversion of this
Note to Preferred Stock or (b) the payment of all amounts due hereunder, upon (i) any
taking by the Company of a record of the holders of any class of securities for the
purpose of determining the holders thereof who are entitled to receive any dividend or
other distribution, (ii) any capital reorganization of the Company, any
reclassification or recapitalization of the capital stock of the Company, any merger or
consolidation of the Company with or into any other corporation, any sale of all or
substantially all the assets of the Company (an “Asset Transfer”) or any
voluntary or involuntary dissolution, liquidation or winding up of the Company or (iii) an
acquisition by an individual or legal entity or “group” (as defined in Section
13(d) of the Exchange Act) of more than 50% of the voting rights or equity interests in
the Company, whether in one transaction or in a series of related transactions (an “Acquisition”),
in each case the Company shall, subject to the Company’s requirements under the
disclosure requirements of federal and state securities laws, furnish to the Holder at
least 20 days prior to the record date specified therein a notice specifying (1) the
date on which any such record is to be taken for the purpose of such dividend or
distribution and a description of such dividend or distribution, (2) the date on
which any such Acquisition, reorganization, reclassification, transfer, consolidation,
merger, Asset Transfer, dissolution, liquidation or winding up is expected to become
effective and (3) the date, if any, that is to be fixed for determining the holders
of record of Common Stock (or other securities) that shall be entitled to exchange their
shares of Common Stock (or other securities) for securities or other property deliverable
upon such Acquisition, reorganization, reclassification, transfer, consolidation, merger,
Asset Transfer, dissolution, liquidation or winding up.  

        9.    Events
of Default. The occurrence of any of the following events (each an           “Event
of Default”), not cured in the applicable cure period,           if any, shall
constitute an Event of Default of the Company:  

        9.1    
a material breach of any covenant or other provision of this Note, which, if capable of
being cured, is not cured within five days following notice thereof to the Company;  

        9.2    
the failure to make when due any payment described in this Note, whether on or after the
Maturity Date, by acceleration or otherwise;  

        9.3    
(i) the application for the appointment of a receiver or custodian for the Company
or the property of the Company, (ii) the entry of an order for relief or the filing
of a petition by or against the Company under the provisions of any bankruptcy or
insolvency law, (iii) any assignment for the benefit of creditors by or against the
Company, or (iv) the Company becomes insolvent; or  

3 

        9.4    
the Company is in breach of any representation, warranty or covenant provided set forth
in any other agreement between the Holder and the Company contained in the Purchase
Agreement or any ancillary agreement between the parties referenced therein.  

        Upon
the occurrence of any Event of Default that is not cured within any applicable cure
period, the Holder may elect, by written notice delivered to the Company, to take any or
all of the following actions: (i) declare this Note to be forthwith due and payable,
whereupon the entire unpaid Principal Amount, together with accrued and unpaid Interest
thereon, and all other cash obligations hereunder, shall become forthwith due and payable,
without presentment, demand, protest or any other notice of any kind, all of which are
hereby expressly waived by the Company, anything contained herein or in any of the Note to
the contrary notwithstanding, and (ii) exercise any and all other remedies provided
hereunder or available at law or in equity upon the occurrence and continuation of an
Event of Default. 

        10.    
Miscellaneous.  

        10.1    
Successors and Assigns. This Note and the securities into which this Note is
convertible may not transferred by the Holder without compliance with applicable
securities laws. Subject to the terms and conditions contained herein, this Note shall be
binding on the Company and its successors and shall inure to the benefit of the original
Holder, its successors and assigns. This Note may not be assigned by the Company without
the written consent of the Holder.  

        10.2    
Loss or Mutilation of Note. Upon receipt by the Company of evidence satisfactory
to the Company of the loss, theft, destruction or mutilation of this Note, together with
indemnity reasonably satisfactory to the Company, in the case of loss, theft or
destruction, or the surrender and cancellation of this Note, in the case of mutilation,
the Company shall execute and deliver to the Holder a new Note of like tenor and
denomination as this Note.  

        10.3    
Titles and Subtitles. The titles and subtitles of the Sections of this Note are
used for convenience only and shall not be considered in construing or interpreting this
agreement.  

        10.4    
Legend. Any certificate representing shares of the Company’s Preferred Stock
issued upon conversion of this Note or otherwise issued hereunder shall be stamped or
otherwise imprinted with a legend substantially in the following form:  

THESE SECURITIES HAVE NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “1933
ACT”), OR UNDER THE PROVISIONS OF ANY APPLICABLE STATE SECURITIES LAWS, BUT HAVE BEEN
ACQUIRED BY THE REGISTERED HOLDER HEREOF FOR PURPOSES OF INVESTMENT AND IN RELIANCE ON
STATUTORY EXEMPTIONS UNDER THE 1933 ACT, AND UNDER ANY APPLICABLE STATE SECURITIES LAWS.
THESE SECURITIES AND THE SECURITIES ISSUED UPON EXERCISE HEREOF MAY NOT BE SOLD, PLEDGED,
TRANSFERRED OR ASSIGNED, NOR MAY THIS NOTE BE EXERCISED, EXCEPT IN A TRANSACTION WHICH IS
EXEMPT UNDER THE PROVISIONS OF THE 1933 ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT. 

4 

        10.5    
Notices. Any notice, request or other communication required or permitted
hereunder shall be in writing and shall be delivered personally or by facsimile (receipt
confirmed electronically) or shall be sent by a reputable express delivery service or by
certified mail, postage prepaid with return receipt requested, addressed as follows:  

		
		if to the Company, to:

Security With Advanced Technology, Inc.

10855 Dover Street, Suite 1100

Westminster, CO 80021

Attn.: Gregory Pusey, Chairman

Fax No.: (303) 722-4011

with a copy to:

Brownstein Hyatt Farber Schreck, P.C.

410 Seventeenth Street, Suite 2200

Denver, CO 80202

Attn: Adam J. Agron

Fax No.: (303) 223-1111

if to the Holder, to:

                                            

_____________________________________

_____________________________________

                   

Attn: ______________________________

                     

Fax No.: ____________________________

with a copy to: 

                                            

_____________________________________

_____________________________________

                   

Attn: ______________________________

                     

Fax No.: ____________________________

 

Either party hereto may change the
above specified recipient or mailing address by notice to the other party given in the
manner herein prescribed. All notices shall be deemed given on the day when actually
delivered as provided above (if delivered personally or by facsimile, provided that any
such facsimile is received during regular business hours at the recipient’s location)
or on the day shown on the return receipt (if delivered by mail or delivery service). 

        10.6      
Note Holder Not Shareholder. This Note does not confer upon the Holder any right
to vote or to consent to or to receive notice as a shareholder of the Company, as such,
in respect of any matters whatsoever, or any other rights or liabilities as a
shareholder, prior to the conversion hereof.  

5 

        10.7      
Governing Law. This Note shall be governed by and construed in accordance with the
domestic laws of the State of Colorado without giving effect to any choice of law or
conflict of law provision or rule (whether of the State of Colorado or any other
jurisdiction) that would cause the application of the laws of any jurisdiction other than
the State of Colorado.  

        10.8      
Waiver and Amendment. Any term of this Note may be amended, waived or modified
only with the written consent of the Company and the Holder of this Note.  

        10.9      
Remedies; Attorneys Fees. No delay or omission by the Holder in exercising any of
its rights, remedies, powers or privileges hereunder or at law or in equity and no course
of dealing between the Holder and the undersigned or any other person shall be deemed a
waiver by the Holder of any such rights, remedies, powers or privileges, even if such
delay or omission is continuous or repeated, nor shall any single or partial exercise of
any right, remedy, power or privilege preclude any other or further exercise thereof by
the Holder or the exercise of any other right, remedy, power or privilege by the Holder.
The rights and remedies of the Holder described herein shall be cumulative and not
restrictive of any other rights or remedies available under any other instrument, at law
or in equity. If an Event of Default occurs, the Company agrees to pay, in addition to
the Principal Amount and Interest payable thereon, reasonable attorneys’ fees and
any other costs incurred by the Holder in connection with its pursuit of its remedies
under this Note.  

     * * * * *

6 

        IN
WITNESS WHEREOF, the Company has caused this Note to be signed in its name on the
Effective Date. 

		
		SECURITY WITH ADVANCED TECHNOLOGY, INC.

By:  ________________________

     Jeffrey G. McGonegal

     Chief Financial Officer

7

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