Contract

SECURITY INTEREST

Grant of Security Interest

mortgage and charge as and by way of a fixed and specific charge to and in favour of the Secured Party and assign and transfer to the Secured Party and grant to the Secured Party, by way of mortgage, charge, assignment and transfer, a security interest in all the Debtor’s right, title and interest, both present and future, in and to all of its presently owned or held and after acquired or held personal property, of whatever nature or kind and wheresoever situate and all proceeds and renewals thereof and therefrom, accretions thereto and substitutions therefor, including, without limitation, all of the following now owned or hereafter owned or acquired by or on behalf of the Debtor:

all inventory of whatever kind and wherever situate, including, without limitation, goods acquired or held for sale or lease or furnished or to be furnished under contracts of rental or service, all raw materials, work in process, finished goods, returned goods, repossessed goods, and all packaging materials, supplies and containers relating to or used or consumed in connection with any of the foregoing (all of which is hereinafter collectively called the “Inventory”);

all equipment (other than Inventory) of whatever kind and wherever situate, including, without limitation, all machinery, tools, apparatus, plant, fixtures, furniture, furnishings, chattels, motor vehicles, vessels and other tangible personal property of whatsoever nature or kind that is not Inventory, and all parts, components, attachments, accessories, accessions, replacements, substitutions, additions and improvements to any of the foregoing (all of which is hereinafter collectively called the “Equipment”);

all book accounts and book debts and generally all accounts, debts, dues, claims, choses in action and demands of every nature and kind howsoever arising or secured including letters of credit and advices of credit, which are now due, owing or accruing or growing due to or owned by or which may hereafter become due, owing or accruing or growing due to or owned by the Debtor (all of which is hereinafter collectively called the “Accounts”);

all deeds, documents, writings, papers, books of account and other books and electronically recorded data relating to or being records of Accounts, Chattel Paper or Documents of Title or by which such are or may hereafter be secured, evidenced, acknowledged or made payable;

all contractual rights, insurance claims, licences, goodwill, patents, trademarks, trade names, copyrights and other industrial or intellectual property of the Debtor, all other choses in action of the Debtor of every kind which now are, or which may at any time hereafter be, due or owing to or owned by the Debtor, and all other intangible property of the Debtor which is not Accounts, Chattel Paper, Instruments, Documents of Title, Investment Property or Money;

all Money;

all property described in Schedule A attached hereto, if so attached, or in any schedule now or at any time hereafter annexed hereto or agreed to form part hereof;

the undertaking of the Debtor; and

all Chattel Paper, Documents of Title (whether negotiable or not), Instruments, Intangibles and Investment Property now owned or hereafter owned or acquired by or on behalf of the Debtor (including such as may be returned to or repossessed by the Debtor), and all other goods of the Debtor which are not Equipment, Inventory or Accounts;

charge as and by way of a floating charge to and in favour of the Secured Party, and ▇▇▇▇▇ to the Secured Party a security interest in and to:

all the Debtor’s right, title and interest in and to all its presently owned or held and after acquired or held real, immovable and leasehold property and all interests therein, and all easements, rights-of-way, privileges, benefits, licences, improvements and rights whether connected therewith or appurtenant thereto or separately owned or held, including all structures, plant and other fixtures (all of which is hereinafter collectively called “Real Property”); and

all property, assets and undertakings of the Debtor, both present and future, of whatsoever nature or kind and wheresoever situate, and all Proceeds thereof and therefrom, other than such of its property, assets and undertakings as are otherwise validly and effectively subject to the charges and security interests in favour of the Secured Party created pursuant to Section 1.1(a) hereof; and

mortgage and charge as and by way of a fixed and specific charge to and in favour of the Secured Party, and assign and transfer to the Secured Party and grant to the Secured Party, by way of mortgage, charge, assignment and transfer, a security interest in all of the Debtor’s right, title and interest, both present and future, in and to all of its presently owned or held and after acquired or held property which:

is or hereafter becomes a fixture; or

constitutes a licence, quota, permit or other similar right or benefit or crops.

EXCEPTIONS

Consumer Goods; or

the last day of the term of any lease or agreement therefor but upon the enforcement of the Security Interest the Debtor shall stand possessed of such last day in trust to assign and dispose thereof as the Secured Party shall direct.

SECURED OBLIGATIONS

PROHIBITIONS

grant, create or permit to be created any security interest in, charge, encumbrance or lien over, or claim against any of its property, assets, or undertakings which ranks or could in any event rank in priority to or pari passu with the Security Interest;

grant, sell, or otherwise assign its Chattel Paper; or

issue or have outstanding at any time any secured or unsecured bonds, debentures, debenture stock or other evidences of indebtedness of the Debtor or of any predecessor in title of the Debtor issued under a trust deed or other instrument running in favour of a trustee.

ATTACHMENT

REPRESENTATIONS AND WARRANTIES

the Debtor lawfully owns and possesses all presently held Collateral and has good title thereto, free from all security interests, charges, encumbrances, liens and claims, save only the charges or security interests, if any, shown in any Schedule hereto and those consented to in writing by the Secured Party, and the Debtor has good right and lawful authority to grant a security interest in the Collateral as provided by this Security Agreement;

where the Collateral includes Accounts, Chattel Paper or Instruments, each is enforceable in accordance with its terms against the party obligated thereunder and that the Debtor has fully and accurately disclosed to the Secured Party the amount owing thereunder and any other relevant information concerning liability for payment thereunder;

with respect to goods constituting Collateral, the Debtor has herein or elsewhere fully and accurately disclosed to the Secured Party the locations thereof and of the business operations and records of the Debtor; and

the Debtor has not consented to the entering into by: (A) any issuer of any Uncertificated Securities included in or relating to the Collateral of a Control Agreement; or (B) any Securities Intermediary for any Securities Accounts or Security Entitlements included in or relating to the Collateral of a Control Agreement, other than, in either case, the Secured Party.

COVENANTS OF THE DEBTOR

General Covenants

defend the title to the Collateral for the benefit of the Secured Party against the claims and demands of all persons;

fully and effectually maintain and keep maintained the validity and effectiveness of the Security Interest;

maintain the Collateral in good order and repair;

forthwith pay:

all taxes, assessments, rates, duties, levies, government fees, claims, dues and other charges of every nature which may be lawfully levied, assessed or imposed upon it or the Collateral when due, unless the Debtor shall in good faith contest its obligations so to pay and shall furnish such security as the Secured Party may require; and

all security interests, charges, encumbrances, liens and claims which rank or could in any event rank in priority to the Security Interest, other than the charges or security interests, if any, shown in any Schedule hereto and those consented to in writing by the Secured Party;

forthwith reimburse and indemnify the Secured Party for all costs, charges, expenses and legal fees and disbursements which may be incurred by the Secured Party in:

inspecting the Collateral;

negotiating, preparing, perfecting and registering this Security Agreement or notice of it and other documents, whether or not relating to this Security Agreement;

investigating title to the Collateral;

taking, recovering, keeping possession of and insuring the Collateral; and

all other actions and proceedings taken in connection with the preservation of the Collateral and the enforcement of this Security Agreement and of any other Security Interest held by the Secured Party as security for the Secured Obligations;

at the Secured Party’s request at any time and from time to time, execute and deliver such further and other documents and instruments and do all acts and things as the Secured Party in its absolute discretion requires in order to confirm and perfect, and maintain perfection of, the Security Interest in favour of the Secured Party upon any of the Collateral;

notify the Secured Party promptly of:

any change in the information contained herein relating to the Debtor, its address, its business or the Collateral, including without limitation any change of name or address of the Debtor and any change in location of any Collateral;

the details of any material acquisition of Collateral;

any material loss or damage to the Collateral;

any material default by any account debtor in payment or other performance of his obligations to the Debtor with respect to any Accounts;

the return to or repossession by the Debtor of the Collateral where such return or repossession of the Collateral is material in relation to the business of the Debtor; and

the details of any claims or litigation affecting the Debtor or the Collateral;

prevent the Collateral, other than Inventory sold, leased, or otherwise disposed of as permitted hereby, from being or becoming an accession to other property not covered by this Security Agreement;

permit the Secured Party and its representatives, at all reasonable times, access to all its property, assets and undertakings and to all its books of account and records for the purpose of inspection and render all assistance necessary for such inspection;

deliver to the Secured Party from time to time promptly upon request:

any Documents of Title, Instruments, Investment Property and Chattel Paper constituting, representing or relating to Collateral;

all books of account and all records, ledgers, reports, correspondence, schedules, documents, statements, lists and other writings relating to the Collateral for the purpose of inspecting, auditing or copying the same;

all financial statements prepared by or for the Debtor regarding the Debtor’s business;

all policies and certificates of insurance relating to the Collateral; and

such information concerning the Collateral, the Debtor and the Debtor’s business and affairs as the Secured Party may reasonably require;

carry on and conduct the business of the Debtor in a proper and efficient manner and so as to protect and preserve the Collateral and to keep, in accordance with generally accepted accounting principles, consistently applied, proper books of account for the Debtor’s business as well as accurate and complete records concerning Collateral;

observe and perform the additional covenants, if any, set out in any schedule attached hereto;

will not consent to:

the entering into by any issuer of any Uncertificated Securities included in or relating to the Collateral of a Control Agreement in respect of such Uncertificated Securities with any Person other than the Secured Party or such nominee or agent as it may direct; or

the entering into by any Securities Intermediary for any Securities Accounts or Security Entitlements included in or relating to the Collateral of a Control Agreement with respect to such Securities Accounts or Securities Entitlements with any Person other than the Secured Party or such nominee or agent as it may direct; and

promptly upon request from time to time by the Secured Party, the Debtor shall:

enter into and use reasonable commercial efforts to cause any Securities Intermediary for any Securities Accounts or Securities Entitlements included in or relating to the Collateral to enter into a Control Agreement with the Secured Party with respect to such Securities Accounts or Securities Entitlements as the Secured Party requires in form and substance satisfactory to the Secured Party; and/or

enter into and use reasonable commercial efforts to cause any issuer of any Uncertificated Securities included in or relating to the Collateral to enter into a Control Agreement with the Secured Party with respect to such Uncertificated Securities in form and substance satisfactory to the Secured Party.

Covenants Regarding Collateral

sell, lease or otherwise dispose of the Collateral;

release, surrender or abandon possession of the Collateral; or

move or transfer the Collateral from the jurisdiction or jurisdictions in which the Security Interest has been perfected.

Dealings With Collateral

INSURANCE

Covenants Regarding Insurance

maintain or cause to be maintained insurance on the Collateral with an insurer, of kinds, for amounts and payable to such person or persons, all as the Secured Party may require, and in particular but without limitation maintain insurance on the Collateral to its full insurable value against loss or damage by fire including extended coverage endorsement and in the case of motor vehicles and other mobile Collateral, maintain insurance against theft;

cause the insurance policy or policies required hereunder to be assigned to the Secured Party and have as part thereof a standard mortgage clause or a mortgage endorsement, as appropriate; and

pay all premiums in connection with such insurance, and deliver all such policies to the Secured Party, if it so requires.

Application of Insurance Proceeds

Proof of Loss

Secured Party as Loss Payee

Failure to Maintain Insurance Coverage

USE AND VERIFICATION OF COLLATERAL

INVESTMENT PROPERTY

COLLECTION OF DEBTS

INCOME FROM AND INTEREST ON COLLATERAL

Income Until Default

Income After Default

INCREASES, PROFITS, PAYMENTS OR DISTRIBUTIONS

Receipt by Secured Party

to receive any increase in or profits on the Collateral (other than money) and to hold the same as part of the Collateral. Money so received shall be treated as income for the purposes of Section 12 hereof and dealt with accordingly; and

to receive any payment or distribution upon redemption or retirement or upon dissolution and liquidation of the issuer of Collateral; to surrender such Collateral in exchange therefor; and to hold any such payment or distribution as part of Collateral.

Receipt by ▇▇▇▇▇▇

DISPOSITION OF MONIES

PERFORMANCE OF OBLIGATIONS

DEFAULT

Events of Default

Floating Charge

the occurrence of an Event of Default; or

the Secured Party taking any action pursuant to Section 17 hereof to enforce and realize upon any or all of the Security Interest created by this Security Agreement,

Consolidation

ENFORCEMENT

Rights of Secured Party on Default

appoint by instrument a receiver, receiver and manager or receiver-manager (the person so appointed is hereinafter called the “Receiver”) of the Collateral, with or without bond as the Secured Party may determine, and from time to time in its absolute discretion remove such Receiver and appoint another in its stead;

enter upon any premises of the Debtor and take possession of the Collateral with power to exclude the Debtor, its agents and its servants therefrom, without becoming liable as a mortgagee in possession;

preserve, protect and maintain the Collateral and make such replacements thereof and repairs and additions thereto as the Secured Party may deem advisable;

sell, lease or otherwise dispose of all or any part of the Collateral, whether by public or private sale or lease or otherwise, in such manner, at such price as can be reasonably obtained therefor and on such terms as to credit and with such conditions of sale and stipulations as to title or conveyance or evidence of title or otherwise as to the Secured Party may seem reasonable, provided that if any sale, lease or other disposition is on credit the Debtor will not be entitled to be credited with the proceeds of any such sale, lease or other disposition until the monies therefor are actually received;

exercise all of the rights and remedies of a secured party under the Act; and

the Secured Party may sell, transfer or use any Investment Property included in the Collateral of which the Secured Party or its agent has “control” within the meaning of the STA.

Receiver

Proceeds of Realization

in payment of all costs, charges and expenses (including legal fees and disbursements on a solicitor and his own client basis) incurred by the Secured Party in connection with or incidental to:

the exercise by the Secured Party of all or any of the powers granted to it pursuant to this Security Agreement; and

the appointment of the Receiver and the exercise by the Receiver of all or any of the powers granted to it pursuant to this Security Agreement, including the Receiver’s reasonable remuneration and all outgoings properly payable by the Receiver excluding the Receiver’s borrowings;

in payment of any sum or sums borrowed by the Receiver from the Secured Party and interest thereon if such sum or sums are secured by the Collateral;

in or toward payment to the Secured Party of all principal and other monies (except interest) due in respect of the Secured Obligations;

in or toward payment to the Secured Party of all interest remaining unpaid in respect of the Secured Obligations; and

in or toward payment of any sum or sums borrowed by the Receiver from any financial institution, corporation or person other than the Secured Party and interest thereon if such sum or sums are secured by the Collateral.

Immediate Exercise of Rights

DEFICIENCY

RIGHTS CUMULATIVE

LIABILITY OF SECURED PARTY

APPOINTMENT OF ATTORNEY

ACCOUNTS

APPROPRIATION OF PAYMENTS

LIABILITY TO ADVANCE

WAIVER

NOTICE

if delivered, when delivered;

if mailed by prepaid registered mail when there is no known or anticipated disruption of postal services, on the /third business day following that on which it was mailed; and

if sent by facsimile transmission, on the close of business on the day on which it was transmitted.

EXTENSIONS

NO MERGER

ASSIGNMENT

SATISFACTION AND DISCHARGE

ENUREMENT

INTERPRETATION

Defined Terms

“Act” means the Personal Property Security Act of British Columbia and all regulations thereunder as the same may be amended from time to time;

“Collateral” has the meaning set out in Section 1 hereof and any reference to Collateral shall, unless the context otherwise requires, be deemed a reference to Collateral as a whole or any part thereof;

“Control Agreement” means:

with respect to any Uncertificated Security included in the Collateral, an agreement between the issuer of such Uncertificated Securities and another Person whereby such issuer agrees to comply with instructions that are originated by such Person in respect of such Uncertificated Security, without the further consent of the Debtor; and

with respect to any Securities Accounts or Security Entitlements included in the Collateral, an agreement between the Securities Intermediary in respect of such Securities Accounts or Security Entitlements to comply with any Entitlement Orders with respect to such Securities Accounts or Security Entitlements that are originated by Secured Party, without the further consent of the Debtor;

“Debtor” and the personal pronoun “it” or “its” and any verb relating thereto and used therewith shall be read and construed as required by and in accordance with the context in which such words are used depending upon whether the Debtor is one or more individuals, corporations or partnerships and, if more than one, shall apply to and be binding upon each of them jointly and severally;

“Event of Default” means an “Event of Default” under the Loan Agreement;

“licence” means any licence or similar right at any time owned or held by the Debtor including but without being limited to a “licence” as defined in the Act;

“Loan Agreement” means the loan agreement dated for reference August 4, 2023 between, the Secured Party and the Debtor, as the said loan agreement may be amended, extended, renewed, replaced, restated and in effect from time to time;

“Loan Documents” means, collectively, the Loan Agreement, this Security Agreement, and all other documents and instruments evidencing or securing the payment of the Secured Obligations in whole or in part, whether provided by or on behalf of an Obligant;

“Obligant” or “Obligants” means, collectively, the Debtor and all other Persons who are from time to time liable to the Secured Party for the payment of the whole or any portion of the Secured Obligations, whether directly or indirectly, absolutely or contingently, jointly, severally or jointly and severally and includes all Persons who from time to time otherwise become liable for, or who agree to indemnify the Secured Party for any loss, costs or damages as a result of the failure of any other Persons to pay the Secured Obligations, in whole or in part;

“Person” or “Persons” means and includes any individual, sole proprietorship, corporation, partnership, bank, joint venture, trust, unincorporated association, association, institution, entity, party or government (whether national, federal, provincial, state, municipal, city, county or otherwise and including any instrumentality, division, agency, body or department thereof);

“Secured Obligations” means all indebtedness and liability of all or any one or more of the Obligants to the Secured Party (and any one or more Persons making the same) under the Loan Documents, whether such indebtedness and liability is present or future, absolute or contingent, joint or several, direct or indirect, matured or not, extended or renewed, wheresoever and howsoever incurred, and any ultimate balance thereof, including all advances on current or running account and all future advances and re-advances, under or pursuant to any of the Loan Documents;

“STA” means the Securities Transfer Act of the Province of British Columbia, as amended from time to time and all regulations thereunder, which act, including amendments thereto and any act substituted therefor and amendments thereto is herein referred to as the “STA” and “Person” shall have the meaning ascribed to it in the STA; and

Words with initial capital letters, unless otherwise defined herein, shall have the meanings ascribed to them in the Loan Agreement.

General

Severability

Headings

Governing Law

MISCELLANEOUS

The Debtor hereby authorizes the Secured Party to file such financing statements, financing change statements and other documents and do such acts, matters and things as the Secured Party may deem appropriate to perfect on an ongoing basis and continue the Security Interest, to protect and preserve the Collateral and to realize upon the Security Interest.

The Debtor hereby waives protest of any Instrument constituting Collateral at any time held by the Secured Party on which the Debtor is any way liable and, subject to the provisions of the Act, notice of any other action taken by the Secured Party.

The Debtor acknowledges and agrees that in the event it amalgamates with any other company or companies it is the intention of the parties hereto that the term “Debtor” when used herein shall apply to each of the amalgamating companies and to the amalgamated company, such that the Security Interest granted hereby:

shall extend to “Collateral” (as that term is herein defined) owned by each of the amalgamating companies and the amalgamated company at the time of amalgamation and to any “Collateral” thereafter owned or acquired by the amalgamated company, and

shall secure the “Secured Obligations” (as that term is herein defined) of each of the amalgamating companies and the amalgamated company to the Secured Party at the time of amalgamation and any “Secured Obligations” of the amalgamated company to the Secured Party thereafter arising. The Security Interest shall attach to “Collateral” owned by each company amalgamating with the Debtor, and by the amalgamated company, at the time of amalgamation, and shall attach to any “Collateral” thereafter owned or acquired by the amalgamated company when such becomes owned or is acquired.

The Debtor hereby authorizes the Secured Party to provide a copy of this Security Agreement and such other information and documents specified under the Act to any person entitled pursuant to the Act to demand and receive same.

COPY OF AGREEMENT AND FINANCING STATEMENT

acknowledges receiving a copy of this Security Agreement; and

waives all rights to receive from the Secured Party a copy of any financing statement, financing change statement or verification statement filed, issued or obtained at any time in respect of this Security Agreement.

PARAMOUNTCY

DEBTOR AND SECURED PARTY INFORMATION

Debtor Address

Secured Party Address

“/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇”