This Security Agreement (the “ Security Agreement ”), dated as of February 12, 2009, is by and
between (i) Neah Power Systems, Inc. , a Nevada corporation (the “ Debtor ”), and (ii) Agile Opportunity
Fund, LLC , a Delaware limited liability company (“ Agile ”), and Capitoline Advisors Inc. , a New York
corporation (“ Capitoline ”; together with Agile, the “ Secured Parties ”, each a “ Secured Party ”).
N O W, T H E R E F O R E,
In consideration of the promises and the mutual covenants and agreements herein set forth, and in order
to induce the Secured Parties to purchase the Notes, the Debtor hereby agrees with the Secured Parties as
Section 1. Grant of Security Interest. The Debtor hereby grants to the Secured Parties, on the
terms and conditions hereinafter set forth, a first priority lien and security interest in the collateral hereinafter
identified (the “ Collateral ”).
Section 2. Collateral . The Collateral is all tangible and intangible assets of the Debtor of
whatever kind and nature (including without limitation all intellectual property of whatever kind or nature of the
Debtor including patents, trademarks, tradenames, copyrights and all other intellectual property and any
applications or registrations therefore, accounts, chattel paper, commercial tort claims, documents, equipment,
farm products, general intangibles, instruments, inventory, investment property, and the stock of all of Debtor’s
subsidiaries), in each case whether now owned or hereafter acquired and wherever located, and all proceeds
thereof, together with all proceeds, products, replacements and renewals thereof.
The Secured Parties have purchased from the Debtor Original Issue Discount Term Secured
Convertible Promissory Notes (the “ Notes ”) in the aggregate face amount of $262,500.00,
pursuant to a Securities Purchase Agreement between the Debtor and the Secured Parties dated
as of the date hereof