EXH10-5
COLLATERAL ASSIGNMENT
AND SECURITY AGREEMENT
THIS AGREEMENT, made as of this _2nd of August, 1990, by and between AUTOMATED
LIGHT TECHNOLOGIES, INC., a Connecticut corporation with an office at 000 Xxxxxx
Xxxx, Xxxxxx, Xxxxxxxxxxx ("Assignor") and CONNECTICUT INNOVATIONS INCORPORATED,
a corporation constituted a quasi-public instrumentality of the State of
Connecticut with an office at 000 Xxxxx Xxxxxx, Xxxxx Xxxx, Xxxxxxxxxxx, 00000
("CII").
WHEREAS, Assignor has executed and delivered to CII a promissory note in the
principal amount of $300,000.00 (the "Note"), pursuant to a certain loan
agreement between Assignor and CII dated August 2, 1990 (the "Loan Agreement");
and
WHEREAS, in order to induce CII to execute and deliver the Loan Agreement and to
make the loan and as security for the performance by Assignor of its duties
under the Note, the Loan Agreement and other documents executed in connection
therewith, Assignor has agreed to assign to CII certain patent, trademark and
copyright rights and to grant to CII a security interest therein.
NOW THEREFORE, in consideration of the premises and the agreements contained
herein, Assignor hereby agrees with CII as follows:
1. To secure the complete and timely performance of Assignor's
responsibilities under the Note, the Loan Agreement and other documents
delivered in connection therewith, Assignor hereby rants, assigns and conveys to
CII its entire right, title and interest in and to the patents, trademarks,
copyrights and intellectual property or licenses thereto listed in Schedule A
attached hereto, including without limitation all proceeds thereof, the right to
xxx for past, present and future infringements, all rights corresponding thereto
throughout the world and all reissues, divisions, continuations, renewals,
extensions and continuations-in-part thereof and all improvements thereon
(collectively called the "Rights") and all future patents, trademarks,
copyrights and intellectual property which may be obtained by Assignor and
acquired or created by Assignor after the date hereof ("After Acquired Rights").
For the purposes of this Agreement the term "intellectual property" shall mean
all creations, inventions and ideas developed, created, acquired or obtained by
Assignor during such time as the Note is outstanding whether or not such items
are patentable, patented, trademarkable, trademarked, copyrightable or
copyrighted.
2. Assignor covenants and warrants:
a. the Rights are subsisting and have not been adjudged invalid
or unenforceable, in whole or in part
b. to the best of Assignor's knowledge, each of the Rights is
valid and enforceable and Assignor has notified CII in writing of all prior acts
with respect to the Rights (including public uses and sales) of which it is
aware:
c. Assignor is the sole and exclusive owner of the entire and
unencumbered right, title and interest in and to each of the rights, free and
clear of any liens, charges and encumbrances, including without limitation
licenses, shop rights and covenants not to xxx; and
d. Assignor has the unqualified right to enter into this
Agreement and perform its terms and has entered into written agreements with
each of its employees, agents and consultants which will enable it to comply
with the covenants herein contained.
Assignor agrees that, until all of the liabilities under the Note and the Loan
Agreement have been satisfied in full, it will not enter into any agreement
which is inconsistent with Assignor's obligations hereunder without CII's prior
written consent, which consent shall not be unreasonably withheld.
3. If, before all liabilities under the Note shall have been satisfied
in full, Assignor shall become entitled to the benefit of any patent, trademark
or copyright application or patent, trademark or copyright for reissue,
division, continuation, renewal, extension or continuation-in-part of any Right
or any After Acquired Right or any improvement on any Right or any After
Acquired Right, Assignor shall give CII prompt notice of the same and the
provisions of Paragraph 1 shall apply thereto.
4. If Assignor has not filed a formal application for any of the Rights
or After Acquired Rights within three months of the date hereof or if any such
application lists the inventor, owner, product, trademark or copyright by a name
different from that set forth on Schedule A, then Assignor agrees to execute, if
necessary, a separate agreement for such Right or After Acquired Right at the
time such application is filed.
5. Assignor hereby authorizes CII to modify this Agreement by amending
Schedule A to include any reissues, divisions, continuations, renewals,
extensions and continuations-in-part of any Rights, After Acquired Rights and
any improvements thereon.
6. Unless and until there shall have occurred an event of default as
defined in the Loan Agreement or the Note, CII hereby grants to Assignor the
exclusive, nontransferable right and license to make, have made, use and sell
the inventions, trademarks and copyrights disclosed and claimed in the Rights
and After Acquired Rights for Assignor's own benefit and account and for none
other. Assignor agrees not to sell or assign its interest in, or grant any
sublicenses under the license granted herein without the prior written consent
of CII, which consent shall not be unreasonably withheld.
7. If any event of default under the Loan Agreement, Note or any other
document executed in connection with the loan shall have occurred and not be
cured within any applicable cure
period or extended period as permitted by CII, Assignor's license of the Rights
and After Acquired Rights as set forth in Paragraph 6 shall terminate forthwith,
and CII shall have, in addition to all other rights and remedies given it by
this Agreement, those allowed by law and the rights and remedies of a secured
party under the Uniform Commercial Code as enacted in any jurisdiction in which
the Rights and After Acquired Rights may be located and, without limiting the
generality of the foregoing, CII may, without demand for performance,
immediately sell, assign, lease or otherwise dispose of the Rights, the After
Acquired Rights or any part thereof, either at public or private sale acceptable
to CII, all at CII's sole option and as it, in its sole discretion, may deem
advisable. CII will give Assignor reasonable notice of the time and place of any
public sale or the time after which any private sale or other intended
disposition will be made. The requirement of reasonable notice shall be met if
such notice is mailed to Assignor at least fifteen (15) business days before the
time of the sale or disposition. After deducting from the proceeds of sale or
other disposition of the Rights and After Acquired Rights all expenses
(including all reasonable expenses for brokers' fees and legal services), CII
shall apply the residue of such proceeds towards the payment of the Note. Any
remainder of the proceeds after payment in full of the Note shall be paid over
to the Assignor. At any such sale or other disposition of the Rights and After
Acquired Rights, any holder of the Note or CII may, to the extent permitted
under applicable law, purchase the whole or any part of the Rights and After
Acquired Rights, free from any right of redemption on the part of Assignor,
which right is hereby waived and released.
8. At such time as Assignor shall completely satisfy all of the
liabilities under the Note, CII shall execute and deliver to Assignor all deeds,
assignments and other instruments as may be necessary or proper to revest in
Assignor full title to the Rights and After Acquired Rights, subject to any
disposition thereof which may have been made by CII pursuant hereto.
9. Any and all fees, costs and expenses, of whatever kind and nature,
including reasonable attorneys' fees and legal expenses, incurred by CII in
connection with the preparation of this Agreement and all other documents
relating hereto and the consumation of this transaction, the filing or recording
of any documents (including all taxes in connection therewith) in public
offices, the payment or discharge of any taxes, counsel fees, maintenance fees,
encumbrances or otherwise protecting, maintaining, preserving the Rights and
After Acquired Rights or in defending or prosecuting any actions or proceedings
arising out of or related to the Rights and After Acquired Rights, shall be
borne and paid by Assignor on demand by CII and until so paid shall be added to
the principal amount of the Note and shall bear interest at the rate set forth
in the Note.
10. Assignor shall have the duty, through counsel reasonably acceptable
to CII, to prosecute diligently any application of the Rights and After Acquired
Rights pending as of the date hereof or thereafter until the Note has been paid
in full, to make application on unpatented but patentable inventions and to
preserve and maintain all rights in patent, trademark and copyright applications
and patents, trademarks and copyrights of the Rights and After Acquired Rights
Any expenses incurred in connection with such an application and/or preservation
or maintenance of the Rights and After Acquired Rights shall be borne by
Assignor. The Assignor shall not abandon any right to any patent, trademark or
copyright or intellectual property, any patent, trademark, copyright application
or to file a patent, trademark or copyright application or extension, division,
continuation,
renewal, reissue, continuation-in-part or improvement thereof without the
consent of CII, which consent shall not be unreasonably withheld.
11. CII shall have the right but shall in no way be obligated to bring
suit in its own name to enforce the Rights, After Acquired Rights and any
license thereunder, in which event Assignor shall at the request of CII do any
and all lawful acts and execute any and all proper documents required by CII in
aid of such enforcement. Assignor shall promptly, upon demand, reimburse and
indemnify CII for all costs and expenses incurred by CII in the exercise of its
rights hereunder. In the event that CII does not exercise its right to bring
suit to enforce the Rights, After Acquired Rights and any license thereunder,
then Assignor shall have the duty, through counsel reasonably acceptable to CII,
to bring suit to enforce the Rights, After Acquired Rights and any license
thereunder .
12. No course of dealing between Assignor and CII, nor any failure to
exercise, nor any delay in exercising, on the part of CII, any right, power or
privilege hereunder or under the Loan Agreement or Note shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder or thereunder preclude any other or further exercise thereof
or the exercise of any other right, power or privilege.
13. All of CII's rights and remedies with respect to the Rights and
After Acquired Rights, whether established hereby or by the Loan Agreement or
Note, or by any other agreements or by law shall be cumulative and may be
exercised singularly or concurrently.
14. The provisions of this Agreement are severable, and if any clause
shall be held invalid and unenforceable in whole or in part in any jurisdiction,
then such invalidity or unenforceability shall affect only such clause or
provision, or part thereof, in such jurisdiction, and shall not in any manner
affect such clause or provision in any other jurisdiction, or any other clause
or provision of this Agreement in any jurisdiction.
15. This Agreement is subject to modification only by a writing signed
by the parties, except as provided in Paragraph 5.
16. The benefits and burdens of this Agreement shall inure to the
benefit of and be binding upon the respective successors and permitted assigns
of the parties. CII agrees that, unless Assignor 18 in default under the loan
made by CII to Assignor as of the date hereof and such loan has been accelerated
by CII, it shall not have the right to assign this Agreement to a competitor of
Assignor. For the purposes hereof, a "competitor of Assignor" shall be any
person or entity that develops, manufactures or markets systems for the
monitoring of or the locating of breaks and damages in fiber optic and/or copper
lines or any other system or systems currently or in the future developed,
manufactured or marketed by Assignor.
17. This Agreement shall be governed by and construed in accordance
with the laws of the State of Connecticut.
IN WITNESS WHEREOF, the parties hereunto set their hands and seals as of the
_____ day of August, 1990.
AUTOMATED LIGHT TECHNOLOGIES, INC.
By:______________________________
XXXX X. XXXXXX
Its President
Duly Authorized
CONNECTICUT INNOVATIONS
INCORPORATED
By:_____________________________
XXXXX X. DRIVER
Its Executive Director
Duly authorized
STATE OF CONNECTICUT)
) ss. at Hartford
COUNTY OF HARTFORD )
The foregoing was acknowledged before me, the undersigned officer, this 2nd day
of August, 1990 by Xxxx X. Xxxxxx, President of Automated Light Technologies,
Inc., a corporation, on behalf of the corporation.
-------------------------------
Commissioner of the Superior
Court/Notary Public
STATE OF CONNECTICUT)
) ss. at Rocky Hill
COUNTY OF HARTFORD )
The foregoing was acknowledged before me, the undersigned officer, this _____
day of August, 1990 by Xxxxx X. Driver Executive Director of Connecticut
Innovations Incorporated, a corporation, on behalf of the corporation.
-------------------------------
Commissioner of the Superior
Court/Notary Public
SCHEDULE A
I. PATENTS
A. CABLE MONITORING SYSTEM PATENTS
l. Original Patents
a. U.S. Patent Number 4,480,251
b. U.K. Patent Number GB 2082406B
2. Cable Failure Detection System
a. U.S. Patent Application Number 512,318 - Filed 4/20/90
b. U.S. Patent Application Number 339,967 - Filed 4/19/89
c. U.S. Patent Application Number 175,251 - Filed 3/30/88
d. Filings of Patents of Confirmation
B. LONG RANGE FAULT LOCATOR PATENT FILINGS
1. Resistive Fault Location Means & Device for Use on
Electrical Cables
a. U.S. Patent Application Number 07/293,288 - Filed 1/4/89
b. European Patent Application EP 0372191 A2
c. British Preliminary Patent Application
d. Japanese Patent Application Number PA-05440
II. TRADEMARKS
A. "FLOODHOUND" - Registration Number 1,485,151
