INTELLECTUAL PROPERTY SECURITY AGREEMENT
THIS
INTELLECTUAL PROPERTY SECURITY AGREEMENT (the “Agreement”),
dated
as of October 18, 2006, is made by RONCO MARKETING CORPORATION, a Delaware
corporation (“Grantor”),
in
favor of LAURUS MASTER FUND, LTD. (“Laurus”).
WHEREAS,
pursuant to that certain Security and Purchase Agreement dated as of the date
hereof by and between Grantor, certain other Companies (as defined in the
Security and Purchase Agreement) party thereto and Laurus (as from time to
time
amended, restated, supplemented or otherwise modified, the “Security
Agreement”),
Laurus has agreed to provide financial accommodations to the
Companies;
WHEREAS,
Laurus is willing to enter into the Security Agreement, but only upon the
condition, among others, that Grantor shall have executed and delivered to
Laurus this Agreement;
NOW,
THEREFORE, in consideration of the premises and mutual covenants herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Grantor hereby agrees as
follows:
Section
1. DEFINED
TERMS.
(a)
When used herein the following terms shall have the following
meanings:
“Copyrights”
means
all copyrights arising under the laws of the United States, any other country
or
any political subdivision thereof, whether registered or unregistered and
whether published or unpublished, all registrations and recordings thereof,
and
all applications in connection therewith, including all registrations,
recordings and applications in the United States Copyright Office, and the
right
to obtain all renewals of any of the foregoing.
“Copyright
Licenses”
means
all written agreements naming any Grantor as licensor or licensee, granting
any
right under any Copyright, including the grant of rights to manufacture,
distribute, exploit and sell materials derived from any Copyright.
“General
Intangibles”
shall
have the meaning provided thereto in Section 9-102 of the UCC, as amended,
restated or otherwise modified from time to time.
“Obligations”
shall
have the meaning provided thereto in the Security Agreement.
“Patents”
means
(a) all letters patent of the United States, any other country or any political
subdivision thereof, and all reissues and extensions of such letters patent,
(b)
all applications for letters patent of the United States or any other country
and all divisions, continuations and continuations-in-part thereof, and (c)
all
rights to obtain any reissues or extensions of the foregoing.
“Patent
Licenses”
means
all agreements, whether written or oral, providing for the grant by or to any
Grantor of any right to manufacture, use or sell any invention covered in whole
or in part by a Patent.
“Trademarks”
means
(a) all trademarks, trade names, corporate names, business names, fictitious
business names, trade styles, services marks, logos and other source or business
identifiers, and all goodwill associated therewith, now existing or hereafter
adopted or acquired, all registrations and recordings thereof, and all
applications in connection therewith, whether in the United States Patent and
Trademark Office or in any similar office or agency of the United States, any
State thereof or any other country or political subdivision thereof, or
otherwise, and all common-law rights thereto, and (b) the right to obtain all
renewals thereof.
“Trademark
Licenses”
means,
collectively, each agreement, whether written or oral, providing for the grant
by or to any Grantor of any right to use any Trademark.
“UCC”
shall
mean the Uniform Commercial Code as adopted in Delaware.
“USPTO”
shall
mean the United States Patent and Trademark Office.
(b)
All capitalized terms used but not otherwise defined herein have the meanings
given to them in the Security Agreement.
Section
2. GRANT
OF SECURITY INTEREST IN INTELLECTUAL PROPERTY COLLATERAL.
To
secure the complete and timely payment of all the Obligations of the Grantor
now
or hereafter existing from time to time, Grantor hereby grants to Laurus
a security
interest in all of Grantor’s right, title and interest in, to and under the
following, whether presently existing or hereafter created or acquired
(collectively, the “IP
Collateral”):
(a)
all of its Patents and Patent Licenses to which it is a party including but
not
limited to those referred to on Schedule
I
hereto;
(b)
all of its Trademarks and Trademark Licenses to which it is a party including
but not limited to those referred to on Schedule
II
hereto;
(c)
all of its Copyrights and Copyright Licenses to which it is a party including
but not limited to those referred to on Schedule
III
hereto;
(d)
all reissues, continuations or extensions of the foregoing;
(e)
all goodwill of Grantor’s business connected with the use of, and symbolized by,
each Patent, each Patent License, each Trademark, each Trademark License, each
Copyright and each Copyright License; and
(f)
all products and proceeds of the foregoing, including, without limitation,
any
claim by Grantor against third parties for past, present or future (i)
infringement or dilution of any Patent or Patent licensed under any Patent
License, (ii) injury to the goodwill associated with any Patent or any Patent
licensed under any Patent License, (iii) infringement or dilution of any
Trademark or Trademark licensed under any Trademark License, (iv) injury to
the
goodwill associated with any Trademark or any Trademark licensed under any
Trademark License, (v) infringement or dilution of any Copyright or Copyright
licensed under any Copyright License, and (vi) injury to the goodwill associated
with any Copyright or any Copyright licensed under any Copyright
License.
Notwithstanding
any reference to the United States and the IP Collateral in the United States,
it is expressly understood that this Agreement and the Security Agreement
executed between the Grantor and Laurus apply to and incorporate any and all
Intellectual Property (as defined in Annex A of the Security Agreement) to
which
Grantor is a party in any and all countries.
Section
3. REPRESENTATIONS
AND WARRANTIES.
Grantor
represents and warrants that Grantor does not own any Patent, Trademark or
Copyright registered with the USPTO or United States Copyright Office except
as
set forth in Schedule
I,
Schedule
II
and
Schedule
III,
respectively, hereto. Grantor’s
Patents, Trademarks and Copyrights
listed
on Schedules
I,
II
and
III, are
valid
and enforceable, are solely owned by Grantor and there is no claim that the
use
of any of them violates the rights of any third person. This Agreement is
effective to create a valid and continuing lien on and perfected security
interest in favor of Laurus in all of Grantor’s Patents, Trademarks and
Copyrights listed
on
Schedules
I,
II
and
III
and such
perfected security interests are enforceable as such as against any and all
creditors of, and purchasers from, Grantor. Upon filing of this Agreement with
the USPTO and the United States Copyright Office, and the filing of appropriate
financing statements, all action necessary or desirable to protect and perfect
Laurus’ lien on each of Grantor’s Patents, Trademarks and Copyrights listed on
Schedules
I,
II
and
III
shall
have been duly taken.
Section
4. COVENANTS.
Grantor
covenants and agrees with Laurus that from and after the date of this
Agreement:
(a) Grantor
shall promptly
notify
Laurus if it knows or
has
reason to know that
any
application or registration relating to any Patent, Trademark or Copyright
listed
on
Schedule I, II or III may
become abandoned or dedicated, or of any adverse determination or development
(including the institution of, or any such determination or development in,
any
proceeding in the USPTO, the United States Copyright Office or any court)
regarding Grantor’s ownership of any Patent, Trademark or Copyright
listed
on Schedule I, II or III,
its
right to register the same, or to keep and maintain the same.
(b) In
no
event shall Grantor, either directly or through any agent, employee, licensee
or
designee, file an application for the registration of any Patent, Trademark
or
Copyright with the USPTO, the United States Copyright Office or any similar
office or agency without giving Laurus prior written notice thereof, and, upon
request of Laurus, Grantor shall execute and deliver a supplement hereto (in
form and substance satisfactory to Laurus) to evidence Laurus’ lien on such
Patent, Trademark or Copyright, and the General Intangibles of Grantor relating
thereto or represented thereby.
(c) Grantor
shall take all actions necessary or
reasonably
requested by Laurus to maintain and pursue each application, to obtain the
relevant registration and to maintain the registration of each of the Patents
or
Trademarks listed on Schedule I or II,
including the filing of applications for renewal, affidavits of use, affidavits
of noncontestability and opposition and interference and cancellation
proceedings.
(d) In
the
event that any of the IP Collateral is infringed upon, or misappropriated or
diluted by a third party, Grantor shall notify Laurus promptly after Grantor
learns thereof. Grantor shall, unless it shall reasonably determine that such
IP
Collateral is not material to the conduct of its business or operations,
promptly xxx for infringement, misappropriation or dilution, and if Grantor
determines that it is cost effective, seek to recover any and all damages for
such infringement, misappropriation or dilution, and take such other actions
as
Laurus, in its reasonable discretion, shall deem appropriate under the
circumstances to protect such IP Collateral.
Section
5. SECURITY
AGREEMENT.
The
security interests granted pursuant to this Agreement are granted in conjunction
with the security interests granted to Laurus by Grantor pursuant to the
Security Agreement. Grantor hereby acknowledges and affirms that the rights
and
remedies of Laurus with respect to the security interest in the IP Collateral
made and granted hereby are more fully set forth in the Security
Agreement,
the
terms and provisions of which are incorporated by reference herein as if fully
set forth herein.
Section
6. REINSTATEMENT.
This
Agreement shall remain in full force and effect and continue to be effective
should any petition be filed by or against Grantor for liquidation or
reorganization, should Grantor become insolvent or make an assignment for the
benefit of any creditor or creditors or should a receiver or trustee be
appointed for all or any significant part of Grantor’s assets, and shall
continue to be effective or be reinstated, as the case may be, if at any time
payment and performance of the Obligations, or any part thereof, is, pursuant
to
applicable law, rescinded or reduced in amount, or must otherwise be restored
or
returned by any obligee of the Obligations, whether as a “voidable preference,”
“fraudulent conveyance,” or otherwise, all as though such payment or performance
had not been made. In the event that any payment, or any part thereof, is
rescinded, reduced, restored or returned, the Obligations shall be reinstated
and deemed reduced only by such amount paid and not so rescinded, reduced,
restored or returned.
SECTION
7. INDEMNIFICATION.
(A)
Grantor assumes all responsibility and liability arising from its use of the
Patents, Trademarks and/or Copyrights and
Grantor hereby indemnifies and holds Laurus harmless from and against any claim,
suit, loss, damage or expense (including reasonable attorneys’ fees) arising out
of Grantor’s operations of its business from the use of the Patents, Trademarks
and/or Copyright.
(B) In
any suit, proceeding or action permitted to be brought by Laurus under the
Security Agreement and brought by Laurus under any Patent License, Trademark
License or Copyright License for any sum owing thereunder, or to enforce any
provisions of such license, Grantor will indemnify and hold Laurus harmless
from
and against all expense, loss or damage suffered by reason of any defense,
set
off, counterclaim, recoupment or reduction or liability whatsoever of the
obligee thereunder, arising out of a breach by Grantor of any obligation
thereunder or arising out of any other agreement, indebtedness or liability
at
any time owing to or in favor of such obligee or its successors from Grantor,
and all such obligations of Grantor shall be and remain enforceable against
and
only against Grantor and shall not be enforceable against Laurus.
Section
8. NOTICES.
Whenever it is provided herein that any notice, demand, request, consent,
approval, declaration or other communication shall or may be given to or served
upon any of the parties by any other party, or whenever any of the parties
desires to give and serve upon any other party any communication with respect
to
this Agreement, each such notice, demand, request, consent, approval,
declaration or other communication shall be in writing and shall be given in
the
manner, and deemed received, as provided for in the Security
Agreement.
Section
9. TERMINATION
OF THIS AGREEMENT.
Subject
to Section
6
hereof,
this Agreement shall terminate upon payment in full of
all
Obligations and irrevocable termination of the Security Agreement.
[Signature
Page to Follow]
IN
WITNESS WHEREOF, Grantor has caused this Intellectual Property Security
Agreement to be executed and delivered by its duly authorized officer as of
the
date first set forth above.
|
RONCO
MARKETING CORPORATION
By:
/s/
Xxxx
Xxxxxxxxx
Name:
Xxxx
Kabaashima
Title:
Interim
President
|
ACCEPTED
and
ACKNOWLEDGED
by:
LAURUS
MASTER FUND, LTD.
By:
unintelligible
Name:
unintelligible
Title:
Director
