Exhibit 10.34
TRADEMARK SECURITY AGREEMENT
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This TRADEMARK SECURITY AGREEMENT (this "Agreement"), dated as of
October 7, 2003, is executed and delivered by and between XXXXXX RESPIRATORY
CARE INC., a California corporation ("Debtor"), and MW POST ADVISORY GROUP, LLC,
a Delaware limited liability company, as administrative agent for the Lenders
(in such capacity, together with its successors and assigns, if any, in such
capacity, "Agent"), with reference to the following:
WHEREAS, Debtor, the Lenders (such Lenders, together with Agent,
individually and collectively, the "Lender Group"), and Agent have entered into
that certain Loan and Security Agreement, dated as of even date herewith (as
amended, restated, modified, supplemented, refinanced, renewed, or extended from
time to time, the "Loan Agreement"), pursuant to which the Lender Group has
agreed to make certain financial accommodations to Debtor, and pursuant to which
Debtor has granted to Agent for the benefit of the Lender Group security
interests in (among other things) all general intangibles of Debtor; and
WHEREAS, to induce the Lender Group to make the financial
accommodations provided to Debtor pursuant to the Loan Agreement, Debtor has
agreed to execute and deliver this Agreement to Agent for filing with the PTO
and with any other relevant recording systems in any domestic or foreign
jurisdiction, and as further evidence of and to effectuate Agent's existing
security interests in the trademarks and other general intangibles described
herein.
NOW, THEREFORE, for valuable consideration, the receipt and adequacy
of which is hereby acknowledged, Debtor hereby agrees in favor of Agent, for the
benefit of the Lender Group, as follows:
1. Definitions; Interpretation.
(a) Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"Agent" has the meaning ascribed to such term in the preamble to this
Agreement.
"Agreement" has the meaning ascribed to such term in the preamble
hereto.
"Debtor" has the meaning ascribed to such term in the preamble to this
Agreement.
"Debtor's Trademarks" has the meaning set forth in Section 4.
"Event of Default" has the meaning ascribed to such term in the Loan
Agreement.
"Excluded Collateral" has the meaning ascribed to such term in the
Loan Agreement.
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"Lender Group" has the meaning ascribed to such term in the recitals
to this Agreement.
"Lenders" means, individually and collectively, each of the lenders
identified on the signature pages of the Loan Agreement, and any other person
made a party thereto in accordance with the provisions of Section 14 thereof
(together with their respective successors and assigns).
"Loan Agreement" has the meaning ascribed to such term in the recitals
to this Agreement.
"Proceeds" means whatever is receivable or received from or upon the
sale, lease, license, collection, use, exchange or other disposition, whether
voluntary or involuntary, of any Trademark Collateral, including "proceeds" as
such term is defined in the UCC, and all proceeds of proceeds. Proceeds shall
include (i) any and all accounts, chattel paper, instruments, general
intangibles, cash and other proceeds, payable to or for the account of Debtor,
from time to time in respect of any of the Trademark Collateral, (ii) any and
all proceeds of any insurance, indemnity, warranty or guaranty payable to or for
the account of Debtor from time to time with respect to any of the Trademark
Collateral, (iii) any and all claims and payments (in any form whatsoever) made
or due and payable to Debtor from time to time in connection with any
requisition, confiscation, condemnation, seizure or forfeiture of all or any
part of the Trademark Collateral by any Person acting under color of
governmental authority, and (iv) any and all other amounts from time to time
paid or payable under or in connection with any of the Trademark Collateral or
for or on account of any damage or injury to or conversion of or infringement of
rights in any Trademark Collateral by any Person.
"PTO" means the United States Patent and Trademark Office and any
successor thereto.
"Secured Obligations" means all liabilities, obligations, or
undertakings owing by Debtor to the Lender Group of any kind or description
arising out of or outstanding under, advanced or issued pursuant to, or
evidenced by the Loan Agreement, this Agreement, or any of the other Loan
Documents, irrespective of whether for the payment of money, whether direct or
indirect, absolute or contingent, due or to become due, voluntary or
involuntary, whether now existing or hereafter arising, and including all
interest, costs, fees (including attorneys fees), and expenses (including
interest, costs, fees, and expenses that, but for the provisions of the
Bankruptcy Code, would have accrued) and any and all other amounts which Debtor
is required to pay pursuant to any of the foregoing, by law, or otherwise.
"Trademark Collateral" has the meaning set forth in Section 2.
"Trademarks" has the meaning set forth in Section 2.
"UCC" means the Uniform Commercial Code as in effect from time to time
in the State of California.
"United States" and "U.S." each mean the United States of America.
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(b) Terms Defined in UCC. Where applicable and except as
otherwise defined herein, terms used in this Agreement shall have the meanings
ascribed to them in the UCC.
(c) Interpretation. In this Agreement, except to the extent the
context otherwise requires:
(i) Any reference to a Section or a Schedule is a
reference to a section hereof, or a schedule hereto, respectively, and to a
subsection or a clause is, unless otherwise stated, a reference to a
subsection or a clause of the Section or subsection in which the reference
appears.
(ii) The words "hereof," "herein," "hereto," "hereunder"
and the like mean and refer to this Agreement as a whole and not merely to
the specific Section, subsection, paragraph or clause in which the
respective word appears.
(iii) The meaning of defined terms shall be equally
applicable to both the singular and plural forms of the terms defined.
(iv) The words "including," "includes" and "include" shall
be deemed to be followed by the words "without limitation."
(v) References to agreements and other contractual
instruments shall be deemed to include all subsequent permitted amendments,
restatements, supplements, refinancings, renewals, extensions, and other
modifications thereto and thereof.
(vi) References to statutes or regulations are to be
construed as including all statutory and regulatory provisions
consolidating, amending or replacing the statute or regulation referred to.
(vii) Any captions and headings are for convenience of
reference only and shall not affect the construction of this Agreement.
(viii) Capitalized words not otherwise defined herein shall
have the respective meanings ascribed to them in the Loan Agreement.
(ix) In the event of a direct conflict between the terms
and provisions of this Agreement and the Loan Agreement,it is the intention
of the parties hereto that such documents shall be read together and
construed, to the fullest extent possible, to be in concert with each
other. In the event of any actual, irreconcilable conflict that cannot be
resolved as aforesaid, the terms and provisions of the Loan Agreement shall
control and govern; provided, however, that the inclusion herein of
additional obligations on the part of Debtor and supplemental rights and
remedies in favor of Agent (whether under federal law or applicable state
law), in each case in respect of the Trademark Collateral, shall not be
deemed a conflict with the Loan Agreement.
2. Security Interest.
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(a) Assignment and Grant of Security in respect of the Secured
Obligations. To secure the prompt payment and performance of the Secured
Obligations, Debtor hereby grants, assigns, transfers and conveys to Agent, for
the benefit of the Lender Group, a continuing security interest in all of
Debtor's right, title and interest in and to the following property, whether now
existing or hereafter acquired or arising and whether registered or unregistered
(collectively, the "Trademark Collateral"):
(i) all state(including common law)and federal
trademarks, service marks and trade names, corporate names, company names,
business names, fictitious business names, trade styles, trade dress,
logos, other source or business identifiers, designs and general
intangibles of like nature, now existing or hereafter adopted or acquired,
together with and including all licenses therefor held by Debtor, and all
registrations and recordings thereof, and all applications filed or to be
filed in connection therewith, including registrations and applications in
the PTO, any State of the United States (but excluding each application to
register any trademark, service xxxx, or other xxxx xxxxx to the filing
under applicable law of a verified statement of use (or the equivalent) for
such trademark or service xxxx) and all extensions or renewals thereof,
including without limitation any of the foregoing identified on Schedule A
hereto (as the same may be amended, modified or supplemented from time to
time), and the right (but not the obligation) to register claims under any
state or federal trademark law or regulation and to apply for, renew and
extend any of the same, to xxx or bring opposition or cancellation
proceedings in Debtor's name or in the name of Agent for past, present or
future infringement or unconsented use thereof, and all rights arising
therefrom throughout the world (collectively, the "Trademarks");
(ii) all claims, causes of action and rights to xxx for
past, present or future infringement or unconsented use of any Trademarks
and all rights arising therefrom and pertaining thereto;
(iii) all general intangibles related to or arising out of
any of the Trademarks and all the goodwill of Debtor's business symbolized
by the Trademarks or associated therewith; and
(iv) all Proceeds of any and all of the foregoing;
provided, however, that Trademark Collateral shall not include any Excluded
Collateral.
(b) Continuing Security Interest. Debtor hereby agrees that this
Agreement shall create a continuing security interest in the Trademark
Collateral which shall remain in effect until terminated in accordance with
Section 18.
(c) Incorporation into Loan Agreement. This Agreement shall be
fully incorporated into the Loan Agreement and all understandings, agreements
and provisions contained in the Loan Agreement shall be fully incorporated into
this Agreement. Without limiting the foregoing, the Trademark Collateral
described in this Agreement shall constitute part of the Collateral in the Loan
Agreement.
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(d) Licenses. Debtor may grant licenses of the Trademark
Collateral in the ordinary course of business in accordance with the terms of
the Loan Agreement.
3. Further Assurances; Appointment of Agent as Attorney-in-Fact.
Debtor at its expense shall execute and deliver, or cause to be executed and
delivered, to Agent any and all documents and instruments, in form and substance
reasonably satisfactory to Agent, and take any and all action, which Agent, in
the exercise of its discretion, may request from time to time, to perfect and
continue the perfection or to maintain the priority of, or provide notice of the
security interest in the Trademark Collateral held by Agent for the benefit of
the Lender Group and to accomplish the purposes of this Agreement. If Debtor
refuses to execute and deliver, or fails timely to execute and deliver, any of
the documents it is requested to execute and deliver by Agent in accordance with
the foregoing, Agent shall have the right, in the name of Debtor, or in the name
of Agent or otherwise, without notice to or assent by Debtor, and Debtor hereby
irrevocably constitutes and appoints Agent (and any of Agent's officers or
employees or agents designated by Agent) as Debtor's true and lawful
attorney-in-fact with full power and authority, (i) to sign the name of Debtor
on all or any of such documents or instruments and perform all other acts that
Agent in the exercise of its discretion deems necessary in order to perfect or
continue the perfection of, maintain the priority or enforceability of or
provide notice of the security interest in the Trademark Collateral held by
Agent for the benefit of the Lender Group, and (ii) to execute any and all other
documents and instruments, and to perform any and all acts and things for and on
behalf of Debtor, that Agent, in the exercise of its discretion, may deem
necessary or advisable to maintain, preserve and protect the Trademark
Collateral and to accomplish the purposes of this Agreement, including (A) after
the occurrence and during the continuance of any Event of Default, to defend,
settle, adjust or institute any action, suit or proceeding with respect to the
Trademark Collateral, (B) after the occurrence and during the continuation of
any Event of Default, to assert or retain any rights under any license agreement
for any of the Trademark Collateral, and (C) after the occurrence and during the
continuance of any Event of Default, to execute any and all applications,
documents, papers and instruments for Agent to use the Trademark Collateral, to
grant or issue any exclusive or non-exclusive license with respect to any
Trademark Collateral, and to assign, convey or otherwise transfer title in or
dispose of the Trademark Collateral. The power of attorney set forth in this
Section 3, being coupled with an interest, is irrevocable so long as this
Agreement shall not have terminated in accordance with Section 18; provided that
the foregoing power of attorney shall terminate when all of the Secured
Obligations have been fully and finally repaid and performed and the Lender
Group's obligation to extend credit under the Loan Agreement is terminated. The
Agent acknowledges that the exercise of the powers granted in this Section 3 may
at some times be subject to the provisions of the Intercreditor Agreement.
4. Representations and Warranties. Debtor represents and warrants to
each member of the Lender Group, in each case to the best of its knowledge,
information, and belief, as follows:
(a) No Other Trademarks. Schedule A sets forth a true and correct
list of all of Debtor's existing Trademarks that are registered, or for which
any application for registration has been filed with the PTO or any
corresponding or similar trademark office of any other U.S. jurisdiction, and
that are owned or held and used by Debtor (collectively, the
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"Debtor's Trademarks"). Schedule A also sets forth a true and correct list of
all of the Trademarks Debtor holds by reason of license from a third party.
(b) Trademarks Subsisting. Each of Debtor's Trademarks is
subsisting and has not been adjudged invalid or unenforceable, in whole or in
part, and, to the best of Debtor's knowledge, each of the Trademarks set forth
on Schedule A is valid and enforceable.
(c) Ownership of Trademark Collateral; No Violation. (i) Debtor
has rights in and good and defensible title to the Trademark Collateral in
respect of the Trademarks that it owns, (ii) Debtor is the sole and exclusive
owner of such Trademark Collateral, free and clear of any Liens and rights of
others (other than Permitted Liens), including licenses (other than licenses
entered into as permitted herein), registered user agreements and covenants by
Debtor not to xxx third persons, and (iii) with respect to any Trademarks for
which Debtor is either a licensor or a licensee pursuant to a license or
licensing agreement regarding such Trademark, each such license or licensing
agreement is in full force and effect, Debtor is not in material default of any
of its obligations thereunder and, to the best of Debtor's knowledge other than
(A) the parties to such licenses or licensing agreements, or (B) in the case of
any non-exclusive license or license agreement entered into by Debtor or any
such licensor regarding such Trademark, the parties to any other such
non-exclusive licenses or license agreements entered into by Debtor or any such
licensor with any other Person, no other Person has any rights in or to any of
such Trademark Collateral, other than licenses entered into as permitted herein.
To the best of Debtor's knowledge, neither the past nor the present use of the
Trademark Collateral by Debtor has or does infringe upon or violate any right,
privilege or license agreement of or with any other Person or give any such
Person the right to terminate any such right, privilege or license agreement.
(d) No Infringement. To the best of Debtor's knowledge, (i) no
material infringement or unauthorized use presently is being made of any of the
Trademark Collateral by any Person, and (ii) neither the past nor the present
use of the Trademark Collateral by Debtor has or does infringe upon or violate
any right, privilege, or license arrangement of or with any other Person or give
such Person the right to terminate any such license arrangement.
(e) Powers. Debtor has the unqualified right, power and authority
to pledge and to grant to Agent, for the benefit of the Lender Group, security
interests in the Trademark Collateral pursuant to this Agreement, and to
execute, deliver and perform its obligations in accordance with the terms of
this Agreement, without the consent or approval of any other Person except as
already obtained.
5. Covenants. So long as any of the Secured Obligations remain
unsatisfied, Debtor agrees: (i) that it will comply in all material respects
with all of the covenants, terms and provisions of this Agreement, and (ii) that
it will promptly give Agent written notice of the occurrence of any event that
could have a material adverse effect on any of the Trademarks and the Trademark
Collateral (except as to such Trademark or Trademarks, which alone or in the
aggregate, the absence of which would not reasonably be expected to materially
impair the conduct of the business), including any petition under the Bankruptcy
Code filed by or against any licensor of any of the Trademarks for which Debtor
is a licensee, provided, however, that Debtor shall not be required to preserve,
protect and maintain, and may abandon, in whole or in
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part, any Trademark as Debtor deems appropriate in the exercise of Debtor's
reasonable business judgment, so long as the absence of such Trademark or
Trademarks, alone or in the aggregate, would not reasonably be expected to
materially impair the conduct of Debtor's business or the Trademark Collateral.
6. Future Rights. For so long as any of the Secured Obligations shall
remain outstanding, or, if earlier, until Agent shall have released or
terminated, in whole but not in part, its interest in the Trademark Collateral,
if and when Debtor shall obtain rights to any new Trademarks, or any reissue,
renewal or extension of any Trademarks, the provisions of Section 2 shall
automatically apply thereto and Debtor shall give to Agent prompt notice
thereof, within 20 days after obtaining such rights, reissuance, renewal, or
extension. Debtor shall do all things reasonably deemed necessary by Agent in
the exercise of its discretion to ensure the validity, perfection, priority and
enforceability of the security interests of Agent in such future acquired
Trademark Collateral. If Debtor refuses to execute and deliver, or fails timely
to execute and deliver, any of the documents it is requested to execute and
deliver by Agent in connection herewith, Debtor hereby authorizes Agent to
modify, amend or supplement the Schedules hereto and to re-execute this
Agreement from time to time on Debtor's behalf and as its attorney-in-fact to
include any future Trademarks which are or become Trademark Collateral and to
cause such re-executed Agreement or such modified, amended or supplemented
Schedules to be filed with the PTO.
7. Duties of Agent and the Lender Group. Notwithstanding any
provision contained in this Agreement, none of Agent or any other member of the
Lender Group shall have any duty to exercise any of the rights, privileges or
powers afforded to it and shall not be responsible to Debtor for any failure to
do so or delay in doing so. Except for the accounting for moneys actually
received by Agent, any other member of the Lender Group hereunder or in
connection herewith, none of Agent or any other member of the Lender Group shall
have any duty to exercise or preserve any rights, privileges or powers
pertaining to the Trademark Collateral.
8. Events of Default. The occurrence of any "Event of Default" under
the Loan Agreement shall constitute an Event of Default hereunder.
9. Remedies. From and after the occurrence and during the
continuation of an Event of Default, and subject to the Intercreditor Agreement,
Agent shall have all rights and remedies available to it under the Loan
Agreement, the other Loan Documents, and applicable law (which rights and
remedies are cumulative) with respect to the security interests in any of the
Trademark Collateral. Debtor hereby agrees that such rights and remedies include
the right of Agent as a secured party to sell or otherwise dispose of the
Trademark Collateral after default, pursuant to the UCC. Debtor hereby agrees
that Agent shall at all times have such royalty-free licenses, to the extent
permitted by law and the other Loan Documents, for any Trademark Collateral that
is reasonably necessary to permit the exercise of any of Agent's rights or
remedies upon or after the occurrence of (and during the continuance of) an
Event of Default with respect to (among other things) any tangible asset of
Debtor in which Agent has a security interest, including Agent's rights to sell
inventory, tooling or packaging which is acquired by Debtor (or their successor,
assignee or trustee in bankruptcy). In addition to and without limiting any of
the foregoing, upon the occurrence and during the continuance of an Event of
Default, Agent shall
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have the right but shall in no way be obligated to bring suit, or to take such
other action as Agent, in the exercise of its discretion, deems necessary, in
the name of Debtor or Agent, to enforce or protect any of the Trademark
Collateral, in which event Debtor shall, at the request of Agent, do any and all
lawful acts and execute any and all documents required by Agent in aid of such
enforcement. To the extent that Agent shall elect not to bring suit to enforce
such Trademark Collateral, Debtor, in the exercise of its reasonable business
judgment, agrees to use all reasonable measures and its diligent efforts,
whether by action, suit, proceeding or otherwise, to prevent the infringement,
misappropriation or violation thereof by others and for that purpose agrees
diligently to maintain any action, suit or proceeding against any Person
necessary to prevent such infringement, misappropriation or violation.
10. Binding Effect. This Agreement shall be binding upon, inure to the
benefit of and be enforceable by Debtor and Agent for the benefit of the Lender
Group and their respective successors and assigns.
11. Notices. All notices and other communications hereunder shall be
in writing and shall be mailed, sent or delivered in accordance with the Loan
Agreement.
12. Governing Law. This Agreement shall be governed by, and construed
and enforced in accordance with, the laws of the State of California, except to
the extent that the validity or perfection of the security interests hereunder
in respect of the Trademark Collateral are governed by federal law, in which
case such choice of California law shall not be deemed to deprive Agent of such
rights and remedies as may be available under federal law.
13. Entire Agreement; Amendment. This Agreement and the other Loan
Documents, together with the Schedules hereto and thereto, contains the entire
agreement of the parties with respect to the subject matter hereof and supersede
all prior drafts and communications relating to such subject matter. Neither
this Agreement nor any provision hereof may be modified, amended or waived
except by the written agreement of the parties to this Agreement.
Notwithstanding the foregoing, Agent may reexecute this Agreement or modify,
amend or supplement the Schedules hereto as provided in Section 6 hereof.
14. Severability. If one or more provisions contained in this
Agreement shall be invalid, illegal or unenforceable in any respect in any
jurisdiction or with respect to any party, such invalidity, illegality or
unenforceability in such jurisdiction or with respect to such party shall, to
the fullest extent permitted by applicable law, not invalidate or render illegal
or unenforceable any such provision in any other jurisdiction or with respect to
any other party, or any other provisions of this Agreement.
15. Counterparts; Telefacsimile Execution. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute but one and the same
agreement. Delivery of an executed counterpart of this Agreement by
telefacsimile shall be equally as effective as delivery of an original executed
counterpart of this Agreement. Any party delivering an executed counterpart of
this Agreement by telefacsimile also shall deliver an original
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executed counterpart of this Agreement but the failure to deliver an original
executed counterpart shall not affect the validity, enforceability, and binding
effect of this Agreement.
16. Loan Documents. Debtor acknowledges that the rights and remedies
of Agent with respect to the security interest in the Trademark Collateral
granted hereby are more fully set forth in the Loan Agreement and the other Loan
Documents and all such rights and remedies are cumulative.
17. No Inconsistent Requirements. Debtor acknowledges that this
Agreement, the Loan Agreement, and the other Loan Documents may contain
covenants and other terms and provisions variously stated regarding the same or
similar matters, and Debtor agrees that all such covenants, terms and provisions
are cumulative and all shall be performed and satisfied in accordance with their
respective terms.
18. Termination. Upon the indefeasible payment and performance in full
of the Secured Obligations, including the cash collateralization, expiration, or
cancellation of all Secured Obligations, if any, consisting of letters of
credit, and the full and final termination of any commitment to extend any
financial accommodations under the Loan Agreement, this Agreement shall
terminate, and Agent shall execute and deliver such documents and instruments
and take such further action reasonably requested by Debtor, at Debtor's
expense, as shall be necessary to evidence termination of the security interest
granted by Debtor to Agent for the benefit of the Lender Group hereunder,
including cancellation of this Agreement by written notice from Agent to the
PTO.
[Signature page follows]
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement, as of the date first above written.
XXXXXX RESPIRATORY CARE INC.,
a California corporation
By:
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Name:
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Title:
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MW POST ADVISORY GROUP, LLC,
a Delaware limited liability company,
as Agent
By:
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Name: Xxxxxxxx Post
Title: Chief Executive Officer
Signature Page
Trademark Security Agreement
SCHEDULE A
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Trademarks of Debtor
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[see attached]
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Trademark Licenses
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None
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