INTELLECTUAL PROPERTY SECURITY AGREEMENT
Exhibit
10.32
This INTELLECTUAL PROPERTY
SECURITY AGREEMENT (as amended, amended and restated, supplemented or otherwise
modified from time to time, the “IP
Security Agreement”)
dated October 15, 2009, is made by AVAX TECHNOLOGIES, INC., a corporation
organized under the laws of the State of Delaware (the “Borrower”)
and AVAX INTERNATIONAL IP HOLDINGS, INC., a corporation organized under the laws
of the State of Delaware (the “IP
Sub”
and together with the Borrower, “AVAX”)
in favor of FIREBIRD GLOBAL MASTER FUND, LTD., a Cayman Islands exempted company
(the “Lender”).
WHEREAS,
the Borrower has entered into a Convertible Note and Warrant Purchase Agreement,
dated as of October 15, 2009 (as amended, restated, supplemented or otherwise
modified from time to time, the “Purchase
Agreement”), together with the Lender, and has issued thereunder a
Convertible Secured Promissory Note, dated October 15, 2009 (the “Note”),
to the Lender.
WHEREAS,
under the terms of the Purchase Agreement and the Note, the Borrower and the IP
Sub have each granted to the Lender a security interest in, among other
property, certain intellectual property of the Borrower and the IP Sub, and have
agreed as a condition thereof to execute this IP Security Agreement for
recording with the U.S. Patent and Trademark Office, the United States Copyright
Office and other governmental authorities.
WHEREAS,
IP Sub will derive substantial benefit and advantage from the loans and other
financial accommodations to Borrower as set forth in the Purchase Agreement, and
it will be to IP Sub’s direct interest and economic benefit to assist Borrower
in procuring said loans and other financial accommodations from the
Lender.
NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, each of the Borrower and the IP Sub agrees as
follows:
SECTION
1. Grant
of Security.
As security for the prompt and complete payment and performance in full of all
obligations under the Purchase Agreement and the Note, Borrower and IP Sub
hereby pledges and hereby grants to Lender, a first priority security interest
(the “Security Interest”) in, and a lien on, all of the Intellectual Property
Assets now owned or hereafter acquired by Borrower or IP Sub or in which the
Borrower or IP Sub now has or hereafter may acquire any right, title or
interest, excluding any Intellectual Property Assets to the extent that such
Intellectual Property Assets are pledged, as of the date hereof, to Cancer
Treatment Centers of America, Inc. to secure certain obligations of the Borrower
thereto (the “Collateral”).
“Intellectual Property Assets” shall mean all right, title and interest of
Borrower or IP Sub in or to all or any Intellectual Property, which is defined
as:
(i)
each and all of the patents and patent applications, owned by, issued or granted
to, filed by or hereafter issued or granted to filed by or acquired by Borrower
or IP Sub, whether or not on a joint basis with any other person or entity,
including without limitation those patents and patent applications listed in
Schedule 1 attached hereto (collectively, the “Patents”);
(ii)
each and all of the trademarks, service marks, trademark applications, and
service xxxx applications, owned by, issued or granted to, filed by or hereafter
issued or granted to filed by or acquired by Borrower or IP Sub, whether or not
on a joint basis with any other person or entity, including without limitation
those trademark and service xxxx registrations and applications set forth in
Schedule 2 attached hereto (provided that no security interest shall be granted
in United States intent-to-use trademark applications to the extent that, and
solely during the period in which, the grant of a security interest therein
would impair the validity or enforceability of such intent-to-use trademark
applications under applicable federal law), together with the goodwill
symbolized thereby (the “Trademarks”);
(iii) each
and all of the copyrights, copyright applications and exclusive copyright
licenses, owned by, issued or granted to, filed by or hereafter issued or
granted to filed by or acquired by Borrower or IP Sub, whether or not on a joint
basis with any other person or entity, including without limitation those
copyright registrations and applications and exclusive copyright licenses set
forth in Schedule 3 attached hereto (the “Copyrights”);
(iv)
all rights to xxx for past, present and future infringements of any and all of
the Patents, Trademarks and Copyrights;
(v)
all proceeds, including without limitation license royalties and proceeds of
infringement suits, based on or relating to any or all of the Patents,
Trademarks and Copyrights;
(vi)
all licenses and other agreements under which Borrower or IP Sub is licensor,
and all fees, rents, royalties, proceeds or monies thereunder, based on or
relating to any or all of the Patents, Trademarks and Copyrights, and the use
thereof;
(vii)
all rights granted to Borrower or IP Sub under a license or other agreement
pertaining to any and all patent, trademark or copyright rights of any third
party;
(viii) all
formulae, processes, compounds, methods, know-how, and trade secrets relating to
the manufacture of Borrower’s or IP Sub’s products under, utilizing, or in
connection with, any or all of the Patents, Trademarks and Copyrights;
and
(ix)
all products and proceeds of the foregoing, in any form, including without
limitation insurance proceeds and all claims against third parties for loss or
damage to or destruction of any or all of the foregoing.
SECTION
2. Security
for Obligations.
The grant of a security interest in, the Collateral by the Borrower or the IP
Sub under this IP Security Agreement secures the payment or performance, as the
case may be, of all obligations of the Borrower now or hereafter existing under
or in respect of the Purchase Agreement and the Note, whether direct or
indirect, absolute or contingent, and whether for principal, reimbursement
obligations, interest, premiums, penalties, fees, indemnifications, contract
causes of action, costs, expenses or otherwise (together, the “Obligations”).
SECTION
3. Recordation.
The Borrower and the IP Sub each hereby authorizes and requests that the
Register of Copyrights, the Commissioner for Patents and the Commissioner for
Trademarks and any other applicable government officer record this IP Security
Agreement.
SECTION
4. Representations
and Warranties.
The Borrower and the IP Sub jointly and severally represent and warrant, as of
the date hereof, to the Lender that:
(a)
The Borrower or the IP Sub has good and valid rights in and title to the
Collateral with respect to which they have purported to grant a security
interest hereunder and has full power and authority to grant to the Lender the
security interest in such Collateral pursuant hereto and to execute, deliver and
perform its obligations in accordance with the terms of this IP Security
Agreement, without the consent or approval of any other person other than any
consent or approval that has been obtained and is in full force and
effect.
(b)
The security interest constitutes (i) a legal and valid security interest in all
the Collateral securing the payment and performance of the Obligations, (ii) a
perfected security interest in all Collateral in which a security interest may
be perfected by filing, recording or registering a financing statement or
analogous document in the in the United States of America, its territories or
possessions, any constituent State of the United States of America or the
District of Columbia pursuant to the Uniform Commercial Code or other applicable
law in such jurisdictions and (iii) a security interest that shall be perfected
in all Collateral in which a security interest may be perfected upon the receipt
and recording of this IP Security Agreement with the United States Patent and
Trademark Office and the United States Copyright Office, as applicable. The
security interest is and shall be prior to any other lien on any of the
Collateral.
(c)
The Collateral is owned by the Borrower or the IP Sub free and clear of any lien
or other security interest. The Borrower and the IP Sub have not filed or
consented to the filing of (i) any financing statement or analogous document
under the Uniform Commercial Code or any other applicable laws covering any
Collateral, (ii) any assignment in which the Borrower or the IP Sub assigns any
Collateral or any security agreement or similar instrument covering any
Collateral with the United States Patent and Trademark Office or the United
States Copyright Office, (iii) any notice under the Assignment of Claims Act or
(iv) any assignment in which the Borrower or the IP Sub assigns any Collateral
or any security agreement or similar instrument covering any Collateral with any
foreign governmental, municipal or other office, which financing statement or
analogous document, assignment, security agreement or similar instrument is
still in effect.
SECTION
5. Covenants.
The Borrower and the IP Sub hereby jointly and severally covenant that each of
them will:
(a)
Notify the Lender
promptly in writing of any change (i) in the Borrower’s or the IP Sub’s legal
name, as reflected in its organizational documents, (ii) in the jurisdiction of
organization or formation of the Borrower or the IP Sub, (iii) if it is not a
registered organization (as defined in the Uniform Commercial Code in effect
from time to time in Delaware), in the location of its chief executive office or
its principal place of business, (iv) in the Borrower’s or the IP Sub’s
organizational form or (v) in the Borrower’s or the IP Sub’s Federal Taxpayer
Identification Number or organizational identification number assigned by the
jurisdiction of organization. The Borrower and the IP Sub agree to promptly
provide the Lender with certified organizational documents reflecting any of the
changes described in the first sentence of this paragraph. The Borrower and the
IP Sub agree not to effect or permit any change referred to in the preceding
sentence unless all filings have been made under the Uniform Commercial Code or
otherwise that are required in order for the Lender to continue at all times
following such change to have a valid, legal and perfected security interest in
all the Collateral. The Borrower and the IP Sub also agrees promptly to notify
the Lender in writing if any material portion of the Collateral is damaged or
destroyed.
(b)
Maintain, at its own cost and expense, such complete and accurate records with
respect to the Collateral owned by it as is consistent with its current
practices and in accordance with such prudent and standard practices used in
industries that are the same as or similar to those in which the Borrower is
engaged, but in any event to include complete accounting records indicating all
payments and proceeds received with respect to any part of the Collateral, and,
at such time or times as the Lender may request, promptly to prepare and deliver
to the Lender a duly certified schedule or schedules in form and detail
satisfactory to the Lender showing the identity, amount and location of any and
all Collateral.
(c)
At its own expense, take any and all actions necessary to defend title to the
Collateral against all persons and to defend the security interest and the
priority thereof against any lien.
(d) At
its own expense, promptly execute, acknowledge, deliver and cause to be duly
filed all such further instruments and documents and take all such actions as
the Lender may from time to time request to better assure, obtain, preserve,
protect and perfect the security interest and the rights and remedies created
hereby, including the payment of any fees and taxes required in connection with
the execution and delivery of this IP Security Agreement, the granting of the
security interest and the filing of any financing or continuation statements
(including fixture filings) or other documents in connection herewith or
therewith. If any amount payable to the Lender under or in connection with any
of the Collateral shall be or become evidenced by any promissory note or other
instrument, such note or instrument shall be promptly pledged and delivered to
the Lender, duly endorsed in a manner satisfactory to the Lender.
(e)
Remain liable to observe and perform all the conditions and obligations to be
observed and performed by it under each contract, agreement or instrument
relating to the Collateral, all in accordance with the terms and conditions
thereof, and the Borrower and the IP Sub each agree to indemnify and hold
harmless the Lender from and against any and all liability for such
performance.
(f)
Not make or permit to be made an assignment, pledge or hypothecation of
the Collateral or grant any other lien in respect of the Collateral or permit
any notice to be filed under the Assignment of Claims Act. The Borrower and the
IP Sub shall not make or permit to be made any transfer of the Collateral and
the Borrower and the IP Sub shall remain at all times in possession or otherwise
in control of the Collateral owned by it.
(g)
Not, and will not permit any of its licensees to, do any act, or omit to do any
act, whereby any Patent may become invalidated or dedicated to the public, and
agrees that it shall continue to xxxx any products covered by a Patent with the
relevant patent number as necessary and sufficient to establish and preserve its
maximum rights under applicable patent laws.
(h) For
each Trademark, (i) maintain such Trademark in full force free from any claim of
abandonment or invalidity for non-use, (ii) maintain the quality of products and
services offered under such Trademark, (iii) display such Trademark with notice
of Federal or foreign registration to the extent necessary and sufficient to
establish and preserve its maximum rights under applicable law and (iv) not
knowingly use or knowingly permit the use of such Trademark in violation of any
third party rights.
(i)
For each work covered by a Copyright, continue to publish, reproduce, display,
adopt and distribute the work with appropriate copyright notice as necessary and
sufficient to establish and preserve its maximum rights under applicable
copyright laws.
(j)
Notify the Lender promptly if it knows or has reason to know that any
Patent, Trademark or Copyright may become abandoned, lost or dedicated to the
public, or of any material and adverse determination or development (including
the institution of, or any such determination or development in, any proceeding
in the United States Patent and Trademark Office, United States Copyright Office
or any court or similar office of any country) regarding the Borrower’s or the
IP Sub’s ownership of any Patent, Trademark or Copyright, its right to register
the same, or its right to keep and maintain the same.
(k)
Not, either itself or through any agent, employee, licensee or designee, file an
application for any Patent, Trademark or Copyright (or for the registration of
any Trademark or Copyright) with the United States Patent and Trademark Office,
United States Copyright Office or any office or agency in any political
subdivision of the United States or in any other country or any political
subdivision thereof, unless it promptly notifies the Lender, and, upon request
of the Lender, executes and delivers any and all agreements, instruments,
documents and papers as the Lender may request to evidence the security interest
in such Patent, Trademark or Copyright, and the Borrower and the IP Sub hereby
each appoint the Lender as its attorney-in-fact to execute and file such
writings for the foregoing purposes, all acts of such attorney being hereby
ratified and confirmed; such power, being coupled with an interest, is
irrevocable.
(l)
Take all necessary steps that are consistent with the practice in any proceeding
before the United States Patent and Trademark Office, United States Copyright
Office or any office or agency in any political subdivision of the United States
or in any other country or any political subdivision thereof, to maintain and
pursue each material application relating to the Patents, Trademarks and/or
Copyrights (and to obtain the relevant grant or registration) and to maintain
each issued Patent and each registration of the Trademarks and Copyrights,
including timely filings of applications for renewal, affidavits of use,
affidavits of incontestability and payment of maintenance fees, and, if
consistent with good business judgment, to initiate opposition, interference and
cancellation proceedings against third parties; provided,
however,
that the Borrower may modify or cancel any such material application relating to
each issued Patent and each registration of the Trademarks and Copyrights with
the prior written consent of the Lender that shall be given or withheld in the
Lender’s sole discretion.
(m)
Promptly notify the Lender if the Borrower or the IP Sub knows or has reason to
believe that any Collateral consisting of a Patent, Trademark or Copyright has
been or is about to be infringed, misappropriated or diluted by a third person,
and shall, if consistent with good business judgment, promptly xxx for
infringement, misappropriation or dilution and to recover any and all damages
for such infringement, misappropriation or dilution, and take such other actions
as are appropriate under the circumstances to protect such
Collateral.
SECTION
6. Execution
in Counterparts.
This IP Security Agreement may be executed in any number of counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
SECTION
7. Grants,
Rights and Remedies.
This IP Security Agreement has been entered into in conjunction with the
provisions of the Purchase Agreement and the Note. The Borrower and the IP Sub
do hereby acknowledge and confirm that the grant of the security interest
hereunder to, and the rights and remedies of, the Lender with respect to the
Collateral are more fully set forth in the Purchase Agreement and the Note, the
terms and provisions of which are incorporated herein by reference as if fully
set forth herein and, in the event of any conflict between this IP Security
Agreement and the Purchase Agreement or the Note, the Purchase Agreement or the
Note, as applicable, shall control.
SECTION
8. Governing
Law.
This IP Security Agreement shall be governed by, and construed in accordance
with, the laws of the State of Delaware.
[SIGNATURE
PAGE FOLLOWS]
IN
WITNESS WHEREOF, the Borrower has caused this IP Security Agreement to be duly
executed and delivered by its officer thereunto duly authorized as of the date
first above written.
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AVAX
TECHNOLOGIES, INC.
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By:
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/s/
Xxxx Xxxxxxxxxxx
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Name:
XXXX XXXXXXXXXXX
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Title:
CHAIRMAN & CEO
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Address
for Notices:
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0000
Xxxxxxxx Xxxxxx
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Xxxxx
000
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Xxxxxxxxxxxx,
XX 00000
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Attn:
Xxxx Xxxxxxxxxxx
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AVAX
INTERNATIONAL IP HOLDINGS, INC.
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By:
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/s/
Xxxx Xxxxxxxxxxx
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Name:
XXXX XXXXXXXXXXX
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Title:
CHAIRMAN & CEO
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Address
for Notices:
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0000
Xxxxxxxx Xxxxxx
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Xxxxx
000
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Xxxxxxxxxxxx,
XX 00000
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Attn:
Xxxx
Xxxxxxxxxxx
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FIREBIRD
GLOBAL MASTER FUND, LTD.
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By:
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/s/
Xxxxx Xxxxxx
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| Name: Xxxxx Xxxxxx | ||
| Title: Director | ||
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Address
for Notices:
Firebird
Global Master Fund, Ltd.
c/o
Trident Trust Company (Cayman) Limited
One
Capital Place, P.O. Box 847
Xxxxxx
Town, Grand Cayman KY1-1103
Cayman
Islands
with
a copy to:
FGS
Advisors, LLC
000
Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx
Xxxx, XX 00000
Attention:
Xxxxx Xxxxxx
Facsimile:
(000)
000-0000
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SCHEDULE
1
Patents
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Patent
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Patent
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|||||||||||
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Grantor
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Titles
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Country
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No.
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Applic.
No.
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Filing
Date
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Issue
Date
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|||||
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AVAX
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Method
for
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USA
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11/
331,468;
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January
13,
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||||||||
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TECHNOL
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producing
a
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published
as US
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2006
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|||||||||
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OGIES,
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vaccine
for
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2006/0240047
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||||||||||
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INC.
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the
treatment
of
cancer
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SCHEDULE
2
Domain
Names and Trademarks
Trademark
Chart - US and International Trademarks
Avax
Technologies, Inc.
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Country
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XXXX
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APP./REG.
No.
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REGISTRATION
DATE
OR FILING
DATE
|
ACTION
|
DEADLINE
|
CLASS/GOODS
|
comments
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|||||||
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Argentina
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N-VAX
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Reg.
No. 1860227
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2~January-2002
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First Renewal |
2-January-2012
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CLASS 5: Pharmaceutical and medicinal preparation for human use only; vaccines for cancer of the kidney in humans | ||||||||
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Argentina
|
M-VAX
|
Reg.
No. 1830547
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22-May-2001
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First
Renewal
|
22-May-2011
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CLASS 5: Melanoma cancer vaccines for
human use
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||||||||
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Argentina
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P-VAX
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Reg,
No. 1860228
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l-February-2002
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First
Renewal
|
1-February-2012
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CLASS 5: Pharmaceutical and medicinal
preparations; prostate cancer vaccine
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||||||||
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Argentina
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O-VAX
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Reg.
No. 1860230
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l-February-2002
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First
Renewal
|
1-February-
2012
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CLASS 5: Vaccine for ovarian
cancer
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||||||||
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Australia
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AC-VAX
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Reg.
No. 827820
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17-April-2001
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First
Renewal
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16-March-2010
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CLASS 5; Pharmaceutical products and
vaccine for the treatment of cancer
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||||||||
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Austraiia
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L-VAX
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Reg.
No. 855551
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22-August-2001
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First
Renewal
|
1-November-2010
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CLASS 5: Pharmaceutical products and
vaccine for the treatment of leukemia
|
||||||||
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Australia
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M-VAX
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Reg.
No. 790208
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10-November-2000
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First
Renewal
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6-April-2009
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CLASS 5; Pharmaceutical products and
vaccine for the treatment of cancer
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Expired
|
|||||||
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Australia
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M-VAX
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Reg.
No. 790180
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10-November-2000
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First
Renewal
|
6-April-2009
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CLASS 5: Pharmaceutical products and
vaccine for the treatment of cancer
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Expired
|
|||||||
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Chile
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L-VAX
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Reg.
No. 631690
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3-June-2002
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First
Renewal
|
3-June-2012
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CLASS 5: Pharmaceutical products and
vaccine for the treatment of leukemia
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||||||||
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China
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L-VAX
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Reg.
No. 1680429
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14-December-2001
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First
Renewal
|
13-December-2011
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CLASS 5: Pharmaceutical products and
vaccine for the treatment of leukemia
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||||||||
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China
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AVAX
& Design
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Reg.
No. 1560533
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28-April-2001
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First
Renewal
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27-April-2011
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CLASS
5: Pharmaceutical products for the treatment of
cancer, vaccine for the treatment of cancer
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||||||||
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China
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N-VAX
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Req.
No. 2019490
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28-January-2004
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First
Renewal
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27-January-
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CLASS 5: Pharmaceutical and |
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COUNTRY
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XXXX
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APP./REG.
No.
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REGISTRATION
DATE OR FILING DATE
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ACTION
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DEADLINE
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CLASS/GOODS
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COMMENTS
|
|||||||
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2014
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medicinal
preparations; kidney cancer vaccine for humans
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|||||||||||||
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China
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O-VAX
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Reg.
No. 2018825
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28-January-2004
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First
Renewal
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27-January-2014
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CLASS 5: Pharmaceutical and medicinal
preparations; vaccine for ovarian cancer
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||||||||
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China
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P-VAX
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Reg.
No. 2019494
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27-January-2Q04
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First
Renewal
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27-January-2014
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CLASS 5: Pharmaceutical and medicinal
preparations; prostate cancer vaccine
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||||||||
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European
Community
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AC
VACCINE
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Reg.
No. 01304021
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12-April-2002
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First
Renewal
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09-September-2009
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CLASS 5: Vaccine for the treatment of
cancer
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Renewal
Possible
|
|||||||
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European
Community
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N-VAX
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Reg.
No. 01304039
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19-January-2001
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First
Renewal
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9-September-2009
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CLASS 5: Pharmaceutical and
medicinal preparations; kidney cancer vaccine for humans
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Renewal
Possible
|
|||||||
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European
Community
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M-VAX
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Reg.
No. 01304062
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19-January-2001
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First
Renewal
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9-September-2009
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CLASS 5: Pharmaceutical and medicinal
preparations; melanoma cancer vaccine for humans
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Renewal
Possible
|
|||||||
|
European
Community
|
P-VAX
|
Reg.
No. 01304013
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19-January-2001
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First
Renewal
|
9-September-2009
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CLASS 5: Pharmaceutical and medicinal
preparations; prostate cancer vaccine
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Renewal
Possible
|
|||||||
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South
Africa
|
Opposition
to AVAX & Design
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App.
No. 200221365
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27-October-2000
(Filing
Date)
26-May-2004
(Publication,
Date)
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CLASS
5
|
This
matter is being handled directly by Avax with local
counsel
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||||||||
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Japan
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M-VAX
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Reg.
No. 4658803
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4-April-2003
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First
Renewal
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4-April-2013
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CLASS 5: Melanoma cancer vaccine for
human; other pharmaceutical and medicinal preparations
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||||||||
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Switzerland
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M-VAX
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Reg.
No. 541648
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24-April-2006
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First
Renewal
|
2-December-2015
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CLASS
5
|
||||||||
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US
|
AVAX
& Design
|
Reg.
No. 2,510,757
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20-November-2001
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First
Renewal
|
20
November-2011
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CLASS 5: pharmaceutical preparations and
vaccine for the treatment of cancer
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2
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COUNTRY
|
XXXX
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APP./REG.
No.
|
REGISTRATION
DATE OR FILING DATE
|
ACTION
|
DEADLINE
|
CLASS/GOODS
|
COMMENTS
|
|||||||
 |
||||||||||||||
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US
|
MVAX
|
Reg.
No. 2,929,049
|
l-May-2005
|
Declaration
of Use/Affidavit of
Incontestability
|
l-March-2010
(Opening
Date)
1
March - 2015
(Next
Renewal)
|
CLASS 5: melanoma cancer vaccine for
humans
|
||||||||
|
US
|
THE
POWER OF
INDIVIDUALIZED
THERAPY
|
Reg.
No. 2,478,644
|
14-August-2001
|
First
Renewal
|
14-August-
2011
|
CLASS 42: Pharmaceutical research and
cancer research services.
|
3
SCHEDULE
3
Copyrights
NONE
