PATENT, TRADEMARK AND COPYRIGHT SECURITY AGREEMENT
PATENT,
TRADEMARK
AND
COPYRIGHT SECURITY AGREEMENT
THIS
PATENT, TRADEMARK AND COPYRIGHT SECURITY AGREEMENT (this “Agreement”) is entered
into as of this __th day of June, 2008, by and
between QUANTRX BIOMEDICAL CORPORATION, a Nevada corporation (the “Pledgor”),
with its principal address at 000 X. Xxxx Xxxxxx, Xxxxx 000, Xxxxxxxxxx, XX
00000, and __________________ (the “Lender”).
WHEREAS,
the Pledgor and the Lender or its assignee are parties to a certain Letter
Loan
Agreement, dated as of June __, 2008 (the “Purchase Agreement”), that provides
for, among other things: (i) the Pledgor to issue to the Lender the Note
identified in the Purchase Agreement (the “Notes”); and (ii) the grant by the
Pledgor to the Lender of a security interest in certain of the Pledgor’s assets.
WHEREAS,
to induce the Lender to purchase the Notes pursuant to the Purchase Agreement,
the Pledgor has agreed to pledge as collateral security for the Pledgor’s
obligations under the Notes, the assets described herein.
NOW,
THEREFORE, in consideration of the foregoing premises and the mutual covenants
and agreements contained, and for other good and valuable consideration (the
receipt and sufficiency of which are hereby acknowledged), the Pledgor and
the
Lender agree as follows:
1. Security
Interest in Patents, Trademarks and Copyrights.
To
secure the complete and timely satisfaction of all of Pledgor’s payment
obligations now or hereafter existing under the Notes (the “Obligations”), the
Pledgor hereby grants and conveys to the Lender through the Collateral Agent
a
security interest (having priority over all other security interests except
as
set forth herein) with power of sale, to the extent permitted by law, in all
of
its now owned or existing, and hereafter acquired or arising:
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(a)
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patents,
patent applications, including, without limitation, any invention
and
improvement to a patent or patent application, including without
limitation those patents and patent applications listed on Schedule
A
(being sometimes referred to individually and/or collectively, the
“Patents”);
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(b)
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trademarks,
registered trademarks and trademark applications, trade names, trade
styles, service marks, registered service marks and service xxxx
applications including, without limitation, the registered trademarks,
trademark applications, registered service marks and service xxxx
applications listed on Schedule
B
and (i) all renewals thereof, (ii) all accounts receivable, income,
royalties, damages and payments now and hereafter due and/or payable
with
respect thereto, including, without limitation, payments under all
licenses entered into in connection therewith and damages and payments
for
past, present or future infringements and dilutions thereof, and
(iii) the
right to xxx for past, present and future infringements and dilutions
thereof, and (iv) all of the Pledgor’s rights corresponding thereto
throughout the world (all of the foregoing registered trademarks,
trademark applications, trade names, trade styles, registered service
marks and service xxxx applications, together with the items described
in
clauses (i)-(iv) in this Section 1(b), being sometimes hereinafter
individually and/or collectively referred to as the “Trademarks”);
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(c)
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the
goodwill of Pledgor’s business connected with and symbolized by the
Trademarks; and
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(d)
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copyrights,
and copyright applications, including without limitation, those copyrights
listed in Schedule
C
(being sometimes referred to individually and/or collectively as
the
“Copyrights”);
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together
with all additions, accessions, accessories, amendments, attachments,
modifications, substitutions, and replacements, proceeds and products of the
foregoing (collectively, the “Collateral”).
In
addition, notwithstanding anything to the contrary contained herein, the
Collateral Agent shall not take any action with respect to the Collateral
pursuant to an exercise of its rights as a secured party hereunder unless the
Collateral Agent shall have given the Pledgor at least 120 days prior written
notice of such action which notice shall not be given prior to the occurrence
of
the occurrence of an Event of Default; provided,
that,
no such
prior written notice shall be required in connection with any action taken
by
the Collateral Agent reasonably necessary to perfect the security interest
granted hereby and protect its rights in and to the Collateral.
2. Recording
of Patents and Trademarks.
Pledgor
represents and warrants that (1) the patents and patent applications listed
in
Schedule A, and (2) the trademark and trademark applications described in
Schedule B, have each been duly recorded in the U.S. Patent and Trademark Office
(the “PTO”); and that no other patents, patent applications, trademarks, or
trademark applications have been filed or recorded with the PTO in which the
Pledgor has an interest.
3. Recording
of Copyrights.
Pledgor
represents and warrants that the copyright and copyright applications described
in Schedule C have been duly recorded in the U.S. Copyright Office, and that
no
other copyright, and copyright applications have been recorded in the U.S.
Copyright Office, in which the Pledgor has an interest.
4. Restrictions
on Future Agreements.
Pledgor
will not, without the Lender’s prior written consent, after the date hereof,
enter into any agreement that is inconsistent with this Agreement, and Pledgor
further agrees that it will not take any action, and will use reasonable efforts
not to knowingly permit any action to be taken by others subject to its control,
or knowingly fail to take any action, which would affect the validity or
enforcement of the rights transferred to the Lender, under this Agreement or
the
rights associated with those Patents, Trademarks and/or Copyrights which are
in
Pledgor’s reasonable business judgment, necessary or desirable in the operation
of Pledgor’s business. Notwithstanding anything to the contrary set forth
herein, it is understood and agreed that the Pledgor shall be permitted to
license the Collateral to the extent the same is permitted pursuant to the
terms
of the Notes.
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5. New
Patents, Trademarks and Copyrights.
Pledgor
represents and warrants that the Patents, Trademarks, and Copyrights listed
on
Schedules A, B, and C, include all of the patents, patent applications,
trademark registrations, trademark applications, service marks registrations,
service xxxx applications, registered copyrights and copyright applications,
now
owned or held by Pledgor. If, prior to the termination of this Agreement,
Pledgor shall (i) create or obtain rights to any new patents, trademarks,
trademark registrations, trademark applications, trade names, trade styles,
service marks, service marks registrations, or service xxxx applications, or
(ii) become entitled to the benefit of any patent, trademark, trademark
registration, trademark application, trade name, trade style, service xxxx,
service xxxx registration, service xxxx application, the provisions of Section
1
above shall automatically apply thereto and Pledgor shall give the Lender prompt
written notice thereof. Pledgor hereby authorizes the Lender to modify this
Agreement by (a) amending Schedules A, B, and/or C, as the case may be, to
include any future patents, trademark registrations, trademark applications,
service xxxx registrations, service xxxx applications, registered copyrights
and
copyright applications that are Patents, Trademarks or Copyrights under Section
1 above, or under this Section 5 (whether or not any such notice from Pledgor
has been sent or received), and (b) filing, in addition to and not in
substitution for this Agreement, a supplement or addendum to this Agreement
containing on Schedule B therein, as the case may be, such registered
trademarks, trademark applications, service marks, registered service marks
and
service xxxx applications that are Trademarks under Section 1 above or this
Section 5 and to take any action the Lender otherwise deems appropriate to
perfect or maintain the rights and interest of the Lender, under this Agreement
with respect to such Patents, Trademarks and Copyrights.
6. Nature
and Continuation of Security Interest; Notice to Third Parties.
This
Agreement has the effect of giving third parties notice of the Lender’s Security
Interest in Pledgor’s Patents, Trademarks and Copyrights. This Agreement is made
for collateral security purposes only. This Agreement shall create a continuing
security interest in the Patents, Trademarks and Copyrights and shall remain
in
full force and effect until the Obligations of the Pledgor to the Lender have
been paid in full.
7. Right
to Inspect; Assignments and Security Interests.
The
Lender shall have the right, at any reasonable time upon prior written request
and from time to time, to inspect Pledgor’s premises and to examine Pledgor’s
books, records and operations relating to the Patents and the Trademarks,
including, without limitation, Pledgor’s quality control processes; provided,
that in conducting such inspections and examinations, the Lender shall use
reasonable efforts not to disturb unnecessarily the conduct of Plegor’s ordinary
business operations. From and after the occurrence of an event of default under
the Notes (an “Event of Default”), Pledgor agrees that the Lender, or a
conservator appointed by the Lender, shall have the right to take any action
to
renew or to apply for registration of any Trademarks as the Lender or said
conservator, on its sole judgment, may deem necessary or desirable in connection
with the enforcement of the Lender’s rights hereunder. Other than a license of
Collateral permitted under Section 4, Pledgor agrees not to sell or assign
its
respective interests in the Patents, Trademarks and/or Copyrights without the
prior written consent of the Lender.
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8. Duties
of Pledgor.
Pledgor
shall have the duty to (i) prosecute diligently any patent application, or
trademark application or service xxxx application that is part of the Trademarks
pending as of the date hereof or thereafter until the termination of this
Agreement, and (ii) preserve and maintain all of Pledgor’s rights in the
patents, patent applications, trademark applications, service xxxx applications
and trademark and service xxxx registrations that are part of the Patents and
Trademarks. Any expenses incurred in connection with the foregoing shall be
borne by Pledgor. Pledgor shall not, without thirty (30) days prior written
notice to the Lender, abandon any trademark or service xxxx that is the subject
of a registered trademark, service xxxx or application therefor and which,
is or
shall be necessary or economically desirable in the operation of the Pledgor’s
business. The Lender shall not have any duty with respect to the Patents,
Trademarks and/or Copyrights. Without limiting the generality of the foregoing,
the Lender shall not be under any obligation to take any steps necessary to
preserve rights in the Patents, Trademarks and/or Copyrights against any other
parties, but may do so at its option during the continuance of an Event of
Default, and all expenses incurred in connection therewith shall be for the
sole
account of Pledgor and added to the Obligations and liabilities secured hereby
and by the Security Agreement.
9. Collateral
Agent’s Right to Xxx.
Upon
(but not until) the occurrence and during the continuance of any Event of
Default, the Collateral Agent shall have the right, for the benefit of the
Lenders, to exercise all rights and remedies available at law or in equity.
From
and after the occurrence and during the continuance of an Event of Default,
the
Collateral Agent shall have the right, but shall not be obligated, to bring
suit
or take any other action to enforce the Patents, Trademarks and Copyrights
and,
if the Lender shall commence any such suit or take any such action, Pledgor
shall, at the request of the Collateral Agent, do any and all reasonable lawful
acts and execute any and all proper documents reasonably required by the
Collateral Agent in aid of such enforcement. Pledgor shall, upon demand,
promptly reimburse and indemnify the Lender for all reasonable out-of-pocket
costs and expenses incurred by the Collateral Agent in the exercise of its
rights under this Section 9 (including, without limitation, all attorneys’
fees). If, for any reason whatsoever, the Collateral Agent is not reimbursed
with respect to the costs and expenses referred to in the preceding sentence,
such costs and expenses shall be added to the Obligations secured hereby and
by
the Security Agreement.
10.
Waivers.
The
Pledgor waives to the extent permitted by applicable law presentment, demand,
notice, protest, notice of acceptance of this Agreement, notice of any loans
made, credit or other extensions granted, collateral received or delivered
or
any other action taken in reliance hereon and all other demands and notices
of
any description, except for such demands and notices as are expressly required
to be provided to the Pledgor under this Agreement or any other document
evidencing the Obligations or the liabilities under the Notes. With respect
to
both the Obligations and any Collateral, the Pledgor assents to any extension
or
postponement of the time of payment or any other forgiveness or indulgence,
to
any substitution, exchange or release of Collateral, to the addition or release
of any party or person primarily or secondarily liable, to the acceptance of
partial payment thereon and the settlement, compromise or adjustment of any
thereof, all in such manner and at such time or times as the Lender may deem
advisable. The Collateral Agent may exercise its rights with respect to the
Collateral without resorting, or regard, to other collateral or sources of
reimbursement for Obligations. The Collateral Agent shall not be deemed to
have
waived any of its rights with respect to the Obligations or the Collateral
unless such waiver is in writing and signed by the Collateral Agent. No delay
or
omission on the part of the Collateral Agent in exercising any right shall
operate as a waiver of such right or any other right. A waiver on any one
occasion shall not bar or waive the exercise of any right on any future
occasion. All rights and remedies of the Collateral Agent in the Obligations
or
the Collateral, whether evidenced hereby or by any other instrument or papers,
are cumulative and not exclusive of any remedies provided by law or any other
agreement, and may be exercised separately or concurrently.
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11.
Successors
and Assigns.
This
Agreement shall be binding upon the Pledgor, its respective successors and
permitted assigns, and shall inure to the benefit of and be enforceable by
the
Collateral Agent and its successors and assigns. Without limiting the generality
of the foregoing sentence, the Collateral Agent may assign or otherwise transfer
any agreement or any note held by it evidencing, securing or otherwise executed
in connection with the Obligations, or sell participations in any interest
therein, to any other person or entity.
12.
General;
Term.
(a)
This
Agreement may not be amended or modified except by a writing signed by the
Pledgor and the Lender, nor may the Pledgor assign any of its rights hereunder.
This Agreement and the terms, covenants and conditions hereof shall be construed
in accordance with, and governed by, the laws of the State of New York (without
giving effect to any conflicts of law provisions contained therein). In the
event that any Collateral stands in the name of the Pledgor and another or
others jointly, as between the Collateral Agent and the Pledgor, the Collateral
Agent may deal with the same for all purposes as if it belonged to or stood
in
the name of the Pledgor alone.
(b)
This
Agreement and the security interests granted herein shall automatically, without
further action of the parties hereto, terminate on the date on which all
payments under the Notes have been indefeasibly paid or satisfied in full
(including as a result of the conversion in full of the Notes). Upon such
termination, the Lender shall promptly take any action reasonably requested
by
the Pledgor to cause the release of the security interests created
hereunder.
(c) This
Agreement shall be subject to all provisions of the Letter Loan Agreement,
dated
as of June __, 2008, between the Pledgor and the Lender (the “Purchase
Agreement”).
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13.
Waiver
of Jury Trial; Venue.
All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by and construed and enforced in accordance
with the internal laws of the State of New York, without regard to the
principles of conflicts of law thereof. The Pledgor agrees that all
proceedings concerning the interpretations, enforcement and defense of the
transactions contemplated by this Agreement, the other Transaction Documents
(as
defined in the Purchase Agreement) and the Notes (whether brought against a
party hereto or its respective affiliates, directors, officers, shareholders,
partners, members, employees or agents) may be brought in the Courts of New
York
County, New York or of the United States of America for the Southern District
of
New York and hereby expressly submits to the personal jurisdiction and venue
of
such courts for the purposes thereof and expressly waives any claim of improper
venue and any claim that such courts are an inconvenient forum. Each of the
Pledgor and the Lender hereby irrevocably consents to the service of process
of
any of the aforementioned courts in any such suit, action or proceeding by
the
mailing of copies thereof by registered or certified mail, postage prepaid,
at
the address in effect for notices to it under the Purchase Agreement, such
service to become effective 10 days after such mailing. Nothing in this Section
shall affect or limit any right to serve process in any other manner permitted
by law. Each of the Pledgor and the Lender hereby agree that the prevailing
party in any suit, action or proceeding arising out of or relating to this
Agreement shall be entitled to reimbursement for reasonable legal fees from
the
non-prevailing party. The Pledgor and the Lender hereby waive all rights to
trial by jury.
[Signature
Page Follows]
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IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
written above.
| PLEDGOR: | ||
| In the Presence of: | QUANTRX BIOMEDICAL CORPORATION | |
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| By: | ||
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Witness
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Name: |
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Title:
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| LENDER: | ||
| In the Presence of: | ||
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| By: | ||
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Witness
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Name: |
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Title:
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SCHEDULE
A
Patents
and Patent Applications
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SCHEDULE
B
Trademarks
and Trademark Applications
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SCHEDULE
C
Copyrights
and Copyright Applications
None
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