Exhibit 10.12
TRADEMARK SECURITY AGREEMENT
AGREEMENT dated as of February ___, 1999 made by EVERCEL, INC., a
Delaware corporation with chief executive office at 0 Xxxxx Xxxxxxx Xxxx,
Xxxxxxx, Xxxxxxxxxxx 00000 ("Borrower"), in favor of ENERGY RESEARCH
CORPORATION, a New York corporation with a place of business at 0 Xxxxx Xxxxxxx
Xxxx, Xxxxxxx, Xxxxxxxxxxx 00000 ("Secured Party").
W I T N E S S E T H:
WHEREAS, Borrower and Secured Party are parties to a Loan Agreement,
dated as of the date hereof (the "Loan Agreement"), and certain supplements,
agreements and instruments entered into pursuant thereto as such may be amended,
modified or supplemented from time to time (collectively, with the Loan
Agreement, the "Loan Documents"), pursuant to which Secured Party may make
certain loans to Borrower; and
WHEREAS, Secured Party's willingness to enter into the Loan Documents
and make the loans and credit accommodations available thereunder is subject to
the condition, among others, that Borrower execute and deliver this Trademark
Security Agreement;
NOW, THEREFORE, in consideration of the premises and for one dollar
($1.00) and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, and in addition to, and not in limitation of,
any rights of the Secured Party under the Loan Documents, Borrower hereby agrees
for the benefit of Secured Party as follows:
1. DEFINITIONS.
1.1 All capitalized terms used herein shall have the respective
meanings provided therefor in the Loan Documents. In addition, the following
terms shall have the meanings set forth in this Section 1 or elsewhere in this
Security Agreement referred to below:
"PROCEEDS" shall mean any consideration received from the
sale, exchange, license, lease or other transfer or disposition of any right,
interest, asset or property which constitutes Trademark Collateral, any value
received as a consequence of the ownership, possession, or use of any Trademark
Collateral, and any payment received from any insurer or other person or entity
as a result of the destruction, loss, theft or other involuntary conversion of
whatever nature of any right, interest, asset or property which constitutes
Trademark Collateral.
"PTO" shall mean the United States Patent and Trademark
Office.
"TRADEMARKS" shall mean all of the trademarks, service marks,
designs, logos, indicia, trade names, corporate names, company names, business
names, fictitious business names, trade styles, elements of package or trade
dress, and/or other source and/or product or service identifiers, and general
intangibles of like nature, used or associated with or appurtenant to the
products, services and business of the Borrower, which (i) are set forth on
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SCHEDULE A attached hereto, or (ii) have been adopted, acquired, owned, held or
used by the Borrower and are now owned, held or used by the Borrower, in the
Borrower's business, or with the Borrower's products and services, or in which
the Borrower has any right, title or interest, or (iii) are in the future
adopted, acquired, owned, held and/or used by the Borrower in the Borrower's
business or with the Borrower's products and services, or in which the Borrower
in the future acquires any right, title or interest.
"TRADEMARK COLLATERAL" shall mean all of the Borrower's
right, title and interest (to the extent Borrower has any such right, title or
interest) in and to all of the Trademarks, the Trademark Registrations, the
Trademark Rights, and all additions, improvements and accessions to,
substitutions for, replacements of, and all products and Proceeds (including
insurance proceeds) of any and all of the foregoing PROVIDED, however, that
Trademark Collateral shall exclude all rights of Borrower (except payment
rights) to the extent that the inclusion of such rights would cause a default by
Borrower under the terms of any agreement.
"TRADEMARK REGISTRATIONS" shall mean all past, present or
future federal, state, local and foreign registrations of the Trademarks (and
all renewals and extensions of such registrations), all past, present and future
applications for any such registrations of the Trademarks (and any such
registrations thereof upon approval of such applications), together with the
right (but not the obligation) to apply for such registrations (and prosecute
such applications), and to take any and all actions necessary or appropriate to
maintain such registrations in effect and/or renew and extend such
registrations.
"TRADEMARK RIGHTS" shall mean any and all past, present or
future rights in, to and associated with the Trademarks throughout the world,
whether arising under federal law, state law, common law, foreign law or
otherwise, including but not limited to the following: all such rights arising
out of or associated with the Trademark Registrations; the right (but not the
obligation) to register claims under any state, federal or foreign trademark law
or regulation; the right (but not the obligation) to xxx or bring opposition or
cancellation proceedings for any and all past, present and future infringements
or dilution of or any other damages or injury to the Trademarks, the Trademark
Rights, and the rights to damages or profits due or accrued arising out of or in
connection with any such past, present or future infringement, dilution, damage
or injury.
"USE" of any Trademark shall include all uses of such
Trademark by, for or in connection with the Borrower or its business or for the
direct or indirect benefit of the Borrower or its business, including but not
limited to all such uses by the Borrower itself, by any of the affiliates of the
Borrower, or by any licensee or contractor of the Borrower.
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2. GRANT OF SECURITY; COLLATERAL ASSIGNMENT.
2.1 GRANT OF SECURITY INTEREST. As collateral security for the
complete and timely payment, performance and satisfaction of all Obligations (as
defined in the Security Agreement from Borrower to Secured Party dated the date
hereof), the Borrower hereby unconditionally grants to the Secured Party, a
continuing security interest in and lien on the Trademark Collateral, and
pledges, mortgages and hypothecates (but does not transfer title to) the
Trademark Collateral to the Secured Party.
2.2 SUPPLEMENTAL TO LOAN DOCUMENTS. The parties expressly
acknowledge and agree that the Borrower has delivered the Loan Documents
pursuant to which the Borrower unconditionally granted to the Secured Party a
continuing security interest in and lien on the Collateral (including the
Trademark Collateral). In no event shall this Security Agreement, or the
recordation of this Security Agreement (or any document hereunder) with the PTO,
adversely affect or impair, in any way or to any extent, the Loan Documents, the
security interest of the Secured Party in the Collateral (including the
Trademark Collateral) pursuant to the Loan Documents, the attachment and
perfection of such security interest under the Code (as defined herein), or the
present or future rights and interests of the Secured Party in and to the
Collateral under or in connection with the Loan Documents, this Security
Agreement and/or the Code. Any and all rights and interests of the Secured Party
in and to the Trademark Collateral (and any and all obligations of the Borrower
with respect to the Trademark Collateral) provided herein, or arising hereunder
or in connection herewith, shall only supplement and be cumulative and in
addition to the rights and interests of the Secured Party (and the obligations
of the Borrower) in, to or with respect to the Collateral (including the
Trademark Collateral) provided in or arising under or in connection with the
other Loan Documents.
3. REPRESENTATIONS AND WARRANTIES. The Borrower represents and
warrants to, and covenants and agrees with, Secured Party, as follows:
3.1 TITLE. The Borrower will subject to its reasonable business
judgment, take all actions as it shall determine to defend its right, title and
interests in and to the Trademarks and the Trademark Collateral against claims
of any third parties.
3.2 MAINTENANCE OF TRADEMARK COLLATERAL. The Borrower shall take
such actions (including but not limited to institution and maintenance of suits,
proceedings or actions) as it determines to be appropriate to maintain, protect,
preserve, care properly for and enforce the Trademarks and the Trademark
Registrations, Trademark Rights and to preserve the Borrower's rights in the
Trademarks.
3.3 NO INFRINGEMENTS. To the best of the Borrower's knowledge and
belief, there is at present no material infringement or unauthorized or improper
use of the Trademarks or the Trademark Registrations or the Trademark Rights
related thereto. In the event any such infringement or unauthorized or improper
use by any third party has been reasonably established by the Borrower, the
Borrower shall promptly notify the Secured Party and shall have the right to xxx
and recover therefor and to retain any and all damage so recovered or obtained.
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4. RIGHTS OF AND LIMITATIONS ON SECURED PARTY.
4.1 BORROWER TO REMAIN LIABLE. It is expressly agreed by Borrower
that Borrower shall remain liable to observe and perform all the conditions and
obligations to be observed and performed by it relating to the Trademark
Collateral. Secured Party shall not have any obligation or liability under or in
relation to the Trademark Collateral by reason of the execution and delivery of
this Security Agreement and Secured Party's rights hereunder, or the grant of a
security interest by Borrower to Secured Party of, or the receipt in accordance
with this Agreement by Secured Party of, any payment relating to any Trademarks,
nor shall Secured Party be required or obligated in any manner to perform or
fulfill any of the obligations of Borrower relating to the Trademark Collateral
or be liable to any party on account of Borrower's use of the Trademark
Collateral.
4.2 SPECIFIC ENFORCEMENT. Due to the unique nature of the
Trademark Collateral, and in order to preserve its value, the Borrower agrees
that the Borrower's agreements, duties and obligations under this Security
Agreement shall be subject to specific enforcement and other appropriate
equitable orders and remedies.
5. REMEDIES UPON AN EVENT OF DEFAULT. During the continuance of an
Event of Default:
(a) Secured Party may declare all Obligations secured hereby
immediately due and payable and shall have all of the rights and remedies of a
secured party under the Uniform Commercial Code as now in effect in the State of
Connecticut ("Code") or under other applicable law.
(b) Secured Party may notify any obligors with respect to the
Trademark Collateral of Secured Party's security interest and that such obligors
are to make payments directly to Secured Party. Secured Party may send this
notice in Borrower's name or in Secured Party's name, and at Secured Party's
request Borrower will join in Secured Party's notice, provide written
confirmation of Secured Party's security interest and request that payment be
sent to Secured Party. Secured Party may enforce this obligation by specific
performance. Secured Party may collect all amounts due from such obligors. Upon
and after notification by Secured Party to Borrower, Borrower shall hold any
proceeds and collections of any of the Trademark Collateral in trust for Secured
Party and shall not commingle such proceeds or collections with any other of
Borrower's funds, and Borrower shall deliver all such proceeds to Secured Party
immediately upon Borrower's receipt thereof in the identical form received and
duly endorsed or assigned to Secured Party.
(c) Secured Party will give to the Borrower reasonable notice of the
time and place of any public sale of Trademark Collateral or of the time after
which any private sale or other intended disposition thereof is to be made. Such
requirement of reasonable notice shall be met if such notice is delivered to the
address of the Borrower set forth in this Agreement at least ten (10) days
before the time of the proposed sale or disposition. Any such sale may take
place from
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Borrower's location or such other location as Secured Party may designate.
Borrower shall remain liable for any deficiency in payment of the Obligations
after any such sale.
Borrower hereby irrevocably appoints Secured Party as its true and
lawful attorney-in-fact with full power of substitution to take any of the
foregoing actions in the name of the Borrower or Secured Party to carry out the
terms of this Agreement and to protect, enforce, preserve or perfect Secured
Party's rights hereunder. Such power of attorney is irrevocable and shall be
deemed to be coupled with an interest.
6. GENERAL PROVISIONS. This Security Agreement is supplemental to the
Loan Agreement, the terms of which, including, without limitation, the notice
and governing law provisions, consent to service of process and jurisdiction and
prohibitions on non-written waivers, the Borrower expressly accepts, confirms
and acknowledges are incorporated herein by reference. In the event of any
irreconcilable conflict between the provisions of this Security Agreement and
the Loan Agreement, the provisions of the Loan Agreement shall govern.
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IN WITNESS WHEREOF, Borrower has caused this Security Agreement to be
executed by its duly authorized officer as of the date first written above.
WITNESS: EVERCEL, INC.
----------------------------- By:
--------------------------------
Name:
---------------------------
Title:
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STATE OF CONNECTICUT:
COUNTY: , 1999
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Then personally appeared the above-named ______________ and stated that
he is a duly authorized _______________ of Evercel, Inc. (the "Corporation") and
acknowledged the foregoing instrument to be his free act and deed, and the free
act and deed of said Corporation, before me,
--------------------------
Notary Public
My Commission Expires:
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SCHEDULE A TO
TRADEMARK COLLATERAL ASSIGNMENT
AND SECURITY AGREEMENT
TRADEMARKS, TRADEMARK REGISTRATION,
SERVICE MARKS
[TO BE COMPLETED]
1.
2.
3.
4.
5.
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