EXHIBIT 10.8
TRADEMARK SECURITY AGREEMENT
This Trademark Security Agreement ("Agreement") is made this 20th day of
March, 2002, by BLONDER TONGUE LABORATORIES, INC., a Delaware corporation,
having a mailing address of One Jake Brown Road, Old Bridge, New Jersey 08857
("Borrower") and delivered to COMMERCE BANK, N.A. having a mailing address of
1701 Route 70 East, Cherry Hill, New Jersey 08034 ("Lender").
BACKGROUND
----------
A. This Agreement is being executed contemporaneously with that certain
Loan and Security Agreement between Borrower and Lender dated the date hereof
("Loan Agreement"), under which Borrower is granting Lender a lien on and
security interest in certain assets of Borrower associated with or relating to
services or products sold under Borrower's trademarks and the goodwill
associated therewith, and under which Lender is entitled to foreclose or
otherwise deal with such assets under the terms and conditions set forth
therein. Capitalized terms not defined herein shall have the meanings given to
such terms in the Loan Agreement.
B. Borrower has adopted, used and is using (or has filed applications for
the registration of) the trademarks, servicemarks and tradenames listed on
Schedule "A" attached hereto and made part hereof (all such marks or names
hereinafter referred to as the "Trademarks").
C. Pursuant to the Loan Agreement, Lender is acquiring a lien on, security
interest in and a license to use the Trademarks and the registration thereof,
together with all the goodwill of Borrower associated therewith and represented
thereby, as security for all of Borrower's Obligations, and Lender desires to
have its security interest in such Trademarks confirmed by a document
identifying same and in such form that it may be recorded in the United States
Patent and Trademark Office.
NOW THEREFORE, with the foregoing Background hereinafter deemed
incorporated by reference and made a part hereof, and in consideration of the
premises and mutual promises herein contained, the parties hereto, intending to
be legally bound hereby, covenant and agree as follows:
1. In consideration of and pursuant to the terms of the Loan Agreement, and
for other good, valuable and sufficient consideration, the receipt of which is
hereby acknowledged, and to secure all of the Obligations, Borrower grants to
Lender a lien on and security interest in all of Borrower's present and future
right, title and interest in and to the Trademarks, together with all the
goodwill of Borrower associated with and represented by the Trademarks, and the
registration thereof and the right (but not the obligation) to sue for past,
present and future infringements, and the proceeds thereof, including, without
limitation, license royalties and proceeds of infringement suits.
2. Borrower hereby covenants and agrees to maintain the Trademarks as
permitted under applicable law in full force and effect until all of the
Obligations are indefeasibly paid and satisfied in full and the Revolving Credit
is terminated.
3. Borrower represents, warrants and covenants to Lender that:
(a) The Trademarks are subsisting and have not been adjudged invalid
or unenforceable;
(b) All of the Trademarks (other than application for the registration
thereof which have been filed) are registered, valid and enforceable;
(c) Borrower is the sole and exclusive owner of the entire and
unencumbered right, title and interest in and to each of the Trademarks, and
each of the Trademarks is free and clear of any liens, charges and encumbrances
including, without limitation, pledges, assignments, licenses (other than to
Surety, Borrower and Lender hereunder) and covenants by Borrower not to sue
third persons;
(d) Borrower has the corporate power and authority to enter into this
Agreement and perform its terms;
(e) Borrower has complied with, and will continue for the duration of
this Agreement to comply with the requirements set forth in 15 U.S.C. Sec.
1051-1127 and any other applicable statutes, rules and regulations in connection
with its use of the Trademarks except where failure to comply would not have a
Material Adverse Effect on Borrower or its property;
(f) Borrower has no notice of any suits or actions commenced or
threatened against it, or notice of claims asserted or threatened against it,
with reference to the Trademarks; and
(g) Borrower has used and will continue to use for the duration of
this Agreement, consistent standards of quality in services or products leased
or sold under the Trademarks and hereby grants to Lender and its employees and
agents the right (with no obligation of any kind upon Lender to do so) to visit
Borrower's affiliates, franchises or management locations and to inspect the use
of the Trademarks and quality control records relating thereto at reasonable
times during regular business hours to ensure Borrower's compliance with this
paragraph 3(g).
4. Borrower further covenants that:
(a) Until all of the Obligations are indefeasibly paid and satisfied
in full and the Revolving Credit is terminated, Borrower will not enter into any
agreement, including, without limitation, license agreements or options, which
are inconsistent with Borrower's obligations under this Agreement, Borrower's
obligations under the Loan Agreement or which restrict or impair Lender's rights
hereunder.
(b) If Borrower acquires rights to any new trademarks, the provisions
of this Agreement shall automatically apply thereto and such trademarks shall be
deemed part of the Trademarks. Borrower shall give Lender prompt written notice
thereof along with an amended Schedule "A."
5. So long as this Agreement is in effect and so long as Borrower has not
received notice from Lender that an Event of Default has occurred under the Loan
Agreement and that
2
Lender has not elected to exercise its rights hereunder: (i) Borrower shall
continue to have the exclusive right to use the Trademarks; and (ii) Lender
shall have no right to use the Trademarks or issue any exclusive or
non-exclusive license with respect thereto, or assign, pledge or otherwise
transfer title in the Trademarks to anyone else.
6. Borrower agrees not to sell, grant any option, assign or further
encumber its rights and interest in the Trademarks to any entity or person other
than Lender, Borrower or any Surety without the prior written consent of Lender.
7. Anything herein contained to the contrary notwithstanding, if and while
an Event of Default exists under the Loan Agreement, Borrower hereby covenants
and agrees that Lender, as the holder of a security interest under the Uniform
Commercial Code, as now or hereafter in the jurisdiction set forth in Section
9.1 of the Loan Agreement, may take such action permitted hereunder, in its
exclusive discretion, to foreclose upon the Trademarks covered hereby. For such
purposes, while an Event of Default exists, Borrower hereby authorizes and
empowers Lender to make, constitute and appoint any officer or agent of Lender
as Lender may select, in its exclusive discretion, as Borrower's true and lawful
attorney-in-fact, with the power to endorse Borrower's name on all applications,
documents, papers and instruments necessary for Lender to use the Trademarks or
to grant or issue any exclusive or non-exclusive license under the Trademarks to
anyone else, or necessary for Lender to assign, pledge, convey or otherwise
transfer title in or dispose of the Trademarks to anyone else including, without
limitation, the power to execute a Trademark Assignment in the form attached
hereto as Exhibit 1. Borrower hereby ratifies all that such attorney or agent
shall lawfully do or cause to be done by virtue hereof, except for the gross
negligence or willful misconduct of such attorney or agent. This power of
attorney shall be irrevocable for the life of this Agreement, the Loan
Agreement, and until all of the Obligations are indefeasibly paid and satisfied
in full and the Revolving Credit is terminated.
8. This Agreement shall be subject to the terms, provisions, and conditions
set forth in the Loan Agreement and may not be modified without the written
consent of the party against whom enforcement is being sought.
9. All rights and remedies herein granted to Lender shall be in addition to
any rights and remedies granted to Lender under the Loan Documents. In the event
of an inconsistency between this Agreement and Loan Agreement, the language of
this Agreement shall control.
10. Upon Borrower's performance of all of the obligations under the Loan
Agreement and after all of the Obligations are indefeasibly paid and satisfied
in full and the Revolving Credit is terminated, Lender shall, at Borrower's
expense, execute and deliver to Borrower all documents reasonably necessary to
terminate Lender's security interest in the Trademarks.
11. Any and all reasonable fees, costs and expenses, of whatever kind or
nature, including the reasonable attorneys' fees and legal expenses incurred by
Lender in connection with the preparation of this Agreement and all other
documents relating hereto and the consummation of this transaction, the filing
or recording of any documents (including all taxes in connection therewith) in
public offices, the payment or discharge of any taxes, reasonable counsel fees,
maintenance fees, encumbrances or costs otherwise incurred in protecting,
maintaining, preserving the Trademarks, or in defending or prosecuting any
actions or proceedings arising out of or related
3
to the Trademarks, in each case in accordance with the terms of this Agreement,
shall be borne and paid by Borrower on demand by Lender and until so paid shall
be added to the principal amount of the Obligations to Lender and shall bear
interest at the otherwise applicable rate prescribed in the Loan Agreement.
12. Subject to the terms of this Agreement, Borrower shall have the duty to
prosecute diligently any application and/or registration with respect to the
Trademarks pending as of the date of this Agreement or thereafter, until all of
the Obligations are indefeasibly paid and satisfied in full and the Revolving
Credit is terminated, to preserve and maintain all rights in the Trademarks, and
upon reasonable request of Lender, Borrower shall make federal application on
registerable but unregistered Trademarks belonging to Borrower and licensed to
Borrower unless Borrower determines in good faith that failure to register such
Trademarks would not have a Material Adverse Effect on Borrower or its Property.
Any reasonable expenses incurred in connection with such applications shall be
borne exclusively by Borrower. Borrower shall not abandon any Trademarks without
the prior written consent of Lender.
13. Borrower shall have the right to bring suit in its own name to enforce
the Trademarks, in which event Lender may, if Borrower reasonably deems it
necessary, be joined as a nominal party to such suit if Lender shall have been
satisfied, in its sole discretion, that it is not thereby incurring any risk of
liability because of such joinder. Borrower shall promptly, upon demand,
reimburse and indemnify Lender for all damages, costs and expenses, including
reasonable attorneys' fees and costs, incurred by Lender in the fulfillment of
the provisions of this paragraph.
14. Upon the occurrence of an Event of Default under the Loan Agreement,
Lender may, without any obligation to do so, complete any obligation of Borrower
hereunder, in Borrower's name or in Lender's name, but at the expense of
Borrower.
15. No course of dealing between Borrower and Lender, nor any failure to
exercise, nor any delay in exercising, on the part of Lender, any right, power
or privilege hereunder, shall operate as a waiver thereof, and all of Lender's
rights and remedies with respect to the Trademarks, whether established hereby
or by the Loan Agreement, or by any other future agreements between Borrower and
Lender or by law, shall be cumulative and may be exercised singularly or
concurrently.
16. The provisions of this Agreement are severable and the invalidity or
unenforceability of any provision herein shall not affect the remaining
provisions which shall continue unimpaired and in full force and effect.
17. This Agreement shall inure to the benefit of and be binding upon the
respective successors and permitted assigns of the parties.
18. Borrower irrevocably agrees to consent to the jurisdiction of the state
and federal courts of the jurisdiction set forth in Section 9.1 of the Loan
Agreement, without regard to its otherwise applicable principles or conflicts of
law.
19. BORROWER (AND LENDER BY ITS ACCEPTANCE HEREOF) HEREBY WAIVES ANY AND
ALL RIGHTS IT MAY HAVE TO A JURY TRIAL IN CONNECTION WITH ANY LITIGATION,
PROCEEDING OR COUNTERCLAIM ARISING WITH RESPECT TO RIGHTS AND OBLIGATIONS OF THE
PARTIES HERETO OR UNDER THE
4
LOAN AGREEMENT OR WITH RESPECT TO ANY CLAIMS ARISING OUT OF ANY DISCUSSIONS,
NEGOTIATIONS OR COMMUNICATIONS INVOLVING OR RELATED TO ANY PROPOSED RENEWAL
EXTENSION, AMENDMENT, MODIFICATION, RESTRUCTURE, FORBEARANCE, WORKOUT, OR
ENFORCEMENT OF THE TRANSACTIONS CONTEMPLATED BY THE LOAN AGREEMENT.
IN WITNESS WHEREOF, the parties hereto have executed this Trademark
Security Agreement, under seal, the day and year first above written.
BORROWER:
BLONDER TONGUE LABORATORIES, INC.
By: /s/ James A. Luksch
-----------------------------------------
James A. Luksch, President and CEO
(Corporate Seal)
Address: c/o Blonder Tongue Laboratories, Inc.
One Jake Brown Road
Old Bridge, NJ 08857
Attn: President
APPROVED AND ACCEPTED:
COMMERCE BANK, N. A.
By: /s/ Kurt J. Fuoti
-------------------------------------
Kurt J. Fuoti, Vice President
5
CORPORATE ACKNOWLEDGMENT
------------------------
UNITED STATES OF AMERICA :
COMMONWEALTH OF PENNSYLVANIA :SS
COUNTY OF PHILADELPHIA :
On this 20th day of March, 2002, before me personally appeared JAMES A.
LUKSCH, to me known and being duly sworn, deposes and says that he is the
President and CEO of BLONDER TONGUE LABORATORIES, INC., the corporation
described in the foregoing Agreement; that he knows the seal of the corporation;
that the seal so affixed to the Agreement is such corporate seal; that he signed
the agreement and affixed the seal of the corporation thereto as such officer
pursuant to the authority vested in him by law; that the within Agreement is the
voluntary act of such corporation; and he/she desires the same to be recorded as
such.
------------------------
Notary Public
My Commission Expires:
6
SCHEDULE A TO TRADEMARK SECURITY AGREEMENT
------------------------------------------
APPLICATION OR
TRADEMARK REGISTRATION NO. COUNTRY FILING DATE
- --------- ---------------- ------- -----------
BLONDER TONGUE 819,812 US 12/6/66
Renewed: 12/16/86
BT (with design) 821,512 US 1/3/67
Renewed: 12/16/86
7
EXHIBIT 1 TO TRADEMARK SECURITY AGREEMENT
-----------------------------------------
TRADEMARK ASSIGNMENT
WHEREAS, BLONDER TONGUE LABORATORIES, INC., a Delaware corporation
("Grantor"), is the registered owner of the United States trademarks, tradenames
and registrations listed on Schedule "A" attached hereto and made a part hereof
(the "Trademarks"), which are registered in the United States Patent and
Trademark Office; and
WHEREAS, ___________________("Grantee") having a place of business at
___________________________________, is desirous of acquiring the Trademarks;
NOW THEREFORE, for good and valuable consideration, receipt of which is
hereby acknowledged, and intending to be legally bound hereby, Grantor, its
successors and assigns, does hereby transfer, assign and set over unto Grantee,
its successors, transferees and assigns, all of its present and future right,
title and interest in and to the Trademarks and all proceeds thereof and all
goodwill associated therewith.
IN WITNESS WHEREOF, the undersigned has caused this Trademark Assignment to
be executed as of the ____ day of _________, 200___.
BLONDER TONGUE LABORATORIES, INC.
Witness: _____________________ By:_______________________________
As Attorney-in-fact
8
CORPORATE ACKNOWLEDGMENT
------------------------
UNITED STATES OF AMERICA :
STATE OF ______________________ : SS
COUNTY OF _____________________ :
On this the ____ day of _____________, 200___ before me a Notary Public for
the said County and State, personally appeared ______________________________
known to me or satisfactorily proven to me to be attorney-in-fact on behalf of
BLONDER TONGUE LABORATORIES, INC. ("Grantor"), and he/she acknowledged to me
that he/she executed the foregoing Trademark Assignment on behalf of Grantor,
and as the act and deed of Grantor for the purposes therein contained.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
-----------------------------
(Individual Notary)
My Commission Expires:
_____________, ______
9
SCHEDULE A TO TRADEMARK ASSIGNMENT
----------------------------------
APPLICATION/OR
TRADEMARK REGISTRATION NO. COUNTRY FILING DATE
- --------- ---------------- ------- -----------
BLONDER TONGUE 819,812 US 12/6/66
Renewed: 12/16/86
BT (with design) 821,512 US 1/3/67
Renewed: 12/16/86
10