EXHIBIT 10.43
PATENT SECURITY AGREEMENT
This PATENT SECURITY AGREEMENT (this "Patent Security Agreement") is made
this 5th day of April, 2007, among the Grantors listed on the signature pages
hereof (collectively, jointly and severally, "Grantors" and each individually
"Grantor"), and THE BANK OF NEW YORK TRUST COMPANY, N.A., in its capacity as
Collateral Agent for itself, the Holders and the Trustee (together with its
successors and assigns in such capacity, "Collateral Agent").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Indenture dated of November 30, 2004 (as
amended, restated, amended and restated, supplemented or otherwise modified from
time to time, including all exhibits and schedules thereto, the "Indenture")
among Altra Industrial Motion, Inc., a Delaware corporation ("Company"), each of
the Guarantors named therein ("Guarantors"), The Bank of New York Trust Company,
N.A., as Trustee (in such capacity, the "Trustee"), and Collateral Agent,
Company has issued to the Holders its 9% Senior Secured Notes Due 2011, and may
issue from time to time additional notes in connection with the provisions of
the Indenture (as the same may be amended and restated, supplemented or
otherwise modified from time to time, collectively, the "Notes");
WHEREAS, as a condition precedent to the initial purchase by the Holders
of the Notes, Company and Guarantors (each in their respective capacity as a
Grantor) executed and delivered to Collateral Agent, for the benefit of the
Holders, Trustee and Collateral Agent, that certain Security Agreement dated as
of November 30, 2004 (including all annexes, exhibits or schedules thereto, as
from time to time amended and restated, supplemented or otherwise modified, the
"Security Agreement");
WHEREAS, as a condition precedent to the purchase by the Holders of
additional Notes in the aggregate principal amount of $105,000,000, the Grantors
shall have executed and delivered to Collateral Agent, for the benefit of the
Holders, Trustee and Collateral Agent, that certain Supplement No. 1 to Security
Agreement dated as of the date hereof (including all annexes, exhibits or
schedules thereto, the "Supplement"); and
WHEREAS, pursuant to the Security Agreement, as modified by the
Supplement, the Grantors are required to execute and deliver to Collateral
Agent, for the benefit of the Trustee and the Holders, this Patent Security
Agreement.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, each Grantor hereby agrees as
follows:
1. DEFINED TERMS. All capitalized terms used but not otherwise defined
herein have the meanings given to them in the Security Agreement and/or the
Indenture.
2. GRANT OF SECURITY INTEREST IN PATENT COLLATERAL. Each Grantor hereby
grants to Collateral Agent, for the benefit of the Trustee, the Collateral Agent
and the Holders, a continuing first priority security interest (subject to
Permitted Liens) in all of such Grantor's right, title and interest in, to and
under the following, whether presently existing or hereafter created or acquired
(collectively, the "Patent Collateral"):
(a) all of its Patents and rights in and to Patent Intellectual
Property Licenses to which it is a party including those referred to on Schedule
I hereto;
(b) all reissues, continuations, continuations-in-part, substitutes,
extensions or renewals of, and improvements on, the foregoing; and
(c) all products and proceeds of the foregoing, including, without
limitation, any claim by such Grantor against third parties for past, present or
future infringement of any Patent.
3. SECURITY AGREEMENT. The security interests granted pursuant to this
Patent Security Agreement are granted in conjunction with the security interests
granted to Collateral Agent, for the benefit of the Trustee, the Collateral
Agent and the Holders, pursuant to the Security Agreement. Each Grantor hereby
acknowledges and affirms that the rights and remedies of Collateral Agent with
respect to the security interest in the Patent Collateral made and granted
hereby are more fully set forth in the Security Agreement, the terms and
provisions of which are incorporated by reference herein as if fully set forth
herein.
4. AUTHORIZATION TO SUPPLEMENT. Grantors hereby authorize Collateral Agent
unilaterally to modify this Agreement by amending Schedule I to include any
patentable inventions or applications therefor which become part of the Patent
Collateral under the Security Agreement. Notwithstanding the foregoing, no
failure to so modify this Patent Security Agreement or amend Schedule I shall in
any way affect, invalidate or detract from Collateral Agent's continuing
security interest in all Collateral, whether or not listed on Schedule I.
5. COUNTERPARTS. This Patent Security Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but all
such separate counterparts shall together constitute but one and the same
instrument. Any signatures delivered by a party by facsimile transmission or by
e-mail transmission shall be deemed an original signature hereto.
[SIGNATURE PAGES FOLLOW]
2
IN WITNESS WHEREOF, each Grantor has caused this Patent Security Agreement to be
executed and delivered by its duly authorized officer as of the date first set
forth above.
GRANTORS:
TB WOOD'S INCORPORATED,
a Pennsylvania corporation, as a Grantor
By: /s/ William T. Fejes, Jr.
-------------------------------
Name: William T. Fejes, Jr.
Title: President, CEO and Director
PLANT ENGINEERING CONSULTANTS, LLC,
a Tennessee limited liability company, as
a Grantor
By: /s/ William T. Fejes, Jr.
-------------------------------
Name: William T. Fejes, Jr.
Title: President
TB WOOD'S ENTERPRISES, INC.,
a Delaware corporation, as a Grantor
By: /s/ Joseph C. Horvath
-------------------------------
Name: Joseph C. Horvath
Title: President and Treasurer
TB WOOD'S CORPORATION,
a Delaware corporation, as a Grantor
By: /s/ William T. Fejes, Jr.
-------------------------------
Name: William T. Fejes, Jr.
Title: President, CEO and Director
COLLATERAL AGENT: THE BANK OF NEW YORK TRUST COMPANY, N.A.,
as Collateral Agent
By: /s/ Sandee Parks
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Name: Sandee Parks
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Title: Vice President
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SIGNATURE PAGE OF PATENT SECURITY AGREEMENT
SCHEDULE I TO PATENT SECURITY AGREEMENT
PATENTS AND PATENT APPLICATIONS
<Table>
<Caption>
REGISTRATION REGISTRATION
GRANTOR COUNTRY PATENT NO. DATE
------- ------- ------ --- ----
TB Wood's United States Housing for Motor D343,387 1/18/1994
Incorporated Control Equipment
TB Wood's United States Combination of a 5,465,804 11/14/1995
Incorporated Power Steering Pump
and Air Conditioning
Compressor in an
Automotive Vehicle
TB Wood's United States Shaft Mountable 5,304,101 4/19/1994
Incorporated Bushing and Hub for
Industrial Power
Transmissions
TB Wood's United States Precision Winding 6,311,920 11/6/2001
Incorporated Method and Apparatus
TB Wood's United States Flexible Coupling 5,611,732 3/18/1997
Incorporated with End Stress
Relief Structure
</Table>