ASSIGNMENT, SECURITY AGREEMENT
AND MORTGAGE TRADEMARKS
------------------------
THIS AGREEMENT is made this _____ day of ________,
1997, between ▇▇▇▇ DERMATOLOGICS, INC., a ____________________
corporation ("Debtor") having an office at ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, and The CIT Group/Credit Finance, Inc., a
Delaware corporation (the "Secured Party"), having an office at
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
WHEREAS, Debtor has adopted the terms and designs
described in Schedule A annexed hereto and made a part hereof;
WHEREAS, as a condition to the Secured Party making any
loans or advances to Debtor, ▇▇▇▇▇▇▇ Pharmaceuticals, Inc.,
▇▇▇▇▇▇▇ Pharmaceuticals (Canada), Inc. and ▇▇▇▇▇▇▇
Pharmaceuticals Overseas, Inc. (collectively "Borrowers")
pursuant to a Loan and Security Agreement dated as of the date
hereof (the "Loan Agreement") between Borrowers and the Secured
Party, the Secured Party has required the execution and delivery
of this Agreement by Debtor;
NOW, THEREFORE, IT IS AGREED that, for and in
consideration of the loans and advances to be made in the
discretion of Secured Party under the Loan Agreement, and other
good and valuable consideration, the receipt of which is hereby
acknowledged, and as collateral security for the full and prompt
payment and performance of all Obligations, as hereinafter
defined, Debtor does hereby mortgage to and pledge with the
Secured Party, and grant to the Secured Party a security interest
in, and all of its right, title and interest in and to, and
assigns to Secured Party (i) each of the Trademarks (as
hereinafter defined), the goodwill of the business symbolized by
each of the Trademarks, all customer lists and other records of
Debtor relating to the distribution of products bearing the
Trademarks and each of the registrations described in Schedule A,
and any formulas of Debtor used or usable in connection with the
Trademarks; and (ii) any and all proceeds of the foregoing,
including, without limitation, any claims by Debtor against third
parties for past, present and future infringement of Trademarks
(collectively, the "Collateral").
1. Terms defined in the Loan Agreement and not
otherwise defined herein shall have the meaning set forth in the
Loan Agreement. As used in this Agreement, unless the context
otherwise requires:
"Trademarks" shall mean (i) all trademarks, trade
names, trade styles, service marks, prints and labels on which
said trademarks, trade names, trade styles and service marks have
appeared or appear, designs and general intangibles of like
nature, now existing or hereafter adopted or acquired, all right,
title and interest therein and thereto acquired under common law
or statute, and whether by use or registration, and all
registrations and recordings thereof, and applications therefor,
including, without limitation, applications, registrations and
recordings in the United States Patent and Trademark Office or in
any similar office or agency of the United States, any State
thereof, or any other country or any political subdivision
thereof, all whether now owned or hereafter acquired by Debtor,
including, but not limited to, those described in Schedule A
annexed hereto and made a part hereof, and (ii) all reissues,
amendments, extensions or renewals thereof and all licenses
thereof.
"Obligations" shall mean all indebtedness, obligations,
liabilities and agreements of any kind of Debtor to secured
Party, including, without limitation, the Loan Agreement, now
existing or hereafter arising, direct or indirect (including
participations or any interest of Secured party in obligations of
Debtor to others), acquired outright, conditionally, or as
collateral security from another, absolute or contingent, joint
or several, secured or unsecured, due or not, contractual or
tortious, liquidated or unliquidated, arising by operation of law
or otherwise, and all loan agreements, documents and instruments
evidencing any of the foregoing obligations or under which any of
the foregoing obligations may have been issued, created, assumed
or guaranteed, and all extensions, renewals, refundings,
replacements and modifications of the foregoing.
2. Debtor hereby represents, warrants, covenants and
agrees as follows:
(a) Debtor has the sole, full and clear title to
the Trademarks in the United States and all other
countries for the goods and services on which they are
used by Debtor, and the registrations thereof are valid
and subsisting and in full force and effect.
(b) Debtor will perform all acts and execute all
documents, including, without limitation, assignments
for security in form suitable for filing with the
United States Patent and Trademark Office and state and
local governments in the United States and in other
countries, substantially in the form of Exhibit 1
hereof, requested by the Secured Party at any time to
evidence, perfect, maintain, record and enforce the
Secured Party's interest in the Collateral or otherwise
in furtherance of the provisions of this Agreement, and
Debtor hereby authorizes the Secured Party to execute
and file one or more financing statements (and similar
documents) or copies thereof or of this Security
Agreement with respect to the Collateral signed only by
the Secured Party.
(c) Except to the extent that the Secured Party,
upon prior written notice of Debtor, shall consent,
Debtor (either itself or through licensees) will
continue to use the Trademarks on all services and
goods applicable to its current line as reflected in
its current catalogs, brochures and price lists in
order to maintain the Trademarks and their
registrations in full force free from any claim of
abandonment for nonuse and Debtor will not (and will
not permit any licensee thereof to) do any act or
knowingly omit to do any act whereby any Trademark or
its registration may become invalidated.
(d) Debtor will promptly pay the Secured Party
for any and all sums, costs, and expenses which the
Secured Party may pay or incur pursuant to the
provisions of this Agreement or in enforcing the
Obligations, the Collateral or the security interest
granted hereunder, including, but not limited to, all
filing or recording fees, court costs, collection
charges, travel, and reasonable attorneys' fees, all of
which together with interest at the highest rate then
payable on the Obligations shall be part of the
Obligations and be payable on demand.
(e) In no event shall Debtor, either itself or
through any agent, employee, licensee or designee, file
an application for any Trademark registration with the
United States Patent and Trademark Office or any
similar office or agency in any state of the United
States or in any other country or any political
subdivision thereof, unless it will promptly inform the
Secured Party, and, upon request of the Secured Party,
execute and deliver any and all assignments,
agreements, instruments, documents and papers as the
Secured Party may request to evidence the Secured
Party's interest in such Trademark and the goodwill and
general intangibles of Debtor relating thereto or
represented thereby and Debtor hereby constitutes the
Secured Party its attorney-in-fact to execute and file
all 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 until the Obligations are paid in full.
(f) Debtor has the right and power to make the
assignment and to grant the security interest herein
granted, and the Collateral is not now, and at all
times will not be, subject to any liens, mortgages,
assignments, security interests or encumbrances of any
nature whatsoever, except for the Assignment, and
except in favor of the Secured Party and to the best
knowledge of Debtor, none of the Collateral is subject
to any claim.
(g) Except to the extent that the Secured Party,
upon prior written notice to Debtor, shall consent,
Debtor will not assign, sell, mortgage, lease,
transfer, pledge, hypothecate, grant a security
interest in or lien upon, encumber, grant an exclusive
or non-exclusive license, or otherwise dispose of any
of the Collateral, and nothing in this Agreement shall
be deemed a consent by the Secured Party to any such
action except as expressly permitted herein.
(h) As of the date hereof Debtor has no Trademark
registrations in, or the subject of pending
applications in, the United States Patent and Trademark
Office or any similar office or agency in any state of
the United States, or in any other country or any
political subdivision thereof other than those
described in Schedule A hereto.
(i) Debtor will take all necessary steps in any
proceeding before the United States Patent and
Trademark Office or any similar office or agency in any
other country or any political subdivision thereof, to
maintain each application and registration of the
Trademarks, including, without limitation, if
applicable, paying of maintenance fees, applications
for reissues or extensions, filing of renewals,
affidavits of use, affidavits of incontestability and
opposition, interference and cancellation proceedings
(except to the extent that dedication, abandonment or
invalidation is permitted under paragraph 2(c) hereof).
3. Upon the occurrence of an Event of Default (as
defined in the Loan Agreement) (whenever used herein, the term
"Event of Default" having such meaning), in addition to all other
rights and remedies of the Secured Party, whether under law, the
Loan Agreement or otherwise, all such rights and remedies being
cumulative, not exclusive and enforceable alternatively,
successively or concurrently, without (except as provided herein)
notice to, or consent by, Debtor, the Secured Party shall have
the following rights and remedies: (a) Debtor shall not make any
use of the Trademarks or any ▇▇▇▇ similar thereto for any
purpose; (b) the Secured Party may, at any time and from time to
time, upon (10) days' prior notice to Debtor, license, whether on
an exclusive or nonexclusive basis, any of the Trademarks,
anywhere in the world for such term or terms, on such conditions,
and in such manner, as the Secured Party shall in its sole
discretion determine; (c) the Secured Party may (without assuming
any obligations or liability thereunder), at any time, enforce
(and shall have the exclusive right to enforce) against any
licensee or sublicensee all rights and remedies of Debtor in, to
and under any one or more license agreements with respect to the
Collateral, and take or refrain from taking any action under any
thereof, and Debtor hereby releases the Secured Party from, and
agrees to hold the Secured Party free and harmless from and
against any claims arising out of, any action taken or omitted to
be taken with respect to any such license agreement; (d) the
Secured Party may, at any time and from time to time, upon ten
(10) days' prior notice to Debtor, assign, sell, buy, or
otherwise dispose of, the Collateral or any of it, either with or
without special or other conditions or stipulations, and with
power also to execute assurances, and do all other acts and
things for completing the assignment, sale or disposition which
the Secured Party shall, in its sole discretion, deem appropriate
or proper; and (e) in addition to the foregoing, in order to
implement the assignment, sale or other disposal of any of the
Collateral pursuant to subparagraph 3(d) hereof, the Secured
Party may, at any time, pursuant to the authority granted in the
Power(s) of Attorney described in paragraph 4 hereof (such
authority becoming effective on the occurrence or continuation as
hereinabove provided of an Event of Default), execute and deliver
on behalf of Debtor, one or more instruments of assignment of the
Trademarks, in form suitable for filing, recording or
registration in any country. Debtor agrees to pay when due all
reasonable costs incurred in any such transfer of the Trademarks,
including any taxes, fees and reasonable attorneys' fees, and all
such costs shall be added to the Obligations. The Secured Party
may apply the proceeds actually received from any such license,
assignment, sale or other disposition to the reasonable costs and
expenses thereof, including, without limitation, reasonable
attorneys' fees and all legal, travel and other expenses which
may be incurred by the Secured Party, and then to the
Obligations, in such order as to principal or interest as the
Secured Party may desire, and Debtor shall remain liable and will
pay the Secured Party on demand any deficiency remaining,
together with interest thereon at a rate equal to the highest
rate then payable on the Obligations and the balance of any
expenses unpaid. Nothing herein contained shall be construed as
requiring the Secured Party to take any such action at any time.
In the event of any such license, assignment, sale or other
disposition of the Collateral, or any of it, after the occurrence
or continuation as hereinabove provided of an Event of Default,
Debtor shall supply its tooling, know-how and expertise relating
to the manufacture and sale of the products covered by the
Trademarks, and its customer lists and other records relating to
the Trademarks and to the distribution of said products, to the
Secured Party or its designee.
4. Concurrently with the execution and delivery
hereof, Debtor is executing and delivering to the Secured Party,
in the form of Exhibit 2 hereto, _____ originals of a Power of
Attorney, coupled with an interest, for the implementation of the
assignment, sale or other disposal of the Trademarks pursuant to
paragraphs 3(d) and (e) hereof and Debtor hereby releases the
Secured Party from any claims, causes of action and demands at
any time arising out of or with respect to any actions taken or
omitted to be taken by the Secured Party, under the powers of
attorney granted herein other than actions taken or omitted to be
taken through the gross negligence or willful misconduct of the
Secured Party.
5. No provision hereof shall be modified, altered or
limited except by a written instrument expressly referring to
this Agreement and executed by the party to be charged. The
execution and delivery of this Agreement has been authorized by
the Board of Directors of Debtor and by any necessary vote or
consent of stockholders thereof. This Agreement shall be binding
upon the successors, assigns or other legal representatives of
Debtor, and shall, together with the rights and remedies of the
Secured Party hereunder, inure to the benefit of the Secured
Party, its successors, assigns or other legal representatives.
This Agreement, the Obligations and the Collateral shall be
governed in all respects by the laws of the United States and the
laws of the State of Illinois. Debtor hereby submits to the
nonexclusive jurisdiction of the state courts of the State of
Illinois and the federal courts of the United States of America
located in such State in any action or proceeding arising under
this Security Agreement. If any term of this Agreement shall be
held to be invalid, illegal or unenforceable, the validity of all
other terms hereof shall in no way be affected thereby.
6. Secured Party shall reassign without warranties
all of the Collateral to Debtor upon the repayment of the
Obligations and the termination of the Loan Agreement.
IN WITNESS WHEREOF, Debtor and the Secured Party have
caused this Agreement to be executed by their respective officers
thereunto duly authorized as of the day and year first above
written.
ATTEST: ▇▇▇▇ DERMATOLOGICS, INC.,
By:______________________ By:______________________
Name: Name:
Title: Title:
(CORPORATE SEAL)
THE CIT GROUP/CREDIT FINANCE, INC.
By:______________________
Name:
Title:
SCHEDULE A TO SECURITY AGREEMENT
-------------------------------
TRADEMARKS
----------
▇▇▇▇ Dermatologics, Inc.
Registered Trademarks (1)
Registration Description Date of State or
Number of ▇▇▇▇ Registration Country
------------ ----------- ------------ --------
TRADEMARK APPLICATIONS
----------------------
Application Description Date of State or
Number of ▇▇▇▇ Registration Country
----------- ----------- ------------ --------
(1) All trademarks owned by ▇▇▇▇ Dermatologics, Inc. and
registered in the United States, the states of the United
States, and/or foreign countries.
Exhibit 1 to
Security Agreement
ASSIGNMENT FOR SECURITY
-----------------------
(TRADEMARKS)
WHEREAS, ▇▇▇▇ Dermatologics, Inc., a __________
corporation (herein referred to as "Assignor"), has adopted, used
and is using the trademarks listed on the annexed Schedule 1-A,
which trademarks are registered in the United States Patent and
Trademark Office (the "Trademarks");
WHEREAS, Assignor is obligated to The CIT Group/Credit
Finance, Inc., a Delaware corporation (herein referred to as
"Assignee"), and has entered into an Assignment, Security
Agreement and Mortgage-Trademarks (the "Agreement") in favor of
Assignee; and
WHEREAS, pursuant to the Agreement, Assignor has
assigned to Assignee and granted to Assignee a security interest
in, and mortgage on, all right, title and interest of Assignor in
and to the Trademarks, together with the goodwill of the business
symbolized by the Trademarks, and all proceeds thereof,
including, without limitation, any and all causes of action which
may exist by reason of infringement thereof, to secure the
payment, performance and observance of the Obligations, as
defined in the Agreement;
NOW, THEREFORE, for good and valuable consideration,
receipt of which is hereby acknowledged, Assignor does hereby
further assign unto Assignee and grant to Assignee a security
interest in, and mortgage on, the Trademarks to secure the prompt
payment, performance and observance of the Obligations.
Assignor does hereby further acknowledge and affirm
that the rights and remedies of Assignee with respect to the
assignment of, security interest in and mortgage on the
Trademarks made and granted hereby are more fully set forth in
the Agreement, the terms and provisions of which are hereby
incorporated herein by reference as if fully set forth herein.
IN WITNESS WHEREOF, Assignor has caused this Assignment
to be duly executed by its officer thereunto duly authorized as
of the _____ day of _________________, 1997.
ATTEST: ▇▇▇▇ DERMATOLOGICS, INC., a _______
corporation
By:_____________________ By:_____________________
Name: Name:
Title: Title:
(CORPORATE SEAL)
STATE OF __________)
) ss.
COUNTY OF _________)
On this _____ day of ____________, 19__, before me
personally appeared __________________ and _________________, to
me known, who, being by me duly sworn, did depose and say that
they are the __________________ and __________________ of ▇▇▇▇
Derematologics, Inc., the corporation described in and which
executed the foregoing instrument, that they know the seal of
said corporation, that the seal affixed to said instrument is
such corporate seal, that it was affixed by order of the Board of
Directors of said corporation, and that they signed their names
thereto by like order.
___________________________________
Notary Public
My commission expires:
___________________________________
SCHEDULE 1-A TO ASSIGNMENT FOR SECURITY
--------------------------------------
TRADEMARKS
----------
▇▇▇▇ Dermatologics, Inc.
Registered Trademarks (1)
Registration Description Date of State or
Number of ▇▇▇▇ Registration Country
----------- ----------- ------------ --------
TRADEMARK APPLICATIONS
----------------------
Application Description Date of State or
Number of ▇▇▇▇ Registration Country
----------- ----------- ------------ --------
(1) All trademarks owned by ▇▇▇▇ Dermatologics, Inc. and
registered in the United States, the states of the United
States, and/or foreign countries.
Exhibit 2 to
Security Agreement
SPECIAL POWER OF ATTORNEY COUPLED WITH AN INTEREST
-------------------------------------------------
STATE OF __________ )
) ss.
COUNTY OF _________ )
KNOW ALL MEN BY THESE PRESENTS, THAT ▇▇▇▇
Dermatologics, Inc. a ________________ corporation with its
principal office at ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇
(hereinafter called "Assignor") hereby appoints and constitutes
The CIT Group/Credit Finance, Inc., a Delaware corporation
(hereinafter called "Assignee"), its true and lawful attorney,
with full power of substitution, and with full power and
authority to perform the following acts on behalf of Assignor:
1. For the purpose of assigning, selling or otherwise
disposing of all right, title and interest of Assignor in
and to any trademarks, trade names, trade styles and service
marks, and all registrations, recordings and renewals
thereof, and all pending applications therefor, and for the
purpose of the recording, registering, filing and
prosecution of, or accomplishing any other formality with
respect to, the foregoing, to execute and deliver any and
all agreements, documents, instruments of assignment or
other papers necessary or advisable to effect such purpose;
and
2. To execute any and all documents, statements,
certificates or other papers necessary or advisable in order
to obtain the purposes described above as Assignee may in
its sole discretion determine.
This power of attorney is made pursuant to an
Assignment, Security Agreement and Mortgage Trademarks, dated the
date hereof, between Assignor and Assignee and takes effect
solely for the purposes of paragraphs 3(d) and (e) thereof and is
subject to the conditions thereof and may not be revoked until
the payment in full of all "Obligations" as defined in such
Assignment, Security Agreement and Mortgage.
Dated: _______________, 1997.
ATTEST: ▇▇▇▇ DERMATOLOGICS, INC. a
__________ corporation
By:_____________________ By:_____________________
Name: Name:
Title: Title:
(CORPORATE SEAL)
STATE OF __________ )
)ss.
COUNTY OF _________ )
On this _____ day of ____________, 1997, before me
personally appeared __________________ and _________________, to
me known, who, being by me duly sworn, did depose and say that
they are the __________________ and __________________ of ▇▇▇▇
Dermatologics, Inc., the corporation described in and which
executed the foregoing instrument, that they know the seal of
said corporation, that the seal affixed to said instrument is
such corporate seal, that it was affixed by order of the Board of
Directors of said corporation, and that they signed their names
thereto by like order.
___________________________________
Notary Public
My commission expires:
___________________________________
