Patent Security Agreement among Kronos Advanced Technologies, Inc., Kronos Air Technologies, Inc., and Secured Parties

Contract Categories: Business Finance › Security Agreements
Summary

This agreement, dated June 19, 2007, is between Kronos Advanced Technologies, Inc., its subsidiary Kronos Air Technologies, Inc., and several secured parties including AirWorks Funding LLLP and various Sands Brothers entities. The agreement grants the secured parties a first priority security interest in all patents and related rights owned by the Kronos companies as collateral for financial accommodations provided under a related funding agreement. The agreement outlines the parties’ obligations to notify secured parties of new patents and allows the secured parties to update the collateral list as needed.

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EX-10.4 8 patentagreement.txt PATENT SECURITY AGREEMENT PATENT SECURITY AGREEMENT This PATENT SECURITY AGREEMENT (this "Patent Security Agreement") is made this 19th day of June, 2007, by and among Kronos Advanced Technologies, Inc., a Nevada corporation with its chief executive office and principal place of business located at 464 Common Street, Box 301, Belmont, Massachusetts 02478 (the "Debtor") and Kronos Air Technologies, Inc. a Nevada corporation with its chief executive office and principal place of business located at 15241 NE 90th Street, Redmond, Washington 98052 (the "Subsidiary" and collectively with the Debtor, the "Pledgors"), and AirWorks Funding LLLP, a Georgia limited liability limited partnership, ("AirWorks"), Sands Brother Venture Capital LLC, a New York limited liability company ("Sands I"), Sands Brothers Venture Capital II LLC, a New York limited liability company ("Sands II"), Sands Brothers Venture Capital III LLC, a New York limited liability company ("Sands III"), Sands Brothers Venture Capital IV LLC, a New York limited liability company ("Sands IV"), Critical Capital Growth Fund, L.P., a Delaware limited partnership and a debenture licensed U.S. Small Business Investment Company ("CCGF") and RS Properties I LLC, a Delaware limited liability company ("RS Properties"). AirWorks, Sands I, Sands II, Sands III, Sands IV, CCGF and RS Properties are collectively referred to herein as the "Secured Parties". W I T N E S S E T H: WHEREAS, pursuant to that certain Funding Agreement dated as of the date hereof (as amended, restated, supplemented or otherwise modified from time to time, the "Funding Agreement") by and among the Debtor and the Secured Parties, the Secured Parties are willing to make certain financial accommodations available to Debtor pursuant to the terms and conditions thereof; and WHEREAS, the Subsidiary is a direct subsidiary of the Debtor and has determined that its execution, delivery and performance of this Patent Security Agreement directly or indirectly benefits, and is within the corporate purposes and in the best interest of, it; and WHEREAS, the Secured Parties are willing to make the financial accommodations to Borrower as provided for in the Funding Agreement, but only upon the condition, among others, that the Pledgors shall have executed and delivered to the Secured Parties this Patent Security Agreement (including all annexes, exhibits or schedules thereto, as from time to time amended, restated, supplemented or otherwise modified, the "Patent Security Agreement") and that certain other Security Agreement of even date herewith by and among the Pledgors and the Secured Parties (the "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, the Pledgors hereby agree 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 Funding Agreement. 2. GRANT OF SECURITY INTEREST IN PATENT COLLATERAL. Each Pledgor hereby grants to the Secured Parties a continuing first priority security interest in all of such Pledgor'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 such Pledgor's patents, license agreements for the commercialization of patents and patent applications to which it is a party, including, in each case, those referred to on Schedule I hereto; (b) all reissues, continuations or extensions of the foregoing; and (c) all products and proceeds of the foregoing, including any claim by such Pledgor against third parties for past, present or future infringement or dilution of any Patent Collateral. 3. SECURITY FOR OBLIGATIONS. This Patent Security Agreement and the security interest evidenced hereby secures the payment and performance of all the Obligations, whether now existing or arising hereafter. Without limiting the generality of the foregoing, this Patent Security Agreement secures the payment of all amounts which constitute part of the Obligations and would be owed by the Pledgors, or any of them, to the Secured Parties or any of them, whether or not they are unenforceable or not allowable due to the existence of an insolvency proceeding involving a Pledgor. The Pledgors hereby authorize the Secured Parties to file this Patent Security Agreement with the United States Patent and Trademark Office. 4. SECURITY AGREEMENT. The security interests granted pursuant to this Patent Security Agreement are granted in conjunction with the security interests granted to the Secured Parties pursuant to the Security Agreement. Each Pledgor hereby acknowledges and affirms that the rights and remedies of the Secured Parties 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. 5. AUTHORIZATION TO SUPPLEMENT. The Pledgors shall give the Secured Parties prompt notice in writing of any additional United States patent registrations or applications therefor after the date hereof. The Pledgors hereby authorize the Secured Parties unilaterally to modify this Agreement by amending Schedule I to include any future United States registered patents or applications therefor of the Pledgors. 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 Agent's continuing security interest in all the Patent Collateral, whether or not listed on Schedule I. 2. 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. 3. CONSTRUCTION. Unless the context of this Patent Security Agreement or any other Transaction Document clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the terms "includes" and "including" are not limiting, and the term "or" has, except where otherwise indicated, the inclusive meaning represented by the phrase "and/or." The words "hereof," "herein," "hereby," "hereunder," and similar terms in this Patent Security Agreement or any other Transaction Document refer to this Patent Security Agreement or such other Transaction Document, as the case may be, as a whole and not to any particular provision of this Patent Security Agreement or such other Transaction Document, as the case may be. Section, subsection, clause, schedule, and exhibit references herein are to this Patent Security Agreement unless otherwise specified. Any reference in this Patent Security Agreement or in any other Transaction Document to any agreement, instrument, or document shall include all alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements, thereto and thereof, as applicable (subject to any restrictions on such alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements set forth herein). Any reference herein to any Person shall be construed to include such Person's successors and assigns. [SIGNATURE PAGE FOLLOWS] Patent Security Agreement Patent Security Agreement IN WITNESS WHEREOF, each Pledgor has caused this Patent Security Agreement to be executed and delivered by its duly authorized officer as of the date first set forth above. KRONOS ADVANCED TECHNOLOGIES, INC. By: /s/ Richard F. Tusing -------------------------------- Name: Richard F. Tusing Title: COO KRONOS AIR TECHNOLOGIES, INC. By: /s/ Richard F. Tusing -------------------------------- Name: Richard F. Tusing Title: COO AIRWORKS FUNDING LLLP By: Compass Partners, LLC, its general partner By: /s/ Richard E. Perlman -------------------------------- Name: Richard E. Perlman Title: President SANDS BROTHERS VENTURE CAPITAL LLC By: /s/ Scott A. Baily -------------------------------- Name: Scott A. Baily Title: COO SANDS BROTHERS VENTURE CAPITAL II LLC By: /s/ Scott A. Baily -------------------------------- Name: Scott A. Baily Title: COO SANDS BROTHERS VENTURE CAPITAL III LLC By: /s/ Scott A. Baily -------------------------------- Name: Scott A. Baily Title: COO SANDS BROTHERS VENTURE CAPITAL IV LLC By: /s/ Scott A. Baily -------------------------------- Name: Scott A. Baily Title: COO CRITICAL CAPITAL GROWTH FUND, L.P. By: Critical Capital, L.P., its General Partner By: Critical Capital Corporation, its General Partner By: /s/ Steven B. Sands -------------------------------- Name: Steven B. Sands Title: Chairman By: /s/ Charles L. Robinson -------------------------------- Name: Charles L. Robinson Title: President RS PROPERTIES I LLC By: /s/ John Lack -------------------------------- Name: John Lack Title: Manager SCHEDULE I TO PATENT SECURITY AGREEMENT PATENT REGISTRATIONS
Case Ref. Title Case Status Application No. Registration No. Country ELECTROSTATIC FLUID WO-432001AU ACCELERATOR Exam requested 10847/01 773626 Australia ELECTROSTATIC FLUID WO-432001AU2 ACCELERATOR Pending ###-###-#### Australia ELECTROSTATIC FLUID WO-432001CA ACCELERATOR Pending 2,355,659 Canada ELECTROSTATIC FLUID Application WO-432001EP ACCELERATOR Filed 00972147.3 European Patent Office ELECTROSTATIC FLUID WO-432001HK ACCELERATOR Published 02103656.7 Hong Kong ELECTROSTATIC FLUID Application WO-432001JP ACCELERATOR Filed 2001-530889 Japan ELECTROSTATIC FLUID WO-432001MX ACCELERATOR Issued PA/a/2001/006037 233725 Mexico ELECTROSTATIC FLUID WO-432002 ACCELERATOR Issued 09/419,720 6,504,308 United States of America Electrostatic Fluid Application WO-432002RE Accelerator Filed 90/007,276 United States of America SPARK MANAGEMENT METHOD WO-432003 AND DEVICE Issued 10/187,983 6,937,455 United States of America An Electrostatic Fluid Accelerator for and Method of Controlling a Application WO-432003AU Fluid Flow Filed ###-###-#### Australia An Electrostatic Fluid Accelerator for and Method of Controlling a WO-432003CA Fluid Flow Issued 2,489,983 2,489,983 Canada AN ELECTROSTATIC FLUID ACCELERATOR FOR AND METHOD OF CONTROL LING A WO-432003CN FLUID FLOW Published 03819690.5 China SPARK MANAGEMENT METHOD WO-432003CON AND DEVICE Published 11/214,066 United States of America AN ELECTROSTATIC FLUID ACCELERATOR FOR AND METHOD OF CONTROL LING A Application WO-432003EP FLUID FLOW Filed 03812413.7 European Patent Office AN ELECTROSTATIC FLUID ACCELERATOR FOR AND METHOD OF CONTROL LING A Application WO-432003HK FLUID FLOW Filed 05111239.3 Hong Kong AN ELECTROSTATIC FLUID ACCELERATOR FOR AND METHOD OF CONTROL LING A WO-432003JP FLUID FLOW Exam requested 570752/2004 Japan An Electrostatic Fluid Accelerator for and Method of Controlling a WO-432003MX Fluid Flow Published PA/a/2004/012882 Mexico An Electrostatic Fluid Accelerator for and Method of Controlling a Examination WO-432003NZ Fluid Flow report received 537254 New Zealand AN ELECTROSTATIC FLUID ACCELERATOR FOR AND METHOD OF CONTROL LING A Entered WO-432003PCT FLUID FLOW National Phase PCT/US03/19651 Patent Cooperation Treaty METHOD OF AND APPARATUS FOR ELECTROSTATIC FLUID ACCELERATION CONTROL OF A WO-432004 FLUID FLOW Issued 10/175,947 6,664,741 United States of America METHOD OF AND APPARATUS FOR ELECTROSTATIC FLUID ACCELERATION CONTROL OF A WO-432004CIP FLUID FLOW Issued 10/735,302 6,963,479 United States of America METHOD OF AND APPARATUS FOR ELECTROSTATIC FLUID ACCELERATION CONTROL OF A Application WO-432004CIP AU FLUID FLOW Filed ###-###-#### Australia METHOD OF AND APPARATUS FOR ELECTROSTATIC FLUID ACCELERATION CONTROL OF A Application WO-432004CIP CA FLUID FLOW Filed 2,550,582 Canada METHOD OF AND APPARATUS FOR ELECTROSTATIC FLUID ACCELERATION CONTROL OF A Application WO-432004CIP CN FLUID FLOW Filed 200480041683.X China METHOD OF ELECTROSTATIC Application WO-432004CIP CON ACCELERATION OF A FLUID Filed 11/549,845 United States of America METHOD OF AND APPARATUS FOR ELECTROSTATIC FLUID ACCELERATION CONTROL OF A Application WO-432004CIP EP FLUID FLOW Filed 04813494.4 European Patent Office METHOD OF AND APPARATUS FOR ELECTROSTATIC FLUID ACCELERATION CONTROL OF A Application WO-432004CIP HK FLUID FLOW Filed 06114151.0 Hong Kong METHOD OF AND APPARATUS FOR ELECTROSTATIC FLUID ACCELERATION CONTROL OF A Application WO-432004CIP JP FLUID FLOW Filed To Be Assigned Japan METHOD OF AND APPARATUS FOR ELECTROSTATIC FLUID ACCELERATION CONTROL OF A Application WO-432004CIP MX FLUID FLOW Filed PA/a/2006/006757 Mexico METHOD OF AND APPARATUS FOR ELECTROSTATIC FLUID ACCELERATION CONTROL OF A Application WO-432004CIP NZ FLUID FLOW Filed 547900 New Zealand Method of and apparatus for electrostatic fluid acceleration control of a WO-432004CIPDIV fluid flow Issued 11/210,773 7,122,070 United States of America METHOD OF AND APPARATUS FOR ELECTROSTATIC FLUID ACCELERATION CONTROL OF A WO-432004CIPPCT FLUID FLOW Published PCT/US2004/041181 Patent Cooperation Treaty AN ELECTROSTATIC FLUID ACCELERATOR FOR AND A METHOD OF CONTR OLLING WO-432005 FLUID FLOW Issued 10/188,069 6,727,657 United States of America AN ELECTROSTATIC FLUID ACCELERATOR FOR AND A METHOD OF CONTROLLING WO-432005CIP FLUID FLOW Issued 10/847,438 7,053,565 United States of America AN ELECTROSTATIC FLUID ACCELERATOR FOR AND A METHOD OF CONTROLLING Application WO-432005 AU FLUID FLOW Filed Australia AN ELECTROSTATIC FLUID ACCELERATOR FOR AND A METHOD OF CONTROLLING Application WO-432005 CA FLUID FLOW Filed Canada AN ELECTROSTATIC FLUID ACCELERATOR FOR AND A METHOD OF CONTROLLING Application WO-432005 CN FLUID FLOW Filed China Application AN ELECTROSTATIC FLUID Filed - ACCELERATOR FOR AND A Awaiting METHOD OF CONTROLLING Confirmation WO-432005 EA FLUID FLOW from FA Eurasian Patent Office AN ELECTROSTATIC FLUID ACCELERATOR FOR AND A METHOD OF CONTROLLING Application WO-432005 EP FLUID FLOW Filed 05 750 980.4 European Patent Office AN ELECTROSTATIC FLUID ACCELERATOR FOR AND A METHOD OF CONTROLLING Application WO-432005 JP FLUID FLOW Filed PCT/US2005/017276 Japan AN ELECTROSTATIC FLUID ACCELERATOR FOR AND A METHOD OF CONTROLLING Application WO-432005 MX FLUID FLOW Filed PCT/US2005/017276 Mexico AN ELECTROSTATIC FLUID ACCELERATOR FOR AND A METHOD OF CONTROLLING Application WO-432005 NZ FLUID FLOW Filed New Zealand Application AN ELECTROSTATIC FLUID Filed - ACCELERATOR FOR AND A Awaiting METHOD OF CONTROLLING Confirmation WO-432005 UA FLUID FLOW from FA Ukraine AN ELECTROSTATIC FLUID ACCELERATOR FOR AND A METHOD OF CONTR OLLING Examination WO-432005CIPPCT FLUID FLOW report received PCT/US05/017276 Patent Cooperation Treaty AN ELECTROSTATIC FLUID ACCELERATOR FOR AND A METHOD OF CONTR OLLING WO-432005CON FLUID FLOW Allowed 10/806,473 United States of America AN ELECTROSTATIC FLUID ACCELERATOR FOR AND METHOD OF CONTROL LING A WO-432006 FLUID FLOW Issued 10/352,193 6,919,698 United States of America An Electrostatic Fluid Accelerator for and Method of Controlling a WO-432006CON Fluid Flow Allowed 11/046,711 United States of America ELECTROSTATIC FLUID WO-432007 ACCELERATOR Issued 10/295,869 6,888,314 United States of America Electrostatic Fluid WO-432007CON Accelerator Published 11/119,748 United States of America CORONA DISCHARGE ELECTRODE AND METHOD OF WO-432010 OPERATING THE SAME Allowed 10/724,707 United States of America CORONA DISCHARGE ELECTRODE AND METHOD OF Application WO-432010-AU OPERATING THE SAME Filed ###-###-#### Australia CORONA DISCHARGE ELECTRODE AND METHOD OF Application WO-432010-CA OPERATING THE SAME Filed 2,547,951 Canada CORONA DISCHARGE ELECTRODE AND METHOD OF Application WO-432010-CN OPERATING THE SAME Filed 200480041207.8 China CORONA DISCHARGE ELECTRODE AND METHOD OF WO-432010-EP OPERATING THE SAME Exam requested 04816999.9 European Patent Office CORONA DISCHARGE ELECTRODE AND METHOD OF Application WO-432010-JP OPERATING THE SAME Filed 100064746 Japan CORONA DISCHARGE ELECTRODE AND METHOD OF WO-432010-MX OPERATING THE SAME Published PA/A/2006/006296 Mexico CORONA DISCHARGE ELECTRODE AND METHOD OF Application WO-432010NZ OPERATING THE SAME Filed 547475 New Zealand CORONA DISCHARGE ELECTRODE AND METHOD OF WO-432010PCT OPERATING THE SAME Exam requested PCT/US04/39783 Patent Cooperation Treaty ELECTROSTATIC AIR WO-432011 CLEANING DEVICE Issued 10/752,530 7,150,780 United States of America ELECTROSTATIC AIR Application WO-432011CON CLEANING DEVICE Filed 11/612,270 United States of America An Electrostatic Fluid Accelerator for and Method of Controlling a Application WO-432012PCT Fluid Flow Filed PCT/US06/003915 Patent Cooperation Treaty An Electrostatic Fluid Accelerator for and Method of Controlling a WO-432012PROV Fluid Flow Expired 60/649,560 United States of America An Electrostatic Fluid Accelerator for and Method of Controlling a Application WO-432012US Fluid Flow Filed 11/347,565 United States of America ELECTROSTATIC AIR Application WO-432014PCT CLEANING DEVICE Filed PCT/US05/14934 Patent Cooperation Treaty IONIC LOUDSPEAKER AND Application WO-432018PROV PATENT APPLICATION Filed 60/794,510 United States of America AN IONIC WIND LOUDSPEAKER AND METHOD OF GENERATION WO-432018US SOUND United States of America ELECTROSTATIC FLUID ACCELERATOR FOR AND A METHOD OF CONTROLLING Application WO-432019CON FLUID FLOW Filed 11/437,828 United States of America FIREPLACE WITH ELECTROSTATICALLY ASSISTED HEAT TRANSFER AND METHOD OF ASSISTING HEAT TRANSFER IN COMBUSTION POWERED Application WO-432021PROV HEATING DEVICES Filed 60/862,760 United States of America RANGE HOOD WITH ELECTROSTATICALLY ASSISTED AIR FLOW AND Application WO-432022PROV FILTERING Filed 60/863,087 United States of America SPACE HEATER WITH ELECTROSTATICALLY ASSISTED HEAT TRANSFER AND METHOD OF ASSISTING HEAT TRANSFER IN HEATING Application WO-432023PROV DEVICES Filed 60/863,946 United States of America DESALINATION METHOD AND Application WO-432024PROV DEVICE Filed 60/864,591 United States of America METHOD OF AND APPARATUS FOR CLEANING AND Application WO-432025PROV DISINFECTION OF AIR Filed 60/865,130 United States of America AN ELECTROSTATIC FLUID ACCELERATOR FOR AND METHOD OF CONTROLLING A Application WO-432026PROV FLUID FLOW Filed 60/866,171 United States of America