Exhibit 10(t)

 

Execution Version

 

TRADEMARK SECURITY AGREEMENT

 

This Trademark Security Agreement (the “Agreement”), dated as of September 8,
2016 is made by K. HOV IP, II, INC., a California corporation (“the Grantor”) in
favor of Wilmington Trust, National Association, as Administrative Agent in its
capacity as collateral agent (in such capacity, the “Agent”) for the benefit of
itself and the Lenders (as defined below).

 

WHEREAS, K. Hovnanian Enterprises, Inc., a California corporation (the
“Borrower”), Hovnanian Enterprises, Inc., a Delaware corporation (“Holdings”),
and each of the other guarantors party thereto (the “Guarantors”) have entered
into the Credit Agreement dated as of July 29, 2016 (as amended, supplemented,
amended and restated or otherwise modified from time to time, the “Credit
Agreement”) with Wilmington Trust, National Association, as administrative agent
(in such capacity, the “Administrative Agent”), pursuant to which the Borrower
may borrow up to $75,000,000 in term loans (collectively, the “Loans”) upon the
terms and subject to the conditions set forth therein;

 

WHEREAS, the Borrower, Holdings, the Guarantors party thereto, the
Administrative Agent, the Mortgage Tax Collateral Agent, the First Lien Notes
Trustee and the First Lien Notes Collateral Agent have entered into the First
Lien Intercreditor Agreement dated as of September 8, 2016 (as amended,
supplemented, amended or restated or otherwise modified from time to time, the
“First-Lien Intercreditor Agreement”);

 

WHEREAS, the Term Loans constitute Super Priority Indebtedness under the
First-Lien Intercreditor Agreement;

 

WHEREAS, the Borrower, Holdings, the Guarantors party thereto, the
Administrative Agent, the First Lien Notes Collateral Agent, the First Lien
Notes Trustee, the Existing Second Lien Collateral Agent, the Existing Second
Lien Trustee, the New Second Lien Notes Collateral Agent, the New Second Lien
Notes Trustee, Wilmington Trust, National Association, as Junior Joint
Collateral Agent (as defined therein) and the Mortgage Tax Collateral Agent have
entered into the Amended and Restated Intercreditor Agreement dated as of
September 8, 2016 (as amended, supplemented, amended or restated or otherwise
modified from time to time, the “Amended and Restated Intercreditor Agreement”);

 

WHEREAS, the Borrower is a member of an affiliated group of companies that
includes Holdings, the Borrower’s parent company, and each other Guarantor;

 

 

 
 

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WHEREAS, the Borrower and the other Guarantors are engaged in related
businesses, and each Guarantor will derive substantial direct and indirect
benefit from the borrowing of Term Loans; and

 

WHEREAS, pursuant to and under the Credit Agreement and the Security Agreement
dated as of September 8, 2016 (the “Security Agreement”) among the Borrower,
Holdings, each of the signatories listed on Schedule A thereto (together with
any other entity that may become a party thereto) and the Agent, the Grantor has
agreed to enter into this Agreement in order to grant a security interest to the
Agent in certain Trademarks as security for such loans and other obligations as
more fully described herein.

 

NOW, THEREFORE, intending to be legally bound hereby, the parties hereto agree
as follows:

 

1.     Defined Terms. Except as otherwise expressly provided herein, (a)
capitalized terms used in this Agreement shall have the respective meanings
assigned to them in the Credit Agreement or the Security Agreement, as
applicable, and (b) the rules of construction set forth in Section 1.02 of the
Credit Agreement shall apply to this Agreement. Where applicable and except as
otherwise expressly provided herein or in the First-Lien Intercreditor
Agreement, terms used herein (whether or not capitalized) shall have the
respective meanings assigned to them in the Uniform Commercial Code as enacted
in New York as amended from time to time (the “Code”).

 

2.     To secure the full payment and performance of all Secured Obligations,
the Grantor hereby grants to the Agent a security interest in the entire right,
title and interest of such Grantor in and to all of its Trademarks, including,
without limitation, any of the foregoing referred to in Schedule A; provided,
however, that notwithstanding any of the other provisions set forth in this
Section 2 (and notwithstanding any recording of the Agent’s Lien made in the
U.S. Patent and Trademark Office, or other registry office in any other
jurisdiction), this Agreement shall not constitute a grant of a security
interest in (i) any property or assets constituting “Excluded Property” (as
defined in the Credit Agreement) or (ii) any property to the extent that such
grant of a security interest is prohibited by any applicable Law of an Official
Body, requires a consent not obtained of any Official Body pursuant to such Law
or is prohibited by, or constitutes a breach or default under or results in the
termination of or gives rise to any right of acceleration, modification or
cancellation or requires any consent not obtained under, any contract, license,
agreement, instrument or other document evidencing or giving rise to such
property, except to the extent that such Law or the term in such contract,
license, agreement, instrument or other document or similar agreement providing
for such prohibition, breach, default or termination or requiring such consent
is ineffective under applicable Law including 9-406, 9-407, 9-408 or 9-409 of
the New York UCC (or any successor provision or provisions); provided, further,
that no security interest shall be granted in any United States “intent-to-use”
trademark or service mark applications unless and until acceptable evidence of
use of the trademark or service mark has been filed with and accepted by the
U.S. Patent and Trademark Office pursuant to Section 1(c) or Section 1(d) of the
Lanham Act (U.S.C. 1051, et seq.), and to the extent that, and solely during the
period in which, the grant of a security interest therein would impair the
validity or enforceability of such “intent-to-use” trademark or service mark
applications under applicable federal Law. After such period and after such
evidence of use has been filed and accepted, the Grantor acknowledges that such
interest in such trademark or service mark applications will become part of the
Collateral. The Agent agrees that, at the Grantor’s reasonable request and
expense, it will provide such Grantor confirmation that the assets described in
this paragraph are in fact excluded from the Collateral during such limited
period only upon receipt of an Officer’s Certificate and an Opinion of Counsel
to that effect.

 

 

 
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3.     The Grantor covenants and warrants that:

 

(a) To the knowledge of the Grantor, on the date hereof, all material
Intellectual Property owned by the Grantor is valid, subsisting and unexpired,
has not been abandoned and does not, to the knowledge of the Grantor, infringe
the intellectual property rights of any other Person;

 

(b) The Grantor is the owner of each item of Intellectual Property listed on
Schedule A, free and clear of any and all Liens or claims of others except for
the Permitted Liens. The Grantor has not filed or consented to the filing of any
financing statement or other public notice with respect to all or any part of
the Collateral in any public office, except as contemplated by the Security
Agreement or as permitted by the Credit Agreement;

 

4.     The Grantor agrees that, until all of the Secured Obligations shall have
been indefeasibly satisfied in full, it will not enter into any agreement (for
example, a license agreement) which is inconsistent with Grantor’s obligations
under this Agreement, without the Agent’s prior written consent which shall not
be unreasonably withheld or delayed, except Grantor may license Intellectual
Property in the ordinary course of business without the Agent’s consent to
suppliers, agents, independent contractors and customers to facilitate the
manufacture and use of such Grantor’s products or services; and may otherwise
take those actions permitted by the Credit Agreement.

 

5.     All of the Agent’s rights and remedies with respect to the Intellectual
Property, whether established hereby, by the Security Agreement or by the Credit
Agreement or by any other agreements or by Law, shall be cumulative and may be
exercised singularly or concurrently. In the event of any irreconcilable
inconsistency in the terms of this Agreement and the Security Agreement, the
Security Agreement shall control.

 

6.     The provisions of this Agreement are severable, and if any clause or
provision shall be held invalid and unenforceable in whole or in part in any
jurisdiction, then such invalidity or unenforceability shall affect only such
clause or provision, or part thereof, in such jurisdiction, and shall not in any
manner affect such clause or provision in any other jurisdiction, or any clause
or provision of this Agreement in any jurisdiction.

 

 

 
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7.     The benefits and burdens of this Agreement shall inure to the benefit of
and be binding upon the respective successors and permitted assigns of the
parties; provided, however, that except as permitted by the Credit Agreement,
the Grantor may not assign or transfer any of its rights or obligations
hereunder or any interest herein and any such purported assignment or transfer
shall be null and void.

 

8.     This Agreement and the rights and obligations of the parties under this
Agreement shall be governed by, and construed and interpreted in accordance
with, the Law of the State of New York.

 

9.     The Grantor hereby irrevocably and unconditionally:

 

(a)     submits for itself and its property in any legal action or proceeding
relating to this Agreement, or for recognition and enforcement of any judgment
in respect thereof, to the non-exclusive general jurisdiction of the courts of
the State of New York, the courts of the United States of America for the
Southern District of New York, and appellate courts from any thereof;

 

(b)     consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;

 

(c)     agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to the Grantor at its
address referred to in Section 8.02 of the Security Agreement or at such other
address of which the Agent shall have been notified pursuant thereto;

 

(d)     agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction; and

 

(e)     waives, to the maximum extent not prohibited by law, any right it may
have to claim or recover in any legal action or proceeding referred to in this
Section any special, exemplary, punitive or consequential damages.

 

10.     This Agreement may be executed by one or more of the parties to this
Agreement on any number of separate counterparts (including by telecopy), and
all of said counterparts taken together shall be deemed to constitute one and
the same instrument.

 

 

 
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11.     THE GRANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY A
JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

 

12.     All notices, requests and demands to or upon the Agent or the Grantor
shall be effected in the manner provided for in Section 9.02 of the Credit
Agreement.

 

13.     In the performance of its obligations, powers and rights hereunder, the
Agent shall be entitled to the rights, benefits, privileges, powers and
immunities afforded to it as Administrative Agent under the Credit Agreement.
The Agent shall take or refrain from taking any discretionary action or exercise
any discretionary powers set forth in this Agreement in accordance with, and
subject to, the Credit Agreement. Notwithstanding anything to the contrary
contained herein and notwithstanding anything contained in Section 9-207 of the
New York UCC, the Agent shall have no responsibility for the creation,
perfection, priority, sufficiency or protection of any liens securing Secured
Obligations (including, but not limited to, no obligation to prepare, record,
file, re-record or re-file any financing statement, continuation statement or
other instrument in any public office). The permissive rights and authorizations
of the Agent hereunder shall not be construed as duties. The Agent shall be
entitled to exercise its powers and duties hereunder through designees,
specialists, experts or other appointees selected by it in good faith

 

[SIGNATURES APPEAR ON FOLLOWING PAGE]

 

 

 
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IN WITNESS WHEREOF, each of the undersigned has caused this Trademark Security
Agreement to be duly executed and delivered as of the date first above written.

 

WILMINGTON TRUST, NATIONAL ASSOCIATION as Agent

   

By:

/s/ Jeffrey Rose

  Name:   Jeffrey Rose   Title:     Vice President

 

 

Grantor:  

K. HOV IP, II, INC.

   

By:

/s/ David Bachstetter

  Name:    David Bachstetter   Title:      Vice President Finance and Treasurer

 

 

 
 [Signature Page to Super Priority IP Security Agreement]

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SCHEDULE A

LIST OF UNITED STATES REGISTERED AND APPLIED FOR TRADEMARKS

 

 

Trademark

Application No. / Registration No.

55 NEVER LOOKED SO GOOD

4035326

EVERY CORNER

86722536

FROM YOUR HOME TO OURS

3682068

HOME DESIGN GALLERY

3017498

HOVNANIAN ENTERPRISES

3782845

HOVNANIAN ENTERPRISES, INC. and Design

3786278

IF YOU'RE NOT 55, YOU'LL WISH YOU WERE

3564614

K HOVNANIAN HOMES and Design

3493815

K. HOVNANIAN

3579682

KHOV

2710008

KHOV.COM

2544720

LET'S BUILD IT TOGETHER

2965030

LIFE. STYLE. CHOICES.

2725754

LIVE COASTAL

86823726

M&M MATZEL & MUMFORD Design

3485602

MATZEL & MUMFORD

3071666

NATURE TECHNOLOGY EFFICIENCY and Design

4152642

NATURE TECHNOLOGY EFFICIENCY and Design

4204392

NATURE TECHNOLOGY EFFICIENCY

4116384

NATURE TECHNOLOGY EFFICIENCY

4116385

THE FIRST NAME IN LASTING VALUE

1418620

THE NAME BEHIND THE DREAM

3832465

WONDER HOMES

2671912

STYLESUITE

4126920

Design

2040802

BRIGHTON HOMES

2412033

BRIGHTON HOMES

2395356

 

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