Exhibit
10.3


 


PATENT
AND TRADEMARK SECURITY AGREEMENT


 


This PATENT AND TRADEMARK SECURITY AGREEMENT dated as of the 18th day
of June 2003, made by Photogen Technologies, Inc., a Nevada corporation, (the
“Grantor”) in favor of Xmark Fund, L.P., a Delaware limited partnership and
Xmark Fund, Ltd., a Cayman Islands corporation (collectively, the “Secured
Parties”).


 


WITNESSETH


 


WHEREAS, the Grantor and the Secured Parties have entered into a Going
Forward Agreement, dated as of May 2, 2003 (the “Going Forward Agreement”).


 


WHEREAS, the Grantor and Alliance Pharmaceutical Corp., a New York
corporation (“Alliance”), are entering into an Asset Purchase Agreement, dated
as of June 10, 2003, pursuant to which, as of the date of the closing of the
transactions contemplated therein (the “Closing Date”), Alliance shall sell,
transfer and assign its property and assets relating to the Product (as defined
below).


 


WHEREAS, the Grantor has agreed to grant to the Secured Parties a
security interest in certain of its property and assets relating to the Product
as of the Closing Date to secure the performance of the obligations of the
Grantor under the Going Forward Agreement; and


 


WHEREAS, the Grantor is contemporaneously entering into a Security
Agreement with the Secured Parties.


 


NOW, THEREFORE, in consideration of the premises set forth above the
Grantor hereby agrees with the Secured Parties as follows:


 


TERMS


 


1.                                       Defined
Terms.  The terms set forth below
have the following meanings:


 


“Code” means the Uniform Commercial Code as from time to time in
effect in the State of New York.


 


“Collateral” shall have the meaning assigned to it in Section 2
of this Patent and Trademark Security Agreement.


 


“Event of Default” means:


 


1.                                       the failure by
the Grantor to perform in any material respect any obligation of the Grantor
under this Patent and Trademark Security Agreement as and when required by this
Patent and Trademark Security Agreement; or


 


2.                                       any
representation or warranty made by the Grantor pursuant to this Patent and
Trademark Security Agreement is untrue in any material respect when made; or


 


3.                                       the failure by
the Grantor to perform in any material respect any obligation of the Grantor
under the Security Agreement as and when required by the Security Agreement; or


 


4.                                       any representation
or warranty made by the Grantor pursuant to the Security Agreement is untrue in
any material respect when made; or


 

















 


5.                                       the security
interests granted herein and pursuant to the Security Agreement do not
constitute for any reason a first priority perfected security interest in the
Collateral covered thereby (other than as a result of a failure to make the
filings specified in Exhibit C, D and E of this Patent and Trademark Security
Agreement); or


 


6.                                       the Grantor
shall file a petition under bankruptcy, insolvency or debtor’s relief law or
make an assignment for the benefit of its creditors; or


 


7.                                       a court of
competent jurisdiction enters an order or decree under any federal or state
bankruptcy law that (X) is for relief against the Grantor in an involuntary
case brought with respect to the Grantor in such court, (Y) appoints a
custodian, receiver or other similar official for all or substantially all the
Grantor’s property or (Z) orders the liquidation of the Grantor, and the order
or decree remains unstayed and in effect for 60 days; or


 


8.                                       any
representation or warranty made by the Grantor pursuant to the Going Forward
Agreement is untrue in any material respect when made; or


 


9.                                       failure of the
Grantor to pay any Obligation when due or to perform in any material respect
any other obligation of the Grantor under the Going Forward Agreement as and
when required by the Going Forward Agreement; or


 


10.                                 the loss or suspension
of the Food and Drug Administration approval relating to the Product; or


 


11.                                 the Grantor shall fail
to pay when due (after the expiration of any cure period provided by agreements
governing the obligation) any principal of, premium or interest on or any
amount payable in respect of any borrowed money indebtedness; or


 


12.                                 the failure by the
Grantor to perform in any material respect any obligation of the Grantor under
those certain Notes made by the Grantor in favor of the Secured Parties of even
date herewith (the “Notes”).


 


“General Intangibles” shall have the meaning ascribed such term
under the Code.


 


“License Rights” shall mean any Grantor rights that were
obtained through the grant, by the Grantor, of rights to a third party under
the Product Patents or Product Trademarks.


 


“Lien” shall mean any lien, mortgage, security interest, chattel
mortgage, pledge or other encumbrance (statutory or otherwise) of any kind
securing satisfaction or performance of an obligation, including any agreement
to give any of the foregoing, any conditional sales or other title retention
agreement, any lease in the nature thereof, and the filing of or the agreement
to give any financing statement under the Code of any jurisdiction or similar
evidence of any encumbrance, whether within or outside the United States.


 


“Obligations” shall mean:


 


(1)                                  all obligations and
liabilities to the Secured Parties, whether now existing or hereafter arising,
under the Going Forward Agreement (including, without limitation, the payment
obligations under Section 2(b)(i) of the Going Forward Agreement and pursuant
to the Put Right (as defined in the Going Forward Agreement)), the Security
Agreement, this 


 


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Patent and Trademark Security Agreement, the Notes and/or any document
or agreement related to any of the foregoing and the due performance and
compliance with the terms of the Going Forward Agreement, the Security
Agreement, this Patent and Trademark Security Agreement, the Notes and/or any
document or agreement related to any of the foregoing;


 


(2)                                  any and all sums
advanced by the Secured Parties in order to preserve the Collateral or to
preserve the Secured Parties’ security interest in the Collateral; and


 


(3)                                  in the event of any
proceeding for the collection or enforcement of any obligations or liabilities
of the Grantor referred to in the immediately preceding clauses (1) through (2)
in accordance with the terms of the Going Forward Agreement, this Security
Agreement, the Patent and Trademark Security Agreement, the Notes and/or any
document or agreement related to the foregoing, the expenses of re-taking,
holding, preparing for sale, selling or otherwise disposing of or realizing on
the Collateral, or of any other exercise by the Secured Parties of their rights
hereunder, together with reasonable attorneys’ fees and court costs.


 


“Patent and Trademark Security Agreement” means this Patent and
Trademark Security Agreement, including all amendments, supplements or
modifications that are agreed to in writing by the parties.


 


“Proceeds” shall have the meaning assigned to such term under
the Code.


 


“Product” means Imagent®, a sterile, non-pyrogenic
white powder with a diluted perflexane headspace that, after reconstitution
into a suspension of microspheres, is used for contrast enhancement during the
indicated ultrasound imaging procedures and is indicated for use in patients
with suboptimal echocardiograms to opacify the left ventricular chamber and to
improve the delineation of the left ventricular endocardial border.


 


“Product Patent(s)” means all letters patent of the United
States and foreign jurisdictions, including any and all extensions, reissues,
re-examinations and renewals thereof, that are now owned by the Grantor or are
acquired by the Grantor during the term of this Patent and Trademark Security
Agreement, and are necessary or beneficial for the use, development,
manufacture, marketing, sale or distribution of the Product, and all letters
patent of the United States or foreign jurisdictions that issue from Product
Patent Applications, including, but not limited to:


 


(1)                                  all
letters patent of the United States or any foreign jurisdiction listed in Exhibit A
hereto or added thereto by written agreement of the parties during the term of
this Patent and Trademark Security Agreement; and


 


(2)                                  all
letters patent of the United States or any foreign jurisdiction that claim
know-how that is now owned by the Grantor or that is acquired by the Grantor
during the term of this Patent and Trademark Security Agreement (“Grantor
Know-How”) and are necessary or beneficial for the use, development,
manufacture, marketing, sale or distribution of the Product.


 


Provided, that the term Product Patent does
not include claims under the Product Patents that do not relate to the Product,
are not necessary for the use, development, manufacture, marketing, sale or
distribution of the Product, and are, as a condition to the consummation of the



 


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transactions contemplated by the Asset Purchase Agreement, licensed by
Photogen to Alliance pursuant to a license agreement of even date herewith.


 


“Product Patent Application(s)” means all applications for
letters patent of the United States or foreign jurisdictions, including any and
all provisionals, continuations, continuations-in-part and divisionals that
claim inventions, discoveries or technology that is now owned by the Grantor or
is acquired by the Grantor during the term of this Patent and Trademark Service
Agreement, and are necessary or beneficial for the use, development, manufacture,
marketing, sale or distribution of the Product, including, but not limited to:


 


(1)                                  all
applications for letters patent of the United States or any foreign
jurisdiction listed in Exhibit A hereto or added thereto by
written agreement of the parties during the term of this Patent and Trademark
Agreement; and


 


(2)                                  all
applications for letters patent of the United States or any foreign
jurisdiction that claim Grantor Know-How and are necessary or beneficial for
the use, development, manufacture, marketing, sale or distribution of the
Product.


 


“Product Trademarks” means all United States and foreign
jurisdiction trademarks, trade names, corporate names, company names, business
names, fictitious business names, trade styles, service marks, logos and other
source or business identifiers of the Grantor that are now owned by the Grantor
or are acquired by the Grantor during the term of this Patent and Trademark
Security Agreement, whether currently in use or not, and are adopted solely for
use in conjunction with the sale of the Product, including, without limitation,
those listed on Exhibit B and the goodwill associated therewith, all
registrations and recordings thereof.


 


“Product Trademark Applications” means all applications for
registration of all United States and foreign jurisdiction trademarks, trade
names, corporate names, company names, business names, fictitious business
names, trade styles, service marks, logos and other source or business
identifiers of the Grantor that are now owned by the Grantor or are acquired by
the Grantor during the term of this Patent and Trademark Security Agreement,
whether currently in use or not and which will, upon registration thereof, be
adopted solely for use in conjunction with the sale of the Product, including,
without limitation, those listed on Exhibit B.


 


“Security Agreement” means that certain Security Agreement,
dated as of the date hereof, between the Grantor and the Secured Parties.


 


2.                                       Grant
of Security Interest.  As collateral
security for the prompt and complete payment and performance when due of the
Obligations, the Grantor hereby grants to the Secured Parties a continuing
first priority security interest in all of the following property now or
hereafter owned by the Grantor, and/or in which the Grantor has or acquires, at
any time during the term of this Patent and Trademark Security Agreement, an
unrestricted right, title or interest:


 


All Product Patents and Product Patent Applications; all Product
Trademarks together with any good will of the business associated with the use
of such Product Trademarks; all License Rights and all Accounts (as defined in
the Code), contract rights and General Intangibles arising under or relating to
said License Rights and to the extent not otherwise included, all products and
proceeds of any and all of the foregoing (collectively, the “Collateral”).


 


3.                                       Representations
and Warranties.  The Grantor hereby
represents and warrants that:


 


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(a)                                  Title;
No Other Liens.  Except for the Lien
granted to the Secured Parties pursuant to this Patent and Trademark Security
Agreement and the Lien granted to the Secured Parties pursuant to the terms of
the Security Agreement and the GSW Ownership Rights (as defined in the Security
Agreement), the Grantor solely owns each item of the Collateral free and clear
of any and all Liens or claims of others. 
No security agreement, financing statement or other public notice with
respect to all or any part of the Collateral is on file or of record in any
public office, except such as may have been filed in favor of the Secured
Parties pursuant to this Patent and Trademark Security Agreement or the
Security Agreement.


 


(b)                                 Perfected
First Priority Liens.  The Liens
granted pursuant to this Patent and Trademark Security Agreement will
constitute upon the completion of all the filings or notices listed in Exhibit C
hereto, which Exhibit includes all UCC-1 financing statements to be filed
pursuant to the terms of the Security Agreement, and all requisite filings to
be made with the U.S. Patent and Trademark Office in the form substantially
similar to that of Exhibit D and Exhibit E, perfected Liens on
all Collateral, which are prior to all other Liens on such Collateral and which
are enforceable as such against all creditors of the Grantor.


 


(c)                                  Chief
Executive Office.  The Grantor’s
chief executive office and chief place of business is located at 140 Union
Square Drive, New Hope, PA 18938.


 


(d)                                 Authority.  The Grantor has full power, authority and
legal right to enter into this Patent and Trademark Security Agreement and to
grant the Secured Parties the Lien on the Collateral pursuant to this Patent
and Trademark Security Agreement.


 


(e)                                  Due
Execution and Delivery.  This Patent
and Trademark Security Agreement has been duly executed and delivered by the
Grantor and constitutes a legal, valid and binding obligation of the Grantor
enforceable in accordance with its terms.


 


(f)                                    No
Violation.  The execution, delivery
and performance of this Patent and Trademark Security Agreement will not
violate any provision of any applicable law or regulation or of any order,
judgment, writ, award or decree of any court, arbitrator or governmental
authority, domestic or foreign, or of any securities issued by the Grantor, or
of any mortgage, indenture, lease, contract or other agreement, instrument or
undertaking to which the Grantor is a party or which purports to be binding
upon the Grantor or upon any of its assets and will not result in the creation
or imposition of any Lien on any of the assets of the Grantor except as
contemplated by this Patent and Trademark Security Agreement and the Security
Agreement.


 


(g)                                 No
Consent or Approval.  No consent,
filing, approval, registration, recording, or other action is required (x) for
the grant by the Grantor of the Lien on the Collateral pursuant to this Patent
and Trademark Security Agreement or for the execution, delivery or performance
of this Patent and Trademark Security Agreement by the Grantor, or (y) to
perfect the Lien purported to be created by this Patent and Trademark Security
Agreement.


 


(h)                                 Validity
of Collateral.  To the knowledge of
the Grantor, all of the Collateral is subsisting and is valid.


 


(i)                                     Organization.  The Grantor is a corporation duly organized,
validly existing and in good standing under the laws of the State of Nevada and
duly qualified and in good standing in 


 


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every other state or
jurisdiction in which the nature of the Grantor’s business or the ownership of
its assets requires such qualification, except where the failure to be so
qualified would not have a material adverse effect on the Grantor or the
Collateral.


 


4.                                       Covenants.  The Grantor covenants and agrees with the
Secured Parties that from and after the date of this Patent and Trademark
Security Agreement until the payment or performance in full by the Grantor of
all of its Obligations:


 


(a)                                  Further
Documentation.  At any time and from
time to time, upon the written request of the Secured Parties, and at the sole
expense of the Grantor, the Grantor will promptly and duly execute and deliver
such further instruments and documents and take such further action as the
Secured Parties may request for the purpose of obtaining or preserving the full
benefits of this Patent and Trademark Security Agreement and of the rights and
powers herein granted, including, without limitation, the filing of any
financing or continuation statements under the Code in effect in any such
jurisdiction with respect to the Liens created hereby.  The Grantor also hereby authorizes the
Secured Parties to file any such financing or continuation statement without
the signature of the Grantor to the extent permitted by applicable law. A
carbon, photographic or other reproduction of this Patent and Trademark
Security Agreement shall be sufficient as a financing statement for filing in
any jurisdiction.


 


(b)                                 Indemnification.  The Grantor agrees to pay, and to save the
Secured Parties and each Secured Party harmless from, any and all liabilities,
costs and expenses (including, without limitation, legal fees and expenses) (i)
with respect to, or resulting from, any delay in paying, any and all excise,
sales or other taxes which may be payable or determined to be payable with
respect to any of the Collateral, (ii) with respect to, or resulting from, any
delay by the Grantor in complying with any law or regulation applicable to any
of the Collateral or (iii) in connection with any action taken by the Secured
Parties in exercising its rights under this Patent and Trademark Security
Agreement.


 


(c)                                  Maintenance
of Records.  The Grantor will keep
and maintain at its own cost and expense satisfactory and complete records of
the Collateral.  The Grantor hereby
grants to the Secured Parties access to all of the Grantor’s books and records
pertaining to the Collateral, and the Grantor shall turn over any such books
and records for inspection at the office of the Grantor to the Secured Parties
or to their representatives during normal business hours at the request of the
Secured Parties.


 


(d)                                 Limitation
on Liens on Collateral.  Except as
provided in paragraph (f) below, the Grantor will not create, incur or permit
to exist, will defend at its own expense the Collateral against, and will take
such other action as is necessary to remove, any Lien or claim on or to the
Collateral, and will defend the right, title and interest of the Secured
Parties in and to any of the Collateral against the claims and demands of all
persons whomsoever.


 


(e)                                  Limitations
on Dispositions of Collateral.  The
Grantor will not sell, transfer, or assign any of the Collateral, or attempt,
offer or contract to do so without express, written agreement by the Secured
Parties, such consent not to be unreasonably withheld.


 


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(f)                                    Limitations
on Licensing of the Collateral. 
Grantor may execute non-exclusive, revocable licenses to Product Patents
and Product Trademarks, and may disclose the contents of Product Patent
Applications under fully executed confidentiality agreements, only upon prior
written notice to Secured Parties and only when the execution of such license
is reasonably unlikely to (i) diminish the value of the Collateral, (ii) have a
material impact on the rights of the Secured Parties and (iii) otherwise
reasonably be considered to have a material adverse effect on the security
interest granted to the Secured Parties in the Collateral in Section 2 of this
Patent and Trademark Security Agreement (the “Security Interest”).  Any and all such licenses shall contain
provisions that enable the Secured Parties, at their discretion, to revoke such
Product Patent and/or Product Trademark licenses when the Secured Parties have
a reasonable belief that their rights are being adversely effected.


 


(g)                                 Further
Identification of Collateral.  The
Grantor will furnish to the Secured Parties from time to time, upon the request
of the Secured Parties, statements and schedules further identifying and
describing the Collateral and such other reports in connection with the
Collateral as the Secured Parties may reasonably request, all in reasonable
detail.


 


(h)                                 Notices.  The Grantor will advise the Secured Parties
promptly, in reasonable detail, at its address set forth in accordance with
Section 13 hereof, (i) of any Lien on, or claim asserted against, any of the
Collateral, other than as created hereby or as permitted hereby, and (ii) of
the occurrence of any other event which could reasonably be expected to have a
material adverse effect on the Collateral or on the Liens created hereunder.


 


(i)                                     Patents.


 


(i)                                     The
Grantor will, at Grantor’s expense, take commercially reasonable steps to
monitor and manage its portfolio of Product Patents and Product Patent
Applications, and will notify the Secured Parties immediately if it knows that
any application relating to any Product Patent or Product Patent Application
may become abandoned or of any adverse determination or development (including,
without limitation, the institution of, or any such determination or development
in, any proceeding in the United States Patent and Trademark Office or any
court or tribunal in any country) regarding the patentability of any Product
Patent Application, the validity or enforceability of any Product Patent or
Grantor’s ownership of any Product Patent or Product Patent Application.


 


(ii)                                  The
Grantor will, at Grantor’s expense, with respect to any Product Patent that the
Grantor obtains after the date hereof, promptly (i) take all actions necessary
so that the Secured Parties shall obtain a perfected Security Interest in such
Product Patent and (ii) provide to the Secured Parties updated versions of Exhibit A,
listing all Product Patents and all License Rights in which Grantor has an
interest.  With respect to this
paragraph 4(i)(ii), an Event of Default is “continuing” if, after a period of
30 days following issuance of any Product Patent, the Grantor has not provided
notice thereof to the Secured Parties.


 


(iii)                               The
Grantor will, at Grantor’s expense, with respect to any Product Patent
Application that the Grantor obtains after the date hereof, promptly (i) take
all actions 


 


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necessary so
that the Secured Parties shall obtain a perfected Security Interest in such
Product Patent and (ii) provide to the Secured Parties updated versions of
Exhibit A listing all such Product Patent Applications.  With respect to this paragraph 4(i)(iii), an
Event of Default is continuing if after a period of 30 days following receipt
of a filing receipt that identifies the serial number thereof, Grantor has not
provided notice thereof to the Secured Parties.


 


(iv)                              Upon
request of the Secured Parties, the Grantor shall execute and deliver any and
all agreements, instruments, documents, and papers as the Secured Parties may
request to evidence the Secured Parties’ Security Interest in any or all
Product Patents or Product Patent Applications.


 


(v)                                 The
Grantor will, at its own expense, take all commercially reasonable steps,
including, without limitation, those required in any proceeding before the
United States Patent and Trademark Office, to reasonably maintain and pursue
each Product Patent and Product Patent Application including, without
limitation, payment of maintenance and other fees.


 


(vi)                              In
the event that the Grantor believes that any Product Patent included in the
Collateral has been infringed by a third party, the Grantor shall, within 20
days of forming a belief that the Collateral is being infringed by a third
party, obtain a legal opinion from outside counsel and notify the Secured
Parties of such infringement and shall, if appropriate in the Grantor’s sole
discretion, at its own expense, sue for infringement, seeking injunctive relief
where appropriate and to recover any and all damages for such infringement, or
take such other actions as the Grantor shall reasonably, in its sole
discretion, deem appropriate under the circumstances to protect such
Patent.  In the event Grantor declines
to pursue infringement claims, the Secured Parties shall have the right to
pursue such claims pursuant to the powers granted in Section 6 hereof.


 


(j)                                     Trademarks.


 


(i)                                     The
Grantor will, with respect to each Product Trademark identified in Exhibit B
hereto as it may be amended, supplemented or otherwise modified from time to
time, take reasonable steps to monitor its portfolio of trademarks, and for
each Product Trademark set forth on Exhibit B, the Grantor will (i) continue to
use or have used such Product Trademark to the extent necessary to maintain
such Product Trademark in full force free from any claim of abandonment for
non-use, (ii) maintain as in the past the quality of products and services
offered under such Product Trademark to the extent appropriate, (iii) employ
such Product Trademark with the appropriate notice of registration, (iv) not
adopt or use any mark which is confusingly similar or a colorable imitation of
such Product Trademark unless the Secured Parties shall obtain a first priority
perfected Security Interest in the Company’s interest in such mark pursuant to
this Patent and Trademark Security Agreement, and (v) not do any act or
knowingly omit to do any act whereby any such Product Trademark may become
invalidated, abandoned, rendered unenforceable or otherwise diminish Grantor’s
rights therein.


 


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(ii)                                  The
Grantor will promptly notify the Secured Parties if any application or
registration relating to any Product Trademark may become opposed, abandoned,
canceled or dedicated to the public, or of any adverse determination or
development (including, without limitation, the institution of, or any such
determination or development in, any proceeding in the United States Patent and
Trademark Office or any court or tribunal in any country) regarding the
validity, enforceability or Grantor’s ownership interest in such Product
Trademark; or its right to register the same or to keep and maintain the same.


 


(iii)                               The
Grantor will, at Grantor’s expense, with respect to any Product Trademark or
Product Trademark Application that is registered or for which an application
for registration is filed after the date hereof, promptly (i) take all actions
necessary so that the Secured Parties shall obtain a perfected Security
Interest in such Product Trademark or Product Trademark Application and (ii)
provide to the Secured Parties an updated version of Exhibit B listing all
registered Product Trademarks and Product Trademark Applications in which the
Grantor has an interest.  With respect
to this paragraph 4(j)(iii), an Event of Default is continuing if after a
period of 30 days following the mailing of the Certificate of Registration or
30 days following receipt of a filing receipt that identifies the serial number
thereof, Grantor has not provided notice thereof to the Secured Parties.


 


(iv)                              Upon
request of the Secured Parties, the Grantor shall execute and deliver any and
all agreements, instruments, documents, and papers as the Secured Parties may
request to evidence the Secured Parties’ Security Interest in any Product
Trademark set forth on Exhibit B and the goodwill and general
intangibles of the Grantor relating thereto or represented thereby, and the
Grantor hereby constitutes the Secured Parties their 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 Grantor shall have paid and performed in full
all of its obligations under the Going Forward Agreement.


 


(v)                                 The
Grantor will, at Grantor’s expense, take all reasonable and necessary steps,
including, without limitation, in any proceeding before the United States
Patent and Trademark Office to maintain and pursue each Product Trademark
Application (and to obtain the relevant registration) and to maintain the
registration of the Product Trademarks, including, without limitation, filing
of applications for renewal, affidavits of use and affidavits of
incontestability.


 


(vi)                              In
the event that Grantor believes that any Product Trademark included in the
Collateral has been infringed, misappropriated or diluted by a third party, the
Grant shall, within 10 days of forming such belief, send a written notice to
such third party demanding that they cease such infringement, misappropriation
or dilution, and the Grantor shall notify the Secured Parties and, if
appropriate in Grantor’s sole discretion, at its own expense, sue for
infringement, misappropriation or dilution, seeking injunctive relief where
appropriate and to recover any and all damages for such infringement,
misappropriation or dilution, or take such other action as the Grantor
reasonably, in its sole discretion, deems appropriate under the circumstances
to protect such Trademark.


 


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With respect
to this paragraph, an Event of Default is continuing if a copy of any written
notice of infringement, misappropriation or dilution is not been provided to
the Secured Parties within 20 days following the date such communication was
supposed to have been provided to the infringing party.  In the event Grantor declines to pursue
infringement claims, the Secured Parties shall have the right to pursue such
claims pursuant to the powers granted in Section 6 hereof.


 


(k)                                  Changes
in Locations, Name, Etc.  The
Grantor will not (i) change the location of its chief executive office/chief
place of business from that specified in Section 3(d) hereof or (ii) change its
name, identity or corporate structure to such an extent that any statement
filed by the Secured Parties with the Patent and Trademark Office in connection
with this Patent and Trademark Security Agreement would become misleading,
unless it shall have given the Secured Parties at least 30 days prior written
notice thereof and, prior to such action or event, shall have taken appropriate
action to preserve and protect the Secured Parties’ Security Interest under
this Patent and Trademark Security Agreement.


 


5.                                       Performance
by Secured Parties of Grantor’s Obligations.  If the Grantor fails to perform or comply with any of its
agreements contained herein and the Secured Parties, as provided for by the
terms of this Patent and Trademark Security Agreement and following reasonable
written notice to the Grantor, shall itself perform or comply, or otherwise
cause performance or compliance, with such agreements, the expenses of the
Secured Parties incurred in connection with such performance or compliance
shall be payable by the Grantor to the Secured Parties on demand and shall constitute
Obligations secured hereby.


 


6.                                       Secured
Parties’ Appointment as Attorney-in-Fact.


 


(a)   The Grantor hereby irrevocably constitutes
and appoints the Secured Parties and any officer or agent thereof, with full
power of substitution, as its true and lawful attorney-in-fact with full
irrevocable power and authority in the place and stead of the Grantor and in
the name of the Grantor or in its own name, from time to time in the Secured
Parties’ discretion, for the purposes of carrying out the terms of this Patent
and Trademark Security Agreement, to take any and all appropriate action and to
execute any and all documents and instruments which may be necessary or
desirable to accomplish the purposes of this Patent and Trademark Security
Agreement and, without limiting the generality of the foregoing, hereby gives
the Secured Parties the power and right, upon the occurrence and continuance of
an Event of Default, on behalf of the Grantor to do the following:


 


(i)  to ask, demand, collect, receive and give acquittances
and receipts for any and all moneys due and to become due under any License
Rights and, in the name of the Grantor or its own name or otherwise, to take
possession of and endorse and collect any checks, drafts, notes, acceptances or
other instruments for the payment of moneys due under any License Rights and to
file any claim or to take any other action or proceeding in any court of law or
equity or otherwise deemed appropriate by the Secured Parties for the purpose
of collecting any and all such moneys due under any License Rights whenever
payable;


 


(ii)   to pay or discharge taxes, liens, security
interests or other encumbrances levied or placed on or threatened against the
Collateral, to effect any repairs or 


 


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any insurance called for by the
terms of this Patent and Trademark Security Agreement and to pay all or any
part of the premiums therefor and the costs thereof; and


 


(iii)  to direct any party liable for any payment
under any of the License Rights to make payment of any and all moneys due and
to become due thereunder directly to the Secured Parties or as the Secured
Parties shall direct;


 


(iv)  to receive payment of and receipt for any
and all moneys, claims and other amounts due and to become due at any time in
respect of or arising out of any Collateral;


 


(v)  to commence and prosecute any suits, actions
or proceedings at law or in equity in any court of competent jurisdiction to
collect the Collateral or any part thereof and to enforce any other right in
respect of any Collateral including, without limitation, infringement suits
against third parties;


 


(vi)  to defend any suit, action or proceeding
brought against the Grantor with respect to any Collateral;


 


(vii)  to settle, compromise, or adjust any suit,
action or proceeding described above and, in connection therewith, to give such
discharges or releases as the Secured Parties may deem appropriate;


 


(viii)
generally to sell, transfer, pledge, make any agreement with respect to or otherwise
deal with any of the Collateral as fully and completely as though the Secured
Parties were the absolute owner thereof for all purposes, and to do, at the
Secured Parties’ option all acts and things which the Secured Parties deems
necessary to protect, preserve or realize upon the Collateral and the Secured
Parties’ Security Interest therein, in order to effect the intent of this
Patent and Trademark Security Agreement, all as fully and effectively as the
Grantor might do; and


 


(ix) take such
actions and make such filings with the U.S. Patent and Trademark Office and any
foreign jurisdictions as are necessary to protect the Collateral.


 


(b)   This power of attorney is a power coupled
with an interest and shall be irrevocable. Notwithstanding the foregoing, the
Grantor further agrees to execute any additional documents which the Secured
Parties may require in order to confirm this power of attorney, or which the
Secured Parties may deem necessary to enforce any of its rights contained in
this Patent and Trademark Security Agreement.


 


(c)   The powers conferred on the Secured Parties
hereunder are solely to protect its interests in the Collateral and shall not
impose any duty upon it to exercise any such powers. The Secured Parties shall
be accountable only for amounts that it actually receives as a result of the
exercise of such powers and neither it nor any of its officers, directors,
employees or agents shall be responsible to the Grantor for any act or failure
to act, except for its own gross (not mere) negligence or willful misconduct.


 


(d)   The Grantor also authorizes the Secured
Parties to execute, in connection 


 


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with the sale provided for in
paragraph 6 of this Patent and Trademark Security Agreement, any endorsements,
assignments or other instruments of conveyance or transfer with respect to the
Collateral.


 


7.                                       Remedies.  If an Event of Default (i) has occurred and
has continued for a period of 30 consecutive days without cure by the Grantor
with respect to items 1, 2, and 3 set forth in the definition of Event of
Default (expect, with respect to paragraphs 4(k) or 6(d) of the Security
Agreement, such period shall be reduced to five (5) consecutive days), or (ii)
has occurred and is continuing with respect all other items set forth in the
definition of Event of Default, the Secured Parties may exercise, in addition
to all other rights and remedies granted to it in this Security Agreement and
in any other instrument or agreement securing, evidencing or relating to the
Obligations, all rights and remedies of a secured party under the Code.  Without limiting the generality of the
foregoing, the Secured Parties, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law referred to below or expressly provided for) to or upon the
Grantor or any other Person (all and each of which demands, defenses,
advertisements and notices are, to the extent permitted by applicable law, hereby
waived), may in such circumstances forthwith collect, receive, appropriate and
realize upon the Collateral, or any part thereof, and/or may forthwith sell,
license, assign, give option or options to purchase, or otherwise dispose of
and deliver the Collateral or any part thereof (or contract to do any of the
foregoing), at public or private sale or sales, at any exchange, broker’s board
or office of the Secured Parties or elsewhere upon such terms and conditions as
it may deem advisable and at such prices as it may deem best, for cash or on
credit or for future delivery without assumption of any credit risk.  The Secured Parties shall have the right
upon any such public sale or sales, and, to the extent permitted by law, upon
any such private sale or sales, to purchase the whole or any part of the
Collateral so sold, free of any right or equity of redemption in the Grantor,
which right or equity is hereby waived, to the extent permitted by applicable
law, or released.


 


8.                                       Severability.  Any provision of this Patent and Trademark
Security Agreement which is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof, and any such prohibition or unenforceability in any jurisdiction shall
not invalidate or render unenforceable such provision in any other
jurisdiction.


 


9.                                       Paragraph
Headings.  The paragraph headings
used in this Patent and Trademark Security Agreement are for convenience of
reference only and are not to affect the construction hereof or be taken into
consideration in the interpretation hereof.


 


10.                                 Cumulative
Remedies.  The rights and remedies
provided herein and in the Going Forward Agreement may be exercised singly or
concurrently and are not exclusive of any rights or remedies provided by law or
in equity or by statute.


 


11.                                 Waivers
and Amendments; Successors and Assigns. 
None of the terms or provisions of this Patent and Trademark Security
Agreement may be waived, amended, supplemented or otherwise modified except by
a written instrument executed by the party to be charged with enforcement. No
course of dealing between the Grantor and the Secured Parties nor any delay in
exercising or failure to exercise any rights, power or privilege under this
Patent and 


 


12

















 


Trademark Security Agreement
shall operate as a waiver.  This Patent
and Trademark Security Agreement shall be binding upon the successors and assigns
of the Grantor and shall inure to the benefit of the Secured Parties and their
successors and assigns. The Grantor may not assign its rights or obligations
under this Patent and Trademark Security Agreement without the prior written
consent of the Secured Parties.


 


12.                                 Termination
of Security Interest; Release of Collateral.  Upon the payment and performance in full by the Grantor of its
Obligation, the Security Interest shall terminate and all rights to the
Collateral shall revert to the Grantor.


 


13.                                 Notices.  Any notices required or permitted to be
given under the terms of this Agreement shall be in writing and shall be sent
by mail, personal delivery, telephone line facsimile transmission or courier
and shall be effective five days after being placed in the mail, if mailed, or
upon receipt, if delivered personally, by telephone line facsimile transmission
or by courier, in each case addressed to a party at such party’s address (or
telephone line facsimile transmission number) shown below or such other address
(or telephone line facsimile transmission number) as a party shall have
provided by notice to the other party in accordance with this provision. In the
case of any notice to the Grantor, such notice shall be addressed to the
Grantor at 140 Union Square Drive, New Hope, PA 18938, Attention: Chief
Financial Officer (telephone line facsimile number (215) 862-7139), and a copy
shall also be given to: Epstein, Becker & Green, P.C., 111 Huntington
Avenue, Boston, MA 02199, Attention: Susan E. Pravda, Esq. (telephone line
facsimile transmission number (617) 342-4001), and in the case of any notice to
the Secured Parties, such notice shall be addressed to the Secured Parties
Xmark Fund, L.P. and Xmark Fund, Ltd., 152 West 57th Street, 21st Floor, New York,
New York  10019, Attention: Mitchell D.
Kaye (telephone line facsimile transmission number (212) 247-1329), and a copy
shall be given to: Lowenstein Sandler PC, 65 Livingston Avenue, Roseland, New
Jersey 07068 Attention: John D. Hogoboom, Esq. (telephone line facsimile
transmission number (973) 597-2383).


 


14.                                 Integration.  This Patent and Trademark Security Agreement
represents the agreement of the Grantor and the Secured Parties with respect to
the subject matter hereof, and there are no promises, undertakings,
representations or warranties by the Secured Parties relative to subject matter
hereof not expressly set forth or referred to herein.


 


15.                                 Governing
Law.  This Patent and Trademark
Security Agreement and the rights and obligations of the Grantor and the
Secured Parties under this Patent and Trademark Security Agreement shall be
governed by, and construed and interpreted in accordance with, the law of the
State of New York, except to the extent that under the New York Uniform
Commercial Code the laws of another jurisdiction govern matters of perfection
and the effect of perfection or non-perfection of any Security Interest granted
hereunder, and except to the further extent that the United States patent and
trademark laws are applicable.


 


16.                                 Counterparts.  This Patent and Trademark Security Agreement
may be executed in counterparts and by the parties hereto on separate
counterparts, each of which shall be deemed to be an original and all of which
together shall constitute one and the same instrument.  A telephone line facsimile transmission of
this Patent and Trademark Security Agreement bearing a signature on behalf of a
party hereto shall be legal and binding on such party.


 


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17.                                 Waiver
of Jury Trial.  To the extent
permitted by applicable law, each of the Grantor and the Secured Parties waives
any right to have a jury participate in resolving any dispute, whether sounding
in contract, tort, or otherwise between the parties hereto arising out of, connected
with, related to, or incidental to the relationship between any of them in
connection with this Security Agreement or the transactions contemplated
hereby.  Instead, any such dispute
resolved in court will be resolved in a bench trial without a jury, submitted
to jurisdiction in the Southern District of New York and New York State Courts
located in the County of New York.


 


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


 


	
   

  	
  PHOTOGEN TECHNOLOGIES, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Brooks Boveroux

  	
   

  
	
   

  	
   

  	
  Name: Brooks Boveroux

  
	
   

  	
   

  	
  Title: Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
  ACKNOWLEDGED AND AGREED:

  
	
   

  
	
  XMARK FUND, L.P.

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Mitchell D. Kaye

  	
   

  
	
   

  	
  Name: Mitchell D. Kaye

  
	
   

  	
  Title: Chief Investment Officer

  
	
   

  	
   

  
	
   

  
	
  ACKNOWLEDGED AND AGREED:

  
	
   

  
	
  XMARK FUND, LTD.

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Mitchell D. Kaye

  	
   

  
	
   

  	
  Name: Mitchell D. Kaye

  
	
   

  	
  Title: Chief Investment Officer

  
							



 


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