Exhibit
10.62


SECURITY AGREEMENT


 


This Security Agreement
is executed by Axion Power International, Inc., a Delaware corporation, and its subsidiaries, as Debtor, and Robert Averill, an
individual as Secured Party.


I


CREATION OF SECURITY INTEREST


 


Debtor hereby grants
to Secured Party a first priority security interest in the collateral described in this Security Agreement pursuant to the New
Jersey Uniform Commercial Code as in effect in New Jersey, N.J.S.A. 12A:1-101, et seq. (the “UCC”).


 


II


 


 OBLIGATIONS SECURED


 


The security interest
is granted to Secured Party to secure the following obligations:


 





A. Payment of the
indebtedness evidenced by an Amended Promissory Note of this same date executed by Debtor, payable to the order of Secured Party,
in the principal amount of Eight Hundred and One Thousand and Forty-Nine Dollars ($801,049.00), bearing interest at the initial
rate of nine percent (9%) compounded monthly, which will increase by one percent (1%) every month (up to the maximum rate allowed
by New Jersey law) beginning on September 16, 2014 and continuing until all principal, accured interest, as well as the accumulated
legal fees referenced therein have been paid in full, together with any renewals, extensions, modifications, or amendments of
the Amended Promissory Note (the “Note”); and


 


B.Upon
a default under the Note by the Debtor, the expenses and costs incurred or paid by Secured Party in the maintenance and preservation
of the collateral and the enforcement of the rights of Secured Party and the duties of Debtor as stated in this Security Agreement,
including, without limitation, reasonable attorneys’ fees, court costs, foreclosure expenses, and witness fees.


 









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III


 


 DESCRIPTION OF COLLATERAL


 


The collateral of this
Security Agreement consists of the following:


 


1.All of Debtor’s
intellectual property.


 


2.All substitutions,
replacements, developments or accessions of the above-described collateral.


 


IV


 


CLASSIFICATION OF COLLATERAL


 


Debtor acknowledges
that at the time the security interest attaches, the collateral consists of intangible personal property, i.e., intellectual property.


 


V


 


PERFECTION OF SECURITY INTEREST


 


To perfect the security
interest granted to Secured Party by the terms of this Security Agreement, Debtor agrees to the following:


 


A.Debtor authorizes Secured Party
to file financing statements in all states, counties, and other jurisdictions as Secured Party may elect, without Debtor’s
signature as permitted by law.


 


B.Debtor shall execute and deliver
to Secured Party, in form and substance satisfactory to Secured Party, such financing statements and such further assurances as
Secured Party may, from time to time, consider reasonably necessary to create, perfect and preserve Secured Party’s security
interest herein granted, and Secured Party may cause such statements and assurances to be recorded and filed at such times and
places as may be required or permitted by law to so create, perfect and preserve such security interest.


 









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Upon performance of
all obligations of Debtor to Secured Party that are secured by this Security Agreement, Secured Party (i) authorizes Debtor to
file financing termination statements and the like in all states, counties and other jurisdictions as Debtor may elect, without
Secured Party’s signature as permitted by law, and (ii) agrees to surrender possession of the original security instruments
to Debtor and to execute such documents as may be necessary to completely release Secured Party’s security interest created
hereby.


 


VI


 


DEBTOR’S COVENANTS AND WARRANTIES


 


A.Debtor is a corporation duly
organized and existing under the laws of the State of Delaware, is in good standing under the laws of the State of Delaware, and
the granting of the security interest and the performance of all other obligations provided in this Agreement are within the Debtor’s
powers, have been duly authorized, and are not in contravention of any law or the Debtor’s Articles of Organization, or any
agreement or undertaking of which Debtor is a party or by which it is bound.


 


B.Debtor agrees that during the
term of this Security Agreement, and as long as any obligation that is subject to this Security Agreement remains outstanding,
Debtor will not grant a security interest in the collateral or any part thereof to any person except as otherwise authorized in
accordance with the provisions of Article VI below.


 


C.During the term of this Security
Agreement, Debtor shall keep the collateral free and clear from any and all liens, encumbrances, and other security interests,
except with respect to those created hereunder, and will pay, prior to delinquency, all taxes, charges, encumbrances, liens, and
assessments against the collateral, and, should the Debtor fail to do so, Secured Party may, but shall not be required, to pay
or discharge the same. Debtor shall give Secured Party ten (10) days’ notice in the event of default of any of these obligations.
Debtor shall reimburse Secured Party for any such payments.


 









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D.Debtor shall execute any and
all Financing Statements relating to the perfection, amendment, release, or termination of the security interest created hereby.
The Debtor hereby authorizes and appoints Secured Party, in the case of need, to sign on behalf of Debtor will full power of substitution
as the Debtor’s attorney-in-fact only with respect to the filing of such Financing Statements.


 


VII


 


USE OF COLLATERAL


 


So long as the Debtor
is not in default under the terms of this Security Agreement, Debtor may use the collateral in the ordinary course of Debtor’s
business. This right includes, but is not limited to, the use of collateral in the manufacture, preparation, and delivery of goods.


 


VIII


 


DEFAULT PROVISIONS


 


A.Definition of Default.
The occurrence of any of the following shall constitute a default by the Debtor under this Security Agreement;


 


1.The failure by Debtor to pay
or perform any obligations secured by the terms of this Security Agreement or to pay or perform under the Promissory Note executed
by it in conjunction with this Security Agreement.


 


2.The failure of Debtor to perform
any of Debtor’s obligations under the terms of this Security Agreement.


 









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3.A material breach of any covenant
or representation made to Secured Party herein.


 


4.The filing of a petition by or
against the Debtor under any state or federal law relating to the relief of debtors, any assignment by Debtor for the benefit of
creditors, or the insolvency or cessation of business by Debtor.


 


5.The sale, transfer, alienation,
encumbrance, or other disposition of the collateral, or of any party thereof or of any interest therein, whether voluntary or involuntarily,
without the prior written consent of Secured Party, except for encumbrances of the collateral as permitted in accordance with the
provisions of article VII above.


 


B.Notice and Right to Cure.


 


1.Notice. Secured Party
must, before pursuing any remedy for an alleged default by Debtor, give written notice of default to Debtor. Each notice of default
must specify the alleged event of default.


 


2.Debtor’s Right to Cure
Defaults. Debtor shall have thirty (30) days in which to cure a default after the delivery of the notice of default by Secured
Party. However, if a non-monetary default cannot reasonably be cured within thirty (30) days, then Debtor is not to be considered
in default if Debtor commences to cure the default within the thirty (30) day period and diligently and in good faith continues
to cure the default thereafter. In the event of a monetary default that is substantially cured within the thirty (30) day notice
period, Secured Party will provide reasonable time to complete the cure.





 



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IX


 


SECURED PARTY’S RIGHTS AND REMEDIES


 


Upon the occurrence
of default that remains uncured within the time limit set forth in section VIII by Debtor, Secured Party may exercise the rights
of enforcement contained in the Uniform Commercial Code in force in New Jersey at the date of the default, including, but not limited
to, the following:


 


A.Acceleration. Secured
Party may, at Secured Party’s option, declare immediately due and payable the obligations of Debtor to Secured Party which
are secured hereby, and the same shall, upon notice to or demand on Debtor, become immediately due and payable.


 


B.Right to Possession of Collateral.
The Secured Party shall have the right to take possession of the collateral and the Debtor agrees to cooperate fully with Secured
Party in the exercise of Secured Party’s right to take possession of the collateral. This right includes, but is not limited
to, Debtor’s obligation to assemble and deliver the collateral or some portion of the collateral or some part or component
of the collateral upon request of the Secured Party, to a place designated by the Secured Party where it shall be made available
to the Secured Party. Failure to cooperate shall constitute a breach of this Agreement and the Debtor shall be liable for any and
all expenses incident to such failure or cooperation.


 


C.Right to Dispose of Collateral.
The Secured Party shall have the right to dispose of the collateral by public or private proceeding and by way of one or more contracts.
Such sale or other disposition of the collateral may be made as a unit or in parcels and at such time and on such terms as Secured
Party may determine, provided only that the disposition effected is commercially reasonable. Disposition of the collateral may
be from the premises of Debtor and Debtor agrees to cooperate fully in facilitating such a disposition, which may include, on request,
the obligation to assemble the collateral in some designated location of the Debtor where the collateral shall be made available
to prospective buyers. Disposition of the collateral may be from any other commercially reasonable location, including the principal
place of business of Secured Party.


 









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D.Notice of Sale. Debtor
and Secured Party agree that notice of disposition of the collateral shall be commercially reasonable if such notice is received
by the Debtor by facsimile or hand delivery, as well as sent by regular and certified mail, return receipt requested, at least
ten (10) days prior to the date of the public sale or the date after which a private sale or other disposition may be effected.


 


E.Proceeds of Sale. The
proceeds of any sale or disposition of the collateral shall be applied in the manner provided by law and shall include any and
all expenses provided in this Agreement. Debtor agrees that Secured Party shall be entitled to recover reasonable attorneys’
fees and costs incurred by the Secured Party in exercising its rights and remedies under this Agreement. Upon payment of Secured
Party’s principle, interests and expenses as allowed by this agreement and by law, Secured Party will return possession of
all collateral to Debtor and agrees to execute such documents as may be necessary to completely release Secured Party’s security
interest created hereby.


 


F.Deficiency. In the event
the proceeds of collection, sale or disposition of the collateral are not sufficient to discharge Debtor’s obligation secured
hereby, Debtor shall be liable for the deficiency.


 






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X


 


MISCELLANEOUS


 


A.Notices. Except as otherwise
expressly provided in this Security Agreement or by law, all notices must be in writing and shall be considered given upon delivery
of, or if mailed, upon the first to occur of actual receipt or the expiration of three (3) days after the deposit in United States
Postal Service mail, first class, postage prepaid and addressed at the address specified. Notices must be given by email and any
other method of delivery, such as facsimile, regular mail, overnight or personal delivery, to the parties listed below:


 





	To Secured Party:	Robert Averill
	 	 	377 Cupsaw Drive
	 	 	Ringwood, New Jersey 07456
	 	 	Facsimile:  973-962-6138
	 	 	Email:  averillbob@yahoo.com
	 	 	 
	 	With copy to:	Christopher Nucifora, Esq.
	 	 	Kaufman Dolowich & Voluck, LLP
	 	 	Court Plaza South
	 	 	21 Main Street, Suite 251
	 	 	Hackensack, New Jersey 07601
	 	 	Facsimile:  201-488-6652
	 	 	Email:  cnucifora@kdvlaw.com
	 	 	 
	To Debtor:	Axion Power International, Inc.
	 	 	Thomas Granville
	 	 	3601 Clover Lane
	 	 	New Castle, Pennsylvania 16105
	 	 	Facsimile:  724-654-3300
	 	 	Email:  tgranville@axionpower.com
	 	 	 
	 	With copy to:	Jolie Kahn, Esq.
	 	 	2 Liberty Place
	 	 	50 South 16th Street
	 	 	Suite 3401
	 	 	Philadelphia, Pennsylvania 19102
	 	 	Facsimile:  866-705-3071
	 	 	Email:  joliekahnlaw@sbcglobal.net







 






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Any change in the address of any party
shall be given by the party having such change to the other parties in the manner provided above. Thereafter, all notices shall
be given in accordance with the notice of change of address. Notices given before actual receipt of the notice of change of address
shall not be invalidated by change of address.


 


B.Time of the Essence. Time
is of the essence of this Security Agreement.


 


C.Waiver. The waiver by
either party of the time for performing any act shall not constitute a waiver of the time for performing any other act or of an
identical act required to be performed at a later time. The exercise of any remedy provided for in this Security Agreement shall
not constitute a waiver of any other remedy provided by law.


 


D.Severability.The unenforceability,
invalidity, or illegality of any provisions of this Security Agreement shall not render any other provision unenforceable, invalid,
or illegal.


 


E.Choice of Law. This Security
Agreement shall be governed by and interpreted under the laws of the State of New Jersey in force from time to time.


 


F.Gender and Number. As
used in this Security Agreement, the masculine, feminine, or neuter gender, and the singular or plural number, shall each be considered
to include the others whenever the context so indicates.


 


G.Binding Effect. This Security
Agreement shall inure to the benefit of, and be binding upon, the heirs, assigns, transferees, personal representatives, and successors
in interest of the parties hereto.


 


H.Captions. The captions
in this Security Agreement shall have no effect on its interpretation.


 



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I.Counterparts and Fax Signatures.
This Security Agreement may be signed in counterpart and all signatures shall constitute the entire agreement. Signature by facsimile
shall be deemed original.


 


Dated this 30th day of June,
2014


 








	 	DEBTOR	 
	 	 	 	 
	 	 	AXION POWER INTERNATIONAL, INC.
	 	 	A Delaware Corporation
	 	 	 	 
	 	 	 	 
	 	 	By: /s/ 	Thomas Granville
	 	 	 	Thomas Granville
	 	 	 	C.E.O.
	 	 	 	 
	 	SECURED PARTY
	 	 	 	 
	 	 	ROBERT AVERILL
	 	 	 	 
	 	 	 	 
	 	 	/s/ Robert Averill
	 	 	 	 
	 	 	 	 










 









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