EXHIBIT 10.23
PATENT AND TRADEMARK SECURITY AGREEMENT
     This Agreement, dated as of March 31, 2006, is made by and between [NAME OF
DEBTOR] having a business location at the address set forth below next to its
signature (the “Debtor”), and Wells Fargo Bank, National Association (the
“Secured Party”), acting through its Wells Fargo Business Credit operating
division, and having a business location at the address set forth below next to
its signature.
Recitals
     The Debtor and the Secured Party are parties to a Credit and Security
Agreement of even date herewith (as the same may hereafter be amended,
supplemented or restated from time to time, the “Credit Agreement”) setting
forth the terms on which the Secured Party may now or hereafter extend credit to
or for the account of the Debtor.
     As a condition to extending credit to or for the account of the Debtor, the
Secured Party has required the execution and delivery of this Agreement by the
Debtor.
     ACCORDINGLY, in consideration of the mutual covenants contained in the Loan
Documents and herein, the parties hereby agree as follows:
     1. Definitions. All terms defined in the Recitals hereto or in the Credit
Agreement that are not otherwise defined herein shall have the meanings given to
them therein. In addition, the following terms have the meanings set forth
below:
     “Obligations” means each and every debt, liability and obligation of every
type and description arising under or in connection with any Loan Document (as
defined in the Credit Agreement) which the Debtor may now or at any time
hereafter owe to the Secured Party, whether such debt, liability or obligation
now exists or is hereafter created or incurred and whether it is or may be
direct or indirect, due or to become due, absolute or contingent, primary or
secondary, liquidated or unliquidated, independent, joint, several or joint and
several, and including specifically, but not limited to, the Obligations (as
defined in the Credit Agreement).
     “Patents” means all of the Debtor’s right, title and interest in and to
patents or applications for patents, fees or royalties with respect to each, and
including without limitation the right to sue for past infringement and damages
therefor, and licenses thereunder, all as presently existing or hereafter
arising or acquired, including without limitation the patents listed on
Exhibit A.
     “Security Interest” has the meaning given in Section 2.
     “Trademarks” means all of the Debtor’s right, title and interest in and to:
(i) trademarks, service marks, collective membership marks, registrations and
applications for registration for each, and the respective goodwill associated
with each, (ii) licenses, fees or royalties with respect to each, (iii) the
right to sue for past, present and future infringement, dilution and damages
therefor, and (iv) licenses thereunder, all

 

--------------------------------------------------------------------------------

 

as presently existing or hereafter arising or acquired, including, without
limitation, the marks listed on Exhibit B.
     2. Security Interest. The Debtor hereby irrevocably pledges and assigns to,
and grants the Secured Party a security interest (the “Security Interest”) with
power of sale to the extent permitted by law, in the Patents and in the
Trademarks to secure payment of the Obligations. As set forth in the Credit
Agreement, the Security Interest is coupled with a security interest in
substantially all of the personal property of the Debtor. This Agreement grants
only the Security Interest herein described, is not intended to and does not
affect any present transfer of title of any trademark registration or
application and makes no assignment and grants no right to assign or perform any
other action with respect to any intent to use trademark application, unless
such action is permitted under 15 U.S.C. § 1060.
     3. Representations, Warranties and Agreements. The Debtor represents,
warrants and agrees as follows:
     (a) Existence; Authority. The Debtor is a corporation duly organized,
validly existing and in good standing under the laws of its state of
incorporation, and this Agreement has been duly and validly authorized by all
necessary corporate action on the part of the Debtor.
     (b) Patents. Exhibit A accurately lists all Patents owned or controlled by
the Debtor as of the date hereof, or to which the Debtor has a right as of the
date hereof to have assigned to it, and accurately reflects the existence and
status of applications and letters patent pertaining to the Patents as of the
date hereof. If after the date hereof, the Debtor owns, controls or has a right
to have assigned to it any Patents not listed on Exhibit A, or if Exhibit A
ceases to accurately reflect the existence and status of applications and
letters patent pertaining to the Patents, then the Debtor shall within 60 days
provide written notice to the Secured Party with a replacement Exhibit A, which
upon acceptance by the Secured Party shall become part of this Agreement.
     (c) Trademarks. Exhibit B accurately lists all Trademarks owned or
controlled by the Debtor as of the date hereof and accurately reflects the
existence and status of Trademarks and all applications and registrations
pertaining thereto as of the date hereof; provided, however, that Exhibit B need
not list common law marks (i.e., Trademarks for which there are no applications
or registrations) which are not material to the Debtor’s or any Affiliate’s
business(es). If after the date hereof, the Debtor owns or controls any
Trademarks not listed on Exhibit B (other than common law marks which are not
material to the Debtor’s or any Affiliate’s business(es)), or if Exhibit B
ceases to accurately reflect the existence and status of applications and
registrations pertaining to the Trademarks, then the Debtor shall promptly
provide written notice to the Secured Party with a replacement Exhibit B, which
upon acceptance by the Secured Party shall become part of this Agreement.
     (d) Affiliates. As of the date hereof, no Affiliate owns, controls, or has
a right to have assigned to it any items that would, if such item were owned by
the Debtor, constitute Patents or Trademarks. If after the date hereof any
Affiliate owns, controls, or

-2-

--------------------------------------------------------------------------------

 

has a right to have assigned to it any such items, then the Debtor shall
promptly either: (i) cause such Affiliate to assign all of its rights in such
item(s) to the Debtor; or (ii) notify the Secured Party of such item(s) and
cause such Affiliate to execute and deliver to the Secured Party a patent and
trademark security agreement substantially in the form of this Agreement.
     (e) Title. The Debtor has absolute title to each Patent and each Trademark
listed on Exhibits A and B, free and clear of all Liens except Permitted Liens.
The Debtor (i) will have, at the time the Debtor acquires any rights in Patents
or Trademarks hereafter arising, absolute title to each such Patent or Trademark
free and clear of all Liens except Permitted Liens, and (ii) will keep all
Patents and Trademarks free and clear of all Liens except Permitted Liens.
     (f) No Sale. Except as permitted in the Credit Agreement, the Debtor will
not assign, transfer, encumber or otherwise dispose of the Patents or
Trademarks, or any interest therein, without the Secured Party’s prior written
consent.
     (g) Defense. The Debtor will at its own expense and using commercially
reasonable efforts, protect and defend the Patents and Trademarks against all
claims or demands of all Persons other than those holding Permitted Liens.
     (h) Maintenance. The Debtor will at its own expense maintain the Patents
and the Trademarks to the extent reasonably advisable in its business including,
but not limited to, filing all applications to obtain letters patent or
trademark registrations and all affidavits, maintenance fees, annuities, and
renewals possible with respect to letters patent, trademark registrations and
applications therefor. The Debtor covenants that it will not abandon nor fail to
pay any maintenance fee or annuity due and payable on any Patent or Trademark,
nor fail to file any required affidavit or renewal in support thereof, without
first providing the Secured Party: (i) sufficient written notice, of at least 30
days, to allow the Secured Party to timely pay any such maintenance fees or
annuities which may become due on any Patents or Trademarks, or to file any
affidavit or renewal with respect thereto, and (ii) a separate written power of
attorney or other authorization to pay such maintenance fees or annuities, or to
file such affidavit or renewal, should such be necessary or desirable.
     (i) Secured Party’s Right to Take Action. If the Debtor fails to perform or
observe any of its covenants or agreements set forth in this Section 3, and if
such failure continues for a period of ten (10) calendar days after the Secured
Party gives the Debtor written notice thereof (or, in the case of the agreements
contained in subsection (h), immediately upon the occurrence of such failure,
without notice or lapse of time), or if the Debtor notifies the Secured Party
that it intends to abandon a Patent or Trademark, the Secured Party may (but
need not) perform or observe such covenant or agreement or take steps to prevent
such intended abandonment on behalf and in the name, place and stead of the
Debtor (or, at the Secured Party’s option, in the Secured Party’s own name) and
may (but need not) take any and all other actions which the Secured Party may
reasonably deem necessary to cure or correct such failure or prevent such
intended abandonment.

-3-

--------------------------------------------------------------------------------

 

     (j) Costs and Expenses. Except to the extent that the effect of such
payment would be to render any loan or forbearance of money usurious or
otherwise illegal under any applicable law, the Debtor shall pay the Secured
Party on demand the amount of all moneys expended and all costs and expenses
(including reasonable attorneys’ fees and disbursements) incurred by the Secured
Party in connection with or as a result of the Secured Party’s taking action
under subsection (i) or exercising its rights under Section 6, together with
interest thereon from the date expended or incurred by the Secured Party at the
Default Rate.
     (k) Power of Attorney. To facilitate the Secured Party’s taking action
under subsection (i) and exercising its rights under Section 6, the Debtor
hereby irrevocably appoints (which appointment is coupled with an interest) the
Secured Party, or its delegate, as the attorney-in-fact of the Debtor with the
right (but not the duty) from time to time to create, prepare, complete,
execute, deliver, endorse or file, in the name and on behalf of the Debtor, any
and all instruments, documents, applications, financing statements, and other
agreements and writings required to be obtained, executed, delivered or endorsed
by the Debtor under this Section 3, or, necessary for the Secured Party, after
an Event of Default, to enforce or use the Patents or Trademarks or to grant or
issue any exclusive or non-exclusive license under the Patents or Trademarks to
any third party, or to sell, assign, transfer, pledge, encumber or otherwise
transfer title in or dispose of the Patents or Trademarks to any third party.
The Debtor hereby ratifies all that such attorney shall lawfully do or cause to
be done by virtue hereof. The power of attorney granted herein shall terminate
upon the termination of the Credit Agreement as provided therein and the payment
and performance of all Obligations.
     4. Debtor’s Use of the Patents and Trademarks. The Debtor shall be
permitted to control and manage the Patents and Trademarks, including the right
to exclude others from making, using or selling items covered by the Patents and
Trademarks and any licenses thereunder, in the same manner and with the same
effect as if this Agreement had not been entered into, so long as no Event of
Default occurs and remains uncured.
     5. Events of Default. Each of the following occurrences shall constitute an
event of default under this Agreement (herein called “Event of Default”): (a) an
Event of Default, as defined in the Credit Agreement, shall occur; or (b) the
Debtor shall fail promptly to observe or perform any covenant or agreement
herein binding on it; or (c) any of the representations or warranties contained
in Section 3 shall prove to have been incorrect in any material respect when
made.
     6. Remedies. Upon the occurrence of an Event of Default and at any time
thereafter, the Secured Party may, at its option, take any or all of the
following actions:
     (a) The Secured Party may exercise any or all remedies available under the
Credit Agreement.
     (b) The Secured Party may sell, assign, transfer, pledge, encumber or
otherwise dispose of the Patents and Trademarks.

-4-

--------------------------------------------------------------------------------

 

     (c) The Secured Party may enforce the Patents and Trademarks and any
licenses thereunder, and if Secured Party shall commence any suit for such
enforcement, the Debtor shall, at the request of Secured Party, do any and all
lawful acts and execute any and all proper documents required by Secured Party
in aid of such enforcement.
     7. Miscellaneous. This Agreement can be waived, modified, amended,
terminated or discharged, and the Security Interest can be released, only
explicitly in a writing signed by the Secured Party. A waiver signed by the
Secured Party shall be effective only in the specific instance and for the
specific purpose given. Mere delay or failure to act shall not preclude the
exercise or enforcement of any of the Secured Party’s rights or remedies. All
rights and remedies of the Secured Party shall be cumulative and may be
exercised singularly or concurrently, at the Secured Party’s option, and the
exercise or enforcement of any one such right or remedy shall neither be a
condition to nor bar the exercise or enforcement of any other. All notices to be
given to Debtor under this Agreement shall be given in the manner and with the
effect provided in the Credit Agreement. The Secured Party shall not be
obligated to preserve any rights the Debtor may have against prior parties, to
realize on the Patents and Trademarks at all or in any particular manner or
order, or to apply any cash proceeds of Patents and Trademarks in any particular
order of application. This Agreement shall be binding upon and inure to the
benefit of the Debtor and the Secured Party and their respective participants,
successors and assigns and shall take effect when signed by the Debtor and
delivered to the Secured Party, and the Debtor waives notice of the Secured
Party’s acceptance hereof. The Secured Party may execute this Agreement if
appropriate for the purpose of filing, but the failure of the Secured Party to
execute this Agreement shall not affect or impair the validity or effectiveness
of this Agreement. A carbon, photographic or other reproduction of this
Agreement or of any financing statement signed by the Debtor shall have the same
force and effect as the original for all purposes of a financing statement. This
Agreement shall be governed by the internal law of Colorado without regard to
conflicts of law provisions. If any provision or application of this Agreement
is held unlawful or unenforceable in any respect, such illegality or
unenforceability shall not affect other provisions or applications which can be
given effect and this Agreement shall be construed as if the unlawful or
unenforceable provision or application had never been contained herein or
prescribed hereby. All representations and warranties contained in this
Agreement shall survive the execution, delivery and performance of this
Agreement and the creation and payment of the Obligations.
THE PARTIES WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY
ACTION OR PROCEEDING BASED ON OR PERTAINING TO THIS AGREEMENT.
[Remainder of page intentionally left blank.]

-5-

--------------------------------------------------------------------------------

 

     IN WITNESS WHEREOF, the parties have executed this Patent and Trademark
Security Agreement as of the date written above.

              [DEBTOR]
 
       
 
  By:    
 
       
 
  Name:    
 
  Its:    
 
        Wells Fargo Bank, National
Association, acting through its Wells
Fargo Business Credit operating
division   WELLS FARGO BANK, NATIONAL
ASSOCIATION, acting through its
Wells Fargo Business Credit
operating division
MAC C7300-210
       
1740 Broadway
       
Denver, Colorado 80274
  By:    
 
       
 
  Name:   Pamela R. Cates
 
  Its:   Vice President

     
 
   
STATE OF COLORADO
  )
 
  )
CITY AND COUNTY OF DENVER
  )
 
   

The foregoing instrument was acknowledged before me this ___day of March, 2006,
by ___, the ___of [DEBTOR], on behalf of the corporation.

     
 
   
 
   
 
  Notary Public

     
 
   
STATE OF COLORADO
  )
 
  ) ss.
CITY AND COUNTY OF DENVER
  )
 
   

     The foregoing instrument was acknowledged before me this ___day of March,
2006, by Pamela R. Cates, a Vice President of Wells Fargo Bank, National
Association, on behalf of the national association.

     
 
   
 
   
 
  Notary Public

-6-

--------------------------------------------------------------------------------

 

EXHIBIT A
UNITED STATES ISSUED PATENTS

          Title   Patent Number   Issue Date
 
       
 
       
 
       

UNITED STATES PATENT APPLICATIONS

          Title   Serial Number   Filing Date
 
       
 
       
 
       

FOREIGN ISSUED PATENTS

              Title   Country   Patent Number   Issue Date
 
           
 
           
 
           

UNITED STATES PATENT APPLICATIONS

          Title   Serial Number   Filing Date
 
       
 
       
 
       

A-1

--------------------------------------------------------------------------------

 

EXHIBIT B
UNITED STATES ISSUED TRADEMARKS, SERVICE MARKS
AND COLLECTIVE MEMBERSHIP MARKS
REGISTRATIONS
APPLICATIONS
COLLECTIVE MEMBERSHIP MARKS
UNREGISTERED MARKS

B-1