04.09.2010

Model Intellectual Property Security Agreement

• Collection (106 IPSAs)• Process

– Outline– Clause Library

• Template– Core Models– Structure (similarities and differences)– Clauses (standard, common and optional)

• Next Steps– Identify model characteristics– Identify clause weighting– Propose draft models

Agenda

• Source: EDGAR• Number of Agreements: 106

– COPYRIGHT SECURITY AGREEMENT (7)

– GUARANTOR TRADEMARK SECURITY AGREEMENT (1)

– INTELLECTUAL PROPERTY SECURITY AGREEMENT(53)

– PATENT AND TRADEMARK SECURITY AGREEMENT (15)

– PATENT SECURITY AGREEMENT (9)

– PATENT TRADEMARK AND COPYRIGHT SECURITY AGREEMENT (2)

– TRADEMARK SECURITY AGREEMENT (19)

Collection

© 2010 KIIAC LLC—All Rights Reserved

Task

1. Collect: identify document for inclusion (vet)

2. Classify: index documents; categorize and decompose into resolutions

3. Outline: create template and resolution library

4. Clauses: identify default and alternate resolutions

5. Edit: normalize language

6. Publish: upload template and generate model forms

8. Draft: document production and review: new documents; update collection and maintain

collect draft

Process: Template Development Overview

kiiac captures standard transaction elements and all deal-specific variations [measures clause commonality]

What are the terms and provisions of an IP security agreement?

What Representations and Warranties are typically given by the debtor?

Is an indemnity provision common?

KNOWLEDGE INFORMATION INNOVATION

Using the template—as a checklist

What is standard language for a particular clause?

What alternative language may be used?

kiiac captures standard clause language and highlights deal-specific and non-standard variations [measures language consistency]

Standard ClauseGoverning Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to the principles of conflicts of law thereof.

Semantically SimilarGoverning Law. This Agreement shall be deemed to be made in, and in all respects shall be interpreted, construed and governed by and in accordance with the internal Laws of, the State of Nevada, without regard to the conflicts of law principles thereof.

Substantively DifferentGoverning Law. This Bank Merger Agreement shall be governed in all respects, including, but not limited to, validity, interpretation, effect and performance, by the laws of the United States

KNOWLEDGE INFORMATION INNOVATION

Using the template—as a clause library

Template: Outline and Clause Library

© 2010 KIIAC LLC—All Rights Reserved

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Grant of Security Interest ………

Representations and Warranties.

Covenants ……………………….

Defaults …………………………..

Indemnity …………………………

Rights and Remedies …………..

Term of Agreement………………

Termination ………………………

Miscellaneous ……………………

Outline

Frequency of Occurrence

Annex B – Template Outline

Models – Short Form; Silicon Valley Bank

© 2010 KIIAC LLC—All Rights Reserved

Models: Based on Structure (similarity/difference)

Model 01

Grant of Security Interest

Rights and Remedies

Model 02

Grant of Security Interest

Security for Obligations

Recordation

Rights and Remedies

Counterparts

Governing Law

Model 04

Defined Terms

Grant of Security Interest

Reps. and Warranties

Debtor's Use of IP

Events of Defaults

Remedies

Miscellaneous

Model 05

Defined Terms

Grant of Security Interest

Grantor Remain Liable

Reps. and Warranties

Covenants

Proceeds

Rights and Remedies

Miscellaneous

Model 06

Defined Terms

Grant of Security Interest

Reps. and Warranties

Defaults

Duty to Hold in Trust

Rights and Remedies

Application of Proceeds

Term of Agreement

Termination

Miscellaneous

Grant of Security Interest

Rights and Remedies

Grant of Security Interest

Grant of Security Interest

Grant of Security Interest

Grant of Security Interest

Rights and Remedies

Remedies

Rights and Remedies

Rights and Remedies

Recordation

Debtor’s Use of IP

Grantor Remains Liable

Term of Agreement

Termination

© 2010 KIIAC LLC—All Rights Reserved

Models: Based on Language (1)

POWER OF ATTORNEY (104. TRADEMARK SECURITY AGREEMENT) TCF National Bank (Golden Valley) October 1999

i) POWER OF ATTORNEY. TO FACILITATE THE SECURED PARTY'S TAKING ACTION UNDER SUBSECTION (g) AND EXERCISING ITS RIGHTS UNDER SECTION 6, EACH DEBTOR HEREBY IRREVOCABLY APPOINTS (WHICH APPOINTMENT IS COUPLED WITH AN INTEREST) THE SECURED PARTY, OR ITS DELEGATE, AS THE ATTORNEY-IN-FACT OF SUCH 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 SUCH DEBTOR, ANY AND ALL INSTRUMENTS, DOCUMENTS, APPLICATIONS, FINANCING STATEMENTS, AND OTHER AGREEMENTS AND WRITINGS REQUIRED TO BE OBTAINED, EXECUTED, DELIVERED OR ENDORSED BY SUCH DEBTOR UNDER THIS SECTION 3, OR, NECESSARY FOR THE SECURED PARTY, AFTER AN EVENT OF DEFAULT, TO ENFORCE OR USE THE TRADEMARKS OR TO GRANT OR ISSUE ANY EXCLUSIVE OR NON-EXCLUSIVE LICENSE UNDER THE TRADEMARKS TO ANY THIRD PARTY, OR TO SELL, ASSIGN, TRANSFER, PLEDGE, ENCUMBER OR OTHERWISE TRANSFER TITLE IN OR DISPOSE OF THE TRADEMARKS TO ANY THIRD PARTY. THE DEBTORS HEREBY RATIFY 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 (AS DEFINED THEREIN).

POWER OF ATTORNEY (80. PATENT AND TRADEMARK SECURITY AGREEMENT) Wells Fargo Bank NA December 29, 2006

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 Indebtedness.

POWER OF ATTORNEY (87. PATENT AND TRADEMARK SECURITY AGREEMENT) Wells Fargo Bank NA March 31, 2006

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.

© 2010 KIIAC LLC—All Rights Reserved

Models: Based on Language (1)

POWER OF ATTORNEY (71. PATENT AND TRADEMARK SECURITY AGREEMENT) Pala Investments Holdings Limited (Channel Islands, Switzerland)

December 12, 2007

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 Debenture as provided therein and the payment and performance of the Indebtedness.

POWER OF ATTORNEY (66. TRADEMARK SECURITY AGREEMENT) Commerce Bank NA (New York) September 25, 2003

i) Power of Attorney. To facilitate the Secured Party's taking action under subsection (h) and exercising its rights under Section 7, the Debtor hereby irrevocably appoints 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 Trademarks or to grant or issue any exclusive or non-exclusive license under the Trademarks to any third party, or to sell, assign, transfer, pledge, encumber or otherwise transfer title in or dispose of the 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 is coupled with an interest and shall be irrevocable until the termination of the Loan Agreement as provided therein and the payment and performance of all Obligations (as defined therein).

POWER OF ATTORNEY (106. PATENT AND TRADEMARK SECURITY AGREEMENT - PARENT) St. Paul Venture Capital VI, LLC June 6, 2001

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, 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 the occurrence and during the continuance of 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 final and indefeasible payment and performance of all Obligations.

© 2010 KIIAC LLC—All Rights Reserved

Next Steps: Process

1. Models• Confirm model selection

2. Outline (Table of contents view)• Review similarity and differences between the models

3. Clause Library (Index view)• Standard clauses• Frequent clauses• Optional Clauses

4. Characteristics• Identify the key characteristics of each model• Identify the party weighting of each clause

5. Draft: Propose draft language for each selected model

6. Access to templates