EXHIBIT 10.7
AMENDED AND RESTATED
PATENT, TRADEMARK AND LICENSE MORTGAGE
--------------------------------------
THIS AMENDED AND RESTATED PATENT, TRADEMARK AND LICENSE MORTGAGE (the
"Mortgage") made as of this lst day of July, 1993, by American Builders &
Contractors Supply Co., Inc., a Texas corporation having an address at 820 Broad
Street, Beloit, Wisconsin 53511 ("Mortgagor"), in favor of American National
Bank and Trust Company of Chicago, as Agent, having an office at 33 North
LaSalle Street, Chicago, Illinois 60690 ("Mortgagee") , hereby amends and
restates in its entirety that certain Patent, Trademark and License Mortgage
made as of December 13, 1990 by Mortgagor in favor of The First National Bank of
Chicago ("FNBC") , filed in the trademark records of the United States Patent
and Trademark Office on December 28, 1990 at Reel 0758, Frame 241 (the "Original
Mortgage"), which Original Mortgage was assigned by FNBC to Mortgagee by
assignment dated March 5, 1992, filed in the trademark records of the United
States Patent and Trademark Office on March 12, 1992 at Reel 0890, Frame 321:
W I T N E S S E T H:
-------------------
WHEREAS, Mortgagor, Mortgagee, American National Bank and Trust Company of
Chicago, in its individual capacity ("ANB") , NationsBank of Texas, N.A.
("NationsBank") and BankAmerica Business Credit, Inc. ("BOA") (ANB, NationsBank
and BOA being referred to herein collectively as "Lenders") , are parties to a
certain Amended and Restated Loan and Security Agreement, as amended from time
to time (the "Loan and Security Agreement") and other related loan documents
heretofore or now executed (collectively, with the Loan and Security Agreement,
the "Loan Agreements"), which Loan Agreements provide (i) for Mortgagee and
Lenders to, from time to time, extend credit to or for the account of Mortgagor
and (ii) for the grant by Mortgagor to Mortgagee of a security interest in
certain of Mortgagor's assets, including, without limitation, its patents,
patent applications, trademarks, trademark applications, tradenames, service
marks, service mark applications, goodwill and licenses, excluding the
trademarks, trademark registrations, trademark applications, tradenames and
tradestyles associated with the "Mule-Hide" business;
NOW, THEREFORE, in consideration of the premises set forth herein and for
other good and valuable consideration, receipt and sufficiency of which are
hereby acknowledged, Mortgagor agrees as follows:
1. Incorporation of Loan Agreements. The Loan Agreements and the terms
and provisions thereof are hereby incorporated herein in their entirety by this
reference thereto. All terms capitalized but not otherwise defined herein shall
have the same meanings herein as in the Loan and Security Agreement.
2. Mortgage of Patents, Trademarks and Licenses. To secure the complete
and timely satisfaction of all of Mortgagor's Liabilities, Mortgagor hereby
reaffirms its prior collateral assignment and grant to Mortgagee of a security
interest having priority over all other security interests, with power of sale,
to the extent permitted by law, upon the occurrence of a Default, and
to the extent such prior collateral assignment and grant was or is insufficient,
hereby makes a collateral assignment and grants to Mortgagee a security interest
having priority over all other security interests, with power of sale, to the
extent permitted by law, upon the occurrence of a Default, in all of Mortgagor's
right, title and interest in and to all of its now existing and hereafter
created or acquired:
(i) patents and patent applications, including, without limitation,
the inventions and improvements described and claimed therein, and those
patents and patent applications listed on Exhibit A attached hereto and
hereby made a part hereof, and (a) the reissues, divisions, continuations,
renewals, extensions and continuations-in-part thereof, (b) all income,
damages and payments now and hereafter due or payable under or with respect
thereto, including, without limitation, damages and payments for past or
future infringements thereof, (c) the right to sue for past, present and
future infringements thereof, and (d) all rights corresponding thereto
throughout the world (all of the foregoing, together with the items
described in clauses (a) - (d) of this subsection 2 (i) , are sometimes
hereinafter referred to individually as a "Patent" and, collectively, as
the "Patents");
(ii) trademarks, trademark registrations, trademark applications,
tradenames and tradestyles, service marks, service mark registrations,
service mark applications and brand names, including without limitation
those trademarks, tradenames, service marks and applications and
registrations thereof listed on Exhibit B attached hereto and hereby made a
part hereof, but excluding the trademarks, trademark registrations,
trademark applications, tradenames and tradestyles associated with the
"MuleHide" business, and (a) renewals or extensions, thereof, (b) all
income, damages and payments now and hereafter due or payable with respect
thereto, including, without limitation, damages and payments for past or
future infringements thereof, (c) the right to sue for past, present and
future infringements thereof, and (d) all rights corresponding thereto
throughout the world (all of the foregoing, together with the items
described in clauses (a)-(d) of this subsection 2(ii), are sometimes
hereinafter referred individually as a "Trademark", and, collectively, as
the "Trademarks");
(iii) all license agreements with respect to any of the Patents or the
Trademarks or any other patent, trademark, service mark or any application
or registration thereof or any other tradename or tradestyle between
Mortgagor and any other party, whether Mortgagor is a licensor or licensee
under any such license agreement, including, without limitation, the
licenses listed on Exhibit C attached hereto and hereby made a part hereof,
but with respect to licenses pertaining to the trademarks, trademark
registrations, trademark applications, tradenames and tradestyles
associated with the "Mule-Hide" business, Mortgagee's interest shall be
limited to the proceeds thereof (all of the foregoing license agreements
and Mortgagor's rights thereunder are referred to collectively as the
"Licenses") ; and
(iv) the goodwill of Mortgagor's business connected with and
symbolized by the Trademarks.
3. Warranties and Representations. Mortgagor warrants and represents to
Mortgagee that:
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(i) no Patent, Trademark or License has been adjudged invalid or
unenforceable nor has any such Patent, Trademark or License been cancelled,
in whole or in part;
(ii) Mortgagor has adopted, used and is currently using all of the
Trademarks;
(iii) Mortgagor has no notice of any suits or actions commenced or
threatened with reference to the Patents, Trademarks or Licenses, except as
otherwise disclosed to Mortgagee in writing; and
(iv) Mortgagor has the unqualified right to execute and deliver this
Mortgage and perform its terms and has entered into or will enter into
written agreements with each of its present and future employees, agents
and consultants to the extent necessary to enable it to comply with the
covenants contained herein.
4. Restrictions on Future Agreements. Mortgagor agrees that until
Mortgagor's Liabilities shall have been satisfied in full and the Loan
Agreements shall have been terminated, Mortgagor shall not sell or assign its
interest in, or grant any license under, the Patents, Trademarks or Licenses, or
enter into any other agreement with respect to the Patents, Trademarks or
Licenses and Mortgagor further agrees that it shall not knowingly take any
action (other than infringement suits against others) , or knowingly permit any
action to be taken by others subject to its control, including licensees, or
knowingly fail to take any action, which would affect the validity or
enforcement of the rights transferred to Mortgagee under this Mortgage.
5. New Patents, Trademarks, and Licenses. Mortgagor represents and
warrants that, to the best of Mortgagor's knowledge, the Patents, Trademarks and
Licenses listed on Exhibits A, B and C, respectively, constitute all of the
Patents, Trademarks, and Licenses now owned by Mortgagor. If, before
Mortgagor's Liabilities shall have been satisfied in full or before the Loan
Agreements have been terminated, Mortgagor shall (i) become aware of any
existing Patents, Trademarks or Licenses of which Mortgagor has not previously
informed Mortgagee, (ii) obtain rights to any new patentable inventions,
Patents, Trademarks or Licenses, or (iii) become entitled to the benefit of any
Patents, Trademarks, or Licenses or any improvement on any Patent, the
provisions of this Mortgage above shall automatically apply thereto and
Mortgagor shall to the extent that it is aware thereof give to Mortgagee prompt
written notice thereof to the extent material to the continued operations of
Mortgagor. Mortgagor hereby authorizes Mortgagee to modify this Mortgage by
amending Exhibits A, B and C, as applicable, to include any such Patents,
Trademarks and Licenses.
6. Royalties; Terms. The term of the mortgages granted herein shall
extend until the earlier of (i) the expiration of each of the respective
Patents, Trademarks and Licenses assigned hereunder, and (ii) Mortgagor's
Liabilities have been paid in full and the Loan Agreements have been terminated.
Mortgagor agrees that upon the occurrence of a Default, the use by Mortgagee of
all Patents, Trademarks and Licenses shall be worldwide and without any
liability for royalties or other related charges from Mortgagee to Mortgagor.
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7. Product Quality. Upon the occurrence of a Default, Mortgagor agrees
that Mortgagee, or a conservator appointed by Mortgagee, shall have the right to
establish such product quality controls as Mortgagee, or said conservator, in
its reasonable judgment, may deem necessary to assure maintenance of the quality
of products sold by Mortgagor under the Trademarks.
8. Release of Mortgage. This Mortgage is made for collateral purposes
only. Upon payment in full of Mortgagor's Liabilities and termination of the
Loan Agreements, Mortgagee shall execute and deliver to Mortgagor all deeds,
assignments and other instruments, and shall take such other actions, as may be
necessary or proper to re-vest in Mortgagor full title to the Patents,
Trademarks and Licenses, subject to any disposition thereof which may have been
made by Mortgagee pursuant to the Loan Agreements.
9. Duties of Mortgagor. Where commercially reasonable and cost effective
as to Mortgagor, unless otherwise consented to by Mortgagee in writing,
Mortgagor shall have the duty (i) to file and prosecute any trademark or service
mark applications pending as of the date hereof or hereafter until Mortgagor's
Liabilities shall have been paid in full, and (ii) to preserve and maintain all
rights in the Patents, Trademarks and Licenses. Any expenses incurred in
connection with Mortgagor's obligations under this Section 9 shall be borne by
Mortgagor. Mortgagor shall not abandon any right to file a patent, trademark or
service mark application, or abandon any pending patent, trademark or service
mark application or any other Patent, Trademark or License.
10. Mortgagee's Right to Sue. Upon the occurrence of a Default, Mortgagee
shall have the right, but shall in no way be obligated, to bring suit in its own
name to enforce the Patents, Trademarks and Licenses, and, if Mortgagee shall
commence any such suit, Mortgagor shall, at the request of Mortgagee, do any and
all lawful acts and execute any and all proper documents required by Mortgagee
in aid of such enforcement and Mortgagor shall promptly, upon demand, reimburse
and indemnify Mortgagee for all reasonable costs and expenses incurred by
Mortgagee in the exercise of its rights under this Section 10.
11. Waivers. No course of dealing between Mortgagor and Mortgagee, nor
any failure to exercise, nor any delay in exercising, on the part of Mortgagee,
any right, power or privilege hereunder or under the Loan Agreements shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, power or privilege hereunder or thereunder preclude any other or further
exercise thereof or the exercise of any other right, power or privilege.
12. Severability. The provisions of this Mortgage are severable, and if
any clause or provision shall be held invalid and unenforceable in whole or in
part in any jurisdiction, then such invalidity or unenforceability shall affect
only such clause or provision, or part thereof, in such jurisdiction, and shall
not in any manner affect such clause or provision in any other jurisdiction, or
any other clause or provision of this Mortgage in any jurisdiction.
13. Modification. This Mortgage cannot be altered, amended or modified in
any way, except as specifically provided in Section 5 hereof or by a writing
signed by the parties hereto.
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14. Cumulative Remedies; Power of Attorney; Effect on Loan Agreements.
All of Mortgagee's rights and remedies with respect to the Patents, Trademarks
and Licenses, whether established hereby or by the Loan Agreements, or by any
other agreements or by law shall be cumulative and may be exercised singularly
or concurrently. Mortgagor hereby authorizes Mortgagee upon the occurrence of a
Default, to make, constitute and appoint any officer or agent of Mortgagee as
Mortgagee may select, in its reasonable discretion, as Mortgagor's true and
lawful attorney-in-fact, with power to (i) endorse Mortgagor's name on all
applications, documents, papers and instruments necessary or desirable for
Mortgagee in the use of the Patents, Trademarks and Licenses, or (ii) take any
other actions with respect to the Patents, Trademarks and Licenses as Mortgagee
deems to be in the best interest of Mortgagee, or (iii) grant or issue any
exclusive or non-exclusive license under the Patents, Trademarks or Licenses to
anyone, or (iv) assign, pledge, convey or otherwise transfer title in or dispose
of the Patents, Trademarks or Licenses to anyone. Mortgagee hereby ratifies all
that such attorney shall lawfully do or cause to be done by virtue hereof. This
power of attorney shall be irrevocable until Mortgagor's Liabilities shall have
been paid in full and the Loan Agreements, including any amendments thereto,
have been terminated. Mortgagor acknowledges and agrees that this Mortgage is
not intended to limit or restrict in any way the rights and remedies of
Mortgagee under the Loan Agreements but rather is intended to facilitate the
exercise of such rights and remedies. Mortgagee shall have, in addition to all
other rights and remedies given it by the terms of this Mortgage and the Loan
Agreements, all rights and remedies allowed by law and the rights and remedies
of a secured party under the Uniform Commercial Code as enacted in any
jurisdiction in which the Patents, Trademarks or Licenses may be located.
15. Binding Effect; Benefits. This Mortgage shall be binding upon
Mortgagor and its respective successors and assigns, and shall inure to the
benefit of Mortgagee, its successors, nominees and assigns.
16. Governing Law. This Mortgage shall be governed by and construed in
accordance with the laws of the State of Illinois.
17. Headings. Paragraph headings used herein are for convenience only and
shall not modify the provisions which they precede.
18. Further Assurances. Mortgagor agrees to execute and deliver such
further agreements, instruments and documents, and to perform such further acts,
as Mortgagee shall request from time to time in order to carry out the purpose
of this Mortgage and agreements set forth herein.
19. Survival of Representations. All representations and warranties of
Mortgagor contained in this Mortgage shall survive the execution and delivery of
this Mortgage and shall be remade on the date of each borrowing under the Loan
Agreements.
IN WITNESS WHEREOF, American Builders & Contractors Supply Co., Inc. has
duly executed this Mortgage in favor of American National Bank and Trust Company
of Chicago, as Agent.
AMERICAN BUILDERS & CONTRACTORS
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ATTEST: SUPPLY CO., INC.
By
- ----------------------------- ---------------------------------
Title Title
-------------------------- ------------------------------
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STATE OF ILLINOIS )
) SS.
COUNTY OF COOK )
The foregoing Amended and Restated Patent, Trademark and License Mortgage
was executed and acknowledged before me this____ day of __________, 1993, by
____________________ and personally known to me to be the ____________________
and ____________________, respectively of American Builders & Contractors Supply
Co., Inc., a Texas corporation, on behalf of such corporation.
__________________________________
Notary Public
My Commission expires:
__________________________________
Agreed and Accepted this lst
day of July, 1993
AMERICAN NATIONAL BANK AND
TRUST COMPANY OF CHICAGO, as
Agent
By_________________________________
Title________________________________
THIS INSTRUMENT PREPARED BY AND
AFTER FILING RETURN TO:
David M. Mason, Esq.
Goldberg, Kohn, Bell, Black,
Rosenbloom & Moritz, Ltd.
Suite 3900
55 East Monroe
Chicago, Illinois 60603
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EXHIBITS
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Exhibit A Patents and Patent Applications
Exhibit B Trademarks and Trademark Registrations
Exhibit C License Agreements
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EXHIBIT A
Patents and Patent Applications
-------------------------------
NONE
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EXHIBIT B
Trademarks and Trademark Registrations
--------------------------------------
- -------------------------------------------------------------------------
Federal Service Mark
Registration Number Registration Date
------------ ------ -----------------
- -------------------------------------------------------------------------
ABC Supply Co., Inc. 1,394,477 May 20, 1986
- -------------------------------------------------------------------------
American Builders & 1,376,499 December 17, 1985
Contractors Supply Co., Inc.
- -------------------------------------------------------------------------
Unregistered Trademarks
-----------------------
Construction Trade Tools
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FIRST AMENDMENT TO AMENDED AND
RESTATED PATENT, TRADEMARK AND LICENSE MORTGAGE
This First Amendment to Amended and Restated Patent, Trademark and License
Mortgage (this "Amendment"), effective as of February 8, 1996 (the "Effective
Date"), is entered into between American Builders & Contractors Supply Co.,
Inc., a Texas corporation (the "Borrower"), and NationsBank of Texas, N.A.
("NationsBank"), as Agent for the Lenders which are parties to the Loan
Agreement described below (in such capacity, the "Agent"):
W I T N E S S E T H:
-------------------
WHEREAS, the Borrower, the Lenders named therein and American National Bank
and Trust Company of Chicago, as Agent for the Lenders, are party to that
certain Amended and Restated Loan and Security Agreement (the "Original Loan
Agreement") dated as of July 1, 1993, as amended by that certain First Amendment
to Amended and Restated Loan and Security Agreement dated as of September 2,
1994 (the "First Amendment"), that certain Waiver and Second Amendment to
Amended and Restated Loan and Security Agreement dated as of June 19, 1995 (the
"Second Amendment"), that certain Third Amendment to Amended and Restated Loan
and Security Agreement dated as of September 18, 1995 (the "Third Amendment"),
that certain Waiver and Fourth Amendment to Loan and Security Agreement dated as
of September 30, 1995 (the "Fourth Amendment"), and that certain Waiver and
Fifth Amendment to Loan and Security Agreement dated as of December 29, 1995
(the "Fifth Amendment"; the Original Loan Agreement, as amended by the First
Amendment, the Second Amendment, the Third Amendment, the Fourth Amendment and
the Fifth Amendment, is referred to hereinafter as the "Loan Agreement")
pursuant to which Lenders have agreed to make certain loans and extend certain
other financial accommodations to the Borrower;
WHEREAS, concurrently herewith, the Borrower, the Agent and the Lenders are
entering into that certain Waiver and Sixth Amendment to Loan Agreement (the
"Sixth Amendment") pursuant to which NationsBank of Texas, N.A. is replacing
American National Bank and Trust Company of Chicago as agent under the Loan
Agreement and the Loan Agreement is being modified in certain other respects;
WHEREAS, concurrently with the execution of the Original Loan Agreement,
the Borrower executed and delivered to American National Bank and Trust Company
of Chicago, as agent for the Lenders, a certain Amended and Restated Patent,
Trademark and License Mortgage (the "Mortgage"), which Mortgage granted to
American National Bank and Trust Company of Chicago, as agent for the Lenders, a
collateral assignment of and security interest in the patents, patent
applications, trademarks, trademark registrations, and license agreements
described on Schedule I attached hereto and incorporated herein by reference,
and which Mortgage was filed in the trademark records of the United Stated
Patent and Trademark Office on July 12, 1993, at Reel 1002, Frame 0378;
WHEREAS, the Borrower and the Agent desire to amend the Mortgage to reflect
that NationsBank of Texas, N.A. has replaced American National Bank and Trust
Company of Chicago as the agent for the Lenders under the Loan Agreement;
NOW, THEREFORE, in consideration of the terms and conditions contained
herein, and of any loans or financial accommodations heretofore, now or
hereafter made to or for the benefit of the Borrower by the Lenders, the parties
hereto agree as follows:
1. Definitions. All terms defined in the Loan Agreement and not otherwise
defined herein, wherever used in this Agreement, shall have the meanings
ascribed to such terms in the Loan Agreement as amended by the Sixth Amendment.
2. Amendment to Introductory Paragraph of the Mortgage. The introductory
paragraph of the Mortgage is hereby amended and restated to read in its entirety
as follows:
"THIS AMENDED AND RESTATED PATENT, TRADEMARK AND LICENSE MORTGAGE (the
"Mortgage") made as of this lst day of July, 1993, by American Builders &
Contractors Supply Co., Inc., a Texas corporation having an address at 820
Broad Street, Beloit, Wisconsin 53511 ("Mortgagor'), in favor of
NationsBank of Texas, N.A., as Agent, having an office at 901 Main Street,
6th Floor, Dallas, Texas 75202 ("Mortgagee"), hereby amends and restates in
its entirety that certain Patent, Trademark and License Mortgage made as of
December 13, 1990 by Mortgagor in favor of The First National Bank of
Chicago ("FNBC"), filed in the trademark records of the United States
Patent and Trademark Office on December 28, 1990 at Reel 0758, Frame 241
(the "Original Mortgage"), which Original Mortgage was assigned by FNBC to
Mortgagee by assignment dated March 5, 1992, filed in the trademark records
of the United States Patent and Trademark Office on March 12, 1992 at Reel
0890, Frame 321:"
3. Amendment to Final Paragraph of the Mortgage. The final paragraph of
the Mortgage is hereby amended and restated to read in its entirety as follows:
"IN WITNESS WHEREOF, American Builders & Contractors Supply Co., Inc.
has duly executed this Mortgage in favor of NationsBank of Texas, N.A., as
Agent. "
4. Representations and Warranties of Borrower. The Borrower hereby
represents and warrants that as of the date of this Amendment the
representations and warranties of the Borrower contained in the Mortgage are
true and correct on and as of the date hereof to the same extent as though made
on and as of the date hereof, and except as disclosed on Schedule 2 attached
hereto, all Exhibits attached to the Mortgage remain true, correct and complete.
5. Reference to and Effect on the Mortgage. Except as expressly provided
herein, the Mortgage shall remain unmodified and in full force and effect and is
hereby ratified and confirmed. The execution, delivery and effectiveness of this
Amendment shall not operate as a waiver or forbearance of (a) any right, power
or remedy of the Agent or the Lenders under the Mortgage, or (b) any Default or
Event of Default. This Amendment shall constitute a Financing Agreement. All
references in any of the Financing Agreements, other than this Amendment, to the
Mortgage shall be deemed to refer to the Mortgage as modified by this Amendment.
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6. Fees, Costs and Expenses. The Borrower agrees to pay on demand all
costs and expenses of the Lenders and the Agent in connection with the
preparation, execution, delivery and filing of this Amendment, including the
fees and out-of-pocket expenses of counsel for the Lenders and the Agent with
respect thereto.
7. Counterparts. This Amendment may be executed in any number of
counterparts and by different parties hereto as separate counterparts, each of
which counterparts, when so executed and delivered, shall be deemed to be an
original and all of which counterparts, when taken together, shall constitute
but one and the same agreement.
8. Effectiveness. This Amendment shall be deemed effective as of the
Effective Date specified in the preamble upon execution by the Borrower and the
Agent
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the day and year first written above.
AMERICAN BUILDERS &
ATTEST: CONTRACTORS SUPPLY CO., INC.
By:____________________________ By:_________________________________
Name:__________________________ Name:_______________________________
Title:_________________________ Title:______________________________
NATIONSBANK OF TEXAS, N.A.,
as Agent
By:_____________________________
Name:___________________________
Title:__________________________
Address for Notice:
901 Main Street, 6th Floor
Dallas, Texas 75202
Attention: Business Credit/Regional Manager: URGENT
STATE OF WISC (S)
(S)
COUNTY OF (S)
Subscribed and sworn to before me, the undersigned notary public, on the
____ day of ____________, 1996, by_______________ the_____________ of American
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Builders & Contractors Supply Co., Inc., a Texas corporation; for and on behalf
of said corporation.
[SEAL]
Notary Public in and for
The State of Wisconsin
My Commission Expires:___________________
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Schedule I
----------
Intellectual Property
Trademarks and Trademark Registrations
--------------------------------------
- ------------------------------------------------------------------------
Federal Service Mark
Registration Number Registration Date
- ------------------------------------------------------------------------
ABC Supply Co., Inc. 1,394,477 May 20, 1986
- ------------------------------------------------------------------------
American Builders &
Contractors Supply Co., Inc. 1,376,499 December 17, 1985
- ------------------------------------------------------------------------
Unregistered Trademarks
-----------------------
Construction Trade Tools
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Schedule 2
----------
Changes to Mortgage Exhibits
None
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