Exhibit 10.3

 

INTELLECTUAL PROPERTY SECURITY AGREEMENT

 

This Intellectual Property Security Agreement (this “Agreement”) is entered into
as of July 18, 2013 by and between DBD CREDIT FUNDING LLC (“Secured Party”), on
the one hand, and NETLIST, INC., a Delaware corporation (“Debtor”), on the other
hand.

 

RECITALS

 

A.                                    Secured Party and Debtor are entering into
that certain Loan and Security Agreement, dated as of an Effective Date on or
about the date hereof (as amended, restated supplemented, or otherwise modified
from time to time, the “Loan Agreement”), pursuant to which Secured Party has
agreed to make certain advances of money and to extend certain financial
accommodations (collectively, the “Loans”), subject to the terms and conditions
set forth therein. Capitalized terms used but not otherwise defined herein shall
have the meanings given them in the Loan Agreement.

 

B.                                    Pursuant to the terms of the Loan
Agreement, Debtor has granted to Secured Party security interests in all of
Debtor’s right, title and interest, whether presently existing or hereafter
acquired, in, to all intellectual property and all other Collateral.

 

NOW, THEREFORE, as collateral security for the payment and performance when due
of all of the Obligations, each Debtor hereby grants, represents, warrants,
covenants and agrees as follows:

 

AGREEMENT

 

1.                                      Grant of Security Interest. To secure
all of the Obligations, each Debtor grants and pledges to Secured Party a
security interest in all of such Debtor’s right, title and interest in, to and
under its intellectual property, including without limitation the following:

 

(a)                                 All present and future United States
registered copyrights and copyright registrations, including, without
limitation, the registered copyrights, maskworks, software, computer programs
and other works of authorship subject to United States copyright protection
listed in Exhibit A to this Agreement (and including all of the exclusive rights
afforded a copyright registrant in the United States under 37 U.S.C. §106 and
any exclusive rights which may in the future arise by act of Congress or
otherwise) and all present and future applications for copyright registrations
(including applications for copyright registrations of derivative works and
compilations) (collectively, the “Registered Copyrights”), and any and all
royalties, payments, and other amounts payable to Debtor in connection with the
Registered Copyrights, together with all renewals and extensions of the
Registered Copyrights, the right to recover for all past, present, and future
infringements of the Registered Copyrights, and all computer programs, computer
databases, computer program flow diagrams, source codes, object codes and all
tangible property embodying or incorporating the Registered Copyrights, and all
other rights of every kind whatsoever accruing thereunder or pertaining thereto.

 

(b)                                 All present and future copyrights,
maskworks, software, computer programs and other works of authorship subject to
(or capable of becoming subject to) United States copyright protection which are
not registered in the United States Copyright Office (the

 

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“Unregistered Copyrights”), whether now owned or hereafter acquired, and any and
all royalties, payments, and other amounts payable to Debtor in connection with
the Unregistered Copyrights, together with all renewals and extensions of the
Unregistered Copyrights, the right to recover for all past, present, and future
infringements of the Unregistered Copyrights, and all computer programs,
computer databases, computer program flow diagrams, source codes, object codes
and all tangible property embodying or incorporating the Unregistered
Copyrights, and all other rights of every kind whatsoever accruing thereunder or
pertaining thereto. The Registered Copyrights and the Unregistered Copyrights
collectively are referred to herein as the “Copyrights.”

 

(c)                                  All right, title and interest in and to any
and all present and future license agreements with respect to the Copyrights.

 

(d)                                 All present and future accounts, accounts
receivable, royalties, and other rights to payment arising from, in connection
with or relating to the Copyrights.

 

(e)                                  All patents, patent applications and like
protections including, without limitation, improvements, divisions,
continuations, renewals, reissues, extensions and continuations-in-part of the
same, including without limitation the patents and patent applications set forth
on Exhibit B attached hereto (collectively, the “Patents”);

 

(f)                                   All trademark and servicemark rights,
whether registered or not, applications to register and registrations of the
same and like protections, and the entire goodwill of the business of Debtor
connected with and symbolized by such trademarks, including without limitation
those set forth on Exhibit C attached hereto (collectively, the “Trademarks”);

 

(g)                                  Any and all claims for damages by way of
past, present and future infringements of any of the rights included above, with
the right, but not the obligation, to sue for and collect such damages for said
use or infringement of the rights identified above;

 

(h)                                 All licenses or other rights to use any of
the Copyrights, Patents or Trademarks, and all license fees and royalties
arising from such use to the extent permitted by such license or rights;

 

(i)                                     All amendments, extensions, renewals and
extensions of any of the Copyrights, Trademarks or Patents; and

 

(j)                                    All proceeds and products of the
foregoing, including without limitation all payments under insurance or any
indemnity or warranty payable in respect of any of the foregoing, and all income
or royalties paid or payable in connection with any of the foregoing (including
in connection with the licensing thereof) and proceeds of infringement suits,
and all rights corresponding to the foregoing throughout the world and all
re-issues, divisions continuations, renewals, extensions and
continuations-in-part of the foregoing.

 

2.                                      Loan Agreement. The security interests
hereunder are granted in conjunction with the security interests granted to
Secured Party under the Loan Agreement. The rights and remedies of Secured Party
with respect to the security interests granted hereby are in addition to those
set forth in the Loan Agreement and the other Loan Documents, and those which
are now

 

2

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or hereafter available to Secured Party as a matter of law or equity. Each
right, power and remedy of Secured Party provided for herein or in the Loan
Agreement or any of the other Loan Documents, or now or hereafter existing at
law or in equity shall be cumulative and concurrent and shall be in addition to
every right, power or remedy provided for herein and the exercise by Secured
Party of any one or more of the rights, powers or remedies provided for in this
Agreement, the Loan Agreement or any of the other Loan Documents, or now or
hereafter existing at law or in equity, shall not preclude the simultaneous or
later exercise by any person, including Secured Party, of any or all other
rights, powers or remedies.

 

3.                                      Covenants and Warranties. Debtor
represents, warrants, covenants and agrees as follows:

 

(a)                                 Debtor shall undertake all commercially
reasonable measures to cause its employees, agents and independent contractors
to assign to Debtor all rights of authorship to any copyrighted material in
which Debtor has or may subsequently acquire any right or interest.

 

(b)                                 Debtor shall promptly advise Secured Party
of any Trademark, Patent or Registered Copyright not specified in this
Agreement, which is hereafter acquired by Debtor.

 

(c)                                  Section 6.11 of the Loan Agreement hereby
is incorporated herein as though fully set forth herein, mutatis mutandis.

 

4.                                      General. If any action relating to this
Agreement is brought by either party hereto against the other party, the
prevailing party shall be entitled to recover reasonable attorneys fees, costs
and disbursements. This Agreement may be amended only by a written instrument
signed by both parties hereto. To the extent that any provision of this
Agreement conflicts with any provision of the Loan Agreement, the provision
giving Secured Party greater rights or remedies shall govern, it being
understood that the purpose of this Agreement is to add to, and not detract
from, the rights granted to Secured Party under the Loan Agreement. This
Agreement, the Loan Agreement, and the other Loan Documents comprise the entire
agreement of the parties with respect to the matters addressed in this
Agreement. This Agreement shall be governed by the laws of the State of New
York, without regard for choice of law provisions. Debtor and Secured Party
consent to the exclusive jurisdiction of the Supreme Court of the State of New
York sitting in New York County and of the United States District Court of the
Southern District of New York, and any appellate court from any thereof;
provided, however, that nothing in this Agreement shall be deemed to operate to
preclude Secured Party from bringing suit or taking other legal action in any
other jurisdiction to realize on the Collateral or any other security for the
Obligations, or to enforce a judgment or other court order in favor of Secured
Party. Debtor hereby waives personal service of the summons, complaints, and
other process issued in such action or suit and agrees that service of such
summons, complaints, and other process may be made by registered or certified
mail addressed to Debtor at the address set forth in the Loan Agreement and that
service so made shall be deemed completed upon the earlier to occur of Debtor’s
actual receipt thereof or three (3) days after deposit in the U.S. mails, proper
postage prepaid.

 

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5. WAIVER OF RIGHT TO JURY TRIAL; JUDICIAL REFERENCE. EACH PARTY HERETO HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION 5.

 

WITHOUT INTENDING IN ANY WAY TO LIMIT THE PARTIES’ AGREEMENT TO WAIVE THEIR
RESPECTIVE RIGHT TO A TRIAL BY JURY, Debtor irrevocably and unconditionally
agrees that it will not commence any action, litigation or proceeding of any
kind or description, whether in law or equity, whether in contract or in tort or
otherwise, against Secured Party, or any Related Party of Secured Party in any
way relating to this Agreement or the transactions relating hereto, in any forum
other than the courts of the State of New York sitting in New York County, and
of the United States District Court of the Southern District of New York, and
any appellate court from any thereof, and each of the parties hereto irrevocably
and unconditionally submits to the jurisdiction of such courts and agrees that
all claims in respect of any such action, litigation or proceeding may be heard
and determined in such New York State court or, to the fullest extent permitted
by applicable law, in such federal court. Each of the parties hereto agrees that
a final judgment in any such action, litigation or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement shall affect any
right that Secured Party may otherwise have to bring any action or proceeding
relating to this Agreement against Debtor or its properties in the courts of any
jurisdiction.

 

[remainder of page intentionally left blank; signature page immediately follows]

 

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IN WITNESS WHEREOF, the parties have caused this Intellectual Property Security
Agreement to be duly executed by its officers thereunto duly authorized as of
the first date written above.

 

 

Address of Debtor:

Debtor:

 

 

NETLIST, INC.

NETLIST, INC.

51 Discovery, Suite 150

 

Irvine, CA 92618

 

Attn: Gail Sasaki, CFO

By:

/s/ Gail Sasaki

Fax: 949.435.0031

Name: Gail Sasaki

Email: gsasaki@netlist.com

Title: Chief Financial Officer

 

[Signature Page to IP Security Agreement]

 

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Address of Secured Party:

Secured Party:

 

 

 

 

1345 Avenue of the Americas, 46th Floor

DBD CREDIT FUNDING LLC

 

 

New York, NY 10105

 

 

 

 

 

 

By:

/s/ Constantine M. Dakolias

 

 

 

 

Name:

CONSTANTINE M. DAKOLIAS

 

 

 

 

Title:

PRESIDENT

 

[Signature Page to IP Security Agreement]

 

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EXHIBIT A

 

REGISTERED COPYRIGHTS
(including copyrights that are the subject of an application for registration)

 

Title

 

Registration/
Application
Number

 

Registration/
Application
Date

 

NONE

 

 

 

 

 

 

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EXHIBIT B

 

PATENTS

 

Title

 

Patent No./
Application
Number

 

Issue/
Application
Date

 

ARRANGEMENT OF INTEGRATED CIRCUITS IN A MEMORY MODULE

 

6,751,113

 

15-Jun-2004

 

ARRANGEMENT OF INTEGRATED CIRCUITS IN A MEMORY MODULE

 

6,873,534

 

29-Mar-2005

 

ARRANGEMENT OF INTEGRATED CIRCUITS IN A MEMORY MODULE

 

6,930,903

 

16-Aug-2005

 

ARRANGEMENT OF INTEGRATED CIRCUITS IN A MEMORY MODULE

 

6,930,900

 

16-Aug-2005

 

HIGH DENSITY MEMORY MODULE USING STACKED PRINTED CIRCUIT BOARDS

 

7,254,036

 

7-Aug-2007

 

HIGH DENSITY MEMORY MODULE USING STACKED PRINTED CIRCUIT BOARDS

 

7,375,970

 

20-May-2008

 

CIRCUIT CARD WITH FLEXIBLE CONNECTION FOR MEMORY MODULE WITH HEAT SPREADER

 

7,442,050

 

28-Oct-2008

 

HIGH DENSITY MODULE HAVING AT LEAST TWO SUBSTRATES AND AT LEAST ONE THERMALLY
CONDUCTIVE LAYER THEREBETWEEN

 

7,630,202

 

8-Dec-2009

 

CIRCUIT WITH FLEXIBLE PORTION

 

7,811,097

 

12-Oct-2010

 

MODULE HAVING AT LEAST TWO SURFACES AND AT LEAST ONE THERMALLY CONDUCTIVE LAYER
THEREBETWEEN

 

7,839,645

 

23-Nov-2010

 

CIRCUIT WITH FLEXIBLE PORTION

 

8,033,836

 

11-Oct-2011

 

CIRCUIT WITH FLEXIBLE PORTION

 

8,287,291

 

16-Oct-2012

 

MODULE HAVING AT LEAST TWO SURFACES AND AT LEAST ONE THERMALLY CONDUCTIVE LAYER
THEREBETWEEN

 

8,345,427

 

1-Jan-2013

 

MODULE HAVING AT LEAST TWO SURFACES AND AT LEAST ONE THERMALLY CONDUCTIVE LAYER
THEREBETWEEN

 

13/731,014

 

29-Dec-2012

 

CIRCUIT WITH FLEXIBLE PORTION

 

13/653254

 

16-Oct-2012

 

MEMORY MODULE WITH FLEXIBLE ELECTRICAL CONDUITS AND ELECTRICAL CONNECTORS
EXTENDING THROUGH HEAT SPREADER (thin flex)

 

13/921,159

 

18-Jun-2013

 

A Multi-Rank Memory Module

 

61/682,249

 

11-Aug-2012

 

MEMORY BOARD WITH SELF-TESTING CAPABILITY

 

8,001,434

 

16-Aug-2011

 

CIRCUIT PROVIDING LOAD ISOLATION AND NOISE REDUCTION

 

8,154,901

 

10-Apr-2012

 

 

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Title

 

Patent No./
Application
Number

 

Issue/
Application
Date

 

SYSTEMS AND METHODS FOR REFRESHING A MEMORY MODULE

 

8,264,903

 

11-Sep-2012

 

MEMORY BOARD WITH SELF-TESTING CAPABILITY

 

8,359,501

 

22-Jan-2013

 

SYSTEMS AND METHODS FOR HANDSHAKING WITH A MEMORY MODULE

 

8,489,837

 

16-Jul-2013

 

CIRCUIT PROVIDING LOAD ISOLATION AND NOISE REDUCTION

 

13/412243

 

5-Mar-2012

 

APPARATUS AND METHOD FOR SELF-TEST IN A MULTI-RANK MEMORY MODULE

 

13/745,790

 

19-Jan-2013

 

SYSTEMS AND METHODS FOR REFRESHING A MEMORY MODULE

 

13/584679

 

13-Aug-2012

 

METHOD AND APPARATUS FOR OPTIMIZING DRIVER LOAD IN A MEMORY PACKAGE

 

13/288850

 

3-Nov-2011

 

METHOD OF RESOLVING INTEROPERABILITY ISSUE AMONG MULTIPLE TYPES OF DUAL IN-LINE
MEMORY MODULES IN THE SAME MEMORY SUBSYSTEM

 

13/411,344

 

2-Mar-2012

 

MEMORY MODULE WITH DISTRIBUTED DATA BUFFERS AND METHOD OF OPERATION

 

61/676,883

 

17-Jul-2012

 

CIRCUIT FOR MEMORY MODULE

 

13/28708 1

 

1-Nov-2011

 

SYSTEM AND METHOD UTILIZING DISTRIBUTED BYTE-WISE BUFFERS ON A MEMORY MODULE

 

99,123,030

 

13-Jul-2010

 

ARCHITECTURE FOR MEMORY MODULE WITH PACKAGES OF THREE-DIMENSIONAL STACKED (3DS)
MEMORY CHIPS

 

201080039043.0

 

12-Mar-12

 

ARCHITECTURE FOR MEMORY MODULE WITH PACKAGES OF THREE-DIMENSIONAL STACKED (3DS)
MEMORY CHIPS

 

10730021.2

 

7-Feb-12

 

ARCHITECTURE FOR MEMORY MODULE WITH PACKAGES OF THREE-DIMENSIONAL STACKED (3DS)
MEMORY CHIPS

 

2012-520662

 

13-Jan-12

 

ARCHITECTURE FOR MEMORY MODULE WITH PACKAGES OF THREE-DIMENSIONAL STACKED (3DS)
MEMORY CHIPS

 

2012-7004038

 

15-Feb-12

 

HIGH-DENSITY MEMORY MODULE UTILIZING LOW- DENSITY MEMORY COMPONENTS

 

7,286,436

 

23-Oct-2007

 

MEMORY MODULE DECODER

 

7,289,386

 

30-Oct-2007

 

MEMORY MODULE WITH A CIRCUIT PROVIDING LOAD ISOLATION AND MEMORY DOMAIN
TRANSLATION

 

7,532,537

 

12-May-2009

 

MEMORY MODULE DECODER

 

7,619,912

 

17-Nov-2009

 

MEMORY MODULE WITH A CIRCUIT PROVIDING LOAD ISOLATION AND MEMORY DOMAIN

 

7,636,274

 

22-Dec-2009

 

 

9

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Title

 

Patent No./
Application
Number

 

Issue/
Application
Date

 

TRANSLATION

 

 

 

 

 

MEMORY MODULE DECODER

 

7,864,627

 

4-Jan-2011

 

CIRCUIT PROVIDING LOAD ISOLATION AND MEMORY DOMAIN TRANSLATION FOR MEMORY MODULE

 

7,881,150

 

1-Feb-2011

 

CIRCUIT PROVIDING LOAD ISOLATION AND MEMORY DOMAIN TRANSLATION FOR MEMORY MODULE

 

7,916,574

 

29-Mar-2011

 

CIRCUIT PROVIDING LOAD ISOLATION AND MEMORY DOMAIN TRANSLATION FOR MEMORY MODULE

 

8,072,837

 

6-Dec-2011

 

CIRCUIT FOR PROVIDING CHIP-SELECT SIGNALS TO A PLURALITY OF RANKS OF A DDR
MEMORY MODULE

 

8,081,535

 

20-Dec-2011

 

CIRCUIT FOR PROVIDING CHIP-SELECT SIGNALS TO A PLURALITY OF RANKS OF A DDR
MEMORY MODULE

 

8,081,537

 

20-Dec-2011

 

CIRCUIT FOR MEMORY MODULE

 

8,081,536

 

20-Dec-2011

 

SYSTEM AND METHOD OF INCREASING ADDRESSABLE MEMORY SPACE ON A MEMORY BOARD

 

12/504131

 

16-Jul-2009

 

CIRCUIT FOR PROVIDING CHIP-SELECT SIGNALS TO A PLURALITY OF RANKS OF A DDR
MEMORY MODULE

 

13/287042

 

1-Nov-2011

 

SYSTEM AND METHOD UTILIZING DISTRIBUTED BYTE-WISE BUFFERS ON A MEMORY MODULE

 

12/761 179

 

15-Apr-2010

 

HEAT SPREADER FOR ELECTRONIC MODULES

 

7,619,893

 

17-Nov-2009

 

HEAT SPREADER FOR MEMORY MODULES

 

7,839,643

 

23-Nov-2010

 

HEAT DISSIPATION FOR ELECTRONIC MODULES

 

8,018,723

 

13-Sep-2011

 

MEMORY MODULE HAVING THERMAL CONDUITS

 

8,488,325

 

16-Jul-2013

 

HEAT DISSIPATION FOR ELECTRONIC MODULES

 

13/205477

 

8-Aug-2011

 

 

10

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EXHIBIT C

 

TRADEMARKS

 

Mark

 

Registration/
Serial
Number

 

Registration/
Application
Date

 

N (DESIGN)

 

3502943

 

September 16, 2008

 

NETLIST

 

3496959

 

September 2, 2008

 

NETLIST

 

3624509

 

May 19, 2009

 

N (DESIGN)

 

3624502

 

May 19, 2009

 

HYPERCLOUD

 

4120406

 

April 3, 2012

 

HyperCloud, the low latency memory

 

85739482

 

September 26, 2012

 

HYPERSTREAM

 

4018527

 

August 30, 2011

 

 

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