Exhibit 10.4


 


INTELLECTUAL PROPERTY SECURITY
AGREEMENT


 


This Intellectual Property Security Agreement (this “Agreement”)
is entered into as of October 31, 2009 by and between SILICON VALLEY BANK
(“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 17 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 license royalties 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 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


 


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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 6.10 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 California, without regard for
choice of law provisions.  Debtor and
Secured Party consent to the nonexclusive jurisdiction of any state or federal
court located in Santa Clara County, California.


 


5.             WAIVER OF RIGHT TO JURY TRIAL; JUDICIAL REFERENCE. TO THE EXTENT PERMITTED BY
APPLICABLE LAW, DEBTOR AND SECURED PARTY EACH WAIVE THEIR RIGHT TO A JURY TRIAL
OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS AGREEMENT,
THE LOAN DOCUMENTS OR ANY CONTEMPLATED TRANSACTION, INCLUDING CONTRACT, TORT,
BREACH OF DUTY AND ALL OTHER CLAIMS. THIS WAIVER IS A MATERIAL INDUCEMENT FOR
BOTH PARTIES TO ENTER INTO THIS AGREEMENT. 
EACH PARTY HAS REVIEWED THIS WAIVER WITH ITS COUNSEL.


 


WITHOUT
INTENDING IN ANY WAY TO LIMIT THE PARTIES’ AGREEMENT TO WAIVE THEIR RESPECTIVE
RIGHT TO A TRIAL BY JURY, IF THE ABOVE WAIVER OF THE RIGHT TO A TRIAL BY JURY
IS NOT ENFORCEABLE, THE PARTIES HERETO AGREE THAT ANY AND ALL DISPUTES OR
CONTROVERSIES


 


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OF ANY
NATURE BETWEEN THEM ARISING AT ANY TIME SHALL BE DECIDED BY A REFERENCE TO A
PRIVATE JUDGE, MUTUALLY SELECTED BY THE PARTIES (OR, IF THEY CANNOT AGREE, BY
THE PRESIDING JUDGE OF THE SANTA CLARA COUNTY, CALIFORNIA SUPERIOR COURT)
APPOINTED IN ACCORDANCE WITH CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 638
(OR PURSUANT TO COMPARABLE PROVISIONS OF FEDERAL LAW IF THE DISPUTE FALLS
WITHIN THE EXCLUSIVE JURISDICTION OF THE FEDERAL COURTS), SITTING WITHOUT A
JURY, IN SANTA CLARA COUNTY, CALIFORNIA; AND THE PARTIES HEREBY SUBMIT TO THE
JURISDICTION OF SUCH COURT.  THE
REFERENCE PROCEEDINGS SHALL BE CONDUCTED PURSUANT TO AND IN ACCORDANCE WITH THE
PROVISIONS OF CALIFORNIA CODE OF CIVIL PROCEDURE §§ 638 THROUGH 645.1,
INCLUSIVE.  THE PRIVATE JUDGE SHALL HAVE
THE POWER, AMONG OTHERS, TO GRANT PROVISIONAL RELIEF, INCLUDING WITHOUT
LIMITATION, ENTERING TEMPORARY RESTRAINING ORDERS, ISSUING PRELIMINARY AND PERMANENT
INJUNCTIONS AND APPOINTING RECEIVERS. 
ALL SUCH PROCEEDINGS SHALL BE CLOSED TO THE PUBLIC AND CONFIDENTIAL AND
ALL RECORDS RELATING THERETO SHALL BE PERMANENTLY SEALED.  IF DURING THE COURSE OF ANY DISPUTE, A PARTY
DESIRES TO SEEK PROVISIONAL RELIEF, BUT A JUDGE HAS NOT BEEN APPOINTED AT THAT
POINT PURSUANT TO THE JUDICIAL REFERENCE PROCEDURES, THEN SUCH PARTY MAY APPLY
TO THE SANTA CLARA COUNTY, CALIFORNIA SUPERIOR COURT FOR SUCH RELIEF.  THE PROCEEDING BEFORE THE PRIVATE JUDGE SHALL
BE CONDUCTED IN THE SAME MANNER AS IT WOULD BE BEFORE A COURT UNDER THE RULES
OF EVIDENCE APPLICABLE TO JUDICIAL PROCEEDINGS. 
THE PARTIES SHALL BE ENTITLED TO DISCOVERY WHICH SHALL BE CONDUCTED IN
THE SAME MANNER AS IT WOULD BE BEFORE A COURT UNDER THE RULES OF DISCOVERY
APPLICABLE TO JUDICIAL PROCEEDINGS.  THE
PRIVATE JUDGE SHALL OVERSEE DISCOVERY AND MAY ENFORCE ALL DISCOVERY RULES
AND ORDER APPLICABLE TO JUDICIAL PROCEEDINGS IN THE SAME MANNER AS A TRIAL
COURT JUDGE.  THE PARTIES AGREE THAT THE
SELECTED OR APPOINTED PRIVATE JUDGE SHALL HAVE THE POWER TO DECIDE ALL ISSUES
IN THE ACTION OR PROCEEDING, WHETHER OF FACT OR OF LAW, AND SHALL REPORT A
STATEMENT OF DECISION THEREON PURSUANT TO THE CALIFORNIA CODE OF CIVIL
PROCEDURE § 644(A).  NOTHING IN THIS
PARAGRAPH SHALL LIMIT THE RIGHT OF ANY PARTY AT ANY TIME TO EXERCISE SELF-HELP
REMEDIES, FORECLOSE AGAINST COLLATERAL, OR OBTAIN PROVISIONAL REMEDIES.  THE PRIVATE JUDGE SHALL ALSO DETERMINE ALL
ISSUES RELATING TO THE APPLICABILITY, INTERPRETATION, AND ENFORCEABILITY OF THIS
PARAGRAPH.


 


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


 


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IN WITNESS WHEREOF, the parties have cause 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

  	
  By:

  	
   

  
	
  Attn: Gail Itow,
  CFO

  	
  Name:

  	
   

  
	
  Fax:
  949.679.0113

  	
  Title:

  	
   

  
	
  Email: gitow@netlist.com

  	
   

  
	
   

  	
   

  
	
  Address of Secured
  Party:

  	
  Secured Party:

  
	
   

  	
   

  
	
  3003 Tasman
  Drive

  	
  SILICON VALLEY BANK

  
	
  Santa Clara,
  California 95054

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
  Form: 3/1/02

  	
   

  



 


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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

  	
   

  	
   

  	
   

  	
   

  



 

















 


EXHIBIT B


 


PATENTS


 


	
  Title

  	
   

  	
  Registration/

  Application

  Number

  	
   

  	
  Registration/

  Application

  Date

  
	
  See Schedule B-1
  attached hereto and incorporated herein

  	
   

  	
   

  	
   

  	
   

  



 

















 


EXHIBIT C


 


TRADEMARKS


 


	
  Title

  	
   

  	
  Registration/

  Application

  Number

  	
   

  	
  Registration/

  Application

  Date

  
	
  See Schedule C-1
  attached hereto and incorporated herein