Edgewater/Epic - Feb 2002 Bridge Loan Trademark License and Security

Agreement









EXHIBIT 4.20




 




TRADEMARK AND LICENSE SECURITY AGREEMENT




 




TRADEMARK AND

LICENSE SECURITY AGREEMENT (“Agreement”) dated as of February        , 2002, is between EPICEDGE, INC., a

Texas corporation (the “Company”), and Edgewater Private Equity Fund

III, L.P., a Delaware limited partnership(the “Lender”).




 




W I T N E S S E T H:




 




WHEREAS, the

Lender has agreed to loan the Company an aggregate principal amount of Six

Hundred Ten Thousand Dollars ($610,000) pursuant to that certain Secured

Promissory Note of even date herewith (the “Note”), made by the Company in

favor of the Lender; and




 




WHEREAS,

pursuant to the terms of the Note, the Company is required to execute this

Agreement in order to secure the obligations and liabilities of the Company

under the Note.




 




NOW,

THEREFORE, in consideration of the premises set forth herein and for other good

and valuable consideration, the receipt and sufficiency of which are hereby

acknowledged, Company agrees as follows:




 




1.             Defined Terms.




 




(a)           Unless otherwise defined herein, the

capitalized terms used herein which are defined in the Note shall have the

meanings specified in the Note.




 




(b)           The words “hereof,” “herein” and

“hereunder” and words of like import when used in this Agreement shall refer to

this Agreement as a whole and not to any particular provision of this

Agreement, and section and schedule references are to this Agreement unless

otherwise specified.




 




(c)           All terms defined in this Agreement

in the singular shall have comparable meanings when used in the plural, and vice

versa, unless otherwise specified.




 




(d)           For purposes of this Agreement, the

term “Event of Default” shall mean a Default under the Note occurring prior to

the full payment of all amounts due under the Note.




 




2.             Security Interest in Trademarks.  To secure the complete and timely payment,

performance and satisfaction of all of the Obligations, the Company hereby

grants to Lender a continuing security interest, with power of sale (upon the

occurrence of and during the continuance of an Event of Default and to the

extent permitted by applicable law) in all of Company’s interest in now owned

or existing and hereafter acquired or arising (collectively, the “Collateral”):




 




(a)           trademarks, registered trademarks and

trademark registrations, trade names, service marks, registered service marks

and service mark registrations, including, without limitation, the registered

trademarks and registered service marks listed on Schedule A, and

(i) the reissues, continuations, all renewals and extensions thereof,

(ii) all income, royalties,




 





























 




 damages and payments now and hereafter due and/or payable under

and with respect thereto, including, without limitation, payments under all

licenses entered into in connection therewith and damages and payments for past

or future infringements or dilutions thereof, (iii) the right to sue for

past, present and future infringements and dilutions thereof, and (iv) all

of such Company’s rights corresponding thereto throughout the world (all of the

foregoing registered trademarks and registered service marks together with the

items described in clauses (i)-(iv) in this paragraph 2(a), being sometimes

hereinafter individually and/or collectively referred to as the “Trademarks”);




 




(b)           the goodwill of such Company’s

business connected with and symbolized by the Trademarks; and




 




(c)           license agreements with any other

party in connection with any Trademarks or such other party’s trademarks,

registered trademarks, trademark registrations, trade names, service marks,

registered service marks and service mark registrations, whether such Company

is a licensor or licensee under any such license agreement, including, but not

limited to, the license agreements listed on Schedule B, and the

right upon the occurrence of and during the continuance of an Event of Default

to use the foregoing in connection with the enforcement of Lender’s rights

under the Note (all of the foregoing being hereinafter referred to collectively

as the “Licenses”). 

Notwithstanding the foregoing provisions of this Section 2,

the Licenses shall not include any license agreement with respect to which the

grant of the security interest contemplated by this Agreement would be a breach

or default thereunder; it being understood that upon request of the

Lender, Company will in good faith use commercially reasonable efforts to

obtain consent for the creation of a security interest in favor of the Lender

in Company’s rights under such license agreement.




 




3.             Restrictions on Future

Agreements.  The Company will not,

without Lender’s prior written consent, enter into any agreement, including,

without limitation, any license agreement, which is inconsistent with this

Agreement, and Company further agrees that it will not take any action, and

will use its best efforts not to permit any action to be taken by others

subject to its control, including licensees, or fail to take any action, which

would in any material respect affect the validity or enforcement of the rights

transferred to Lender under this Agreement or the rights associated with those

Trademarks which are necessary or desirable in the operation of Company’s

business.




 




4.             New Trademarks and Licenses.  The Company represents and warrants that the

Trademarks and Licenses listed on Schedule A and Schedule B,

respectively, include all of the Trademarks and Licenses now owned or held by

such Company.  If, prior to the

termination of this Agreement, Company shall (i) obtain rights to any new

Trademark or Licenses or (ii) become entitled to the benefit of any new or

existing Trademark or License, the provisions of Section 2 shall

automatically apply thereto and Company shall notify Lender in writing (with

reasonable detail) upon request of Lender of such changes.  Provided that Company shall, within

ten (10) days of approval, notify Lender and provide Lender with copies of

all relevant documents relating to the approval of an application for a

domestic Trademark by the United States Patent and Trademark Office.  The Company hereby authorizes Lender to

unilaterally modify this Agreement by (a) amending Schedule A

or Schedule B, as the case may be, to include any Trademarks or

Licenses which are described under Section 2, or under this 




 




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Section 4,

and (b) filing with the United States Patent and Trademark Office, in

addition to and not in substitution for, this Agreement, a duplicate original

of this Agreement containing on Schedule A or Schedule B

thereto, as the case may be, the revised list of Trademarks and/or Licenses

under Section 2 or this Section 4.  Notwithstanding the foregoing, the Company

hereby agrees that Lender’s security interest shall extend to all of the

collateral listed in Section 2 and this Section 4,

regardless of whether Lender actually amends Schedule A and Schedule B.




 




5.             Royalties.  Company hereby agrees that the use by Lender

of the Trademarks and Licenses and as authorized hereunder for collateral

security purposes (upon the occurrence of and during the continuance of an

Event of Default) shall be co-extensive with such Company’s rights thereunder

and with respect thereto and without any liability for royalties or other

related charges from Lender to Company.




 




6.             Nature and Continuation of

Lender’s Security Interest.  This

Agreement is made for collateral security purposes only.  This Agreement shall create a continuing

security interest in the Trademarks and Licenses and shall remain in full force

and effect until the Obligations have been paid in full and the Note

terminated.  At such time, the rights

granted to Lender hereunder shall also terminate, and Lender agrees to execute

a release and termination as necessary to effectuate the release of the

security interest granted to it.  If at

any time all or any part of any payment theretofore applied by the Lender to

any of the Obligations is or must be rescinded or returned by the Lender for

any reason whatsoever (including the insolvency, bankruptcy or reorganization

of the Company), such Obligations shall, for the purposes of this Agreement, to

the extent that such payment is or must be rescinded or returned, be deemed to

have continued in existence, notwithstanding such application by the Lender,

and this Agreement shall continue to be effective or be reinstated, as the case

may be, as to such Obligations, all as though such application by the Lender

had not been made.




 




7.             Right to Inspect; Further

Assignments and Security Interests. 

Lender shall have the right, at any reasonable time and from time to

time, to inspect the premises and to examine the books, records, and operations

of Company relating to the Trademarks and the Licenses including, without

limitation, Company’s quality control processes.  From and after the occurrence of, and during the continuance of,

an Event of Default, and subject to the terms of the Note, the Company agrees

that Lender or a conservator appointed by Lender, shall have the right to

establish such reasonable additional product quality controls as Lender or such

conservator, in its sole judgment, may deem necessary to assure maintenance of

the quality of products sold by Company under the Trademarks or the

Licenses.  The Company agrees

(i) not to sell or assign its respective interests in, or grant any

license under, the Trademarks or the Licenses outside the ordinary course of

business in accordance with past practices without the prior written consent of

Lender, (ii) to maintain the quality of any and all products in connection

with which the Trademarks are used, consistent with the quality of said

products as of the date hereof, and (iii) not to reduce the quality of

such products in any material respect without the prior written consent of

Lender.




 




8.             Duties of Company.




 




(a)           The Company shall have the duty:  (i) to prosecute diligently any

trademark applications or registrations or service mark applications or

registrations that are part 




 




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of the Trademarks pending as of

the date hereof or thereafter until the termination of this Agreement;

(ii) to make applications for trademarks and service marks as Company

deems appropriate, and (iii) to take commercially reasonable steps to

preserve and maintain all of Company’s rights in the trademark and service mark

applications and trademark and service mark registrations that are part of the

Trademarks.  Any expenses incurred in

connection with the foregoing shall be borne by Company.  The Company shall not abandon any material

trademark or service mark which is the subject of a registered trademark,

service mark or application therefor and which is or shall be, in such

Company’s commercially reasonable business judgment, necessary or economically

desirable in the operation of such Company’s business.  Company agrees to retain an experienced

trademark attorney reasonably acceptable to Lender for filing and prosecution

of all applications and other proceedings.




 




(b)           Lender shall not have any duty with

respect to the Trademarks or Licenses. 

Without limiting the generality of the foregoing, Lender shall not be

under any obligation to take any steps necessary to preserve rights in the

Trademarks and Licenses against any other parties, but may do so at Lender’s

option upon the occurrence of and during the continuance of an Event of

Default, and all reasonable expenses incurred in connection therewith shall be

for the sole account of Company and added to the Obligations secured hereby.




 




9.             Lender’s Right to Sue.  Upon the occurrence of and during the

continuance of an Event of Default, and subject to the terms of the Note,

Lender shall have the right, but shall not be obligated, to bring suit to

enforce the Trademarks and the Licenses and, if Lender shall commence any such

suit, Company shall, at the request of Lender, do any and all lawful acts and

execute any and all proper documents reasonably required by Lender in aid of

such enforcement.  The Company shall,

upon demand, promptly reimburse and indemnify Lender for all reasonable costs

and expenses incurred by Lender in the exercise of its rights under this Section 9

(including, without limitation, all attorneys’ and paralegals’ fees).  If, for any reason whatsoever, Lender is not

reimbursed with respect to the costs and expenses referred to in the preceding

sentence, such reasonable costs and expenses shall be added to the Obligations

secured hereby.




 




10.           Waivers.  No course of dealing between Company and

Lender, and no failure to exercise or delay in exercising on the part of Lender

any right, power or privilege hereunder or under the other Loan Documents shall

operate as a waiver of any of Lender’s rights, powers or privileges.  No single or partial exercise of any right,

power or privilege hereunder or under Note shall preclude any other or further

exercise thereof or the exercise of any other right, power or privilege.




 




11.           Lender’s Exercise of Rights and

Remedies Upon Default. 

Notwithstanding anything set forth herein to the contrary, it is hereby

expressly agreed that upon the occurrence of and during the continuance of an

Event of  Default, Lender may exercise

any of the rights and remedies provided in this Agreement and any of the other

Loan Documents.  Without limiting the

foregoing, Company acknowledges and agrees that upon the occurrence of and

during the continuance of an Event of 

Default, Lender or its nominee may use the Trademarks and Licenses to complete

the manufacture of, assemble, package, distribute, prepare for sale and sell

the inventory, or for any other purpose in connection with the conduct of

Company’s business.




 




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12.           Intent-to-Use Applications.  Notwithstanding any provision of this

Agreement, the applicable Uniform Commercial Code or any other agreement or

law, in no event shall any party be required or permitted under this Agreement

to assign, convey or transfer any trademark or service mark that is the subject

of an application for registration under Section 1(b) of the Lanham

Act (15 U.S.C. § 1051(b)), as amended, prior to the filing of the verified

statement of use under Section 1(d) of the Lanham Act

(15 U.S.C. § 1051(d)), as amended except in connection with the ongoing

business to which such trademark or service mark pertains.




 




13.           Severability.  The provisions of this Agreement are

severable, and if any clause or provision shall be held invalid or

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

Agreement in any jurisdiction.




 




14.           Modification.  This Agreement cannot be altered, amended or

modified in any way, except as specifically provided in Section 2

and Section 4 hereof or by a writing signed by the parties hereto.




 




15.           Cumulative Remedies; Power of

Attorney.  All of Lender’s rights

and remedies with respect to the Trademarks and the Licenses, whether

established hereby, by any other agreements or by law, shall be cumulative and

may be exercised singularly or concurrently. 

The Company hereby irrevocably appoints Lender as Company’s  attorney-in-fact, with full authority in the

place and stead of Company and in the name of Company or otherwise to carry out

the acts described below.  Subject to

the terms of the Note, upon the occurrence of and during the continuance of an

Event of Default, the Company hereby authorizes Lender to, in its sole

discretion, (i) endorse Company’s name on all applications, documents,

papers and instruments necessary or desirable for Lender to exercise its rights

and remedies regarding the Trademarks and the Licenses, (ii) take any

other actions to exercise its rights and remedies regarding the Trademarks and

the Licenses as Lender deems are in its best interest, (iii) grant or

issue any exclusive or nonexclusive license under the Trademarks to anyone on

commercially reasonable terms, and (iv) assign, pledge, convey or

otherwise transfer title in or dispose of the Trademarks to anyone on

commercially reasonable terms.  Lender

shall take no action pursuant to subsection (i), (ii), (iii) or (iv) of this Section 15

without taking like action with respect to the entire goodwill of Company’s

business connected with the use of, and symbolized by, such Trademarks.  The Company hereby ratifies all such actions

that such attorney-in-fact shall lawfully do or cause to be done by virtue

hereof.  This power of attorney is

coupled with an interest and shall be irrevocable until this Agreement shall

have been terminated pursuant to Section 6 hereof.  The Company acknowledges and agrees that

this Agreement is not intended to limit or restrict in any way the rights and

remedies of Lender under the Loan Documents, but rather is intended to

facilitate the exercise of such rights and remedies.  Lender shall have, in addition to all other rights and remedies

given it by the terms of this Agreement, 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, respectively, either (y) the

Trademarks may be located or deemed located, or (z) the Licenses were

granted (the “UCC”).




 




16.           Binding Effect; Benefits.  This Agreement shall be binding upon Company

and its successors and assigns, and shall inure to the benefit of Lender and

its nominees, successors and




 




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assigns. Company’s successors

and assigns shall include, without limitation, a receiver, trustee or

debtor-in-possession of or for Company; provided, however that Company shall not

voluntarily assign its obligations hereunder without the prior written consent

of Lender.




 




17.           Governing Law.  This Agreement shall be construed in

accordance with and governed by the laws of the State of Illinois applicable to

contracts made and to be performed entirely within such State, subject,

however, to the applicability of the UCC of any jurisdiction in which any

Collateral may be located or deemed located at any given time.




 




18.           Forum

Selection.  ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER

OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, SHALL

BE BROUGHT AND MAINTAINED EXCLUSIVELY IN THE COURTS OF THE STATE OF ILLINOIS OR

IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS; PROVIDED

THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY

MAY BE BROUGHT, AT THE LENDER’S OPTION, IN THE COURTS OF ANY JURISDICTION

WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE LOCATED OR DEEMED LOCATED.  COMPANY HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS

TO THE JURISDICTION OF THE COURTS OF THE STATE OF ILLINOIS AND OF THE UNITED

STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS FOR THE PURPOSE OF

ANY SUCH LITIGATION AS SET FORTH ABOVE. 

COMPANY FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY

REGISTERED MAIL, POSTAGE PREPAID, TO THE ADDRESS OF THE COMPANY SPECIFIED IN,

OR PURSUANT TO, THE NOTE OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF

ILLINOIS.  COMPANY HEREBY EXPRESSLY AND

IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH

IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION

BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH

LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.




 




19.           Jury

Trial.  EACH OF COMPANY AND LENDER HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN

ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT,

THE OTHER LOAN DOCUMENTS AND ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT

DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH

OR THEREWITH OR ARISING FROM ANY FINANCING RELATIONSHIP EXISTING IN CONNECTION

WITH ANY OF THE FOREGOING, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL

BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.




 




20.           Notices.  All notices or other communications

hereunder shall be given in the manner and to the addresses set forth in the

Note.




 




21.           Section Headings.  The section headings herein are for

convenience of reference only and shall not affect in any way the interpretation

of any of the provisions hereof.




 




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22.           Execution in Counterparts.  This Agreement may be executed in any number

of counterparts and by different parties hereto in separate counterparts, each of

which when so executed shall be deemed to be an original and all of which taken

together shall constitute one and the same agreement.  Delivery of an executed counterpart of this Agreement by

telefacsimile shall be equally as effective as delivery of a manually executed

counterpart of this Agreement.  Any

party delivering an executed counterpart of this Agreement by telefacsimile

shall also deliver a manually executed counterpart of this Agreement, but the

failure to deliver a manually executed counterpart shall not affect the

validity, enforceability, and binding effect of this Agreement.




 




23.           Right of Recordal of Security

Interest.  Lender shall have the

right, but not the obligation, at the expense of Company, to record this

Agreement in the United States Patent and Trademark Office and with such other

recording authorities deemed reasonable and proper by Lender.  Upon satisfaction in full of the Obligations

and termination of the Note, Company shall have the right to effect recordal of

such satisfaction or termination at the expense of Company in the United States

Patent and Trademark Office and with such other recording authorities deemed

reasonable and proper by Company. 

Lender and Company shall cooperate to effect all such recordals

hereunder.




 




[SIGNATURE PAGE FOLLOWS]




 




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Trademark and

License Security Agreement Signature Page




 




IN WITNESS

WHEREOF, the parties hereto have duly executed this Agreement on the day and

year first above written.




 




 




	

   


  	

  Company:


  
	

   


  	

   


  
	

   


  	

  EPICEDGE,

  INC., a Texas corporation


  
	

   


  	

   


  
	

   


  	

  By:


  	

   


  
	

   


  	

  Title:


  	

   


  
	

  ACCEPTED AND

  AGREED BY:


  	

   


  
	

   


  	

   


  
	

  EDGEWATER

  PRIVATE EQUITY FUND


  	

   


  
	

   III, L.P., as Lender


  	

   


  
	

   


  	

   


  
	

  By:  Edgewater III Management, L.P.


  	

   


  
	

  Its:  General Partner


  	

   


  
	

   


  	

   


  
	

  By:  Gordon Management, Inc.


  	

   


  
	

  Its:  General Partner


  	

   


  
	

   


  	

   


  
	

  By:


  	

   


  	

   


  	

   


  	 

	

  Title:


  	

   


  	

   


  	

   


  	 

										





 





























 




	

  STATE OF


  	

   


  	

  )


  	

   


  	

   


  	 

	

   


  	

   


  	

  ) SS


  	

   


  	

   


  
	

  COUNTY OF


  	

   


  	

  )


  	

   


  	

   


  	 

												





 




The foregoing

Trademark and License Security Agreement was executed and acknowledged before

me this         day of                                    , 2002, by                                         , personally known to me to be the                                            

of EpicEdge, Inc., a Texas corporation, on behalf of such entity.




 




(SEAL)




 




	

   


  	

  Notary

  Public


  	

   


  
	

   


  	

  My

  commission expires


  	

   


  
				





 




 





























 




	

  STATE OF


  	

   


  	

  )


  	

   


  	

   


  	 

	

   


  	

   


  	

  ) SS


  	

   


  	

   


  
	

  COUNTY OF


  	

   


  	

  )


  	

   


  	

   


  	 

												





 




The foregoing

Trademark and License Security Agreement was executed and acknowledged before

me this          day of                                            ,

2002, by                                                , personally known

to me to be the                                              of Edgewater Private

Equity Fund III, L.P., as Lender.




 




(SEAL)




 




	

   


  	

  Notary

  Public


  	

   


  
	

   


  	

  My

  commission expires


  	

   


  
				





 





























SCHEDULE A




to Trademark and License Security Agreement




 




TRADEMARKS




 




[COMPANY TO COMPLETE]




 





























SCHEDULE B




to Trademark and License Security Agreement




 




LICENSES




 




[COMPANY TO COMPLETE]