Unassociated Document


    
      

    

    EXHIBIT
D – For Filing

     

    INTELLECTUAL
PROPERTY SECURITY AGREEMENT

     

    This
INTELLECTUAL PROPERTY SECURITY AGREEMENT (this “Agreement”), dated as of April ___, 2008, is made by AXIS TECHNOLOGIES, INC., a Delaware corporation
(the “Grantor”), in favor of GEMINI STRATEGIES, LLC, as
collateral agent (“Agent”) for the holder(s) of 10% Senior Secured Convertible Notes issued
or to be issued in the original aggregate principal amount of up to $1,500,000 (the “Notes”) by Axis Technologies
Group, Inc., a Delaware
corporation (“Company”), pursuant to the Purchase Agreement
(as defined below) (collectively, together with their endorsees, transferees and
assigns, the “Lenders”).

     

    W I T N E
S S E T H:

     

    WHEREAS, the Company and the Lenders are
party to that certain Securities Purchase Agreement, dated on or about
on or about the date hereof (“Purchase
Agreement”),
pursuant to which the
Company issued or is issuing the Notes, among other things;

     

    WHEREAS, the Grantor is a wholly-owned
subsidiary of the Company and will benefit from the issuance of the Notes
pursuant to the Purchase Agreement;

     

    WHEREAS,
pursuant to that certain Subsidiary Guarantee, dated as of the date hereof
(“Guarantee”),
the Grantor has agreed to
guarantee and act as surety for payment of the Notes;

    


    WHEREAS, contemporaneously herewith the
Grantor and the Company are entering into a Security Agreement (“Security
Agreement”), pursuant to which the Grantor has
granted a security interest in its assets and properties to secure the
satisfaction of the Company’s obligations under the Notes and the Grantor’s obligations under the
Guarantee, among other things;
and

     

    WHEREAS, the Grantor is obligated under
the Security Agreement to take such further actions as the collateral Agent
requests to further perfect the Lenders’ security interest granted under the
Security Agreement, including without limitation with respect to intellectual
property;

     

    NOW,
THEREFORE, in consideration of the premises and mutual covenants herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Grantor hereby agrees as
follows:

     

    DEFINED
TERMS.

     

    (a)           Certain Defined
Terms.  As used in this Agreement, the following terms shall
have the meanings set forth below:

     

    “Copyrights”
means copyrights and copyright registrations, including without limitation the
copyright registrations and recordings listed on Schedule I attached
hereto, if any, and (i) all reissues, continuations, extensions or renewals
thereof, (ii) all income, royalties, damages and payments now and hereafter due
and/or payable under and with respect thereto, subject to payment to any
co-owner of its, his or her share thereof, including without limitation payments
under all licenses entered into in connection therewith and damages and payments
for past or future infringements thereof, (iii) the right to sue for past,
present and future infringements thereof, and (iv) all of the Grantor’s rights
corresponding thereto throughout the world.


    
      
         


      

      
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    “Intellectual
Property Licenses” means rights under or interest in any Patent,
Trademark, Copyright or other intellectual property under a license agreement,
whether verbal or in writing, regardless of whether Debtor is a licensee or
licensor under any such license agreement, including without limitation all the
intellectual property licenses listed on Schedule I attached
hereto, if any, and also including without limitation software license
agreements with any other party, and  also including all of the
Debtor’s rights corresponding to Debtor’s Intellectual Property Licenses
throughout the world.

     

    “Patents”
means patents and patent applications, including without limitation the patents
and patent applications listed on Schedule I hereto and
all continuations, divisionals, provisionals, continuations in part, or reissues
of applications related to patents thereon, and (i) all renewals thereof, (ii)
all income, royalties, damages and payments now and hereafter due and/or payable
under and with respect thereto, subject to payment to any co-owner or inventor
of its, his or her share thereof, 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 thereof, and (iv) all of the Grantor’s
rights corresponding thereto throughout the world.

     

    “Trademarks”
means trademarks, trade names, trade styles, registered trademarks, trademark
applications, service marks, registered service marks and service mark
applications, including without limitation the registered trademarks listed on
Schedule I
hereto, and (i) all renewals thereof, (ii) all income, royalties, damages and
payments now and hereafter due and/or payable under and with respect thereto,
subject to payment to any co-owner of its, his or her share thereof, 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, (iv) the goodwill of the Grantor’s business symbolized by the
foregoing and connected therewith, and (v) all of the Grantor’s rights
corresponding thereto throughout the world.

     

    (b)           Terms Defined in the
Purchase Agreement.  Capitalized terms used in this Agreement
and not otherwise defined herein have the meanings ascribed to them in the
Purchase Agreement.

     

    2.    
        GRANT OF SECURITY INTEREST
IN INTELLECTUAL PROPERTY COLLATERAL.  Grantor hereby grants to
the Agent, as collateral agent for the Lenders, a continuing and perfected first
priority security interest (as set forth in the Security Agreement) in all of
Grantor’s right, title and interest in, to and under all of Grantor’s
Intellectual Property (as defined in the Security Agreement), including without
limitation the following, whether presently existing or hereafter created or
acquired (collectively, the “Intellectual Property
Collateral”):


    
      
         


      

      
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    (a)           all
of Grantor’s Patents and Grantor’s rights under all Patent Intellectual Property
Licenses to which it is a party, including those patents referred to on Schedule I hereto,
including:

     

    
      	
               
      

            	
              (i)

            	
              all
      registrations and applications in respect of the foregoing, including
      continuations, divisionals, provisionals, continuations in part, or
      reissues of applications and patents issuing thereon;
  and

            


    

     

    
      	
               
      

            	
              (ii)

            	
              all
      products and proceeds of the foregoing, including without limitation any
      claim by Grantor against third parties for past, present or future
      infringement of any Patent or any Patent licensed under any Intellectual
      Property License;

            


    

     

    (b)           all
of Grantor’s Trademarks and Grantor’s rights under all Trademark Intellectual
Property Licenses to which it is a party, including those trademarks referred to
on Schedule I
hereto, including:

     

    
      	
               
      

            	
              (i)

            	
              all
      registrations, applications, and renewals in respect of the
      foregoing;

            


    

     

    
      	
               
      

            	
              (ii)

            	
              all
      goodwill of the business connected with the use of, and symbolized by,
      each Trademark and each Trademark licensed under an Intellectual Property
      License; and

            


    

     

    
      	
               
      

            	
              (iii)

            	
              all
      products and proceeds of the foregoing, including without limitation any
      claim by Grantor against third parties for past, present or future (i)
      infringement or dilution of any Trademark or any Trademark licensed under
      any Intellectual Property License or (ii) injury to the goodwill
      associated with any Trademark or any Trademark licensed under any
      Intellectual Property License; and

            


    

     

    (c)           all
of Grantor’s Copyrights and Grantor’s rights under all Copyright Intellectual
Property Licenses to which it is a party, including those referred to on Schedule I hereto,
including:

     

    
      	
               
      

            	
              (i)

            	
              all
      registrations, applications, and renewals in respect of the foregoing;
      and

            


    

     

    
      	
               
      

            	
              (ii)

            	
              all
      products and proceeds of the foregoing, including without limitation any
      claim by Grantor against third parties for past, present or future
      infringement of any Copyright or any Copyright licensed under any
      Intellectual Property License.

            


    

     

    3.   
         SECURITY
AGREEMENT.  The security interests granted pursuant to this
Agreement are granted in conjunction with the security interests granted to
Lenders pursuant to the Security Agreement.  Grantor hereby
acknowledges and affirms that the rights and remedies of Lenders with respect to
the security interest in the Intellectual Property Collateral made and granted
hereby are more fully set forth in the Security Agreement, the terms and
provisions of which are incorporated by reference herein as if fully set forth
herein.


    
      
         


      

      
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    4.       
     AUTHORIZATION TO
SUPPLEMENT.  If Grantor shall obtain rights to any new
Intellectual Property (as defined in the Security Agreement), the provisions of
this Agreement shall automatically apply thereto.  Grantor shall give
Lenders prompt written notice with respect to any such new Intellectual
Property.  Grantor represents that Schedule I is
substantially accurate and complete but reserves the right from time to time to
correct inaccuracies and/or omissions by giving Lenders written notice
thereof.  Without limiting Grantor’s obligations under this Section 4, Grantor
hereby authorizes the Agent and Lenders unilaterally to modify this Agreement by
amending Schedule
I to include any such corrections and other modifications and any such
new Intellectual Property of Grantor.  Notwithstanding the foregoing,
no failure to so modify this Agreement or amend Schedule I shall in
any way affect, invalidate or detract from Lenders’ continuing security interest
in all Intellectual Property Collateral, whether or not listed on Schedule
I.

     

    5.      
      COUNTERPARTS.  This
Agreement may be executed in any number of counterparts, each of which shall be
deemed to be an original, but all such separate counterparts shall together
constitute but one and the same instrument.  In proving this Agreement
in any judicial proceedings, it shall not be necessary to produce or account for
more than one such counterpart signed by the party against whom enforcement is
sought.  Any signatures delivered by a party by facsimile transmission
or by e-mail transmission shall be deemed an original signature
hereto.

     

    6.       
     GOVERNING LAW;
JURISDICTION.  This Agreement shall be governed by and
construed under the laws of the State of New York applicable to contracts made
and to be performed entirely within the State of New York.  Each party
hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in the City and County of New York for the adjudication
of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby and hereby irrevocably waives, and agrees not to assert in
any suit, action or proceeding, any claim that it is not personally subject to
the jurisdiction of any such court, that such suit, action or proceeding is
brought in an inconvenient forum or that the venue of such suit, action or
proceeding is improper.  Each party hereby irrevocably waives personal
service of process and consents to process being served in any such suit, action
or proceeding by mailing a copy thereof to such party at the address in effect
for notices to it under this Agreement and agrees that such service shall
constitute good and sufficient service of process and notice
thereof.  Nothing contained herein shall be deemed to limit in any way
any right to serve process in any manner permitted by law.

     

    7.       
     SUCCESSORS AND
ASSIGNS.  The terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective successors and
permitted assigns of the parties.  Nothing in this Agreement, express
or implied, is intended to confer upon any party other than the parties hereto
or their respective successors and permitted assigns any rights, remedies,
obligations or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement.  A Lender may assign its rights
hereunder in connection with any private sale or transfer of its Notes, in which
case the term “Lender” shall be deemed to refer to such transferee as though
such transferee were an original signatory hereto.  Grantor may not
assign its rights or obligations under this Agreement.

     

    [Signature Pages
Follow]


    
      
         


      

      
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    IN
WITNESS WHEREOF, the Grantor has caused this Intellectual Property Security
Agreement to be executed and delivered by its duly authorized officer as of the
date first set forth above.

     

    
      	 
      	
              AXIS
      TECHNOLOGIES, INC.

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
              By:

            	 /s/
      Jim Erickson
	 
      	
              Name:

            
	 
      	
              Title:

            


    


    
      
         


      

      
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    SCHEDULE
I

    to

    INTELLECTUAL PROPERTY
SECURITY AGREEMENT

    


     

    
      	
              TRADEMARK

            	 	
              COUNTRY

            	 	
              FILING DATE

            	 	
              APPLICATION/ SERIAL NO.

            	 	
              ISSUANCE DATE

            	 	
              STATUS

            	 	
              REG. NO.

            
	
              The
      Future of Florescent Lighting

            	 	
              United
      States

            	 	
              6/17/2004

            	 	
              78-437,293

            	 	
              9/27/2005

            	 	
              Registered

            	 	
              3,001,415

            
	 
      	 	 
      	 	 
      	 	 
      	 	 
      	 	 
      	 	 
      
	
              PATENT

            	 	
              COUNTRY

            	 	
              FILING DATE

            	 	
              APPLICATION/ SERIAL NO.

            	 	
              ISSUANCE DATE

            	 	
              STATUS

            	 	
              REG. NO.

            
	
              Method
      and Apparatus for Dimming Control of Electronic Ballasts

            	 	
              United
      States

            	 	
              06/29/2004

            	 	
              10/707,982

            	 	
              11/29/2005

            	 	
              Registered

            	 	
              US
      6,969,955 B2

            


    

     

     

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