Intellectual Property Security Agreement (GE)


    


    INTELLECTUAL
      PROPERTY SECURITY AGREEMENT

    


    


    INTELLECTUAL
      PROPERTY SECURITY AGREEMENT AND COLLATERAL ASSIGNMENT,
      dated
      as of June 5, 2007 (this “Agreement”),
      made
      by and among THE
      BOMBAY COMPANY, INC.,
      a
      Delaware corporation, BBA
      HOLDINGS, LLC,
      a
      Delaware limited liability company, and BOMBAY
      INTERNATIONAL, INC.,
      a
      Delaware corporation (individually, a “Grantor”
      and
      collectively, the “Grantors”),
      in
      favor of GENERAL
      ELECTRIC CAPITAL CORPORATION,
      as
      administrative Agent and collateral Agent (in such capacity, together with
      its
      successors and permitted assigns, “Administrative
      Agent”).

     

    W I T N E S S E T H:

    


    WHEREAS,
      pursuant to the Credit Agreement, dated as of October 24, 2006 as amended by
      Amendment No. 1 to Credit Agreement, dated as of May 25, 2007 by and among
      the
      Borrowers, the Lenders, and the Administrative Agent, (as amended, supplemented
      or otherwise modified from time to time the “Credit
      Agreement”),
      the
      Lenders have made Revolving Loans to the Borrowers upon the terms and subject
      to
      the conditions set forth therein;

     

    WHEREAS,
      each
      Grantor has granted a security interest to Administrative Agent, for the benefit
      of itself and the Lenders, in, among other things, all right, title and interest
      of the Grantors in, to and under all of the Grantors’ Intellectual Property (as
      defined below), whether now existing or hereafter arising or acquired as
      security for the Obligations from time to time owing by the Grantors under
      the
      Credit Agreement;

     

    WHEREAS,
      the
      Administrative Agent and GB Merchant Partners, LLC (the “Term
      Loan Agent”)
      have
      entered into that certain Intercreditor Agreement, dated as of June 5, 2007
      (as
      the same may be amended, restated, amended and restated, supplemented, replaced
      or otherwise modified from time to time, the “Intercreditor
      Agreement”);

     

    WHEREAS,
      each
      Grantor is the owner of the entire right, title and interest in, to and under
      such Grantor’s respective Intellectual Property listed on Schedule
      I
      hereto;
      and

     

    NOW,
      THEREFORE,
      in
      consideration of the premises and for good and valuable consideration, the
      receipt and sufficiency of which hereby are acknowledged, the Grantors hereby
      agree with Administrative Agent as follows:

     

    1.  Defined
      Terms.

     

    (a)  Definitions.
      Unless
      otherwise defined herein or the context otherwise requires, terms used in this
      Agreement, including its preamble and recitals, have the meanings provided
      in
      the Credit Agreement.

     

    (b)  Definitions
      of Certain Terms Used Herein.
      As used
      herein, the following terms shall have the following meanings:

     

    “Copyrights”
shall
      mean, with respect to any Grantor, all of such Grantor’s now existing or
      hereafter acquired right, title, and interest in and to: (i) copyrights, rights
      and interests in copyrights, works protectable by copyright, all applications,
      registrations and recordings relating to the foregoing as may at any time be
      filed in the United States Copyright Office or in any similar office or agency
      of the United States, any State thereof, any political subdivision thereof
      or in
      any other country, and all research and development 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    relating
      to the foregoing; and (ii) all renewals of any of the foregoing.

     

    “Copyright
      Licenses”
shall
      mean all agreements, whether written or oral, providing for the grant by or
      to
      any Grantor of any right to use any Copyright.   

     

    “Credit
      Agreement”
shall
      have the meaning assigned to such term in the preliminary statement of this
      Agreement.

     

    “Intellectual
      Property”
shall
      mean all: (i) Trademarks and Trademark Licenses; (ii) Patents and Patent
      Licenses; (iii) Copyrights and Copyright Licenses; (iv) all customer lists
      and
      customer information; (v) books, records, writings, computer tapes or disks,
      flow diagrams, specification sheets, computer software, source codes, object
      codes, executable code, data, databases and other physical manifestations,
      embodiments or incorporations of any Trademark, Trademark License, Patent,
      Patent License, Copyright or Copyright License; (vi) all other intellectual
      property; and (vii) all common law and other rights throughout the world in
      and
      to all of the foregoing.

     

    “IP
      Collateral”
shall
      have the meaning assigned to such term in Section 2
      hereof.

     

    “Licenses”
shall
      mean, collectively, the Trademark Licenses, the Patent Licenses, and the
      Copyright Licenses.

     

    “Patents”
shall
      mean, with respect to any Grantor, all of such Grantor’s now existing or
      hereafter acquired right, title and interest in and to: (i) all patents, patent
      applications, inventions, invention disclosures and improvements, and all
      applications, registrations and recordings relating to the foregoing as may
      at
      any time be filed in the United States Patent and Trademark Office or in any
      similar office or agency of the United States, any State thereof, any political
      subdivision thereof or in any other country, and all research and development
      relating to the foregoing; and (ii) the reissues, divisions, continuations,
      renewals, extensions and continuations-in-part of any of the
      foregoing.

     

    “Patent
      Licenses”
shall
      mean all agreements, whether written or oral, providing for the grant by or
      to
      any Grantor of any right to manufacture, use or sell any invention covered
      by a
      Patent.

     

    “Trademarks”
shall
      mean, with respect to any Grantor, all of such Grantor’s now existing or
      hereafter acquired right, title, and interest in and to: (i) all of such
      Grantor’s trademarks, trade names, corporate names, company names, business
      names, fictitious business names, trade styles, service marks, logos, other
      business identifiers, prints and labels on which any of the foregoing have
      appeared or appear, all applications, registrations and recordings relating
      to
      the foregoing as may at any time be filed in the United States Patent and
      Trademark Office or in any similar office or agency of the United States, any
      State thereof, any political subdivision thereof or in any other country, and
      all research and development relating to the foregoing; (ii) all renewals
      thereof; (iii) the entire goodwill of the such Grantor’s business connected with
      and symbolized by the foregoing or the use thereof; and (iv) all designs and
      general intangibles of a like nature.

     

    “Trademark
      Licenses”
shall
      mean all agreements, whether written or oral, providing for the grant by or
      to
      any Grantor of any right to use any Trademark.

     

    (c)  Other
      Definitional Provisions.
      

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    (i)  The
      words
“hereof,” “herein” and “hereunder” and words of similar 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 paragraph references are to this
      Agreement unless otherwise specified.

     

    (ii)  The
      meanings given to terms defined herein shall be equally applicable to both
      the
      singular and plural forms of such terms.

     

    2.  Grant
      of Security Interest.
      To
      secure the payment and performance of the Obligations, each Grantor hereby
      confirms and acknowledges that, it has granted, assigned and conveyed (and,
      to
      the extent not previously granted under the Credit Agreement, does hereby grant,
      assign and convey) to Administrative Agent for the benefit of itself and the
      Lenders a security interest in such Grantor’s entire right, title and interest
      in its respective Intellectual Property and all proprietary rights relating
      to
      or arising from such Intellectual Property, in each case whether now owned
      or
      hereafter acquired by such Grantor, and including, without limitation, each
      Grantor’s right, title and interest in and to each Intellectual Property and
      proprietary rights identified on Schedule
      I
      attached
      hereto and made a part hereof, and the right to sue for past, present and future
      infringements and dilutions, and all rights corresponding thereto throughout
      the
      world, and the entire goodwill of such Grantor’s business connected with and
      symbolized by the Intellectual Property and all income, fees, royalties,
      proceeds and other payments at any time due or payable with respect to any
      of
      the foregoing (referred to collectively as the “IP
      Collateral”). 

     

    3.  Protection
      of Intellectual Property by Grantors.
      The
      Grantors shall, at their sole cost, expense and risk, undertake the following
      with respect to the Intellectual Property identified on Schedule I:

     

    (a)  Pay
      all
      renewal fees and other fees and costs associated with maintaining the
      Intellectual Property and with the processing of the Intellectual Property
      and
      take all other reasonable and necessary steps to maintain each registration
      of
      the Intellectual Property.

     

    (b)  Take
      all
      actions reasonably necessary to prevent any of the Intellectual Property from
      becoming forfeited, abandoned, dedicated to the public, invalidated or impaired
      in any way.

     

    (c)  Pursue
      the prompt, diligent processing of each application for registration which
      is
      the subject of the security interest created herein and not abandon or delay
      any
      such efforts.

     

    (d)  Take
      any
      and all action which the Grantors reasonably deem appropriate under the
      circumstances to protect the Intellectual Property from infringement,
      misappropriation or dilution, including, without limitation, the prosecution
      and
      defense of infringement actions.

     

    4.  Representations
      and Warranties.
      Each
      Grantor represents and warrants that:

     

    (a)  Schedule
      I
      is a
      true, correct and complete list of all registered or applied for Intellectual
      Property owned by the Grantors as of the date hereof.

     

    (b)  Except
      as
      set forth in Schedule
      I,
      none of
      the Intellectual Property identified on Schedule I is the subject of any
      licensing or franchise agreement pursuant to which any Grantor is the licensor
      or franchisor.

     

    (c)  The
      Intellectual Property identified on Schedule
      I
      hereto,
      is valid and enforceable, and (i) no claim has been made that the use of any
      of
      the Intellectual Property does or may violate the rights of any third person;
      and (ii) no material claim has been asserted and is pending by any Person
      challenging or questioning the use by any Grantor of any 

     

    
      
         

      

      
        3

        
          

        

      

      
         
of
        the
        Intellectual Property owned by any Grantor or the validity or effectiveness
        of
        any of the Intellectual Property owned by any Grantor, nor does any Grantor
        know
        of any valid basis for any such claim.

    

     

    (d)  Each
      Grantor owns, or is licensed to use, all Intellectual Property necessary for
      the
      conduct of its business as currently conducted, and such Grantor is the sole
      and
      exclusive owner of the entire right, title and interest in, under and to, free
      and clear of any liens, charges and encumbrances, other than any Intellectual
      Property listed on Schedule
      I
      that is
      purported to be owned by each of the Grantors, Permitted Liens and Liens in
      favor of Administrative Agent.

     

    (e)  No
      holding, decision or judgment has been rendered by any Governmental Authority
      which would limit, cancel or question the validity of, or any Grantor’s rights
      in, any Intellectual Property set forth on Schedule
      I
      in any
      respect that could reasonably be expected to have a Material Adverse Effect
      on
      the business or the property of any Grantor.

     

    (f)  Each
      Grantor has the legal right and authority to enter into this Agreement and
      perform its terms.

     

    (g)  The
      Grantors shall give Administrative Agent written notice (with reasonable detail)
      following the occurrence of any of the following:

     

    (i)  The
      Grantors’ obtaining rights to, and filing applications for registration of, any
      new Intellectual Property, or otherwise acquiring ownership of any newly
      registered Intellectual Property.

     

    (ii)  The
      Grantors’ becoming entitled to the benefit of any registered Intellectual
      Property whether as licensee or licensor.

     

    (iii)  The
      Grantors’ entering into any new Licenses.

     

    (iv)  The
      Grantors’ shall give Administrative Agent written notice (with reasonable
      detail) following the occurrence of the Grantors’ knowing or having reason to
      know, that any application or registration relating to any material Intellectual
      Property may become forfeited, abandoned or dedicated to the public, or of
      any
      adverse determination or development (including, without limitation, the
      institution of, or any such determination or development in, any proceeding
      in
      the United States Patent and Trademark Office or any court or tribunal)
      regarding the Grantors’ ownership of, or the validity of, any material
      Intellectual Property or the Grantors’ right to register the same or to own and
      maintain the same.

     

    (h)  If
      any
      Grantor amends its name, such Grantor shall provide copies of such amendment
      documentation to Administrative Agent and shall re-register such Grantor’s
      Intellectual Property with the appropriate Governmental Authority and shall
      execute and deliver such agreements or documentation as Administrative Agent
      shall request to maintain a perfected first priority security interest (except
      to the extent that the Administrative Agent’s claim is junior to that of the
      Term Loan Agent under the terms of the Intercreditor Agreement, in which case
      such Grantor shall take all actions required under this Section 4(h) to maintain
      the Administrative Agent’s perfected second priority security interest) in such
      Intellectual Property, to the extent such security interest can be perfected
      by
      such filing.

     

    5.  No
      Violation of Credit Agreement.
      The
      representations, warranties or covenants contained herein are supplemental
      to
      those representations, warranties and 

     

    
      
         

      

      
        4

        
          

        

      

      
         
covenants
        contained in the Credit Agreement, and shall not be deemed to modify any
        such
        representation, warranty or covenant contained in the Credit
        Agreement.

    

     

    6.  Agreement
      Applies to Future Intellectual Property. 

     

    (a)  The
      provisions of this Agreement shall automatically apply to any such additional
      property or rights described in Sections 4(g)(i),
      above,
      all of which shall be deemed to be and treated as “Intellectual Property” within
      the meaning of this Agreement.

     

    (b)  Upon
      the
      reasonable request of Administrative Agent, the Grantors shall execute and
      deliver, and have recorded, any and all agreements, instruments, documents
      and
      papers as Administrative Agent may request to evidence Administrative Agent’s
      security interest in any
      Intellectual Property and the goodwill of the Grantors relating thereto or
      represented thereby (including, without limitation, filings with the United
      States Patent and Trademark Office or any similar office), and the Grantors
      hereby constitute Administrative Agent as their attorney-in-fact to execute
      and
      file all such writings for the foregoing purposes, all acts of such attorney
      being hereby ratified and confirmed; provided,
      however,
      Administrative Agent’s taking of such action shall not be a condition to the
      creation or perfection of the security interest created hereby.

     

    7.  Grantors’
      Rights To Enforce Intellectual Property.
      Prior to
      Administrative Agent’s giving of notice to the Grantors following the occurrence
      and during the continuance of an Event of Default below, the Grantors shall
      have
      the exclusive right to sue for past, present and future infringement of the
      Intellectual Property including the right to seek injunctions and/or money
      damages, in an effort by the Grantors to protect the Intellectual Property
      against encroachment by third parties, provided,
      however:

     

    (a)  Any
      money
      damages awarded or received by the Grantors on account of such suit (or the
      threat of such suit) shall constitute IP Collateral.

     

    (b)  Any
      damages recovered in any action pursuant to this Section, net of costs and
      attorneys’ fees reasonably incurred, to be applied as provided in Section
      2.11(c) of the Credit Agreement.

     

    (c)  Following
      the occurrence of any Event of Default, Administrative Agent, by notice to
      the
      Grantors may terminate or limit the Grantors’ rights under this Section
7.

     

    8.  Administrative
      Agent’s Actions To Protect Intellectual Property.
      In
      the
      event of the occurrence and continuance of any other Event of Default,
      Administrative Agent, acting in its own name or in that of the Grantors, may
      (but shall not be required to) act in the Grantors’ place and stead and/or in
      Administrative Agent’s own right in connection therewith.

     

    9.  Rights
      Upon Default.
      Upon the
      occurrence of any Event of Default, Administrative Agent may exercise all rights
      and remedies as provided for in the Credit Agreement.

     

    10.  Administrative
      Agent as Attorney In Fact.

     

    (a)  The
      Grantors hereby irrevocably constitute and designate Administrative Agent as
      and
      for the Grantors’ attorney in fact, effective following the occurrence and
      during the continuance of an Event of Default:

     

    (i)  To
      supplement and amend from time to time Schedule
      I
      of this
      Agreement to include any new or additional Intellectual Property of the
      Grantors.

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    (ii)  To
      exercise any of the rights and powers referenced herein.

     

    (b)  The
      within grant of a power of attorney, being coupled with an interest, shall
      be
      irrevocable until this Agreement is terminated by a duly authorized officer
      of
      Administrative Agent.

     

    (c)  Administrative
      Agent shall not be obligated to do any of the acts or to exercise any of the
      powers authorized by this Section 10,
      but if
      Administrative Agent elects to do any such act or to exercise any of such
      powers, it shall not be accountable for more than it actually receives as a
      result of such exercise of power, and shall not be responsible to any Grantor
      for any act or omission to act except for any act or omission to act as to
      which
      there is a final determination made in a judicial proceeding (in which
      proceeding Administrative Agent has had an opportunity to be heard) which
      determination includes a specific finding that the subject act or omission
      to
      act had been negligent or in actual bad faith.

     

    11.  Administrative
      Agent’s Rights.
      Upon an
      Event of Default, any use by Administrative Agent of the Intellectual Property,
      as authorized hereunder in connection with the exercise of Administrative
      Agent’s rights and remedies under this Agreement and under the Credit Agreement
      shall be coextensive with the Grantors’ rights thereunder and with respect
      thereto and without any liability for royalties or other related
      charges.

     

    12.  No
      Limitation; Credit Agreement.
      This
      Agreement has been executed and delivered by the Grantors for the purpose of
      recording the security interest granted to Administrative Agent with respect
      to
      the IP Collateral with the United States Patent and Trademark Office. The
      security interest granted hereby has been granted as a supplement to, and not
      in
      limitation of, the security interest granted to Administrative Agent under
      the
      Credit Agreement. The Credit Agreement (and all rights and remedies of the
      Grantors, Administrative Agent, and the Lenders thereunder) shall remain in
      full
      force and effect in accordance with its terms. In the event of a conflict
      between this Agreement and the Credit Agreement, the terms of this Agreement
      shall control with respect to the IP Collateral and the Credit Agreement with
      respect to all other Collateral.

     

    13.  Termination;
      Release of Trademark Collateral.
      This
      Agreement and all obligations of the Grantors and Administrative Agent hereunder
      shall terminate on the date upon which the Obligations are performed in full
      and
      indefeasibly paid in full in cash and the Credit Agreement and other Loan
      Documents are terminated in accordance with the terms of the Credit Agreement.
      Upon termination of this Agreement, Administrative Agent shall, at the expense
      of the Grantors, take such actions required by the Credit Agreement to release
      its security interest in the IP Collateral.

     

    14.  Binding
      Effect; Benefits.
      This
      Agreement shall be binding upon the Grantors and their respective successors
      and
      assigns, and shall inure to the benefit of Administrative Agent, the Lenders
      and
      their respective successors and assigns.

     

    15.  GOVERNING
      LAW.
      THIS
      AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
      GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE
      OF
      NEW YORK, WITHOUT GIVING EFFECT TO ITS CHOICE OF LAW PROVISIONS.

     

    [Remainder
      of Page Intentionally Left Blank]

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    


    


    


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

    


    


    
      	
               

                                                      THE
                BOMBAY COMPANY, INC.

               

            
	
                                                      By:________________________________________

                                                      Name:
                

                                                      Title:
                

               

               

            
	
                                                      BBA
                HOLDINGS, LLC

               

            
	
                                                      By:_______________________________________

                                                      Name:
                

                                                      Title:

               

               

            
	
                                                      BOMBAY
                INTERNATIONAL, INC.

            
	
               

                                                      By:________________________________________

                                                     
Name:
                

                                                     
                Title:

               

            


    

    
 

    
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    


    
      	
               

               

                                                      GENERAL
                ELECTRIC CAPITAL CORPORATION,

                                                      as
                Administrative Agent for itself and the Lenders

               

            
	
                                                      By:________________________________________

                                                      Name:
                

                                                      Title:
                

            


    

    


     

     

    
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    



    Schedule
      I

    


    [SCHEDULE
      IP BY EACH GRANTOR]

    


    TRADEMARK
      APPLICATIONS AND REGISTRATIONS

     

    


    
      	
              Trademark

            	
              Country

            	
              Status

            	
              App.
                No./

              Reg.
                No.

            	
              App.
                Date/

              Reg.
                Date

            
	 	 	 	 	 


    

    


    


    


    


    TRADEMARK
      LICENSES

     

    


    
      	
              Name
                of Agreement

            	
              Parties

            	
              Date
                of Agreement

            
	 	 	 


    

    


     

    


     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    



    


     

    


     

    LIST
      OF COPYRIGHTS AND APPLICATIONS

     

    


     

    


    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    



    


     

    LIST
      OF PATENTS

     

    PATENT
      APPLICATIONS AND REGISTRATIONS 

     

    


    
      	
              Country

            	
              Status

            	
              Application
                No./ Registration No.

            	
              Description
                of Patent

            	
              Date
                of Filing

            
	 	 	 	 	 


    

    


    


    PATENT
      LICENSES

     

    


    
      	
              Name
                of Agreement

            	
              Parties

            	
              Date
                of Agreement