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EXHIBIT 10(a)(a) TO FRONTSTEP, INC. ANNUAL REPORT ON FORM 10-K
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COPYRIGHT SECURITY AGREEMENT
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THIS COPYRIGHT SECURITY AGREEMENT (this "Agreement"), dated as
of July 17, 2001 is made by FRONTSTEP, INC., an Ohio corporation, FRONTSTEP
SOLUTIONS GROUP, INC., an Ohio corporation, and BRIGHTWHITE SOLUTIONS, INC., an
Ohio corporation (each a "Debtor" and collectively, jointly and severally, the
"Debtors"), in favor of FOOTHILL CAPITAL CORPORATION, a California corporation,
as agent for the Lenders referred to below (the "Secured Party").
RECITALS
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A. The Debtors, Frontstep Canada, Inc., the financial
institutions party thereto from time to time (the "Lenders") and the Secured
Party have entered into that certain Loan and Security Agreement, dated as of
July 17, 2001 (as amended, restated, modified, renewed or extended from time to
time, the "Loan Agreement"), pursuant to which the Lenders have agreed (among
other things) to make loans to the Debtors in an aggregate principal amount at
any one time outstanding not to exceed the Maximum Revolver Amount (as defined
in the Loan Agreement), and pursuant to which the Debtors have granted to the
Secured Party for the benefit of the Lenders security interests in (among other
things) all or substantially all of the general intangibles of the Debtors.
B. Each Debtor has granted to Secured Party for the benefit of
the Lenders, a continuing first priority security interest in (among other
things) all general intangibles of such Debtor in order to secure the Debtors'
obligations under each of the Loan Documents.
C. Pursuant to the Loan Agreement and as one of the conditions
to the obligations of the Secured Party and the Lenders under the Loan
Agreement, the Debtors have agreed to execute and deliver this Agreement to the
Secured Party for filing with the United States Copyright Office and with any
other relevant recording systems in any domestic or foreign jurisdiction, and as
further evidence of and to effectuate Secured Party's existing security
interests in the Copyright Collateral (as hereinafter defined).
ASSIGNMENT
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NOW, THEREFORE, for valuable consideration, the receipt and
adequacy of which is hereby acknowledged, each Debtor xxxxxx agrees in favor of
Secured Party as follows:
1. DEFINITIONS; INTERPRETATION.
(a) CERTAIN DEFINED TERMS. As used in this Agreement, the
following terms shall have the following meanings:
"COPYRIGHT COLLATERAL" has the meaning set forth in SECTION 2
(a).
"COPYRIGHT RIGHTS" has the meaning set forth in SECTION
2(a)(i).
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"COPYRIGHTS" has the meaning set forth in SECTION 2.
"LIEN" means any pledge, security interest, assignment, charge
or encumbrance, lien (statutory or other), or other preferential arrangement
(including any agreement to give any security interest).
"PROPRIETARY RIGHTS" has the meaning set forth in SECTION
2(a)(ii).
"REGISTRATIONS" has the meaning set forth in SECTION 2(a)(i).
"SECURED OBLIGATIONS" means, with respect to each Debtor, all
liabilities, Obligations, and undertakings owing by such Debtor to Secured Party
and the Lenders of any kind or description arising out of or outstanding under,
advanced or issued pursuant to, or evidenced by, the Loan Agreement, the other
Loan Documents, or this Agreement, irrespective of whether for the payment of
money, whether direct or indirect, absolute or contingent, due or to become due,
voluntary or involuntary, whether now existing or hereafter arising, and
including all interest (including interest that accrues after the filing of a
case under the Bankruptcy Code) and any and all costs, fees (including attorneys
fees), and expenses which the Debtor is required to pay pursuant to any of the
foregoing, by law, or otherwise.
"UCC" means the Uniform Commercial Code, as in effect from
time to time in the State of New --- York.
"UNITED STATES" and "U.S." each mean the United States of
America.
(b) TERMS DEFINED IN UCC. Where applicable and
except as otherwise defined herein, terms used in this Agreement shall have the
meanings ascribed to them in the UCC.
(c) INTERPRETATION. In this Agreement, except
to the extent the context otherwise requires:
(i) Any reference to a Section or a
Schedule is a reference to a section hereof, or a schedule hereto, respectively,
and to a subsection or a clause is, unless otherwise stated, a reference to a
subsection or a clause of the Section or subsection in which the reference
appears.
(ii) The words "hereof," "here,"
"hereunder," and the like mean and refer to this Agreement as a whole and not
merely to the section, subsection, paragraph or clause in which the respective
word appears.
(iii) The meaning of defined terms shall
be equally applicable to both the singular and plural forms of the terms
defined.
(iv) The words "including," "includes"
and "include" shall be deemed to be followed by the words "without limitation."
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(v) References to agreements and other
contractual instruments shall be deemed to include all subsequent amendments,
restatements, supplements, refinancings, renewals, extensions, and other
modifications thereto and thereof.
(vi) References to statutes or
regulations are to be construed as including all statutory and regulatory
provisions consolidating, amending or replacing the statute or regulation
referenced.
(vii) Any captions and headings are for
convenience of reference only and shall not affect the construction of this
Agreement.
(viii) Capitalized words not otherwise
defined herein shall have the respective meanings ascribed to them in the Loan
Agreement.
(ix) In the event of a direct conflict
between the terms and provisions of this Agreement and the Loan Agreement, it is
the intention of the parties hereto that both such documents shall be read
together and construed, to the fullest extent possible, to be in concert with
each other. In the event of any actual, irreconcilable conflict that cannot be
resolved as aforesaid, the terms and provisions of the Loan Agreement shall
control and govern; PROVIDED, HOWEVER, that (A) the inclusion herein of
additional obligations on the part of the Debtors and supplemental rights and
remedies in favor of Secured Party, in each case in respect of the Copyright
Collateral, shall not be deemed a conflict with the Loan Agreement and (B) the
exclusion of any property from the Copyright Collateral pursuant to Section 2(b)
hereof shall be deemed to be an exclusion of such property from the Collateral
under the Loan Agreement.
2. SECURITY INTEREST.
(a) ASSIGNMENT AND GRANT OF SECURITY. Each
Debtor, as security for the payment and performance of the Debtors' Secured
Obligations, hereby grants, assigns, transfers and conveys to Secured Party for
the benefit of the Lenders a continuing first priority security interest in all
of such Debtor's right, title and interest in, to and under the following
property, whether now existing or hereafter acquired or arising or in which such
Debtor now has or hereafter acquires or develops an interest and wherever the
same may be located (the "Copyright Collateral"):
(i) all copyrights, rights, titles and
interests in and to published and unpublished original and derivative works of
authorship, whether registered or unregistered, including without limitation,
all software (whether or not considered to be a "good" rather than an intangible
and including the source code version thereof) that such Debtor owns or uses in
its business or will in the future adopt and so use, including without
limitation the Software, and all copyrights in any original or derivative works
of authorship and all works protectable by copyright that are presently, or in
the future may be, owned, created, acquired or used (whether pursuant to a
license or otherwise) by such Debtor, in whole or in part (collectively, the
"Copyrights"), all Copyright registrations and applications for Copyright
registration that have been heretofore or may hereafter be issued thereon or
applied for in the United States or throughout the Universe, including renewal
registrations, recordings, supplemental registrations and pending applications
for registration in the United States Copyright Office (the
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"Registrations"), all common law and other rights in and to the Copyrights
throughout the Universe, including all Copyright licenses (collectively, the
"Copyright Rights"), and all renewals, extensions, restorations and reversions
thereof, throughout the Universe, including all proceeds thereof (such as, by
way of example and not by limitation, license royalties and proceeds of
infringement suits), the right (but not the obligation) to renew, extend and
restore such Copyrights, Registrations and Copyright Rights and to register
works protectable by Copyright and the right (but not the obligation) to sue or
bring proceedings in the name of such Debtor or in the name of Secured Party for
past, present and future infringements or violations of the Copyrights,
registrations and Copyright Rights, and recover damages for past, present and
future infringements or violations thereof, and all rights corresponding thereto
throughout the Universe, including:
(A) all of such Xxxxxx's right,
title and interest in and to all Copyrights or rights or interests in Copyrights
registered or recorded in the United States Copyright Office, including the
Registrations listed on SCHEDULE A attached hereto, as the same may be amended
or supplemented pursuant hereto from time to time;
(B) all of such Xxxxxx's right,
title and interest in and to all Copyrights relating to the works set forth on
SCHEDULE B attached hereto, including without limitation all Registrations
therefor, as the same may be amended or supplemented from time to time,
including in connection with an Amendment to Copyright Security Agreement;
(C) all of such Xxxxxx's right,
title and interest in and to all renewals and extensions of any such Copyrights,
including renewals or extensions of the Registrations listed on Schedule A
attached hereto, that may be secured under the law now or hereafter in force and
effect;
(D) all of such Xxxxxx's right,
title and interest to make and exploit all derivative works based on or adopted
from all works covered by any of the Copyright Collateral; and
(E) all of such Xxxxxx's right,
title and interest pursuant to or under licensing or other contracts in favor of
Debtor pertaining to copyrights and works protectable by copyright presently or
in the future owned or used by third parties;
(ii) all inventions, designs, patents,
patent applications, registrations, trade secrets, proprietary rights, corporate
or other business records, source codes, object codes, data bases and all other
intangible personal property at any time used in connection with the businesses
of such Debtor (referred to herein as "Proprietary Rights");
(iii) all rights and interests pursuant
to or under licensing or other contracts in favor of Debtor pertaining to
Copyrights and works protectable by Copyright presently or in the future owned
or used by third parties;
(iv) all general intangibles (as defined
in the UCC) and all intangible intellectual or other similar property of such
Debtor of any kind or nature, whether now owned or hereafter acquired or
developed, associated with or arising out of any of the
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Copyrights, Registrations, Copyright Rights or Proprietary Rights and not
otherwise described above; and
(v) all proceeds of any and all of the
foregoing Copyright Collateral (including license royalties, rights to payment,
accounts receivable and proceeds of infringement suits) and, to the extent not
otherwise included, all payments under insurance (whether or not Secured Party
is the loss payee thereof) or any indemnity, warranty or guaranty payable by
reason of loss or damage to or otherwise with respect to the foregoing Copyright
Collateral. For purposes of this Agreement, the term "proceeds" includes
whatever is receivable or received when Copyright Collateral or proceeds are
sold, licensed, collected, exchanged or otherwise disposed of, whether such
disposition is voluntary or involuntary, and includes, without limitation, all
rights to payment, including returned premiums, with respect to any insurance
relating thereto.
(b) CERTAIN EXCLUSIONS FROM GRANT OF SECURITY
INTEREST. Anything in this Agreement and the other Loan Documents to the
contrary notwithstanding, the foregoing grant, assignment, transfer, and
conveyance of a security interest shall not extend to, and the term "Copyright
Collateral" shall not include, any item of Copyright Collateral described in
Section 2(a) above that is now or hereafter held by any Debtor as licensee or
otherwise, solely in the event and to the extent that and only for the times
that: (i) as the proximate result of the foregoing grant, assignment, transfer,
or conveyance of a security interest, such Debtor's rights in or with respect to
such item of Copyright Collateral would be forfeited or would become void,
voidable, terminable, or revocable pursuant to the restrictions in the
underlying license or other agreement that governs such item of Copyright
Collateral; and (ii) any such restriction shall be effective and enforceable
under applicable law, including Section 9-408 of the Code; PROVIDED, HOWEVER,
that the foregoing grant, assignment, transfer, and conveyance of security
interest shall extend to, and the term "Copyright Collateral" shall include, (y)
any and all proceeds of such item of Copyright Collateral to the extent that the
assignment or encumbering of such proceeds is not so restricted, and (z) upon
any such licensor or other applicable party's consent with respect to any such
otherwise excluded item of Copyright Collateral being obtained, thereafter such
item of Copyright Collateral as well as any proceeds thereof that might
theretofore have been excluded from such grant, assignment, transfer, and
conveyance of a security interest and the term Copyright Collateral.
(c) CONTINUING SECURITY INTEREST. Debtor agrees
that this Agreement shall create a continuing security interest in the Copyright
Collateral which shall remain in effect until terminated in accordance with
Section 17 hereof.
(d) INCORPORATION INTO LOAN AGREEMENT. This
Agreement shall be fully incorporated into the Loan Agreement and all
understandings, agreements and provisions contained in the Loan Agreement shall
be fully incorporated into this Agreement. Without limiting the foregoing, the
Copyright Collateral described in this Agreement shall constitute part of the
Collateral in the Loan Agreement.
(e) PERMITTED LICENSING. Anything in the Loan
Agreement or this Agreement to the contrary notwithstanding, Debtor may license
to any other Person the Copyright Collateral on an exclusive or non-exclusive
basis (subject to the security interest of
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the Secured Party in such Collateral) in the ordinary course of business
consistent with past practice.
3. REPRESENTATIONS AND WARRANTIES. Each Debtor jointly
and severally represents and warrants to Secured Party and for the benefit of
Secured Party the following:
(a) TRUE AND COMPLETE LIST. Set forth in
SCHEDULE A is a true and complete list, as of the date of this Agreement, of all
Registrations in the United States Copyright Office and applications for
Registrations in the United States Copyright Office owned by the Debtors, in
whole or in part; SCHEDULE B attached hereto includes a true and complete list
of all versions of the Syteline Software and, on and after the 30th day
following the Closing Date, all other Marketed Software, including all prior
versions of Software for which any version of the Marketed Software constitutes
a derivative work under U.S. copyright law, and the dates of creation for each
such version, as such Schedule B is modified from time to time pursuant to
Section 4(a) hereof.
(b) POWERS. Each Debtor has full power,
authority and legal right to pledge and to grant to Secured Party a continuing
first priority security interest in all right, title, and interest of such
Debtor in and to the Copyright Collateral pursuant to this Agreement, and to
execute, deliver and perform its obligations in accordance with the terms of
this Agreement, without the consent or approval of any other Person except as
already obtained;
(c) VALIDITY. Each of the Registrations of
each Debtor referred to in SCHEDULE A is valid, subsisting and enforceable, and
such Debtor has properly complied in all material respects with all applicable
statutory and regulatory requirements, including all notice requirements, in
connection with each of such Registrations, and, except as disclosed in the
litigation schedule or annex to the Loan Agreement, to the best of each Debtor's
knowledge, no claim has been made that the use of any of such Copyrights does or
may infringe or otherwise violate the rights of any third Person;
(d) TITLE. Each Debtor has rights in and good
title to the Copyright Collateral shown on the schedules hereto as being owned
by it, is the sole and exclusive owner of the entire and unencumbered right,
title and interest in and to such Copyright Collateral, free and clear of any
Liens (other than Liens in favor of Secured Party and other than the rights of
the licensor of a license made by such licensor to such Debtor as licensee, or
the rights of other licensees under non-exclusive licenses of the same subject
matter if such Debtor's license of such subject matter is a non-exclusive
license). For any Copyright Collateral for which a Debtor is either a licensor
or a licensee pursuant to a license or licensing agreement regarding such
Copyright Collateral, each such license or licensing agreement is in full force
and effect, such Debtor is not in default of any of its obligations thereunder
and, other than the parties to such licenses or licensing agreements, no other
Person has any rights in or to any of such Copyright Collateral;
(e) NO VIOLATION. The execution, delivery and
performance by each Debtor of this Agreement do not violate any provision of law
or the articles of incorporation or by-laws of such Debtor or result in a breach
of or constitute a material default under any
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contract, obligation, indenture or other instrument to which any Debtor is a
party or by which such Debtor may be bound;
(f) AUTHORIZATION. This Agreement has been
duly authorized, executed and delivered, and constitutes, a legal, valid and
binding agreement of each Debtor, enforceable in accordance with its terms; and
(g) SECRECY. Each Debtor has taken and will
continue to take all reasonable steps to protect the secrecy of all trade
secrets relating to any of its unpublished Copyright Collateral and its
Proprietary Rights.
4. COVENANTS. Each Debtor covenants that so long as
this Agreement shall be in effect, such Debtor shall:
(a) FURTHER ACTS. On a continuing basis,
make, execute, acknowledge and deliver, and file and record in the proper filing
and recording places (including, without limitation, the United States Copyright
Office, all such instruments and documents, including appropriate financing and
continuation statements and security agreements, and take all such action as
Secured Party deems in its Permitted Discretion necessary or advisable or as may
be requested by Secured Party to carry out the intent and purposes of this
Agreement, or for assuring, confirming or protecting the grant or perfection of
the security interest granted or purported to be granted hereby, to ensure such
Debtor's compliance with this Agreement or to enable Secured Party to exercise
and enforce its rights and remedies hereunder with respect to the Copyright
Collateral, provided that in no event shall any Debtor be required to register
any Copyright Collateral other than as provided in Section 6 hereof and in
accordance with the applicable provisions of the Loan Agreement. Without
limiting the generality of the foregoing sentence, each Debtor:
(i) authorizes Secured Party, in its
Permitted Discretion, to modify this Agreement without first obtaining the
Debtor's approval of or signature to such modification by amending SCHEDULE A
and/or SCHEDULE B hereof to include a reference to any right, title or interest
in any existing Copyright, Registration, Copyright Right or Proprietary Rights
or any Copyright, Registration, Copyright Right or Proprietary Rights acquired
or developed by such Debtor after the execution hereof, or to delete any
reference to any right, title or interest in any Copyright, Registration,
Copyright Right or Proprietary Rights in which such Debtor no longer has or
claims any right, title or interest, provided that Secured Party has requested
that such Debtor so modify this Agreement and Debtor fails to do so within ten
(10) days of Secured Party's request; and
(ii) hereby authorizes Secured Party, in
its Permitted Discretion, to file one or more financing or continuation
statements, and after ten (10) days prior notice to such Debtor, amendments
thereto, relative to all or any portion of the Copyright Collateral without the
signature of such Debtor where permitted by law;
(b) COMPLIANCE WITH LAW. Comply, in all
material respects, with all applicable statutory and regulatory requirements in
connection with any and all of the Copyright Collateral that is the subject of
the Registrations and give such notice of Copyright, prosecute
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such material claims, and do all other acts and take all other measures which
may be reasonably necessary or desirable to preserve, protect and maintain such
Copyright Collateral and all of such Debtor's rights therein, including
diligently prosecute any material Copyright application pending as of the date
of this Agreement or thereafter;
(c) COMPLIANCE WITH AGREEMENT. Comply with
each of the terms and provisions of this Agreement, and not enter into any
agreement (for example, a license agreement) which is inconsistent with the
obligations of such Debtor under this Agreement without Secured Party's prior
written consent; and
(d) LIEN PROTECTION. Not permit, without
the prior written consent of Secured Party, the inclusion in any contract to
which such Debtor becomes a party, any provision that could or might impair or
prevent the creation of a security interest in favor of Secured Party in such
Debtor's rights and interest in any property included within the definitions of
the Copyrights, Registrations and Copyright Rights acquired under such
contracts.
5. NEW COPYRIGHTS; REGISTRATIONS AND COPYRIGHT RIGHTS. If any
Debtor shall obtain rights to or develop any new works protectable by Copyright,
or become entitled to the benefit of any Copyright Rights, Registrations,
application for Registrations or Proprietary Rights not described on the
schedules hereto, or any renewals or extension of any Copyright, Copyright
Rights, Registrations or Proprietary Rights, the provisions of this Agreement
shall automatically apply thereto. Each Debtor shall give Secured Party written
notice, in accordance with the applicable provisions of the Loan Agreement, (a)
of any such work or such rights of material value to such Debtor or the
operation of its businesses and (b) any such Registration, applications for
Registration or renewal or extension of any Copyright. Concurrently with its
filing of an application for any Registration for any Copyright, such Debtor
shall execute and deliver an amendment to this Agreement in the form of SCHEDULE
C attached hereto (or, at the election of Secured Party, a new Copyright
Security Agreement substantially in the form of this Agreement and otherwise in
form and substance satisfactory to the Secured Party), pursuant to which such
Debtor shall grant and reaffirm its grant of a security interest to the extent
of its interest in such Registration as provided herein to Secured Party, and
such Debtor shall cause such agreement to be recorded in the offices and
jurisdictions indicated by Secured Party and promptly shall provide proof of
such recordations to Secured Party.
6. COPYRIGHT REGISTRATION. RENEWAL AND LITIGATION.
(a) REGISTRATION. Each Debtor shall have the
duty diligently to make any application for Registration, in accordance with the
applicable provisions of the Loan Agreement, on any existing or future
unregistered but Copyrightable works that are used in or are related to any
Marketed Software and to do any and all acts which are reasonably necessary or
desirable to preserve, renew and maintain all rights in all Copyrights,
Registrations, Copyright Rights and Proprietary Rights. Any expenses incurred in
connection therewith shall be borne solely by the Debtors. Except as otherwise
permitted in the Loan Agreement or this Section 6(a), the Debtors shall not do
any act or omit to do any act whereby any of the Copyright Collateral may become
abandoned or fall into the public domain or fail to renew any Copyright,
Registration or Copyright Right owned by the Debtor without the prior written
consent of Secured Party.
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(b) PROTECTION. Except as provided in Section 8
and notwithstanding Section 2(a)(i), each Debtor shall have the right and
obligation to commence and diligently prosecute in its own name, as real party
in interest, for its own benefit and at its own expense, such suits, proceedings
or other actions for infringement or other damage as are reasonably necessary to
protect the Copyright Collateral or any of such Debtor's rights therein. Each
Debtor shall provide to Secured Party any information with respect thereto
requested by Secured Party. Secured Party shall provide at such Debtor's expense
all necessary cooperation in connection with any such suit, proceeding or action
including joining as a nominal party if Secured Party shall have been satisfied
that it is not incurring any risk of liability because of such joinder. Each
Debtor shall provide at its expense representation acceptable to Secured Party
for the common interest of such Debtor and Secured Party with respect to such
proceedings.
(c) NOTICE. Each Debtor shall, promptly upon
its becoming aware thereof, notify Secured Party in writing of the institution
of, or any material adverse determination in, any proceeding, application, suit
or action of any kind described in Section 6(a) or 6(b), or regarding such
Debtor's claim of ownership in any of the Copyrights, Registrations, Copyright
Rights or Proprietary Rights, its right to register the same, or its right to
keep and maintain such registration, whether before the United States Copyright
Office or any United States or foreign court or governmental agency, including
(x) any petition under the Bankruptcy Code filed by or against any licensor of
any of the Copyrights as to which such Debtor is a licensee, and (y) any other
claims asserted in a judicial, administrative or other proceeding concerning the
Copyrights. Each Debtor shall provide promptly to Secured Party any information
with respect thereto requested from time to time by Secured Party.
7. EVENTS OF DEFAULT. The occurrence of any "Event of
Default" under the Loan Agreement or any other Loan Document shall constitute an
Event of Default hereunder.
8. REMEDIES. Following the occurrence and during the
continuation of an Event of Default, Secured Party shall have all rights and
remedies available to it under the Loan Agreement and the other Loan Documents
and applicable law (which rights and remedies are cumulative) with respect to
its security interests in any of the Copyright Collateral or any other
collateral. Each Debtor agrees that such rights and remedies include the right
of Secured Party as a secured party to sell or otherwise dispose of its
collateral after the occurrence and during the continuance of a default,
pursuant to UCC Section 9-610. Each Debtor agrees that Secured Party shall at
all times have such royalty free licenses, to the extent permitted by law, for
any Copyright, Copyright Rights, Proprietary Right and any other Copyright
Collateral that is reasonably necessary to permit the exercise of any of Secured
Party's rights or remedies after the occurrence of (and during the continuance
of) an Event of Default with respect to (among other things) any asset of such
Debtor in which Secured Party has a security interest, including Secured Party's
rights to sell or license general intangibles, inventory, tooling or packaging
which is acquired by such Debtor (or its successors, permitted assignees, or
trustee in bankruptcy). In addition to, and without limiting any of the
foregoing, upon the occurrence and during the continuance of an Event of
Default, Secured Party shall have the right but shall in no way be obligated to
bring suit, or to take such other action as Secured Party deems necessary or
advisable, in the name of any Debtor or Secured Party, to enforce or protect any
Copyright, Registration, Copyright Right or Proprietary Right, and any license
thereunder, in which event each Debtor shall, at the request of Secured Party,
do any and all lawful acts and execute any
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and all documents required by Secured Party in aid of such enforcement. To the
extent that Secured Party shall elect not to bring suit to enforce any
Copyright, Registration, Copyright Rights, Proprietary Right, or any license
thereunder, each Debtor agrees to use all reasonable measures and its diligent
efforts, whether by action, suit, proceeding or otherwise, to prevent the
infringement, misappropriation or violation thereof by others and for that
purpose agrees diligently to maintain any action, suit or proceeding against any
Person necessary to prevent such infringement; misappropriation or violation.
9. AUTHORIZATION. If any Debtor fails to comply with any of
its obligations hereunder, Secured Party may do so in such Xxxxxx's name or in
Secured Party's name, but at the Debtor's expense, and each Debtor hereby agrees
to reimburse Secured Party in full upon demand for all reasonable expenses,
including reasonable attorney's fees, incurred by Secured Party in protecting,
defending, maintaining, registering or recording any of the Copyright Collateral
or any right, title or interest of such Debtor or Secured Party therein. Each
Debtor hereby appoints Secured Party, and authorizes, directs and empowers
Secured Party to make, constitute and appoint any officer or agent of Secured
Party as Secured Party may select, in its exclusive discretion, as the true and
lawful attorney-in-fact of the Debtor, with the power, (a) if such Debtor
refuses or fails to do so within ten (10) days of the delivery of written notice
of such request to such Debtor by Agent, to execute in the name of such Debtor
any financing statement or other similar instrument, any supplement or amendment
to this Agreement, or any supplemental Copyright Security Agreement, in each
case, described in Sections 4(a) or 5 hereof, and do such other acts on such
Debtor's behalf, that Secured Party may deem necessary or advisable to
accomplish the purposes of this clause (a), and (b) upon and after the
occurrence and continuation of any Event of Default, (i) to endorse such
Debtor's name on all applications, documents, papers and instruments necessary
for Secured Party to use any of the Copyright Collateral, (ii) to assert or
retain any rights under any license agreement for any of the Copyright
Collateral, including any rights of such Debtor arising under Section 365(n) of
the Bankruptcy Code, (iii) to grant or issue any exclusive or nonexclusive
license under any of the Copyright Collateral to anyone else, or as may be
necessary for Secured Party to assign, pledge, convey or otherwise transfer
title in or dispose of any of the Copyright Collateral or any other Collateral
to anyone else and (iv) do such other acts on such Debtor's behalf, that Secured
Party may deem necessary or advisable to accomplish the purposes of this
Agreement. Each Debtor hereby ratifies all that such attorney shall lawfully do
or cause to be done by virtue hereof. This power of attorney is coupled with an
interest and is irrevocable until termination of this Agreement.
10. NOTICES. All notices and other communications
hereunder to or from Secured Party and any Debtor shall be in writing and shall
be mailed, sent or delivered in accordance with the Loan Agreement.
11. GOVERNING LAW AND VENUE: JURY TRIAL WAIVER. THIS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK, EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF THE ASSIGNMENT
AND SECURITY INTERESTS HEREUNDER IN RESPECT OF ANY PROPERTY ARE GOVERNED BY
FEDERAL LAW, IN WHICH CASE SUCH CHOICE OF NEW YORK LAW SHALL NOT BE DEEMED TO
DEPRIVE SECURED PARTY OF SUCH RIGHTS AND REMEDIES AS MAY BE AVAILABLE UNDER
FEDERAL LAW. THE PARTIES
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AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT
SHALL BE TRIED AND LITIGATED ONLY IN THE STATE OF NEW YORK; PROVIDED, HOWEVER,
THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY PLEDGED COLLATERAL MAY BE BROUGHT,
AT SECURED PARTY'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH PLEDGED
COLLATERAL MAY BE FOUND OR WHERE IT IS NECESSARY TO BRING SUIT IN ORDER TO
OBTAIN SUBJECT MATTER JURISDICTION. THE DEBTOR AND SECURED PARTY WAIVES, TO THE
EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE
DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE OT THE EXTENT ANY
PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 11.
THE DEBTORS AND SECURED PARTY HEREBY WAIVE THEIR RESPECTIVE
RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT
OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN, INCLUDING
CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR
STATUTORY CLAIMS. THE DEBTORS AND SECURED PARTY REPRESENT THAT EACH HAS REVIEWED
THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS
FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF
THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
12. ENTIRE AGREEMENT: AMENDMENT. This Agreement, together with
the Schedules hereto, and the Loan Agreement contain the entire agreement of the
parties with respect to the subject matter hereof and supersedes all prior
drafts and communications relating to such subject matter. Neither this
Agreement nor any provision hereof may be modified, amended or waived except by
the written agreement of the parties, as provided in the Loan Agreement.
Notwithstanding the foregoing, Secured Party may re-execute this Agreement,
modify, amend or supplement the Schedules hereto or execute a supplemental
Copyright Security Agreement, as provided herein, and the terms of any such
modification, amendment, supplement or supplemental Copyright Security Agreement
shall be deemed to be incorporated herein by this reference.
13. SEVERABILITY. If one or more provisions contained in this
Agreement shall be invalid, illegal or unenforceable in any respect in any
jurisdiction or with respect to any party, such invalidity, illegality or
unenforceability in such jurisdiction or with respect to such party shall, to
the fullest extent permitted by applicable law, not invalidate or render illegal
or unenforceable any such provision in any other jurisdiction or with respect to
any other party, or any other provisions of this Agreement.
14. 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 but one and the same agreement.
-11-
13
15. LOAN AGREEMENT. Each Debtor acknowledges that the rights
and remedies of Secured Party with respect to the secured interest in the
Copyright Collateral granted hereby are more fully set forth in the Loan
Agreement, and the other Loan Documents and all such rights and remedies are
cumulative.
16. NO INCONSISTENT REQUIREMENTS. Each Debtor acknowledges
that this Agreement and the other Loan Documents may contain covenants and other
terms and provisions variously stated regarding the same or similar matters, and
each Debtor agrees that all such covenants, terms and provisions are cumulative
and all shall be performed and satisfied in accordance with their respective
terms.
17. TERMINATION. Upon the indefeasible payment in full of the
Secured Obligations, including the cash collateralization, expiration, or
cancellation of all Secured Obligations, if any, consisting of letters of
credit, and the full and final termination of any commitment to extend any
financial accommodations under the Loan Agreement, this Agreement shall
terminate and Secured Party shall execute and deliver such documents and
instruments and take such further action reasonably requested by the Debtors,
all without representation or warranty and at the Debtors' expense, as shall be
necessary to evidence termination of the security interests granted by the
Debtors to Secured Party hereunder.
[The remainder of this page has been intentionally left blank]
-12-
14
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement, as of the date first above written.
FRONTSTEP GROUP, INC.
FRONTSTEP SOLUTIONS GROUP, INC.
BRIGHTWHITE SOLUTIONS, INC.,
each an Ohio corporation
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President & Chief Financial
Officer
FOOTHILL CAPITAL CORPORATION,
a California corporation
By: /s/ Xxxx X. Xxxxxx
----------------------
Name: Xxxx X. Xxxxxx
Title: V.P.
-13-
15
STATE OF OHIO )
) ss
COUNTY OF Franklin )
On July 12, 2001, before me, Xxxx X. Xxxxxxxxx, Notary Public,
personally appeared Xxxxxx X. Xxxxxxx, personally known to me (or proved to me
on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their authorized capacity(ies), and that by
his/her/their signature(s) on the instrument the person(s), or the entity(ies)
upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
/s/ Xxxx X. Xxxxxxxxx
---------------------------------------
Signature
[SEAL]
STATE OF CALIFORNIA )
) ss
COUNTY OF Los Angeles )
On July 12, 2001, before me, Xxxxxxx Xxxxxxxxx, Notary Public,
personally appeared Xxxx Xxxxxx, personally known to me to be the person(s)
whose name(s) is/are subscribed to the within instrument and acknowledged to me
that he/she/they executed the same in his/her/their authorized capacity(ies),
and that by his/her/their signature(s) on the instrument the person(s), or the
entity(ies) upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
/s/ Xxxxxxx Xxxxxxxxx
--------------------------------------------
Signature
[SEAL]
-14-
16
SCHEDULE A
COPYRIGHT REGISTRATIONS (US)
------------------------------------------------------------------------ ------------------------------------
TITLE REGISTRATION NUMBER
------------------------------------------------------------------------ ------------------------------------
Mongoose TX4892002
------------------------------------------------------------------------ ------------------------------------
SYMIX manufacturing and accounting control system: software; SYMIX TX3321575
------------------------------------------------------------------------ ------------------------------------
SYMIX Manufacturing and Accounting Control System: Software; SYMIX TX 0-000-000
------------------------------------------------------------------------ ------------------------------------
Syman Source Code TX 0-000-000
------------------------------------------------------------------------ ------------------------------------
Syman source code TX3059889
------------------------------------------------------------------------ ------------------------------------
AweSim! TX4539251
------------------------------------------------------------------------ ------------------------------------
MAPICS XZ finite capacity planning and schedule (FCPS) product TX4322234
training workshop: version 2.2.
------------------------------------------------------------------------ ------------------------------------
SLAMsystem V4.5 OS/2 TX3994757
------------------------------------------------------------------------ ------------------------------------
Packaging line simulation system, V2.0 TX4042474
------------------------------------------------------------------------ ------------------------------------
SLAMsystem Version 4.5 MS DOS TX4008988
------------------------------------------------------------------------ ------------------------------------
Factor: AIM modeling reference: version 5.3 TX3658472
------------------------------------------------------------------------ ------------------------------------
Factor. TX3607077
------------------------------------------------------------------------ ------------------------------------
Factor/Aim: Version 5.1 / Xxxx Xxx Xxxx, author XX0000000
------------------------------------------------------------------------ ------------------------------------
Slamsystem, version 2.0
------------------------------------------------------------------------ ------------------------------------
Factory-in-the-computer TXU532780
------------------------------------------------------------------------ ------------------------------------
Packaging line simulation system TX3017155
------------------------------------------------------------------------ ------------------------------------
SLAMSYSTEM V.3.0 TX2972489
------------------------------------------------------------------------ ------------------------------------
TESS: The Extended simulation support system/Xxxxxxx X. Xxxxxxxxxx, TX2629676
A. Xxxx X. Xxxxxxxx -- 7/18/1989
------------------------------------------------------------------------ ------------------------------------
TESS V.4.0 TX2835171
------------------------------------------------------------------------ ------------------------------------
SlamSystem: total simulation project support TX2809649
------------------------------------------------------------------------ ------------------------------------
SLAM II/material handling extension: V.2/11 - TX2679475
------------------------------------------------------------------------ ------------------------------------
MAP/1:3.1 TX2679474
------------------------------------------------------------------------ ------------------------------------
Map/1: manufacturing analysis program using simulation/Xxxxxx X. TX2635394
Xxxxxxx, Xxxxx X. Xxxxxx
------------------------------------------------------------------------ ------------------------------------
Introduction to simulation and Slam II/X. Xxxx X. Xxxxxxxx TX2629675
------------------------------------------------------------------------ ------------------------------------
Tess 3.1 TX2623026
------------------------------------------------------------------------ ------------------------------------
Factor TX2621991
TX 0-000-000
TXu 306-456
------------------------------------------------------------------------ ------------------------------------
Simchart TX 715-669
------------------------------------------------------------------------ ------------------------------------
The Simchart User's Manual TX 715-668
------------------------------------------------------------------------ ------------------------------------
Simchart Installation/Operations Guide TX 860-758
------------------------------------------------------------------------ ------------------------------------
Modeling & Analysis Using Q-Gert Networks. 2nd Edition TX 255-677
------------------------------------------------------------------------ ------------------------------------
Resources in Q-Gert: The Next Chapter TX 14-894
------------------------------------------------------------------------ ------------------------------------
The Q-Gert Analysis Program TX 260-050
------------------------------------------------------------------------ ------------------------------------
Modeling & Analysis Using Q-Gert Networks A 891-429
------------------------------------------------------------------------ ------------------------------------
The Q-Xxxx User's Manual A 547-069
------------------------------------------------------------------------ ------------------------------------
Technical Reference Manual For The SLAM Simulation Program TX 519-723
------------------------------------------------------------------------ ------------------------------------
Introduction To Simulation & SLAM TX 179-361
------------------------------------------------------------------------ ------------------------------------
Aid Installation/Operations Guide TX 860-755
------------------------------------------------------------------------ ------------------------------------
Aid-Fitting Distributions To Observations: A Graphical Approach TX 715-667
------------------------------------------------------------------------ ------------------------------------
Improved SDL Database Management Capabilities TX 860-757
------------------------------------------------------------------------ ------------------------------------
SDL Installation/Operations Guide TX 860-754
------------------------------------------------------------------------ ------------------------------------
The Simulation Data Language TX 538-886
------------------------------------------------------------------------ ------------------------------------
17
------------------------------------------------------------------------ ------------------------------------
TITLE REGISTRATION NUMBER
------------------------------------------------------------------------ ------------------------------------
The Simulation Data Language I(SDL/I) Language Reference Manual TX 538-432
------------------------------------------------------------------------ ------------------------------------
SLAM II TX 716-749
------------------------------------------------------------------------ ------------------------------------
SLAM II, v. 2.0 TX 0-000-000
------------------------------------------------------------------------ ------------------------------------
SLAM II Installation/Operations Guide TX 860-756
------------------------------------------------------------------------ ------------------------------------
SLAM II: Enhanced Simulation Capabilities TX 716-750
------------------------------------------------------------------------ ------------------------------------
VR 90* TXu 890-082
TXu 824-684
TXu 786-701
------------------------------------------------------------------------ ------------------------------------
VR-10E* TXu 861-253
------------------------------------------------------------------------ ------------------------------------
VR-BIZ* TXu 861-252
------------------------------------------------------------------------ ------------------------------------
Distribution Architects Visible Results: VR Alert* TXu 861-251
------------------------------------------------------------------------ ------------------------------------
Distribution Architects Visible Results: XX-XX* TXu 861-250
------------------------------------------------------------------------ ------------------------------------
MDS, Version 8.1* TXu 786-701
------------------------------------------------------------------------ ------------------------------------
MDS-90119* TXu 786-700
------------------------------------------------------------------------ ------------------------------------
Symix Manufacturing and Accounting Control System Computer Software,
v2.7
------------------------------------------------------------------------ ------------------------------------
Symix Manufacturing and Accounting Control System Computer Software,
v3.0
------------------------------------------------------------------------ ------------------------------------
Symix Manufacturing and Accounting Control System Computer Software,
v4.0
------------------------------------------------------------------------ ------------------------------------
SyteLine Enterprise Resource Planning System, v2.0
------------------------------------------------------------------------ ------------------------------------
SyteLine Enterprise Resource Planning System, v3.0
------------------------------------------------------------------------ ------------------------------------
SyteLine Enterprise Resource Planning System, v3.5
------------------------------------------------------------------------ ------------------------------------
SyteLine Enterprise Resource Planning System, v4.0
------------------------------------------------------------------------ ------------------------------------
SyteLine Enterprise Resource Planning System, v4.5
------------------------------------------------------------------------ ------------------------------------
SyteLine Enterprise Resource Planning System, v5.0
------------------------------------------------------------------------ ------------------------------------
SyteLine Enterprise Resource Planning System, v6.0
------------------------------------------------------------------------ ------------------------------------
Copyright proprietor is Frontstep, Inc. for all works above except those
identified with an asterisk (*). For works identified with an asterisk (*),
copyright proprietor is Frontstep Solutions Group, Inc.
Applications for Registration submitted to counsel for Secured Party:
- Symix Manufacturing and Accounting Control System Computer Software, v.2.7 -
Symix Manufacturing and Accounting Control System Computer Software, v.3.0 -
Symix Manufacturing and Accounting Control System Computer Software, v.4.0 -
SyteLine Enterprise Resource Planning System, v2.0 - SyteLine Enterprise
Resource Planning System, v3.0 - SyteLine Enterprise Resource Planning System,
v3.5 - SyteLine Enterprise Resource Planning System, v4.0 - SyteLine Enterprise
Resource Planning System, v4.5 - SyteLine Enterprise Resource Planning System,
v5.0 - SyteLine Enterprise Resource Planning System, v6.0
Copyright proprietor is Frontstep, Inc.
-2-
18
SCHEDULE B
TO THE COPYRIGHT SECURITY AGREEMENT
JULY 12, 2001
------------------------------------------------------- -----------------------------------------------------
Works of Authorship Publication Date
------------------------------------------------------- -----------------------------------------------------
SYMIX/SYTELINE
------------------------------------------------------- -----------------------------------------------------
SYMAN 9/30/85
------------------------------------------------------- -----------------------------------------------------
SYMIX 2.6 4/26/91
------------------------------------------------------- -----------------------------------------------------
SYMIX 2.7 8/15/92
------------------------------------------------------- -----------------------------------------------------
SYMIX 3.0 3/01/94
------------------------------------------------------- -----------------------------------------------------
SYMIX 4.0 (a/k/a SYMIX 4.1) 11/01/94 (new name used after 12/12/97)
------------------------------------------------------- -----------------------------------------------------
SyteLine 2.0 3/15/96
------------------------------------------------------- -----------------------------------------------------
SyteLine 3.0 9/30/97
------------------------------------------------------- -----------------------------------------------------
SyteLine 3.5 5/05/98
------------------------------------------------------- -----------------------------------------------------
SyteLine 4.0 12/14/98
------------------------------------------------------- -----------------------------------------------------
SYTELINE 4.5 8/09/99
------------------------------------------------------- -----------------------------------------------------
SYTELINE 5.0 3/31/00
------------------------------------------------------- -----------------------------------------------------
SYTELINE 6.0 3/20/01
------------------------------------------------------- -----------------------------------------------------
FRONTOFFICE
------------------------------------------------------- -----------------------------------------------------
FRONTOFFICE 5.0
------------------------------------------------------- -----------------------------------------------------
FRONTOFFICE 4.5
------------------------------------------------------- -----------------------------------------------------
FRONTOFFICE 4.0
------------------------------------------------------- -----------------------------------------------------
FRONTOFFICE 3.0
------------------------------------------------------- -----------------------------------------------------
------------------------------------------------------- -----------------------------------------------------
DISTRIBUTION
------------------------------------------------------- -----------------------------------------------------
SYTEDISTRIBUTION 9.2
------------------------------------------------------- -----------------------------------------------------
SYTEDISTRIBUTION 9.1
------------------------------------------------------- -----------------------------------------------------
------------------------------------------------------- -----------------------------------------------------
APS
------------------------------------------------------- -----------------------------------------------------
APS 4.6
------------------------------------------------------- -----------------------------------------------------
APS 4.5
------------------------------------------------------- -----------------------------------------------------
APS 4.1
------------------------------------------------------- -----------------------------------------------------
APS 3.5
------------------------------------------------------- -----------------------------------------------------
------------------------------------------------------- -----------------------------------------------------
AIM
------------------------------------------------------- -----------------------------------------------------
AIM 9.0
------------------------------------------------------- -----------------------------------------------------
AIM 8.1
------------------------------------------------------- -----------------------------------------------------
AIM 8.0
------------------------------------------------------- -----------------------------------------------------
AIM 7.0
------------------------------------------------------- -----------------------------------------------------
------------------------------------------------------- -----------------------------------------------------
FACTOR (WINDOWS)
------------------------------------------------------- -----------------------------------------------------
FACTOR 8.1
------------------------------------------------------- -----------------------------------------------------
Factor 8.0
------------------------------------------------------- -----------------------------------------------------
------------------------------------------------------- -----------------------------------------------------
SUPPLY CHAIN
------------------------------------------------------- -----------------------------------------------------
SC 3.0
------------------------------------------------------- -----------------------------------------------------
SC 2.0
------------------------------------------------------- -----------------------------------------------------
SC 1.0
------------------------------------------------------- -----------------------------------------------------
------------------------------------------------------- -----------------------------------------------------
AWESIM
------------------------------------------------------- -----------------------------------------------------
AWESIM 3.0
------------------------------------------------------- -----------------------------------------------------
19
------------------------------------------------------- -----------------------------------------------------
Works of Authorship Publication Date
------------------------------------------------------- -----------------------------------------------------
------------------------------------------------------- -----------------------------------------------------
TEAM BUILDER
------------------------------------------------------- -----------------------------------------------------
TEAMBUILDER 2.0
------------------------------------------------------- -----------------------------------------------------
TEAMBUILDER 4.0
------------------------------------------------------- -----------------------------------------------------
------------------------------------------------------- -----------------------------------------------------
ECRM
------------------------------------------------------- -----------------------------------------------------
ECRM 5.0
------------------------------------------------------- -----------------------------------------------------
ECRM 5.1
------------------------------------------------------- -----------------------------------------------------
ECRM 5.2
------------------------------------------------------- -----------------------------------------------------
ECRM 5.3
------------------------------------------------------- -----------------------------------------------------
ECRM 5.4
------------------------------------------------------- -----------------------------------------------------
------------------------------------------------------- -----------------------------------------------------
PROJECTS (A/K/A SINGLE SOURCE SYSTEMS PROJECTS
EXTENSION)
------------------------------------------------------- -----------------------------------------------------
for Symix v. 4.0
------------------------------------------------------- -----------------------------------------------------
for Symix v. 4.1
------------------------------------------------------- -----------------------------------------------------
for Symix v. 3.5
------------------------------------------------------- -----------------------------------------------------
for SyteLine v. 4.0
------------------------------------------------------- -----------------------------------------------------
for SyteLine v. 4.5
------------------------------------------------------- -----------------------------------------------------
Copyright proprietor is Frontstep, Inc. for all listed works.
Works listed in BOLD are Marketed Software as of the date hereof.
This Schedule lists all prior versions of the Symix/SyteLine product
line, together with all versions of works (that is, the Projects
module) as to which the Symix/SyteLine product line constitutes a
derivative work.
For Marketed Software which is not the Symix/SyteLine product line,
this Schedule lists some but not necessarily all prior versions, and
some but not necessarily all works as to which such non-Symix/SyteLine
works constitute derivative works.
-2-
20
SCHEDULE C
AMENDMENT
TO
COPYRIGHT SECURITY AGREEMENT
This Amendment (the "AMENDMENT"), dated as of________ ___,
200__ (the "Amendment Effective Date") to the Copyright Security Agreement,
dated as of July __, 2001 (the "AGREEMENT"), among FOOTHILL CAPITAL CORPORATION,
a California corporation (the "SECURED PARTY") and FRONTSTEP, INC., an Ohio
corporation, FRONTSTEP SOLUTIONS GROUP, INC., an Ohio corporation, and
BRIGHTWHITE SOLUTIONS, INC., an Ohio corporation (each a "DEBTOR" and
collectively, jointly and severally, the "DEBTORS").
WHEREAS the Secured Party and the Debtors desire to amend
certain terms of the Agreement (a true copy of which is attached as Exhibit 1
hereto). Accordingly, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Secured Party and Debtors
hereby agree as follows:
1. DEFINITIONS. All capitalized terms used herein and not
otherwise defined herein are used herein as defined in the Agreement.
2. AMENDMENT TO SCHEDULE A. SCHEDULE A to the Agreement is
hereby amended to add the works identified on ANNEX I attached hereto
(collectively, the "ANNEX I WORKS"). All Agreement terms and provisions
(including without limitation all conditions, representations, warranties,
covenants and other agreements) shall apply to the Annex I Works as if such
works had been included on Schedule A as of July ___, 2001. Without limiting the
foregoing provisions, as of the date hereof, the term "Copyright Collateral"
shall include without limitation the works set forth in Annex I hereto.
3. GRANT OF SECURITY INTEREST. Each Debtor, as security for
the payment and performance of its Secured Obligations, hereby grants, assigns,
transfers and conveys to the Secured Party for the benefit of the Lenders a
continuing first priority security interest in all of its right, title and
interest in, to and under the Copyright Collateral, including without limitation
Copyright Collateral in or otherwise concerning the Annex I Works.
4. REPRESENTATIONS AND WARRANTIES. Each Debtor jointly and
severally represents and warrants to the Secured Party as follows:
(a) TRUE AND COMPLETE LIST. Set forth in
SCHEDULE A as amended by Annex I is a true and complete list, as of the date of
this Amendment, of (i) all works registered with the United States Copyright
Office in which any of the Debtors
21
own Copyright Collateral and (ii) all works for which are pending applications
for registration with the United States Copyright Office in which any of the
Debtors own Copyright Collateral.
(b) VALIDITY. Each of the Registrations owned
by Debtors identified in SCHEDULE A as amended by Xxxxx X, and all other
Copyright Collateral owned and otherwise claimed by any Debtor (including rights
relating to works identified on Annex I hereto) is valid, subsisting and
enforceable. Each Debtor has properly complied in all material respects with all
applicable statutory and regulatory requirements, including all notice
requirements, in connection with the Copyright Collateral, and, except as
disclosed in the litigation schedule or annex to the Loan Agreement, no claim
has been made that use (or other exploitation) of any Debtor's rights in and to
the Copyright Collateral does or may infringe or otherwise violate the rights of
any third Person.
(c) TITLE. Each Debtor has rights in and good
title to the Copyright Collateral owned or otherwise claimed by such Debtor
(including rights relating to works identified on SCHEDULE A as amended by Annex
I) and is the sole and exclusive owner of the entire and unencumbered right,
title and interest in and to such Copyright Collateral, free and clear of any
Liens (other than Liens in favor of the Secured Party and other than the rights
of the licensor of a license made by such licensor to a Debtor as licensee, or
the rights of other licensees under non-exclusive licenses of the same subject
matter if a Debtor's license of such subject matter is a non-exclusive license).
For any Copyright Collateral for which a Debtor is either a licensor or a
licensee pursuant to a license or licensing agreement regarding such Copyright
Collateral, each such license or licensing agreement is in full force and
effect, such Debtor is not in default of any of its obligations thereunder and,
other than the parties to such licenses or licensing agreements, no other Person
has any rights in or to any of such Copyright Collateral.
(d) NO VIOLATION. The execution, delivery and
performance by each Debtor of this Amendment do not violate any provision of law
or the articles of incorporation or by-laws of such Debtor or result in a breach
of or constitute a material default under any contract, obligation, indenture or
other instrument to which such Debtor is a party or by which such Debtor may be
bound.
(e) AUTHORIZATION. This Agreement has been
duly authorized, executed and delivered, and constitutes, a legal, valid and
binding agreement of each Debtor, enforceable in accordance with its terms; and
(f) SECRECY. Each Debtor has taken and will
continue to take all reasonable steps to protect the secrecy of all trade
secrets relating to any of its Copyright Collateral.
5. CONTINUED EFFECTIVENESS OF AGREEMENT. Each Debtor hereby
(i) confirms and agrees that each Loan Document to which it is a party is, and
shall continue to be, in full force and effect and is hereby ratified and
confirmed in all respects except
-2-
22
that on and after the Amendment Effective Date of this Amendment all references
in any such Loan Document to "the Agreement", "thereto", "thereof", "thereunder"
or words of like import referring to the Agreement shall mean the Agreement as
amended by this Amendment, and (ii) confirms and agrees that to the extent that
any such Loan Document purports to assign or pledge to the Secured Party, or to
grant to the Secured Party a Lien on any collateral as security for the
Obligations of the Debtors from time to time existing in respect of the
Agreement and the Loan Documents, such pledge, assignment and/or grant of a Lien
is hereby ratified and confirmed in all respects.
6. MISCELLANEOUS.
(a) This Amendment may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which shall be deemed to be an original, but all of which taken together
shall constitute one and the same agreement.
(b) Section and paragraph headings herein are
included for convenience of reference only and shall not constitute a part of
this Amendment for any other purpose.
(c) This Amendment shall be governed by, and
construed in accordance with, the laws of the State of New York, applicable to
agreements made and wholly performed therein.
(d) The Debtors will pay on demand all
reasonable out-of-pocket costs and expenses of the Secured Party in connection
with the preparation, execution and delivery of this Amendment, including,
without limitation, the reasonable fees, disbursements and other charges of
Xxxxxxx Xxxx & Xxxxx LLP, counsel to the Secured Party.
-3-
23
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed by their respective officers thereunto duly authorized
as of the day and year first above written.
FRONTSTEP GROUP, INC.
FRONTSTEP SOLUTIONS GROUP, INC.
BRIGHTWHITE SOLUTIONS, INC.,
each an Ohio corporation
By:
--------------------------------------------
Name:
------------------------------------------
Title:
-----------------------------------------
FOOTHILL CAPITAL CORPORATION
By:
--------------------------------------------
Name:
------------------------------------------
Title:
-----------------------------------------
-4-
24
STATE OF )
) ss
COUNTY OF )
On ________ __ 2001, before me, ____________________________,
Notary Public, personally appeared ________________________, personally known to
me (or proved to me on the basis of satisfactory evidence) to be the person(s)
whose name(s) is/are subscribed to the within instrument and acknowledged to me
that he/she/they executed the same in his/her/their authorized capacity(ies),
and that by his/her/their signature(s) on the instrument the person(s), or the
entity(ies) upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
------------------------------------------
Signature
[SEAL]
STATE OF )
) ss
COUNTY OF )
On _________ __, 2001, before me, ____________________, Notary
Public, personally appeared ________________________, personally known to me (or
proved to me on the basis of satisfactory evidence) to be the person(s) whose
name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and
that by his/her/their signature(s) on the instrument the person(s), or the
entity(ies) upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
-----------------------------------------
Signature
[SEAL]
-5-
