Exhibit 10.9.1
INTELLECTUAL PROPERTY
SECURITY AGREEMENT
THIS INTELLECTUAL PROPERTY SECURITY AGREEMENT ("Security Agreement"), is
made as of November 5, 1999, {being the actual date of spin off, not an earlier
"as of" date} by SPIDER TECHNOLOGIES, INC., a Delaware corporation (the
"Grantor"), in favor of INTEK INFORMATION, INC., a Delaware corporation (the
"Secured Party").
RECITALS:
--------
WHEREAS, Secured Party has transferred to Grantor certain Software
described further on Schedule A hereto pursuant to the terms of that certain
Software Assignment and Grant-Back License, Maintenance and Support Agreement of
even date herewith between Grantor and Secured Party (the "Assignment
Agreement");
WHEREAS, Grantor desires to grant to Secured Party a security interest in
the Collateral to secure the payment of the Obligations.
AGREEMENT:
----------
NOW, THEREFORE, in consideration of the premises and to induce Secured
Party to enter into the Assignment Agreement, Grantor hereby agrees with Secured
Party, as follows:
1. Defined Terms. The following terms shall have the following meanings:
"Collateral" has the meaning assigned to it in Section 2 of this Security
Agreement.
"Documentation" means engineers' notes, manuals, documentation and similar
written (in any medium) materials related to or explaining the development or
operation of the Software.
"Event of Default" means (i) a breach of this Agreement or any Obligation
that is not cured within twenty (20) days after notice thereof by Secured Party;
(ii) termination of the Assignment Agreement by Secured Party due to a material
breach thereof by Grantor; (iii) a failure to pay the Royalties (as defined
therein) then due under the terms of the Assignment Agreement within twenty (20)
days after written notice from Secured Party; (iv) termination of the Sublease
and Resource Sharing Agreement or the Transition Support Agreement, each between
the Grantor and Secured Party and dated as of October 1, 1999, due to a breach
by Grantor, if Grantor has not within 20 days
after such termination paid the monetary damages resulting to Secured Party as a
result of such breach and termination.
"Existing Liens" has the meaning assigned to it in Section 3 of this
Security Agreement.
"Intellectual Property Rights" means patent applications, patents,
trademark applications, trademarks (and associated goodwill), copyrights,
copyright applications, and copyright registrations, and trade secrets for
the Software and Documentation, including but not limited to U.S. Copyright
Registration Number TX4-935-066 Telweb v. 2.0 and U.S. Copyright Registration
Number TX4-946-000 TelWeb v.2.0a.
"Obligations" means (a) the Royalties (as defined in the Assignment
Agreement) owing under the terms of the Assignment Agreement, (b) the
liabilities, expenses and damages incurred by Secured Party as a result of
Grantor's breach of the Sublease and Resource Sharing Agreement or Transition
Support Agreement, each between the parties and dated as of October 1, 1999 and
(c) all attorney's fees, court costs and expenses of whatever kind incident to
the collection or performance of any of the foregoing and the enforcement and
protection of the security interest created under this Security Agreement.
"Permitted Liens" means any lien, charge, assignment, non-exclusive
licenses granted by Grantor for the Collateral as contemplated in Section 14, or
other encumbrance that arises by operation of law with respect to obligations of
Grantor that are not yet due and payable or governmental liens, charges,
assignments or other encumbrances that are being contested in good faith by
appropriate proceedings.
"Security Agreement" means this Intellectual Property Security Agreement,
as amended, supplemented or otherwise modified from time to time in accordance
with its terms.
"Software" means the "TelWeb" software developed or owned by Secured Party
and transferred by Secured Party to Grantor by way of the Assignment (further
described in the attached Schedule A), and software owned by Grantor which is
----------
based upon any evolution or upgrade thereof or derivative work thereon, but does
not include software licensed from third parties that is used in connection with
that Software.
"UCC" means the Uniform Commercial Code as from time to time in effect in
the State of California.
"USPTO Filing" has the meaning assigned to it in Section 4 of this Security
Agreement.
2. Grant of Security Interest. As collateral security for the prompt and
complete payment and performance when due of the Obligations, Grantor hereby
grants to Secured Party for the benefit of Secured Party a security interest in
all of Grantor's right, title and interest in and to the Software,
2
the Documentation and the Intellectual Property Rights, and rights of Grantor
incident thereto necessary for the enjoyment of the foregoing, now owned or
hereafter acquired by Grantor or in which Grantor now has or at any time in the
future may acquire any right, title or interest (collectively, the
"Collateral"), including all Proceeds and products of any and all of the
foregoing. (collectively, the "Collateral").
3. Representations and Warranties Concerning the Intellectual Property.
Grantor represents and warrants that except for Permitted Liens, and except for
those liens, charges, mortgages, pledges, assignments or other encumbrances or
security interests, if any, to which the Collateral may be subject at the time
of conveyance to Grantor pursuant to the Assignment Agreement ("Existing
Liens"), Grantor has not executed and/or delivered any assignment, transfer or
conveyance of any of the Collateral, recorded or unrecorded.
4. Covenants. Grantor covenants and agrees with Secured Party that,
from and after the date of this Security Agreement until the Obligations are
paid in full:
(a) From time to time, upon the written request of Secured
Party, and at the sole expense of Grantor, Grantor will promptly and
duly execute and deliver such further instruments and documents and
take such further action as Secured Party may reasonably request for
the purpose of obtaining or preserving the full benefits of this
Security Agreement and of the rights and powers herein granted,
including, without limitation, the filing of any financing or
continuation statements under the UCC in effect in any jurisdiction
with respect to the liens created hereby or filings in the United
States Patent and Trademark Office or United States Copyright Office
to record or perfect Secured Party's security interest in respect of
filed Intellectual Property Rights (collectively, "USPTO Filings").
Grantor also hereby authorizes Secured Party to file any such
financing or continuation statement or any USPTO Filing without the
signature of Grantor to the extent permitted by applicable law. A
carbon, photographic or other reproduction of this Security Agreement
shall also be sufficient as a financing statement for filing in any
jurisdiction.
(b) Grantor will not create, incur or permit to exist, will
take all commercially reasonable actions to defend the Collateral
against, and will take such other commercially reasonable action as
is necessary to remove, any lien or claim on or to the Collateral,
other than the liens created hereby, Permitted Liens, or Existing
Liens, and will take all commercially reasonable actions to defend
the right, title and interest of Secured Party in and to any of the
Collateral against the claims and demands of all persons whomsoever
except with respect to Existing Liens.
(c) Grantor will not grant any exclusive license for, sell or
transfer, but may otherwise license or sub-license the Collateral, as
contemplated in Section 14.
3
(d) Grantor will advise Secured Party, its successors and
assigns, promptly, in reasonable detail, of any lien on, or claim
asserted against, the Collateral.
(e) Whenever Grantor shall file an application for any patent
or for the registration of any copyright with the United States
Patent and Trademark Office, the United States Copyright Office, or
any similar office or agency in the United States, in respect of the
Collateral, Grantor shall report such filing to Secured Party within
ten days after such filing occurs. Upon request of Secured Party,
Grantor shall execute and deliver any and all reasonably necessary
agreements, instruments, documents, and papers as Secured Party may
request to evidence and perfect Secured Party's security interest in
any such newly filed patent or copyright and the goodwill relating
thereto or represented thereby, and Grantor hereby appoints Secured
Party its attorney-in-fact to execute and file all such writings for
the foregoing purposes, all acts of such attorney being hereby
ratified and confirmed; such power being coupled with an interest and
being irrevocable until the Obligations are discharged in full.
5. Performance by Secured Party of Grantor's Obligations. If Grantor
fails to perform or comply with any of its agreements contained herein and
Secured Party, as provided for by the terms of this Security Agreement, shall
itself perform or comply, or otherwise cause performance or compliance, with
such agreement, then the expenses of Secured Party incurred in connection with
such performance or compliance, shall be payable by Grantor to Secured Party on
demand and shall constitute Obligations secured hereby.
6. Remedies Upon Default. Upon an Event of Default, Secured Party
may pursue any or all of the following remedies, without any notice to Grantor
except as required below:
(a) Secured Party may give written notice of default to
Grantor, following which Grantor shall not dispose of, conceal,
transfer, sell or encumber any of the Collateral (including, but not
limited to, cash proceeds) without Secured Party's prior written
consent, even if such disposition is otherwise permitted hereunder in
the ordinary course of business. Secured Party may obtain a temporary
restraining order or other equitable relief to enforce Grantor's
obligation to refrain from so impairing Secured Party's Collateral.
(b) Secured Party may take possession of any or all of the
Collateral. Grantor hereby consents to Secured Party's entry into any
of Grantor's premises to repossess Collateral, and specifically
consents to Secured Party's forcible entry thereto as long as Secured
Party causes no significant damage to the premises in the process of
entry (drilling of locks, cutting of chains and the like do not in
themselves
4
cause "significant" damage for the purposes hereof) and provided that
Secured Party accomplishes such entry without a breach of the peace.
(c) Secured Party may dispose of the Collateral at private or
public sale. Any required notice of sale shall be deemed commercially
reasonable if given at least five (5) days prior to sale. Secured
Party may adjourn any public or private sale to a different time or
place without notice or publication of such adjournment, and may
adjourn any sale either before or after offers are received. The
Collateral may be sold in such lots as Secured Party may elect, in
its sole discretion. Secured Party may take such action as it may
deem necessary to repair, protect, or maintain the Collateral pending
its disposition.
(d) Secured Party may exercise its lien upon and right of
setoff against any monies, items, credits, deposits or instruments
that Secured Party may have in its possession and that belong to
Grantor or to any other person or entity liable for the payment of
any or all of the Obligations.
(e) Secured Party may exercise any right that it may have
under any other document evidencing or securing the Obligations or
that is otherwise available to Secured Party at law or equity.
7. Limitation on Duties Regarding Preservation of Collateral. Secured
Party's sole duty with respect to the custody, safekeeping and physical
preservation of the Collateral in its possession, under Section 9-207 of the UCC
or otherwise, shall be to deal with it in the same manner as Secured Party would
deal with similar property for its own account. Neither Secured Party nor any of
its partners, directors, officers, employees or agents shall be liable for
failure to demand, collect or realize upon all or any part of the Collateral or
for any delay in doing so or shall be under any obligation to sell or otherwise
dispose of any Collateral upon the request of Grantor or otherwise.
8. Release. At such time as Grantor shall have paid and performed in
full the Obligations, Secured Party shall execute and deliver to Grantor all
assignments and other instruments as may be reasonably necessary or proper to
terminate the Secured Party's security interest in the Collateral.
9. Severability. Any provision of this Security Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
10. No Waiver: Cumulative Remedies. Secured Party shall not by any act
(except by a written instrument pursuant to the "Notices" Section hereof),
delay, indulgence, omission or
5
otherwise be deemed to have waived any right or remedy hereunder or to have
acquiesced in any default or Event of Default or in any breach of any of the
terms and conditions hereof. No failure to exercise, nor any delay in
exercising, on the part of Secured Party, any right, power or privilege
hereunder shall operate as a waiver thereof. No single or partial exercise of
any right, power or privilege hereunder shall preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. A
waiver by Secured Party of any right or remedy hereunder on any occasion shall
not be construed as a bar to any right or remedy which Secured Party would
otherwise have on any future occasion. The rights and remedies herein provided
are cumulative, may be exercised singly or concurrently and are not exclusive of
any rights or remedies provided by law or equity.
11. Waivers and Amendments; Successors and Assigns. None of the terms or
provisions of this Security Agreement may be waived or modified except by a
written instrument executed by Grantor and Secured Party. This Security
Agreement shall be binding upon and inure to the benefit of the successors and
assigns of Grantor and Secured Party.
12. Notices. Any and all notices, elections or demands permitted or
required to be made under this Security Agreement shall be in writing, signed by
the party giving such notice, election or demand and shall be delivered
personally, telecopied, or sent overnight via nationally recognized courier
service (such as Federal Express), to the other party at the address set forth
below, or at such other address as may be supplied in writing and of which
receipt has been acknowledged in writing. The date of personal delivery or
telecopy or the next business day after delivery to such courier service), as
the case may be, shall be the date of such notice, election or demand. For the
purposes of this Security Agreement:
The Address of Grantor is: Spider Technologies, Inc.
0000 XXX Xxxxxxx, 00xx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000
Fax No.: 000-000-0000
with a copy to: E* Law Group
0000 Xxxx 000/xx/ Xxxxx
Xxxxxxxxxxx, XX 00000
Telecopy No.: (000) 000-0000
Attention: Xxxxxx Xxxxxxxxxxx
The Address of Secured Party is: Intek Information, Inc.
0000 XXX Xxxxxxx, 00xx Xxxxx
Xxxxxxxxx, XX 00000-0000
Attention: Xxxxxxx X. X'Xxxxxxx
Telecopy No.: (000)000-0000
6
with a copy to: Xxxxxxxx, Xxxxx & Xxxxxxx, P.C.
0000 00/xx/ Xxxxxx
Xxxxxxx, XX 00000
Attention: G. Xxxxx Xxxxxxxx, Jr.
Telecopy No.: (000) 000-0000
13. Governing Law. This Security Agreement shall be governed by, and
construed and interpreted in accordance with, the laws of the State of
California, without regard to its conflict of law provisions.
14. Quiet Enjoyment by Licensees. Secured Party, its successors and
assigns, upon exercise of its rights hereunder shall not disturb a licensee's
rights in respect of the Collateral pursuant to a non-exclusive license granted
by the Grantor for the Collateral, provided, however, that Secured Party, its
successors and assigns, shall have no obligation to perform any maintenance,
support or other work thereunder, and no provision of any such license shall be
binding upon Secured Party, its successors and assigns, other than the
obligation to license such Collateral. Without limitation, no right of first
refusal or purchase right shall be binding upon Secured Party, its successors
and assigns.
7
Intellectual Property Security Agreement (continued)
IN WITNESS WHEREOF, the parties hereto have caused this Security Agreement
to be duly executed and delivered as of the date first above written.
GRANTOR:
SPIDER TECHNOLOGIES, INC.,
a Delaware corporation
By: /S/ XXXXXXX X. X'XXXXXXX
----------------------------
Title: ____________________________
SECURED PARTY:
INTEK INFORMATION, INC.,
a Delaware corporation
By: /S/ XXXXXXX X. X'XXXXXXX
------------------------------
Title: ____________________________
8
SCHEDULE A
(ATTACHED IS ADDITIONAL DESCRIPTION OF THE "TELWEB" SOFTWARE
FROM ASSIGNMENT AGREEMENT
EXHIBIT A
(ADDITIONAL DESCRIPTION OF THE "TELWEB" SOFTWARE
FROM SOFTWARE ASSIGNMENT AGREEMENT)
Software Description
Modules & Sections
Application Manager Reporting Manager (RM)
Event Manager ----------------------
Exchange Manager . Reporting Library
Program Manager . Scheduling
Process Manager . Distribution
Reporting Manager
Order Inventory Order Inventory (OI)
Scripting & Data Capture --------------------
. Orders
Application Manager (AM) . Order Entry (OE)
------------------------ . Shipping (SH)
. Installation Manager . Taxation (TX)
. Configuration Manager . Payment (PA)
. User Manager Authorization
. Users & Groups Settlement
. Message Manager . Inventory (IN)
. User Interface . Invoicing (IV)
. Screen Manager . Products & Suppliers
. Screens & Menues . Products (PR)
. Security Suppliers
Shipping
Event Manager (EM) Pricing
------------------
. Event Types Scripting & Data Capture (SD)
. Queues ----------------------------
. Scheduler . Scripting Engine
. Script building tool
Exchange & Process Manager (XM) . Script validation and verification
-------------------------------
. Data Import and Export
. EDI
Program Manager (PM)
--------------------
. Customers & Prospects
. Programs & Projects
. Events & Event Logging
