Exhibit
10.3


 


As amended


David Vogel


Dechert


17.03.03


 


 


Dechert


2 Serjeants’ Inn 

London EC4Y 1LT 

England


 


April 17th, 2003


 


Authoriszor Inc.


c/o WRDCLogsys, First
Floor


Ebor Court, Westgate,
Leeds


LS1 4ND United Kingdom


 


Ladies and Gentlemen:


 


Dechert (the “Creditor”)
and Authoriszor Inc. (the “Company”) have had previous discussions regarding
the obligations owed by the Company to the Creditor and the settlement
thereof.  This letter is being delivered
to evidence the agreement made between the Creditor and the Company regarding
such obligations.


 


In order to avoid the
time, trouble and extraordinary expenses of litigation, the Creditor and the
Company hereby agree, upon execution of this letter by the Company in the
appropriate place below, to comprise, resolve and settle, release and
extinguish all existing and inchoate claims, actions, demands, and/or causes of
action, whether now known or unknown, that each has, might have, or might claim
to have against the other, whatever kind or nature.  As consideration for the foregoing, the
Company hereby agrees to pay, in immediately available funds, the aggregate sum
of $53,479.81 (the “Debt”) to the Creditor within 100 days from the date first
written above.  The Company hereby also
agrees, as security for the payment of the Debt as contemplated in the
foregoing sentence, to pledge 319,390 shares of WRDCLogsys Ltd. held by it
pursuant to that certain Pledge Agreement, a copy of which is attached as Exhibit
A hereto (the “Pledge Agreement”).


 


In the event that the
Company shall fail to pay the Debt to the Creditor within 100 days of the date
first written above, the Creditor hereby agrees and understands that its sole
and exclusive remedies against the Company are the remedies set forth in the
Pledge Agreement. Notwithstanding anything to the contrary contained herein and
in the Pledge Agreement, this letter shall survive and remain in effect should
the Company fail to pay the Debt to the Creditor in immediately available funds
as provided herein.


 


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Neither the Creditor nor the Company have assigned or
otherwise transferred to any other person or entity any interest in any account,
claim, demand, action and/or cause of action they have, or may have, or may
claim to have in connection with the matters released hereby and/or the persons
and entities released herein.  The
Creditor and the Company have agreed to the matters contained herein of their
own choice and free will and with their own judgment after advice of counsel.


 


If the foregoing correctly sets forth the
understanding and agreement of the Creditor and the Company, please indicate
your acceptance hereof in the space provided below for that purpose, whereupon
this letter shall constitute a valid and binding agreement between the Creditor
and the Company.  Upon execution hereof,
this letter shall be binding upon and inure to the benefit of the Company and
the Creditor and their respective heirs, legal representatives, successors and
assigns.   This letter shall be governed
by and construed in accordance with the laws of the State of New York.


 


 


	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  DECHERT

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  



 


 


The foregoing letter
agreement is hereby confirmed and accepted as of the date first above written.


 


	
  Authoriszor Inc.

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  



 


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Exhibit A


 


PLEDGE
AGREEMENT


 


 


THIS PLEDGE AGREEMENT
(this “Agreement”) is made as of the 17th day of April 2003, by and
between Authoriszor Inc., a Delaware corporation
(“Pledgor”) and Dechert (“Secured
Party”).


 


RECITALS:


 


A.            Pledgor
and Secured Party have executed that certain Letter Agreement, dated April
17th, 2003 (the “Letter”);


 


B.            Pledgor
is the owner of certain Collateral (as defined below) and expects to receive
substantial direct and indirect benefits from the agreement set forth in the
Letter; and


 


C.            As
security for the payment and performance of all of Pledgor’s obligations pursuant
to the Letter, Pledgor has agreed to grant Secured Party a Security Interest
(as defined below) in the Collateral.


 


AGREEMENTS:


 


In consideration of the
premises, the covenants and agreements contained herein, and other good and
valuable consideration, the receipt and adequacy of which are hereby acknowledged,
Secured Party and Pledgor do hereby agree as follows:


 


1.             Definitions.  The following terms shall have the meanings
indicated below and shall be construed to have the broadest possible meanings
permitted under the Code:


 


“Code”
means the Uniform Commercial Code as enacted by the State of New York, as it
shall be amended from time to time.


 


“Collateral”
means 319,390 shares of WRDCLogsys Ltd. (“WRDCLogsys”) owned by Pledgor, and
the certificates representing such shares, together with all additions,
replacements, substitutions, increases, profits, proceeds, dividends,
distributions and products thereof, in any form and wherever located.


 


“Event of
Default” and “Default” means
the breach by Pledgor of its obligations to pay the Debt (as defined in the
Letter) to Secured Party.


 


“Security
Interest” means the security interest (as that term is
defined by the Code) granted by this Agreement.


 


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2.             Grant
of Security Interest.  Pledgor hereby
delivers to Secured Party certificates evidencing, and grants to Secured Party
a continuing and unconditional Security Interest in, the Collateral,
accompanied by stock powers in substantially the form of Annex 1
attached hereto and made a part hereof (the “Powers”), duly executed in
blank, to secure the prompt, timely and complete payment of all obligations and
liabilities of Pledgor to Secured Party now existing or hereafter arising under
the Letter and the full, complete and timely performance of any and all
existing or future obligations of Pledgor under the Letter and this
Agreement.  All such present and future
obligations under the Letter and this Agreement are referred to herein as the “Secured
Obligations.”


 


3.             Representations
and Warranties.  Pledgor represents
and warrants as follows:


 


(a)           Pledgor
is the sole legal and beneficial owner of the Collateral, free and clear of all
security interests, except for the security interest created by this Agreement,
the provisions of the Articles of Association of WRDCLogsys (formerly know as Authoriszor
Holdings Limited) (as amended, modified and supplemented from time to time, the
“Articles”) and the provisions of that certain Investment Agreement,
dated as of July 18, 2002, by and among Pledgor and the parties named therein
(as amended, modified and supplemented from time to time, the “Investment
Agreement”);


 


(b)           Pledgor
has the capacity, power and authority to enter into this Agreement;


 


(c)           The
pledge of the Collateral pursuant to this Agreement creates a valid and first
priority security interest in the Collateral, in favor of Secured Party,
securing the payment and performance of the Secured Obligations, subject to the
Articles and Investment Agreement.


 


4.             Covenants
of Pledgor.  So long as this
Agreement has not been terminated as provided hereafter, Pledgor:


 


4.1           Title.  Will defend the Collateral against the claim
of all other persons;


 


4.2           No
Encumbrances.  Will keep the
Collateral free of all security interests, except the Security Interest, the
Articles and the Investment Agreement;


 


4.3           No
Sale, Etc.  Will not assign, deliver,
sell, transfer, lease or otherwise dispose of (including dispositions by operation
of law) any portion of the Collateral, or any interest therein without the
prior written consent of Secured Party;  provided, however, no consent shall be required in
connection with the recapitalization of the capital stock of WRDCLogsys or
similar transaction;  provided further, however, no consent shall be required if
the Collateral is sold, assigned or otherwise disposed of and the proceeds
received from such sale, assignment or other method of disposal are applied to
pay the Secured Obligations in full;


 


4.4           Financing
Statements.  Will execute and deliver
to Secured Party such stock powers, financing statements, certificates and
other documents and instruments, pay all


 


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costs, including costs of
filing financing statements and other documents in any public offices requested
by Secured Party, and take such other action as Secured Party may deem
reasonably necessary and advisable to perfect the Security Interest created by
this Agreement;


 


4.5           Taxes.  Will pay all taxes (including documentary
stamp taxes and intangible taxes), assessments and other charges of every
nature which may be levied or assessed against the Collateral, or imposed upon
Pledgor or Secured Party by reason of this Agreement; and


 


4.6           Cooperation.  Will take other action reasonably requested
by Secured Party to carry out the terms of this Agreement, to preserve the
Collateral, and to preserve and perfect the Security Interest of Secured Party.


 


5.             Default.  If an Event of Default shall occur and be
continuing, the Secured Party may take all of the actions or remedies specified
in Section 6 hereof (“Remedies”) or elsewhere herein.


 


6.             Remedies.


 


6.1           If an
Event of Default shall have occurred and be continuing, the Secured Party shall
have, as its sole and exclusive remedy, the right to realize upon the
Collateral in accordance with the provisions of the Code.  Pledgor agrees that any notice by Secured
Party of the sale or disposition of the Collateral or any other intended action
hereunder, whether required by the Code or otherwise, shall constitute
reasonable notice to Pledgor if the notice is delivered to Pledgor by a
reputable overnight courier, at least ten (10) days before the action to be
taken.


 


6.2           Pledgor
agrees that in any sale of any Collateral, Secured Party is hereby authorized
to comply with any limitation or restriction in connection with such sale as it
may be reasonably advised by counsel is necessary in order to avoid any
violation of applicable law (including, without limitation, compliance with
such procedures as may restrict the number of prospective bidders and
purchasers of securities, require that such prospective bidders and purchasers
have certain qualifications, and restrict such prospective bidders and
purchasers to persons who will represent and agree that they are purchasing for
their own account for investment and not with a view to the distribution or
resale of such Collateral, or in order to obtain any required approval of the
sale or of the purchaser by any governmental regulatory authority or official),
and Pledgor further agrees that such compliance shall not result in such sale
being considered or deemed not to have been made in a commercially reasonable
manner, nor shall the Secured Party be liable nor accountable to Pledgor for
any discount allowed by reason of the fact that such Collateral is sold in
compliance with any such limitation or restriction.


 


7.             Voting
of Pledged Shares.  Subject to the
provisions of the Articles and the Investment Agreement, Pledgor hereby irrevocably
constitutes and appoints Secured Party in connection with all securities that
comprise the Collateral, whether or not the securities have been transferred
into the name of Secured Party or its nominee, as Pledgor’s proxy (and such
proxy shall be deemed to be coupled with an interest) with full power, solely
upon the occurrence and


 


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during the continuance of an Event of Default and the exercise of
Secured Party’s rights under this Section 7, to:


 


(a)           attend all
meetings of security holders of WRDCLogsys that the Collateral entitles them to
attend that are held after the date of this Agreement and to vote the
securities at those meetings in such manner as Secured Party shall in its sole
discretion deem appropriate;


 


(b)           to consent
in the sole discretion of Secured Party to any action by or concerning
WRDCLogsys for which the consent of the security holders of WRDCLogsys is or
may be necessary or appropriate; and


 


(c)           without
limitation to do all things that Pledgor could do as a security holder of
WRDCLogsys, giving to Secured Party full power of substitution and revocation.


 


The proxy contained in
this paragraph shall terminate when this Agreement terminates as provided in
Section 10.11 hereof.  Pledgor hereby
agrees not to give or permit to exist any other proxies in derogation of this
proxy so long as this Agreement is in force.


 


8.             Transfer
Securities of Record.  Pledgor
authorizes and appoints Secured Party, effective upon occurrence of a Default,
as Pledgor’s attorney-in-fact to transfer all or any part of the securities
that comprise any part of the Collateral into Secured Party’s name or that of
its nominee so that Secured Party or its nominee may appear of record as the
sole owner of the securities.


 


9.             Distributions
In Respect of Collateral.


 


9.1           Upon the
occurrence and during the continuance of an Event of Default and the exercise
by Secured Party of its rights under this Section 9, Pledgor
assigns to, and authorizes Secured Party to receive, any interest, principal,
dividends, distributions, or other income or payments of whatever nature
(whether in cash or in kind) now or hereafter made in respect of the Collateral,
including those made in connection with the dissolution, liquidation, sale of assets,
merger, consolidation, or other reorganization of WRDCLogsys, or any stock
dividend, stock split, recapitalization, reclassification or otherwise
(collectively, “Distributions”), to surrender such Collateral or any
part thereof in exchange therefor, and to hold any such Distribution as part of
the Collateral.


 


9.2           After the
occurrence and during the continuance of an Event of Default, Pledgor will not
demand or receive any income or Distribution with respect to the Collateral and
if Pledgor receives any such Distributions, Pledgor will hold such Distributions
in trust and deliver them promptly in the form received to Secured Party to
hold as Collateral.  After the occurrence
and during the continuance of an Event of Default, Secured Party may apply any
net cash Distributions to payment of any of the Secured Obligations, but
Secured Party shall account for and pay over to Pledgor any Distributions
remaining after full payment of such obligations.


 


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10.           Miscellaneous
Provisions.


 


10.1         Perfection.  Pledgor authorizes Secured Party at Pledgor’s
expense to file any financing statements relating to the Collateral (without
Pledgor’s signature thereon) that Secured Party deems reasonably appropriate,
and Pledgor appoints Secured Party as Pledgor’s attorney-in-fact to execute any
such financing statements in Pledgor’s name and to perfect and to continue
perfection of the Security Interest.


 


10.2         Right to
Perform Obligations.  Upon Pledgor’s
failure to perform any of its duties hereunder and after ten (10) days written
notice of such failure from Secured Party, Secured Party may, but it shall not
be obligated to, perform any of such duties and Pledgor shall forthwith upon
demand reimburse Secured Party for any expenses incurred by Secured Party in so
doing; provided that no prior notice shall be required if in Secured
Party’s reasonable judgment such delay would materially jeopardize or impair
the value of the Collateral (Secured Party shall provide written notice as soon
as practical following the taking of such action).


 


10.3         No Waiver.  No delay or omission by Secured Party in
exercising any right hereunder shall operate as a waiver of that or any other
right, and no single or partial exercise of any right shall preclude Secured
Party from any other or further exercise of the right or the exercise of any
other right or remedy.  All rights and
remedies of Secured Party under this Agreement and under the Code shall be
deemed cumulative.


 


10.4         Care of
Collateral, Etc.  Secured Party shall
exercise reasonable care in the custody and preservation of the Collateral to
the extent required by law, and it shall be deemed to have exercised reasonable
care if it takes such action for that purpose as Pledgor shall reasonably
request in writing; provided, however, no omission to do any act
not requested by such Pledgor shall, by itself, be deemed a failure to exercise
reasonable care and no omission to comply with any requests by such Pledgor
shall of itself be deemed a failure to exercise reasonable care.


 


10.5         Enforcement.  If an Event of Default shall occur, Secured
Party may demand, collect and sue for all amounts owed pursuant to the
Collateral or for proceeds of any Collateral (either in Pledgor’s name or
Secured Party’s name at the latter’s option), with the right to enforce,
compromise, settle or discharge any such amounts.  After Default, Pledgor appoints Secured Party
as such Pledgor’s attorney-in-fact to endorse such Pledgor’s name on all
checks, commercial paper and other documents or instruments pertaining to Collateral
or proceeds.


 


10.6         Other
Rights.  Pledgor acknowledges that
its obligations hereunder are absolute and unconditional and authorizes Secured
Party without affecting Pledgor’s obligations hereunder from time to time to
take the following actions, whether or not increasing the risk of loss to
Pledgor:


 


(a)           to take from
any party and hold collateral (other than the Collateral) for the payment of
the Secured Obligations or any party thereof, and to exchange, enforce or
release such collateral or any guaranty of payment of the Secured Obligations
or any part thereof and to


 


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release or substitute any such endorser or guarantor or any party who
has given any Security Interest in any collateral as security for the payment
of the Secured Obligations or any party thereof or any party in any way
obligated to pay the Secured Obligations or any part thereof; and


 


(b)           upon the
occurrence of any Event of Default to direct the manner of the disposition of
the Collateral and any other collateral and the enforcement of any endorsements
or guaranties relating to the Secured Obligations or any party thereof as
Secured Party in its sole discretion may determine, consistent with the
provisions of Section 6.


 


10.7         Successors
and Assigns.  This Agreement shall be
binding upon and inure to the benefit of Pledgor and Secured Party and their
respective successors and assigns, except that Pledgor may not assign any of
its rights or obligations under this Agreement without the prior written
consent of Secured Party.


 


10.8         Benefit.  The terms “Secured Party” and “Pledgor” as
used in this Agreement include the heirs, personal representatives and
successors or assigns of those parties, and this Agreement shall benefit and
bind such parties.


 


10.9         Amendment.  This Agreement may not be modified or amended
nor shall any provision of it be waived except in writing signed by Pledgor and
by an authorized officer of Secured Party.


 


10.10       Governing
Law; Venue.  This Agreement shall be
governed by and construed under the Uniform Commercial Code and any other applicable
laws of the State of Delaware in effect from time to time.  ANY ACTION RELATED TO
AND/OR BASED UPON THE SUBJECT MATTER OF THIS AGREEMENT SHALL BE BROUGHT IN THE
COURT OF PROPER JURISDICTION IN DELAWARE.


 


10.11       Term.  This Agreement shall remain in force until
the earlier of: (a) the payment in full of the Debt by Pledgor to Secured Party
or (b) Secured Party’s realization upon the Collateral.  Upon termination of the Agreement due to
Pledgor’s payment in full of the Debt, Secured Party shall take all steps
reasonably requested (but at Pledgor’s cost) by Pledgor to release its Security
Interest and Pledgor shall be discharged in full from any and all obligations under
this Agreement.


 


10.12       Notices.  Notice required or permitted to be given
hereunder shall be given to the parties at the addresses set forth on the
signature pages of this document or at such other address as may be designated
in writing from time to time by one party to the other.  Any such notices or communications shall be
deemed to be received upon the earlier of actual receipt at the address
provided or, if mailed, fifteen (15) business days after mailing by first class
mail.


 


10.13       Powers.  All powers, rights, proxies and privileges
granted to Secured Party herein are coupled with an interest and are
irrevocable.


 


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10.14       Counterparts.  This Agreement may be executed in any number
of counterparts and by different parties thereto in separate counterparts, each
of which when so executed and delivered shall be deemed as original and all of
which when taken together shall constitute but one and the same instrument.


 


 


[Remainder
of Page Left Blank Intentionally]


 


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IN WITNESS WHEREOF, the
parties hereto have executed this instrument as of the date first stated above.


 


	
   

  	
  PLEDGOR:

  
	
   

  	
   

  
	
   

  	
  AUTHORISZOR INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
  Authoriszor Inc.

  
	
   

  	
  c/o WRDCLogsys, First
  Floor

  
	
   

  	
  Ebor Court, Westgate,
  Leeds

  
	
   

  	
  LS1 4ND United Kingdom

  
	
   

  	
   

  
	
   

  	
  SECURED PARTY:

  
	
   

  	
   

  
	
   

  	
  DECHERT

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
  Dechert

  
	
   

  	
  2 Serjeants’ Inn

  
	
   

  	
  London EC4Y 1LT

  
	
   

  	
  England

  



 


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ANNEX 1


 


IRREVOCABLE STOCK
POWER


 


FOR VALUE RECEIVED, the undersigned does hereby sell,
assign and transfer unto Dechert, Three Hundred Nineteen Thousand Three Hundred
Ninety (319,390) shares of WRDCLogsys Ltd. (the “Company”), represented by
Certificate No.              
(the “Certificate”), standing in the name of the undersigned on the books of
the Company.


 


The undersigned does hereby irrevocably constitute and
appoint                        ,
to transfer the Certificate on the books of the Company, with full power of
substitution in the premises.


 


DATED:                     ,
              .


 


 


	
   

  	
  Authoriszor Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  



 


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