Document:

Exhibit 4.13

 

DATED  5 December 2002

 

 

SOFTBRANDS
EUROPE LIMITED

 

 

-and-

 

 

CAPITAL
RESOURCE PARTNERS IV, L.P.

 

 

 

DEBENTURE

 

 

 

CONTENTS

 

	
  Clause

  	
   

  	
  Subject matter

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  DEFINITIONS AND INTERPRETATION

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  GUARANTEE

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  SECURITY

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
  CONVERSION OF FLOATING CHARGE

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
  FURTHER ASSURANCE

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
   

  	
  NEGATIVE PLEDGE

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  7.

  	
   

  	
  UNDERTAKINGS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  8.

  	
   

  	
  COSTS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  9.

  	
   

  	
  DEFAULT

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.

  	
   

  	
  STATUTORY POWER OF SALE

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  11.

  	
   

  	
  RECEIVER

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  12.

  	
   

  	
  REASSIGNMENT

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  13.

  	
   

  	
  POWER OF ATTORNEY

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  14.

  	
   

  	
  CUMULATIVE AND CONTINUING SECURITY

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  15.

  	
   

  	
  WAIVERS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  16.

  	
   

  	
  SEVERABILITY

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  17.

  	
   

  	
  NOTICES

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  18.

  	
   

  	
  LAW AND JURISDICTION

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  19.

  	
   

  	
  COUNTERPARTS AND DELIVERY

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  20.

  	
   

  	
  TERMINATION

  	
   

  

 

i

 

DEBENTURE

 

DATE                                                               5
December 2002

 

PARTIES

 

(1)                                  SOFTBRANDS
EUROPE LIMITED (registered in England and Wales under company number 02579692)
the registered office of which is at 11 Worton Drive, Reading, Berkshire RG2
0LX (the “Company”); and

 

(2)                                  CAPITAL
RESOURCE PARTNERS IV, L.P., a Delaware limited partnership, of 85 Merrimac
Street, Suite 200, Boston, Massachusetts 02114 (the “Purchaser”).

 

RECITALS

 

Pursuant to a Senior
Subordinated Secured Note and Warrant Purchaser Agreement, to be entered into
on the date hereof (the “Purchase Agreement”),
between the Company, the Purchaser, Softbrands, Inc. and certain of the other
subsidiaries of Softbrands, Inc., the Purchaser has agreed to purchase from
Softbrands, Inc. upon the terms and subject to the conditions set forth
therein, the promissory notes (the “Notes”)
to be issued by Softbrands, Inc. thereunder. 
It is a condition precedent to the obligation of the Purchaser to
Softbrands, Inc. to purchase and pay for the Notes under the Purchase Agreement
that the Company shall have executed and delivered this Debenture.

 

NOW,
THEREFORE, in consideration of the foregoing premises and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and to induce the Purchaser to enter into the Purchase
Agreement, the Company hereby agrees with the Purchaser as follows:

 

1.                                      DEFINITIONS AND INTERPRETATION

 

1.1                               Definitions

 

In this Debenture the
following expressions have the following meanings, unless the context otherwise
requires:

 

“Business
Day”

 

means any day other than
a Saturday, a Sunday, Christmas Day, Good Friday or a day which is a Purchaser
holiday in any part of the United Kingdom;

 

“Charged  Property”

 

means the whole or any
part of the property, assets, income and undertaking of the Company from time
to time mortgaged, charged or assigned to the Purchaser pursuant to this
Debenture;

 

“Company”

 

means Softbrands Europe
Limited;

 

1

 

“Contracts”

 

means all the Company’s
rights, title, interest and benefit in and to any contract in respect of the
whole or any part of the Charged Property to which the Company is a party;

 

“Costs”

 

means all costs, charges
or expenses of whatsoever nature including, without limitation, disbursements
and any Value Added Tax to be charged on such costs, charges, expenses and
disbursements;

 

“Event
of Default”

 

shall have the same
meaning as is ascribed to it in the Purchase Agreement;

 

“Fixtures”

 

means all assets of
whatsoever nature, apart from land and buildings, forming part of any freehold
or leasehold property owned by the Company and deemed by law to be immovable
property other than tenant’s fixtures;

 

“Guaranteed
Obligations”

 

shall have the meaning
ascribed to it in Clause 2;

 

“Insolvency
Act”

 

means the Insolvency Act
1986;

 

“Intellectual
Property”

 

means all subsisting patents
and subsisting rights of a similar nature held in any part of the world,
applications for patents and such rights, divisions and continuations of such
applications for patents, registered and unregistered trade marks, registered
and unregistered service marks, registered designs, utility models (in each
case for their full period and all extensions and renewals of them),
applications for any of them and the right to apply for any of them in any part
of the world, inventions, confidential information, Know-how, business names,
trade names, brand names, copyright and rights in the nature of copyright,
design rights and get-up and any similar rights existing in any country; and
the benefit (subject to the burden) of any and all agreements, arrangements and
licences in connection with any of the foregoing;

 

“Know-how”

 

means all the body of
knowledge, technical experience, expertise and skills, technical processes,
secret processes, formulae and technical information held by the Company and
relating to its business, which is not in the public domain;

 

“LPA”

 

means the Law of Property
Act 1925;

 

2

 

“Obligations”

 

shall mean all
obligations of every nature of Softbrands Inc. or other Significant
Subsidiaries from time to time owed to the Purchaser with respect to the Notes,
whether under the Purchase Agreement or any other Note Agreement, whether for
principal, interest, redemption, fees, expenses, indemnification or otherwise;

 

“Occupational
Leases”

 

means all leasehold
interests and other occupational rights whatsoever (including, without
limitation, all licences and agreements for leases) in existence from time to
time relating to the whole or any part of the Property, the immediate reversion
to which is vested in the Company;

 

“Permitted
Security Interest”

 

means:

 

(a)                                  the
security constituted by the charge entered into between the Company and The
Royal Bank of Scotland plc dated 26 June 1996;

 

(b)                                 the
security constituted by this Debenture; and

 

(c)                                  any
other liens permitted pursuant to Section 7.02 of the Purchase Agreement;

 

“Plant
and Machinery”

 

means all plant and
machinery, equipment, fittings, installations and apparatus, tools, motor
vehicles and all other such assets (other than Fixtures) whatsoever, wherever
situate, which are the property of the Company;

 

“Property”

 

means all estates and
other interests in any freehold, leasehold or other immovable property
(including, without limitation, all Fixtures on such property) which are the
property of the Company, all proceeds of sale derived from such property and
the benefit of all covenants to which the Company is entitled in respect of
such property;

 

“Purchase
Agreement”

 

shall have the meaning
ascribed to it in the Recital;

 

“Receiver”

 

means any receiver
appointed pursuant to this Debenture;

 

“Rights”

 

means all the Company’s
rights, title and interest from time to time in any lease, licence or
occupational right whatsoever together with the entire benefit of all the
Company’s rights, title and interest from time to time in any renewal of,
replacement of or variation to any such lease, licence or occupational right
(including, without limitation, all its

 

3

 

rights, title and
interest in any Occupational Lease, agreement for any Occupational Lease and
any associated agreements which may be granted by the Company or any person
deriving title from the Company from time to time over or in respect of the
whole or any part of the Property and any other properties (freehold or
leasehold) in which the Company has an interest);

 

“Security
Interest”

 

means any mortgage,
charge, assignment, pledge, lien, right of set-off, hypothecation, encumbrance,
priority or other security interest (whether fixed or floating) including,
without limitation, any “hold-back”
or “flawed asset” arrangement;

 

“Shares”

 

means no more than sixty
five percent (65%) of the equity securities of any foreign subsidiaries of the
Company which are held to the order of the Purchaser whether held in the United
Kingdom or elsewhere and irrespective of whether the deposit was made or the
certificates or other documents were received by the Purchaser for the purposes
of creating security, safe custody, collection or otherwise;

 

“Subsidiary”

 

bears the same meaning as
that contained in Section 736 of the Companies Act 1985 (Definition of “subsidiary”);

 

1.2                               Interpretation

 

1.2.1                        In this Debenture:

 

(a)                                  the
Contents page and Clause headings are included for convenience only and do not
affect the construction of this Debenture;

 

(b)                                 words
denoting the singular include the plural and vice versa;

 

(c)                                  words
denoting one gender include each gender and all genders.

 

(d)                                 documents,
instruments and agreements (including, without limitation, this Debenture and
any document referred to in this Debenture) are references to such documents,
instruments and agreements as modified, amended, varied, supplemented or
novated from time to time;

 

(e)                                  Recitals,
Clauses and Schedules are references to recitals to this Debenture, Clauses of
this Debenture and schedules to this Debenture;

 

(f)                                    statutory
provisions (where the context so admits and unless otherwise expressly
provided) are construed as references to those provisions as respectively
amended, consolidated, extended or re-enacted from time to time, and to any
orders regulations instruments or other subordinate legislation made under the
relevant statute; and

 

(g)                                 a
time of day is a reference to London time.

 

4

 

1.3                               Purchase
Agreement Defined Terms

 

Unless otherwise defined
in this Debenture, terms defined in the Purchase Agreement shall bear the same
meaning in this Debenture.

 

2.                                      GUARANTEE

 

The Company hereby
unconditionally guarantees (the “Guarantee”)
due payment, performance and fulfillment to the Purchaser of all Obligations,
whether direct or indirect, absolute or contingent, due or to become due, now
existing or hereafter arising or acquired and whether consisting of obligations
to pay money or to perform obligations (the “Guaranteed
Obligations”).

 

(a)                                  The
Guarantee shall operate as a continuing and absolute Guarantee and shall remain
in full force and effect until all of the Guaranteed Obligations have been paid
in full.

 

(b)                                 The
Company consents to any renewal, extension or postponement of the time of
payment of any of the Guaranteed Obligations or to any other forbearance or
indulgence with respect thereto and consent to any substitution, exchange,
modification or release of any security therefor or the release of any other
person primarily or secondarily liable on any of the Guaranteed Obligations
whether or not notice thereof shall be given to the Company, and agree to the
provisions of any instrument, security or other writing evidencing or securing
any of the Guaranteed Obligations, and the enforcement hereof shall not be
affected by the delay or failure of the Purchaser to take any action with
respect to any security, right, obligation, Guarantee or other means of
collecting the Guaranteed Obligations which it may at any time hold, including
perfection or enforcement thereof, or by any change with respect to the Company
in the form or manner of doing business, it being hereby agreed that the
Company shall be and remain jointly and severally bound upon this Guarantee irrespective
of any action, delay or omission by the Purchaser in dealing with the Company,
any of the Guaranteed Obligations, any collateral therefor or any person at any
time liable with respect thereto.

 

(c)                                  On
any default or failure by Softbrands Inc. or any other Significant Subsidiary
to pay or perform any of the Guaranteed Obligations, the liability of the
Company hereunder shall be effective immediately and the Company waives all
requirements of notice, demand, presentment or protest and any right which the
Company might otherwise have to require the Purchaser first to proceed against
Softbrands Inc. or against any other person or first to realize on any security
held by it before proceeding against the Company for the enforcement of this
Guarantee.  The Company shall not assert
any right arising from payment or other performance hereunder, whether by
set-off or counterclaim, or claim of indemnity, reimbursement, subrogation or
otherwise, until the Company’ liability hereunder shall have been discharged in
full and all of the Guaranteed Obligations shall have been fulfilled.

 

(d)                                 If
for any reason the Company is under no legal obligation to discharge any of the
Guaranteed Obligations, or if any amounts included in the Guaranteed
Obligations shall have become irrecoverable from the Company by operation of
law or for any other reason, or if any security or other Guarantee shall be
found invalid, the Company shall nonetheless be and remain bound upon this
Guarantee.

 

5

 

(e)                                  Any
deposits or other sums at any time credited by or due from the Purchaser to the
Company, and any securities or other property of the Company at any time held
by the Purchaser may at all times be held and treated as security for all obligations
of the Company hereunder.  Regardless of
the adequacy of security the Purchaser may apply or set off such deposits or
other sums against such obligations (whether or not then due or payable) at any
time.

 

3.                                      SECURITY

 

As collateral security
for the prompt and complete payment and performance when due (whether at the
stated maturity, by acceleration or otherwise) of the Guaranteed Obligations,
the Company hereby grants to the Purchaser a security interest in all of the
Company’s right, title and interest in or to its personal property, and
interest in property, of the Company, whether now owned or at any time
hereafter acquired by the Company or in which the Company now has or at any
time in the future may acquire any right, title or interest, including, without
limitation:

 

3.1                               Property
and the Future Property

 

By way of first fixed
charge:

 

3.1.1                        the Property;

 

3.1.2                        all Rights relating to the
Property; and

 

3.1.3                        all Rights relating to the
Property coming into existence after the date of this Debenture.

 

3.2                               Intellectual
Property

 

By way of first fixed
charge, all the Intellectual Property owned by the Company.

 

3.3                               Plant
and Machinery

 

By way of first fixed
charge, the Plant and Machinery.

 

3.4                               Shares

 

By way of first fixed
charge, the Shares.

 

3.5                               Goodwill

 

By way of first fixed
charge, all the goodwill and uncalled capital for the time being of the
Company.

 

3.6                               Floating
charge

 

By way of first floating
charge, all the undertaking and assets of the Company whatsoever, wherever
situate, whether movable, immovable, present or future.

 

6

 

4.                                      CONVERSION OF FLOATING CHARGE

 

The Purchaser may by
notice to the Company convert the floating charge contained in this Debenture
into a fixed charge as regards such Charged Property as the Purchaser may
specify (whether generally or specifically) in that notice at any time
following the occurrence of an Event of Default which is continuing.

 

5.                                      FURTHER ASSURANCE

 

The Company shall
promptly, at any time following receipt of a written request from the
Purchaser, at its own expense execute and deliver to the Purchaser such further
legal or other mortgages or charges, and documents as the Purchaser may
reasonably require of the whole or such part of the Charged Property as the
Purchaser may reasonably request to secure the payment or discharge of the
Obligations;

 

6.                                      NEGATIVE PLEDGE

 

The Company shall not:

 

6.1                               create,
purport to create or allow to subsist, any Security Interest over the whole or
any part of the Charged Property except for any Permitted Security Interest; or

 

6.2                               convey,
assign, transfer, or agree to convey, assign or transfer the whole or any part
of the Charged Property;

 

7.                                      UNDERTAKINGS

 

The Company gives each of
the undertakings contained in this Clause to the Purchaser.

 

7.1                               Duration

 

The undertakings in this
Clause shall remain in force during the continuance of the security constituted
by this Debenture.

 

7.2                               To
comply with statutes

 

The Company shall comply
with all obligations under any statute and all byelaws and regulations relating
to the whole or any part of the Charged Property.

 

7.3                               Books
of account

 

The Company shall:

 

7.3.1                        keep, or cause to be kept,
proper books of account relating to the business of the Company, and

 

7.3.2                        keep such books of account, and
all other documents relating to the affairs of the Company, at the Company’s
registered office.

 

7

 

7.4                               To
provide information

 

The Company shall furnish
to the Purchaser promptly upon receipt of a written request from the Purchaser
such information and supply such documents or papers relating to the Charged
Property from time to time as the Purchaser may reasonably request.

 

7.5                               Access
and information

 

The Company shall:

 

7.5.1                        upon prior written notice,
permit the Purchaser, its representatives and agents free access at all
reasonable times to examine and take copies and extracts from the records,
books of account and statutory books of the Company;

 

7.5.2                        furnish the Purchaser with all
additional information which the Purchaser may in its discretion require in
connection with such examination; and

 

7.5.3                        co-operate and comply with all
reasonable requests relating to such examination.

 

7.6                               Insurance

 

7.6.1                        The Company will maintain, with
financially sound and reputable companies, insurance policies (i) insuring the
Charge of Property against loss by fire, explosion, theft and such other
casualties as may be reasonably satisfactory to the Purchaser’s Representative
and (ii) insuring the Company and the Purchaser against liability for personal
injury and property damage relating to the Charge of Property such policies to
be in such form and amounts and having such coverage as may be reasonably
satisfactory to the Purchaser’s Representative, with losses payable to the
Company and the Purchaser as their respective interests may appear.  All such insurance shall (i) provide that no
termination, cancellation, material reduction in amount of material change in
coverage thereof shall be effective until at least 10 days after receipt by the
Purchaser of written notice thereof, (ii) name the Purchaser as loss payee and
additional insureds and (iii) be reasonably satisfactory in all other respects
to the Purchaser’s Representative.  From
time to time upon the request of the Purchaser’s Representative, the Company
shall deliver to the Purchaser’s Representative insurance policies,
certificates or binders as the Purchaser’s Representative may from time to time
reasonably request.  In addition, within
thirty (30) days after the end of each fiscal year of the Company, the Company
shall cause its insurance carrier(s) and those of its subsidiaries of confirm
in writing to the Purchaser’s Representative the insurance coverage provided by
such provider to the Company, as applicable as provided under Section 7.03
of the Purchase Agreement.

 

7.7                               Insurance
monies

 

7.7.1                        Any monies received by virtue
of any insurance relating to the whole or any part of the Charged Property
(whether effected pursuant to this Debenture or otherwise) will be deemed to be
part of the Charged Property.  The
Company shall apply all such monies in making good, or in recouping expenditure
incurred in making good, any loss or damage or, if the Purchaser in its discretion
so requires, towards discharge of the Obligations.

 

7.8                               To
repair

 

The Company shall:

 

8

 

7.8.1                        at all times keep in good and
substantial repair and condition all the Charged Property including, without
limitation, all buildings, erections and structures on and in the Property; and

 

7.8.2                        keep all Plant and Machinery in
good repair and working order in each case ordinary wear and tear and
immaterial impairments of value and damage by the elements excepted and will
provide all maintenance, service and repairs necessary for such purpose.

 

8.                                      COSTS

 

The Company shall on
demand pay to the Purchaser or the Receiver, as the case may be, and discharge
all Costs payable by it pursuant to this Debenture.

 

9.                                      DEFAULT

 

9.1                               Enforcement

 

This Debenture will
become enforceable upon the occurrence and during the continuance of any Event
of Default, in the event of any default or failure by Softbrands Inc or any of
the Significant Subsidiaries to pay or perform any of the Guaranteed
Obligations pursuant to Section 2.14 of the Purchase Agreement.

 

9.2                               Consequences
of default

 

On and at any time after
the occurrence and during the continuance of an Event of Default, the Purchaser
in its absolute discretion may by written notice to the Company:

 

9.2.1                        declare the Guaranteed
Obligations to be immediately due and payable by the Company in accordance with
Clause 2 or Section 2.14 of the Purchase Agreement and, upon that
declaration, such sums shall become immediately due and payable without demand
or notice of any kind, all of which are hereby expressly waived by the Company,
or

 

9.2.2                        declare the security
constituted by this Debenture to be enforceable.

 

10.                               STATUTORY POWER OF SALE

 

10.1                        For
the purposes of all powers implied by statute, and in particular the power of
sale under Section 101 of the LPA (Powers incident to estate or interest
in a mortgage), the Obligations will be deemed to have become due when the
security created by this Debenture becomes enforceable and Section 103 of
the LPA (Regulation of exercise of power of sale) and Section 93 of the
LPA (Restriction on consolidation of mortgages) will not apply.

 

10.2                        Each
of the Purchaser and the Receiver may exercise such person’s statutory power of
sale in respect of the whole or any part of the Property.

 

11.                               RECEIVER

 

11.1                        Appointment
of Receiver

 

11.1.1                  At any time after the security
constituted by this Debenture has become enforceable, whether or not the
Purchaser has entered into or taken possession of the whole or any part of the
Charged Property pursuant to this Debenture:

 

9

 

(a)                                  the
Purchaser may, by writing under the hand of any authorised officer of the
Purchaser, appoint any person to be a receiver of the Charged Property and such
person shall, with effect from the date of such appointment, be a “Receiver”; and

 

(b)                                 the
Purchaser may, from time to time, in similar manner, remove the Receiver and
appoint another in his place;

 

11.1.2                  The Receiver may from time to time
delegate, by power of attorney or otherwise, to any person any of his powers
and discretions, whether arising by statute, the provisions of this Debenture
or otherwise, upon such terms and for such periods of time as he may in his
discretion think fit and may from time to time terminate any such delegation.

 

11.2                        Powers of
Receiver

 

The Receiver has all the
powers to do or abstain from doing anything which the Company could do or
abstain from doing in relation to the Charged Property including, without
limitation the powers conferred by Section 109 of the LPA (Appointment,
powers, remuneration and duties of receivers) and, in the case of a Receiver
who is an administrative receiver, the powers conferred by Section 29 of
the Insolvency Act (Definitions) and Schedule I to the Insolvency Act (Powers
of administrator or administrative receiver).

 

12.                               REASSIGNMENT

 

Upon irrevocable
discharge in full of the Guaranteed Obligations, the.  Purchaser shall reassign to the Company all
the Company’s rights, title, interest and benefit in the Charged Property,
including without limitation all Contracts.

 

13.                               POWER OF ATTORNEY

 

13.1                        The
Company irrevocably appoints at any time after the occurrence and during the
continuance of an Event of Default, by way of security the Purchaser, each
person deriving title from the Purchaser and the Receiver, jointly and
severally to be its attorney (with full power to appoint substitutes and to
sub-delegate) for it, in its name, on its behalf and as its act and deed or
otherwise to sign or execute any deed or document or do any act or thing which
the Company is, or may become, obliged to sign, execute or do pursuant to this
Debenture or which the Purchaser, the Receiver or any person deriving title
from the Purchaser or the Receiver may in the discretion of such person think
fit in connection with the exercise of any of the powers of such person or the
realisation of any security constituted by this Debenture.

 

13.2                        Without
prejudice to the generality of the foregoing, the Company unconditionally
undertakes to the Purchaser, and separately to the Receiver and to each person
deriving title from the Purchaser or the Receiver, that it shall ratify and
confirm anything done or purported to be done by any attorney appointed
pursuant to this Clause.

 

14.                               CUMULATIVE AND CONTINUING SECURITY

 

14.1                        This
Debenture is a continuing security to the Purchaser regardless of any
intermediate payment or discharge of the whole or any part of the Guaranteed
Obligations and will not be prejudiced or affected by any act, omission or
circumstance which, but for this Clause, might affect or diminish its
effectiveness.

 

10

 

14.2                        The
security constituted by this Debenture is in addition to, is not
i4.substitution for, is without prejudice to, and does not merge with, any
rights whatsoever which the Purchaser may have, whether in respect of the
Guaranteed Obligations or otherwise, including, without limitation, any rights
arising under any other Security Interest, any bill, note, guarantee, contract
or applicable rule of law.

 

14.3                        Any
receipt, release or discharge of the security constituted by, or of any
liability arising under, this Debenture shall not release or discharge the
Company from any liability which may exist independently of this Debenture to
the Purchaser.

 

14.4                        Where
the security constituted by this Debenture initially takes effect as a
collateral or further security to any other Security Interest held by the
Purchaser then, notwithstanding any receipt, release or discharge given in
respect of such other Security Interest, this Debenture shall take effect as an
independent security for any monies, liabilities or other sums secured by such
other Security Interest.

 

15.                               WAIVERS

 

No failure or delay or
other relaxation or indulgence on the part of the Purchaser to exercise any
power, right or remedy shall operate as a waiver thereof nor shall any single
or partial exercise or waiver of any power, right or remedy preclude its
further exercise or the exercise of any other power, right or remedy.

 

16.                               SEVERABILITY

 

Each of the provisions of
this Debenture is distinct and severable from the others and if at any time one
or more of such provisions is or becomes illegal, invalid or unenforceable the
validity, legality and enforceability of the remaining provisions hereof shall
not in any way be affected or impaired thereby.

 

17.                               NOTICES

 

17.1                        Each
party may give any notice, demand or other communication under or in connection
with this Debenture by letter, telex, facsimile or comparable means of
communication addressed to the other party at the address identified with its
name below.  Any such communication will
be deemed to be given as follows:

 

17.1.1                  if personally delivered, at the time
of delivery;

 

17.1.2                  if by letter, at noon on the Business
Day following the day such letter was posted (or in the case of airmail, seven
days after the envelope containing the same was delivered into the custody of
the postal authorities); and

 

17.1.3                  if by telex, facsimile transmission
or comparable means of communication during the business hours of the addressee
then on the day of transmission, otherwise on the next following Business Day.

 

17.2                        In
proving such service it shall be sufficient to prove that personal delivery was
made or that such letter was properly stamped first class, addressed and
delivered to the postal authorities or that the telex was transmitted with a
correct answerback or in the case of facsimile transmission or other

 

11

 

comparable means of
communication, that a confirming hard copy was provided promptly after
transmission.

 

18.                               LAW AND JURISDICTION

 

18.1                        This
Debenture shall be governed by and construed in accordance with English law.

 

18.2                        The
Company agrees that any legal action or proceedings arising out of or in
connection with this Debenture against the Company or any of its assets may be
brought in the High Court of Justice in England, irrevocably and
unconditionally submits to the jurisdiction of such Court.  The submission to such jurisdiction shall not
(and shall not be construed so as to) limit the right of the Purchaser to take
proceedings against the Company in whatsoever jurisdictions it thinks fit, nor
shall the taking of proceedings in any one or more jurisdiction preclude the
taking of proceedings in any other jurisdiction, whether concurrently or
not.  The Company waives objection to
such Court on the grounds of inconvenient forum or otherwise as regards
proceedings in connection with this Debenture and agrees that the judgment or
order of such Court in connection with this Debenture is conclusive and binding
on it and may be enforced against it in the courts of any other jurisdiction.

 

19.                               COUNTERPARTS AND DELIVERY

 

19.1                        This
Debenture may be executed in any number of counterparts, each of which is an
original, and which together constitute one and the same document.

 

19.2                        If
this Debenture is executed in more than one counterpart, this Debenture is
deemed to be delivered and has effect when:

 

19.2.1                  each party other than the Purchaser has
executed a counterpart of this Debenture;

 

19.2.2                  each party other than the Purchaser
has handed over such counterpart to one of the other parties to this Debenture;
and

 

19.2.3                  each of the counterparts has been
dated.

 

19.3                        If
this Debenture is not executed in more than one counterpart, this Debenture is
deemed to be delivered and has effect when each party other than the Purchaser
has executed this Debenture and this Debenture has been dated.

 

19.4                        The
execution (whether under hand or as a deed) or sealing of this Debenture by or
on behalf of a party constitutes an authority to the solicitors or legal
counsel acting for that party in connection with this Debenture, or any agent
or employee of such solicitors or legal counsel, to deliver it as a deed on behalf
of that party.

 

19.5                        Each
party to this Debenture agrees to be bound by this Debenture despite the fact
that any other person which was intended to execute or to be bound does not do
so or is not effectually bound and despite the fact that any Security Interest
contained in this Debenture is terminated or becomes invalid or unenforceable
against any other person whether or not such termination, invalidity or
unenforceability is known to the Purchaser.

 

12

 

20.                               TERMINATION

 

This Debenture shall
terminate automatically upon the satisfaction in full of the Obligations.

 

IN
WITNESS WHEREOF this Debenture has been executed and
delivered as a deed on the date written at the beginning of this Debenture.

 

	
  EXECUTED and DELIVERED
  as a DEED

  	
   

  	
  )

  
	
  for and on behalf of
  SOFTBRANDS

  	
   

  	
  )

  
	
  EUROPE LIMITED by:

  	
   

  	
  )

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Director : /s/ Authorized
  Signer  5/12/02

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Directory/Secretary: /s/
  Authorized Signer 5/12/02

  
	
   

  	
   

  	
   

  
	
  EXECUTED and DELIVERED
  as a DEED

  	
   

  	
  )

  
	
  for and on behalf of
  CAPITAL RESOURCE

  	
   

  	
  )

  
	
  PARTNERS IV, LP a
  Delaware Limited

  	
  )

  	
   

  
	
  Partnership acting
  through its General Partner,

  	
  )

  	
   

  
	
  CRP Partners IV, LLC

  	
  )

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Authorised Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Authorised Officer

  

 

13Exhibit 4.14

 

 

INVESTOR AGREEMENT

 

 

by and between

 

 

SOFTBRANDS, INC.

 

 

and

 

 

INFO-QUEST SA

 

 

Dated as of May 15, 2002

 

 

INVESTOR AGREEMENT (this “Agreement”), dated as of May 15,
2002, by and between:

 

1.                                       SoftBrands, Inc. (“SoftBrands”),
a corporation organized under the laws of the State of Delaware and a
wholly-owned subsidiary of AremisSoft Corporation (“AremisSoft”); and

 

2.                                       Info-Quest SA (“Info-Quest”),
a corporation organized under the laws of Greece.

 

W I  T  N  E  S  S  E
T  H:

 

WHEREAS,
Info-Quest currently holds 13.5% of the outstanding capital stock of
AremisSoft; and

 

WHEREAS,
AremisSoft filed a petition for relief under Chapter 11 of the United States
Bankruptcy Code (the “Reorganization”) on March 15, 2002, pursuant to
which SoftBrands will be the surviving corporation; and

 

WHEREAS,
pursuant to the Reorganization (the “Reorganization”), Info-Quest will be
entitled to receive that number of shares of the common stock of SoftBrands
(the “Shares”) equal to the number of Shares issued to Info-Quest as an
Eligible Class Member (as defined in the Plan of Reorganization of AremisSoft)
plus the number of Shares issued to Info-Quest in exchange for Info-Quest’s
shares of common stock of AremisSoft (such number of Shares collectively, the “Reorganization
Shares”), each as set forth in the documentation relating to the
Reorganization; and

 

WHEREAS,
the parties desire that this Agreement shall replace the existing Stock
Purchase Agreement, dated September 10, 1999, between AremisSoft and
Info-Quest, and any documents relating thereto, and the parties further desire
that this Agreement shall constitute the entire agreement among the parties
with respect to the subject matter discussed herein.

 

NOW,
THEREFORE, in consideration of the foregoing and the mutual representations,
warranties, covenants and agreements set forth herein, intending to be legally
bound hereby, the parties agree as follows:

 

ARTICLE I

DEFINITIONS

 

Section 1.1                                      Definitions.  In this Agreement (including the Recitals),
in addition to the terms already defined, the following expressions shall,
unless the context otherwise requires, have the meanings set forth opposite
them respectively:

 

(a)                                  “Business Day” shall mean any day other than a
Saturday, Sunday or a day on which the SEC is not open to receive filings.

 

1

 

(b)                                 “Exchange Act” shall mean
the United States Securities Exchange Act of 1934, as amended, and the rules
and regulations promulgated thereunder.

 

(c)                                  “Exempt Issuance” shall mean
any issuance of Other SoftBrands Securities (i) pursuant to registration under
the Securities Act; (ii) representing awards, or pursuant to awards or exercise
of awards, under an employee benefit plan approved by the Board; (iii) in
connection with any stock split, stock dividend or recapitalization by
SoftBrands; (iv) approved by the Board in connection with bona fide equipment
lease or working capital debt financings with lending institutions; (v) in
connection with acquisitions, mergers, consolidations or similar business
combinations or the transfer of substantially all of the assets of SoftBrands.

 

(d)                                 “Initial Public Offering”
shall mean an underwritten public offering pursuant to an effective
registration statement under the Securities Act, covering the initial offer and
sale of Shares for the account of SoftBrands to the public.

 

(e)                                  “person” shall mean an
individual, corporation, unincorporated association, partnership, a 13D Group,
trust, joint stock company, joint venture, business trust or unincorporated organization,
limited liability company, any governmental entity or any other entity of
whatever nature.

 

(f)                                    “Registrable Securities”
shall mean (i) all of the Reorganization Shares, (ii) any Shares issued as (or
issuable upon the conversion or exercise of any warrant, right, option or other
convertible security which is issued as) a dividend or other distribution with
respect to, or in exchange for, or in replacement of, such Reorganization
Shares referred to in clause (i) and (iii) any Shares issued by way of a stock
split, reclassification, recapitalization or similar event of the
Reorganization Shares referred to in clauses (i) or (ii) above.  For purposes of this Agreement, any
Registrable Securities shall cease to be Registrable Securities when (w) a registration
statement covering such Registrable Securities has been declared effective and
such Registrable Securities have been disposed of pursuant to such effective
registration statement, (x) such Registrable Securities shall have been
distributed pursuant to Rule 144 (or any similar provision then in effect)
under the Securities Act, (y) such Registrable Securities are sold or (z) such
Registrable Securities shall cease to be outstanding.

 

(g)                                 “Register, “ “registered”
and “registration” shall refer to a registration effected by preparing and
filing a registration statement or similar document in compliance with the
Securities Act and the declaration or ordering of effectiveness of such
registration statement or document.

 

(h)                                 “SEC” shall mean the United
States Securities and Exchange Commission.

 

(i)                                     “Securities Act” shall mean
the United States Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.

 

(j)                                     “13D Group” shall mean any “group”
(within the meaning of Section 13(d) of the Exchange Act) formed for the
purpose of acquiring, holding, voting or disposing of Shares.

 

2

 

ARTICLE II

CORPORATE GOVERNANCE

 

Section 2.1                                      Info-Quest Designee.  From and after the date hereof, Info-Quest
shall have the right to designate one individual (the “Designee”) to be
nominated by the SoftBrands Board of Directors (the “Board”) for election to
the Board until the later of (i) the second anniversary of the date of this
Agreement, and (ii) the date on which Info-Quest ceases to hold at least
one-third of the number of Reorganization Shares it will be entitled to hold
immediately following completion of the Reorganization (as such number may be
adjusted for any stock split, reclassification, recapitalization or similar
event), provided, however, that
nomination of the Designee shall be subject to the consent of the Board, such
consent not to be unreasonably withheld.

 

If, following election to
the Board, any Designee shall resign or be removed or be unable to serve for
any reason prior to the expiration of his or her term as a member of the Board,
SoftBrands shall, within 30 days of such event, notify Info-Quest in writing to
designate a replacement Designee for nomination by the Board to be elected to
the Board.  SoftBrands shall undertake
all reasonable efforts to have the Designee and any replacement Designee
elected to the Board.

 

Section 2.2                                      Info-Quest Observer.  If Info-Quest so chooses, for so long as
Info-Quest is entitled to nominate the Designee, it shall be entitled to
nominate an observer to the Board (the “Observer”) in place of the Designee who
shall not be a director but shall be extended all of the rights and privileges
of the Designee (except, for the avoidance of doubt, that the Observer shall
not have the voting rights of the Designee).

 

Section 2.3                                      Composition of the Board.  The Board shall be composed of a majority of
independent directors, with not more than one executive officer of SoftBrands
serving as a director.  The directors
shall be chosen in accordance with the bylaws of SoftBrands (the “Bylaws”).  Info-Quest shall be consulted in advance of
all Board appointments and, to the extent reasonably practicable, Info-Quest’s
opinions with respect to such appointments shall be considered by the Board
prior to such appointments.  SoftBrands’
independent auditor shall be consulted in advance of all Board appointments.

 

Section 2.4                                      Meetings; Notice.  The Board shall conduct regularly scheduled
meetings not less frequently than quarterly and shall provide at least two
weeks’ written notice to the Designee of the dates of such meetings.  SoftBrands shall provide each director with
written notice of any special Board meeting in accordance with its Bylaws
(which as of the date of this Agreement provide for five days’ written notice,
or 48 hours electronic or facsimile notice) and SoftBrands shall distribute
materials, either in writing, by electronic mail or by facsimile, in connection
with any such meeting not later than the last date on which it is entitled to
provide notice of such meeting, provided,
however, that SoftBrands will specifically contact Info-Quest by
telephone at least 48 hours prior to any meeting of the Board to confirm
receipt of any notice or materials transmitted by electronic mail or
facsimile.  Directors may participate in
meetings of the Board or any committee thereof by means of conference telephone
or other communications equipment by means of which all persons participating
in the meeting can hear each other. Participation in this manner shall
constitute presence in person at the meeting.

 

3

 

Section 2.5                                      Consultation with Experts.  The directors shall be entitled to consult
with independent experts in connection with their duties as directors, the
reasonable cost of such consultation to be borne by SoftBrands, provided that any independent director of
SoftBrands shall be entitled to participate in any such consultation.

 

Section 2.6                                      Access to Information.  The Designee shall be entitled to reasonable
access to the management of, and operational information regarding SoftBrands,
and shall be provided with quarterly reports detailing the business activity,
financial information and strategic plans of SoftBrands.  The Designee shall also be entitled to
complete access to the minutes and minute books of the Board and committees
thereof (including both historic and current minutes).

 

ARTICLE III

REGISTRATION RIGHTS

 

Section 3.1                                      Demand Registration of
Registrable Securities.

 

(a)                                  Following the six-month
anniversary of the Initial Public Offering, upon written notice by Info-Quest
requesting that SoftBrands effect the registration under the Securities Act of
not less than 75% of the Registrable Securities then held by Info-Quest, which
notice shall specify the intended method or methods of disposition of such
Registrable Securities, SoftBrands will use its reasonable best efforts to
effect the registration under the Securities Act of such Registrable Securities
for disposition in accordance with the intended method or methods of
disposition stated in such request, provided
that:

 

(i)                                     SoftBrands shall not effect a registration prior to
the completion of the Reorganization and the distribution of the Shares
pursuant thereto;

 

(ii)                                  If Info-Quest previously has
disposed of Registrable Securities pursuant to a registration under this Section 3.1(a),
SoftBrands shall not be required to effect a registration under this Section 3.1(a) until a
period of at least 180 days shall have elapsed from the effective date of the
most recent preceding registration pursuant to this Section 3.1(a);

 

(iii)                               If, upon receipt of a
registration request pursuant to this Section 3.1(a), SoftBrands and
Info-Quest are advised by, following consultation with, a recognized
independent investment banking firm selected by SoftBrands that, in such firm’s
opinion, a registration at that time and on the terms requested of any of the
Registrable Securities proposed to be offered would adversely affect a public
offering by SoftBrands of the Shares (other than in connection with employee
benefit and similar plans) (a “SoftBrands Company Offering”) that had been
planned by SoftBrands prior to the date of the written registration request
under this Section 3.1(a), and provided
that SoftBrands complies with Section 3.2 hereof with respect
to such SoftBrands Company Offering, SoftBrands shall not be required to effect
a registration pursuant to this Section 3.1 (a) until the earliest of (i)
the later of (A) 180 days after the completion of such SoftBrands Company
Offering or (B) the termination of any “lock-up” period required by the
underwriters, if any, to be applicable to Info-Quest in connection with such

 

4

 

SoftBrands Company Offering and (ii) five Business Days after
abandonment of such SoftBrands Company Offering; provided, however, that unless Info-Quest elects to proceed
with such registration at such deferred time, such registration will not count
as a demand registration.

 

(iv)                              If, while a registration
request is pending under this Section 3.1(a), the Board determines in good
faith that (i) the filing of a registration statement would require the
disclosure of material, non-public information regarding SoftBrands and (ii)
public disclosure of such material information would have a significant adverse
impact on SoftBrands, then, on written notice given Info-Quest setting forth
details regarding the basis for such determination, SoftBrands shall not be
required to effect a registration pursuant to this Section 3.1(a) until
the earlier of (x) the date upon which such material information is disclosed
to the public or ceases to be material to SoftBrands, and (y) 60 days after
SoftBrands provides such written notice of such determination to Info-Quest;

 

(v)                                 SoftBrands and Info-Quest
shall jointly select the managing and other underwriters for any underwritten
offering pursuant to this Section 3.1(a);

 

(b)                                 SoftBrands may register
Shares for sale for the account of another person in a registration of
Registrable Securities under Section 3.1(a), provided that, except as
otherwise required under the terms of currently outstanding registration rights
agreements of SoftBrands, SoftBrands shall not have the right to register any
such Shares to the extent that Info-Quest and SoftBrands are advised by,
following consultation with, the managing underwriter for the offering of such
Registrable Securities that, in such managing underwriter’s opinion,
registration of such other Shares may adversely affect the offering and sale of
such Registrable Securities.

 

(c)                                  Info-Quest shall have the
right to one registration pursuant to Section 3.1(a) in any 6 month period
up to a maximum of 2 registrations.  If
after SoftBrands has exercised its right to delay a registration pursuant to Section 3.1(iii)
or (iv), Info-Quest withdraws its demand for such registration, such withdrawn
demand shall not be counted as a demand under this Section 3.1.

 

Section 3.2                                      “Piggyback” Registration
of Registrable Securities.

 

(a)                                  If at any time SoftBrands
proposes to register for public sale under the Securities Act (other than on a
form not permitting the inclusion of the Shares of selling shareholders) any
equity securities of SoftBrands (the “Other SoftBrands Securities”) on a form
and in a manner which would permit registration of Registrable Securities for
sale to the public under the Securities Act, SoftBrands will give prompt
written notice to Info-Quest of its intention to do so, describing such
securities, and specifying the form and manner and the other relevant facts
involved in such registration (including, without limitation, (x) whether or
not such registration will be in connection with an underwritten offering of
equity securities and, if so, the identity of the managing underwriter and
whether such offering will be pursuant to a “best efforts” or “firm commitment”
underwriting and (y) the anticipated price range at which such securities are
reasonably expected to be sold to the public). 
Upon the written request of Info-Quest,

 

5

 

to be
delivered to SoftBrands by Info-Quest within 15 Business Days after the giving
of any such notice by SoftBrands, which request shall specify the maximum
number of Registrable Securities intended to be disposed of by Info-Quest,
which number shall not exceed 20% of the number of Other SoftBrands Securities
to be registered, SoftBrands will use its reasonable best efforts to effect, in
connection with the registration of the Other SoftBrands Securities, the
registration under the Securities Act of all Registrable Securities which
SoftBrands has been requested to register by Info-Quest, to the extent required
to permit the disposition of Registrable Securities so to be registered; provided that:

 

(i)                                     SoftBrands will not be
required to effect any registration of Registrable Securities pursuant to this Section 3.2
if (i) the registration involves a “firm commitment” underwriting, (ii) no
securities of any other selling shareholders are to be included in the
registration and (iii) SoftBrands and Info-Quest shall have been advised by,
following prior consultation with, a recognized independent investment banking
firm selected by SoftBrands that, in such firm’s opinion, a registration at
that time of any of the Registrable Securities proposed to be offered would
adversely affect the proposed offering of the Other SoftBrands Securities;

 

(ii)                                  If SoftBrands and Info-Quest
shall have been advised by, following prior consultation with, a recognized
independent investment banking firm selected by SoftBrands that, in such firm’s
opinion, the number of Registrable Securities proposed to be included in a
registration under this Section 3.2 is greater than the number of
securities which can be offered without adversely affecting the offering,
SoftBrands may reduce pro rata the number of Registrable Securities to be
offered for the account of Info-Quest to a number deemed satisfactory by such
investment banking firm;

 

(iii)                               SoftBrands may, in its sole
discretion, delay any offering of Other SoftBrands Securities for which
registration of Registrable Securities also is effected under this Section 3.2
by giving written notice of the delay to Info-Quest, provided, however, that if (i) the registration statement
with respect to the offering is not yet effective and the delay extends for
more than 30 days from the date of the written notice of delay under this Section 3.2
or (ii) the registration statement with respect to the offering has been
declared effective by the SEC and the closing of the offering is delayed for
more than 24 hours, Info-Quest may withdraw its Registrable Securities from the
offering, and thereupon SoftBrands shall be relieved of its obligation to
register such Registrable Securities;

 

(iv)                              SoftBrands shall have the
right to select the managing underwriter for any underwritten offering for
Info-Quest pursuant to this Section 3.2.

 

(b)                                 No registration of
Registrable Securities effected under this Section 3.2 shall relieve
SoftBrands of its obligation to effect a registration of Registrable Securities
pursuant to Section 3.1.

 

6

 

Section 3.3                                      Rule 144 and Rule 144A
Information.

 

With a view to making
available the benefits of certain rules and regulations of the SEC which may at
any time permit the sale of the Registrable Securities to the public without
registration, at all times following the date upon which SoftBrands is required
to file reports under Section 12 or 15(d) of the Exchange Act, SoftBrands
agrees to:

 

(a)                                  make and keep public
information available, as those terms are understood and defined in Rule 144
under the Securities Act, at all times;

 

(b)                                 use its best efforts to file
with the SEC in a timely manner all reports and other documents required of
SoftBrands under the Securities Act and the Exchange Act; and

 

(c)                                  promptly furnish to
Info-Quest upon request a written statement by SoftBrands as to its compliance
with the reporting requirements of such Rule 144 and of the Securities Act and
the Exchange Act, a copy of the most recent annual or quarterly report of
SoftBrands and such other reports and documents so filed by SoftBrands as
Info-Quest may reasonably request in availing itself of any rule or regulation
of the SEC allowing Info-Quest to sell any Registrable Securities without
registration.

 

Section 3.4                                      Registration Procedures.

 

(a)                                  Registration and
Qualification.  If and whenever
SoftBrands is required to use its reasonable best efforts to effect the
registration under the Securities Act of any Registrable Securities, as
provided in Sections 3.1 or 3.2 of this Agreement, SoftBrands will as
expeditiously as is practicable:

 

(i)                                     prepare and promptly file
with the SEC a registration statement under the Securities Act on the appropriate
form with respect to such securities to be offered and use its reasonable best
efforts to cause such registration statement to become effective and, in the
case of a registration under Section 3.1 of this Agreement, keep such
registration statement effective until the distribution contemplated in the
registration statement has been completed, but not in any case more than 90
days;

 

(ii)                                  prepare and file with the
SEC such amendments (including post-effective amendments) and supplements to
such registration statement and the prospectus used in connection therewith as
may be necessary to keep such registration statement effective and to comply
with the provisions of the Securities Act with respect to the disposition of
such securities, until the expiration of 90 days after such registration
statement becomes effective;

 

(iii)                               furnish to Info-Quest copies
of any such registration statement, any prospectus included therein (including
any preliminary prospectus or summary prospectus) and any amendment or supplement
thereto, and (i) with respect to a registration under Section 3.1 of this
Agreement, such documents shall be subject to the prior review of Info-Quest
for a period of at least five Business Days and SoftBrands shall not file with
the SEC any such registration statement, prospectus, amendment or supplement to
which Info-Quest shall reasonably object within five Business Days of receipt
thereof and (ii) with respect to a registration under Section 3.2 hereof,
such

 

7

 

documents shall be subject to the prior review of Info-Quest
for a reasonable period of time under the circumstances and prior to filing
with the SEC any such registration statement, prospectus, amendment or
supplement, SoftBrands will consider the reasonable objections of Info-Quest
which are conveyed to it;

 

(iv)                              furnish to Info-Quest and to
any underwriter of such securities, such number of conformed copies of such
registration statement and of each such amendment and supplement thereto (in each
case including all exhibits), such number of copies of the prospectus included
in such registration statement in conformity with the requirements of the
Securities Act, such documents incorporated by reference in such registration
statement or prospectus and such other documents as Info-Quest or such
underwriter may reasonably request in order to facilitate the public sale or
other disposition of such securities;

 

(v)                                 use its best efforts to
register or qualify all the securities covered by such registration statement
under such other securities or blue sky laws of such jurisdictions as
Info-Quest or any underwriter of such securities shall reasonably request and
do any and all other acts and things which may be reasonably necessary or
advisable to enable Info-Quest or any underwriter to consummate the disposition
in such jurisdictions of the securities covered by such registration statement;
provided, that SoftBrands shall
not for any such purpose be required to qualify generally to do business as a
foreign corporation in any jurisdiction where it is not so qualified or to
subject itself to any taxation in any such jurisdiction or to consent to
general or unlimited service of process in any jurisdiction where it is not
then so subject;

 

(vi)                              otherwise use its best
efforts to comply with all applicable rules and regulations of the SEC and make
generally available to its securityholders, in each case as soon as
practicable, but not later than 45 calendar days after the close of the period
covered thereby (90 calendar days in case the period covered corresponds to a
fiscal year), an earnings statement of SoftBrands which will satisfy the
provisions of Section 11(a) of the Securities Act;

 

(vii)                           use its best efforts to list
such securities on the securities exchange or quote such securities on the
quotation system the Shares are then, or are intended to be, listed or quoted,
as the case may be;

 

(viii)                        (x) immediately notify
Info-Quest at any time when a prospectus relating to a registration pursuant to
Section 3.1 or 3.2 of this Agreement is required to be delivered under the
Securities Act of the happening of any event as a result of which the
prospectus included in such registration statement, as then in effect, includes
an untrue statement of a material fact or omits to state any material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances then existing, not misleading and (y) at the request
of Info-Quest, prepare and furnish to Info-Quest a reasonable number of copies
of a supplement to, or an amendment of, such prospectus as may be necessary so
that, as thereafter delivered to the purchasers of such securities, such
prospectus shall not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements

 

8

 

therein, in light of the circumstances then existing, not
misleading.  Info-Quest agrees not to
sell any Registrable Securities registered under Sections 3.1 or 3.2 hereof if
Info-Quest has been notified of the happening of an event under clause (x) of
this paragraph (a)(viii) until Info-Quest has received such copies of the
supplement or amendment as aforesaid and is further notified by SoftBrands that
the prospectus included in the registration statement, as then in effect, no
longer includes an untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances then existing, not misleading.  Upon the happening of an event under clause
(x) of this paragraph (a)(viii), the 90 day time period set forth in clause
(ii) of this paragraph (a), if applicable, shall be extended for a number of
days equal to the number of days that Info-Quest is prohibited from selling
such Registrable Securities under this paragraph (a)(viii);

 

(ix)                                (x) furnish to Info-Quest,
addressed to Info-Quest, an opinion of counsel for SoftBrands dated the date of
the closing of the sale of the securities under the underwriting agreement,
covering substantially the Info-Quest matters with respect to such registration
statement (and the prospectus included therein) as are customarily covered in
opinions of SoftBrands’s counsel delivered to underwriters in underwritten
public offerings of securities and such other matters as Info-Quest may
reasonably request, and (y) if permitted by applicable accounting standards,
use its reasonable best efforts to furnish to Info-Quest, addressed to
Info-Quest, a “cold comfort” letter signed by the independent public
accountants who have certified SoftBrands’s financial statements included in or
incorporated by reference into such registration statement, covering
substantially the Info-Quest matters with respect to such registration
statement (and the prospectus included therein), and with respect to events
subsequent to the date of such financial statements, as are customarily covered
in accountants’ letters delivered to underwriters in underwritten public
offerings of securities and such other matters as Info-Quest may reasonably
request;

 

(x)                                   execute and deliver all
instruments and documents and take such other actions and obtain all such other
certificates and opinions as is customary in an underwritten offering;

 

(xi)                                SoftBrands may require
Info-Quest to furnish to it such information regarding Info-Quest and the
distribution of such Registrable Securities that it may from time to time
reasonably request in writing and as shall be required by law or by the SEC or
the National Association of Securities Dealers, Inc. (“NASD”) in connection
with any such registration.

 

(b)                                 Underwriting.

 

(i)                                     If requested by the
underwriters for any underwritten offering of Registrable Securities pursuant
to a registration requested by Info-Quest hereunder, SoftBrands and Info-Quest
will enter into an underwriting agreement with such underwriters for such
offering, such agreement to contain such representations, warranties, covenants
and indemnities by SofBrands and Info-Quest and such other terms and provisions
as are customarily contained in underwriting agreements with respect to

 

9

 

secondary distributions, including without limitation such
underwriters’ form of indemnities and contribution and the provision of an
opinion of counsel and, if applicable, a “cold comfort” letter.

 

(ii)                                  In the event that any
registration pursuant to Section 3.2 of this Agreement shall involve, in
whole or in part, an underwritten offering, SoftBrands may require that the
Registrable Securities be included in such underwriting on the Info-Quest terms
and conditions as shall be applicable to the Other SoftBrands Securities being
sold through underwriters under such registration.  In such case, Info-Quest shall be a party to
any such underwriting agreement.  Such
agreement shall contain such representations, warranties, covenants and
indemnities by Info-Quest and such other terms and provisions as are
customarily contained in underwriting agreements with respect to the selling
shareholders in a secondary distribution, including without limitation the
underwriters’ form of indemnities and contribution, provided that the aggregate
amount of any indemnification and contribution to be provided by Info-Quest
thereunder shall be limited to the net proceeds to Info-Quest from the offering
under such registration.

 

(iii)                               In the event that any
registration under Section 3.1 of this Agreement shall involve an
underwritten offering of Registrable Securities, SoftBrands will, for a period
not longer than one week, (i) market the securities to be offered by Info-Quest
in such registration with the Info-Quest diligence as it would devote to the
marketing of a primary registration of its securities and (ii) cause its
management to participate in any efforts by the underwriters to market such
securities to be offered by Info-Quest in such registration, if and as required
by such underwriters; provided that
SoftBrands, shall only be required to market such securities pursuant to this
paragraph (b)(iii) once every twenty-four (24) month period.

 

(c)                                  Registration Expenses

 

(i)                                     Except as set forth in Section 3.4(c)(ii)
below, SoftBrands shall pay all Registration Expenses in connection with any registration
of Registrable Securities pursuant to Section 3.1 or 3.2 of this
Agreement.

 

(ii)                                  Info-Quest shall pay the
following: any underwriting discounts or commissions or transfer taxes, if any,
attributable to the sale of Registrable Securities by Info-Quest pursuant to
this Agreement; printing expenses (including expenses of printing certificates
for Registrable Securities and prospectuses), messenger, telephone and delivery
expenses attributable to the sale of Registrable Securities; the fees and disbursements
of the underwriters (including expenses relating to “road shows” and other
marketing activities) and all fees, costs and expenses of counsel to Info-Quest
in connection with Registration Expenses attributable to the sale of
Registrable Securities.

 

(iii)                               As used in this Agreement, “Registration
Expenses” shall include all expenses incident to the performance of or
compliance by SoftBrands with the registration requirements set forth in this
Agreement, including, without limitation, the following: (i) the fees,
disbursements and expenses of its counsel, accountants and

 

10

 

transfer agent in connection with the registration of
securities to be disposed of under the Securities Act; (ii) all expenses in connection
with the preparation, printing and filing of the registration statement, any
preliminary prospectus or final prospectus, any other offering document and
amendments and supplements thereto, including all filing fees, and the mailing
and delivering of copies thereof to the underwriters and dealers; (iii) the
cost of printing or producing any agreement(s) among underwriters, underwriting
agreement(s) and blue sky or legal investment memoranda, any selling agreements
and any other documents in connection with the offering, sale or delivery of
the securities to be disposed of; (iv) the cost of printing or producing and
the issuance and delivery of certificates for the securities, (v) all expenses
in connection with the qualification of the securities for offering and sale
under international and U.S. state securities laws, including the fees and
disbursements of counsel for the underwriters in connection with such
qualification and in connection with any blue sky and legal investment surveys;
and (vi) the filing fees incident to securing any required review by the NASD
of the terms of the sale of the securities and; (vii) the listing or quotation
of the securities on stock exchanges or quotation systems.

 

(d)                                 Market Stand-off.  Upon any underwritten public offering of
Shares by SoftBrands, including the Initial Public Offering, Info-Quest,
whether or not the Registrable Securities are included in the Initial Public
Offering, will, if and to the extent requested by the managing underwriter in
the Initial Public Offering, enter into an agreement not to effect any public
sale or distribution, including any sale pursuant to Rule 144 under the
Securities Act (but excluding those securities sold in such underwritten
offering), of any of the equity securities of SoftBrands owned by Info-Quest,
without the consent of such managing underwriter, during a period commencing on
the effective date of such registration and ending a number of calendar days
thereafter not exceeding 180 days as such managing underwriter shall reasonably
determine is required to effect a successful offering; provided that (i) the executive officers
and directors of SoftBrands and other holders of registration rights in
SoftBrands securities shall be required to enter into similar agreements with
SoftBrands and (ii) the agreement entered into by Info-Quest shall be
substantially identical in form and substance to such agreements entered into
by the executive officers and directors of SoftBrands and other holders of
registration rights in SoftBrands securities. 
In connection with the foregoing, SoftBrands may impose stop-transfer
instructions with respect to the Registrable Securities of Info-Quest for the
duration of such period.

 

Section 3.5                                      Termination of Registration
Rights.  The registration rights of Info-Quest under Section 3.1
and Section 3.2 shall terminate upon the earlier to occur of:

 

(a)                                  the five year anniversary of
Initial Public Offering;

 

(b)                                 the date on which Info-Quest
ceases to hold at least one-third of the number of Reorganization Shares it
will be entitled to hold immediately following completion of the Reorganization
(as such number may be adjusted for any stock split, reclassification,
recapitalization or similar event); and

 

11

 

(c)                                  that date on which all of
the Registrable Securities held by Info-Quest may be sold under Rule 144 during
one 90-day period, or may otherwise be sold by Info-Quest in market
transactions without registration under the Securities Act.

 

ARTICLE IV

PURCHASE PARTICIPATION RIGHT

 

Section 4.1                                      Purchase Participation Right.  Subject to the provisions of this Agreement,
SoftBrands hereby grants to Info-Quest a right to participate in any issuances
to third parties, other than Exempt Issuances, of Other SoftBrands Securities
(including any convertible bonds or warrants or other equity instruments or
rights for Shares) after the date of this Agreement (the “Purchase
Participation Right”), provided, however,
that the number of Shares that Info-Quest shall be entitled to purchase in such
issuance shall not exceed that number of Shares (the “Pro Rata Portion”) of
such Other SoftBrands Securities which equals the proportion that the number of
Shares then held by Info-Quest bears to the total number of Shares then outstanding;
and provided further that this
provision shall cease to have any effect upon the earlier of the completion of
the Initial Public Offering or the termination of the registration rights
pursuant to Section 3.5(b) above.

 

Section 4.2                                      Notice and Acceptance;
Compliance with Laws.  In the case of any
issuance by SoftBrands of Other SoftBrands Securities, other than an Exempt
Issuance, SoftBrands shall deliver a notice of such issuance (the “Offer Notice”)
to Info-Quest, not later than ten (10) days after such issuance, which shall
state the price and terms upon which SoftBrands proposes to issue (if such
issuance has not been completed) or upon which it has issued such Other
SoftBrands Securities.  Info-Quest may exercise
the Purchase Participation Right by delivery of written notification to
SoftBrands (the “Purchase Participation Notice”) within ten (10) days after its
receipt of the Offer Notice.  The
Purchase Participation Notice shall state the number of Shares, up to the
Pro-Rata Portion, that Info-Quest elects to purchase at the price and on the
terms specified in the Offer Notice.  In
the event that Info-Quest elects to exercise its Purchase Participation Right
in accordance with this Article IV, the purchase by and sale to Info-Quest
of such Other SoftBrands Securities shall be completed as promptly as
practicable, and in any event within twenty (20) days of such exercise.  SoftBrands shall use its reasonable best
efforts to cause any issuance to Info-Quest pursuant to the Purchase
Participation Right to be in compliance with applicable laws, rules and
regulations, including applicable securities laws and stock exchange rules and
regulations.

 

ARTICLE V

TERMINATION

 

Section 5.1                                      Termination. 
This
Agreement shall terminate at the

 

earliest of:

 

(a)                                  the date that Info-Quest
(together with its subsidiaries) ceases to hold at least one-third of the
number of the Reorganization Shares it will be entitled to hold immediately
following completion of the Reorganization (as such number may be adjusted for
any stock split, reclassification, recapitalization or similar event);

 

12

 

(b)                                 upon the liquidation,
dissolution, winding up or bankruptcy of SoftBrands;

 

(c)                                  upon the tenth anniversary
of this Agreement; or

 

(d)                                 by mutual written consent of
SoftBrands and Info-Quest.

 

Section 5.2                                      Effect of Termination.  In the event of termination of this
Agreement, this Agreement shall become void and have no effect, without any
liability or obligation on the part of any party hereto, except that the
provisions of Sections 6.1, 6.4, 6.5, 6.6, 6.7, 6.8, 6.9, 6.10, 6.11 and 6.12
shall survive the termination of this Agreement.

 

ARTICLE VI

MISCELLANEOUS

 

Section 6.1                                      Entire Agreement, No Third
Party Beneficiaries; Conflicts.  This Agreement
and the other agreements contemplated hereby and instruments delivered pursuant
hereto and thereto constitute the entire agreement, and supersede all other
prior agreements and understandings, both written and oral, among the parties
with respect to the subject matter hereof and thereof and, except as otherwise
expressly provided herein, is not intended to and shall not confer upon any
person other than the parties hereto any rights or remedies hereunder.  In the event of any conflict between the terms
of this Agreement and the Bylaws, the parties hereto agree that the terms of
this Agreement shall govern.

 

Section 6.2                                      Preparation; Reasonable
Investigation.  In connection with the
preparation and filing of each registration statement registering Registrable
Securities under the Securities Act, and subject to such agreements with
respect to confidentiality as are reasonable and customary under such
circumstances, each of the parties hereto shall grant the other parties and the
underwriters, if any, and their respective counsel and accountants, such
reasonable and customary access after reasonable notice to its books and
records and such opportunities to discuss its business with its officers and
the independent public accountants who have certified its financial statements
and perform such other diligence as shall be necessary, to conduct a reasonable
investigation within the meaning of the Securities Act.

 

Section 6.3                                      Regulatory Cooperation.  The parties shall cooperate with each other
to ensure that all information necessary or desirable for the making of (or
responding to any requests for further information consequent upon) any
notifications or filings made in connection with this Agreement, the
transactions contemplated hereunder or any on-going regulatory filings or other
obligations in connection with the operations of SoftBrands or any of its
subsidiaries, is supplied to the party responsible for such notifications and
filings.

 

Section 6.4                                      Notices.  Any notice, request, instruction or other
document to be given hereunder by either party to another party shall be in
writing and shall be deemed given when delivered personally, upon receipt of a
transmission confirmation (with a confirming copy sent by overnight courier) if
sent by facsimile or like transmission, and on the next business day when sent
by overnight courier, to the party at the following addresses (or such other
addresses for a party as shall be specified by like notice):

 

13

 

(a)                                  If to SoftBrands, to:

 

SoftBrands, Inc.

Two Meridian Crossings, Suite 800

Minneapolis, MN 55423

Attention: David G. Latzke, Chief Financial Officer

 

(b)                                 If to Info-Quest, to:

 

Info-Quest SA

25 Pantou Street

17671 Kallithea, Athens, Greece

Attention: Theodoros Fessas

 

Section 6.5                                      Governing Law.  This Agreement shall be governed by and
construed in accordance with New York law, without regard to the principles of
conflicts of laws thereof.

 

Section 6.6                                      Arbitration.

 

(a)                                  The parties hereto shall
attempt to resolve any disputes, claims, controversies and disagreements
arising out of, or in connection with, this Agreement amicably and promptly by
negotiations between designated senior executives of the parties who have
authority to settle the controversy. 
Notwithstanding the foregoing, with respect to any dispute not resolved
in the normal course of business, a party may give the other party written
notice of such dispute (the “Dispute Notice”) and that it seeks, subject to the
conditions herein, to refer such dispute to such senior executives for
resolution.  Upon receipt of the Dispute
Notice, the designated senior executives of the parties shall meet at a
mutually acceptable time and place, and thereafter as often as they reasonably
deem necessary, to exchange relevant information and to attempt to resolve the
dispute; provided, however, that if the matter that is the subject of the
Dispute Notice has not been resolved within thirty days of the date of the
Dispute Notice (the “30-Day Period”), either party hereto may give written
notice (an “Arbitration Notice”) to the other that it intends to resolve the
dispute by arbitration in accordance with paragraph (c) below.

 

(b)                                 Upon expiration of the
30-Day Period and issuance of an Arbitration Notice, any disputes, claims, controversies
and disagreements arising out of or in connection with this Agreement not
otherwise resolved in accordance with paragraph (b) above, shall be submitted
by either party to binding arbitration. 
The arbitration shall be conducted on a confidential basis under the
Federal Arbitration Act 9 U.S.C. § § 1-16, and under the Center for
Public Resources Institute Rules for Non-administered Arbitration.  The parties shall mutually agree on a sole
arbitrator.  In the event that the parties
cannot agree within thirty days of notice of arbitration, the arbitrator shall
be selected by the Center for Public Resources from its Panels of
Neutrals.  The arbitrator may award legal
fees and expenses.  Judgment upon the
arbitrator’s award may be entered and enforced in any court of competent
jurisdiction.  The location of each
arbitration proceeding shall be New York, New York.  The decision and award of the arbitrators
shall be final and binding and non-appealable, and shall be enforceable in any
court of competent jurisdiction.

 

14

 

Section 6.7                                      Severability.  Any provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement in any other jurisdiction. 
Upon such determination that any term or other provision is invalid or
unenforceable, the parties hereto shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible to the fullest extent permitted by applicable law in an acceptable
manner to the end that the transactions contemplated hereby are fulfilled to
the extent possible.

 

Section 6.8                                      Costs.  Except as otherwise set forth in this
Agreement, each of the parties shall pay its own costs, charges and expenses
incurred in connection with the preparation and implementation of this
Agreement and the transactions contemplated by it.

 

Section 6.9                                      Successors; Assigns;
Transferees.  The provisions of this Agreement shall be
binding upon and accrue to the benefit of the parties hereto and their
respective successors and permitted assigns. 
Except as otherwise provided in this Section 6.9, the rights and
obligations hereunder may not be assigned or delegated in part or in whole to a
third party (including a purchaser of Shares) by Info-Quest without first
obtaining the written consent of SoftBrands. 
For purposes of the foregoing, a merger, consolidation or sale or
transfer of substantially all of the assets of Info-Quest, or the acquisition
by any person or person acting in concert of more than 50% of the voting
securities of Info-Quest, shall be considered an assignment of this
Agreement.  Notwithstanding the
foregoing, the transfer of this Agreement by merger, consolidation or transfer
of substantially all of the assets of Info-Quest, or the acquisition by any person
or person acting in concert of more than 50% of the voting securities of
Info-Quest, shall not constitute an assignment of the rights contained in Article III
(but not of Article II) and shall not require the consent to assignment of
the rights contained in Article III, by SoftBrands.

 

Section 6.10                                Amendments; Waivers.  This Agreement may not be amended, modified
or supplemented and no waivers of or consents to departures from the provisions
hereof may be given unless consented to in writing by the parties.

 

Section 6.11                                Counterparts.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which shall
constitute one.

 

Section 6.12                                Representations and
Warranties.  Each of SoftBrands and Info-Quest hereby
represents and warrants that:

 

(a)                                  It has all necessary
corporate power and authority to enter into this Agreement and to perform its
obligations hereunder.  The execution,
delivery and performance of this Agreement and the consummation of the transactions
contemplated hereby have been duly authorized by its Board of Directors, no
other corporate actions are necessary to authorize this Agreement or to
consummate such transactions, and this Agreement constitutes a legal, valid and
binding obligation of such party, enforceable against such party in accordance
with its terms.

 

(b)                                 The execution and delivery
of this Agreement does not, and the performance of this Agreement will not,
conflict with or violate any provision of the Certificate

 

15

 

of
Incorporation or other corporate organization documents of such party or any of
its subsidiaries or any law applicable to such party or any of its subsidiaries
of any of their respective properties or assets.

 

IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be signed as of the date first
written above.

 

	
   

  	
  SOFTBRANDS, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ George H Ellis

  	
   

  
	
   

  	
   

  	
  Name:
  George H. Ellis

  
	
   

  	
   

  	
  Title:
  Chairman and Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  INFOR-QUEST SA

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Theodore Fessas

  	
   

  
	
   

  	
   

  	
  Name:
  Theodore Fessas

  
	
   

  	
   

  	
  Title:
  Chairman and Managing Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David Samuel

  	
   

  
	
   

  	
   

  	
  Name:
  David Samuel

  
	
   

  	
   

  	
  Title:
  Member of the Board of Directors

  

 

16

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