Cooperative Computing, Inc.

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IN THE MATTER OF COOPERATIVE COMPUTING, INC.

CONSENT ORDER, ETC., INREGARD TO ALLEGED VIOLATION OF SEC. 7 OF THE CLAYTON ACT AND SEC. 5 OF THE FEDERAL TRADE COMMISSION ACT Docket C-3757. Complaint, June 20, 1997--Decision, June 20, 1997 This consent order requires Cooperative Computing, Inc., among other things, to divest its electronic parts catalog to MacDonald Computer Systems through an exclusive, royalty-free and perpetual license with the right to sublicense and to transfer or assign its PartFinder® electronic catalog database, its J-CON® application program interface, and support software and documentation. Appearances For the Commission: Daniel Ducore.

For the respondent: Thomas A. Roberts and Debra J. Pearlstein, Weil, Gotshal & Manges, New York, N.Y.

COMPLAINT Pursuant to the provisions of the Federal Trade Commission Act and of the Clayton Act, and by virtue of the authority vested in it by said Acts, the Federal Trade Commission, having reason to believe that Cooperative Computing, Inc. ("CCI") has entered into an Agreement and Plan of Merger with Triad Systems Corporation ("Triad"), whereby CCI has agreed to acquire all of the outstanding shares of Triad and that CCI has commenced a tender offer for the outstanding shares of Triad, in violation of Section 5 of the Federal Trade Commission Act, as amended, 15 U.S.C. 45, and that such acquisition, if consummated, would violate Section 7 of the Clayton Act, as amended, 15. U.S.C. 18, and Section 5 of the Federal Trade Commission Act, and it appearing to the Commission that a proceeding in respect thereof would be in the public interest, hereby issues its complaint stating its charges as follows: A. THE RESPONDENT 1. Respondent Cooperative Computing, Inc. ("CCI") is a corporation organized, existing, and doing business under and by virtue of the laws of the State of Texas with its office and principal place of business located at 6207 Bee Cave Road, Austin, Texas. COOPERATIVE COMPUTING, INC. 1707 1706 Complaint 2. At all times relevant herein, respondent has been and is now engaged in commerce as commerce is defined in Section 1 of the Clayton Act, 15 U.S.C. 12, and is a corporation whose business is in or affecting commerce as commerce is defined in Section 4 of the Federal Trade Commission Act, as amended, 15 U.S.C. 44. B. THE PROPOSED ACQUISITION 3. In October 1996, CCI entered into a merger agreement with Triad Systems Corporation ("Triad") and announced its intention to commence a tender offer for all of the outstanding voting securities of Triad. Under the terms of the tender offer, Triad shareholders will receive $9.25 per share, or a total of approximately $181 million. Immediately prior to the CCI acquisition of Triad, Hicks, Muse, Tate & Furst ("Hicks Muse"), a private investment firm based in Dallas, Texas, will acquire over 50 percent of CCI stock and gain control of CCI.

4. CCI is a privately-held company that develops and markets management information system software for the automotive aftermarket. CCI offers a portfolio of software products that assist auto parts distributors and retailers to track their parts inventory. CCI has developed and markets with its software a proprietary database of auto parts for domestic and foreign automobiles. CCI has had annual sales of approximately $43 million.

5. Triad, a publicly-held Livermore, California-based company, develops and markets management information system software for the automotive aftermarket and for the hardlines and lumber industries. Triad has had annual sales of approximately $175 million, including approximately $90 million attributable to sales to the automotive parts aftermarket. Triad offers a portfolio of applications software that allows automotive parts distributors and retailers to efficiently manage their businesses. Triad also develops and sells a proprietary database of auto parts for domestic and foreign automobiles.

C. RELEVANT LINES OF COMMERCE 6. Warehouse distributors and jobbers are businesses that distribute and sell automotive parts and accessories into the replacement market, known as the automotive aftermarket. Warehouse distributors are large automotive aftermarket wholesalers and distributors of automotive parts and accessories. A warehouse SSS aaa a a eT | Complaint 123 F.T.C.

distributor typically purchases automotive parts directly from manufacturers, carries an inventory of tens of thousands of parts, and distributes those parts to jobbers. Jobbers are generally smaller distributors of automotive aftermarket parts and accessories which purchase parts from warehouse distributors. A jobber typically carries an inventory of a few thousand automotive parts and distributes those parts to professional automotive repair service dealers. The functions of traditional warehouse distributors and jobbers are today sometimes combined in what are known as two-step distributors, which are automotive aftermarket distributors who purchase automotive parts and accessories directly from manufacturers and sell those parts directly to automotive repair service dealers. 7. A management information system or MIS system is a computer system, including software, and sometimes including hardware, used by warehouse distributors and jobbers to manage their business including managing the inventory of the millions of aftermarket automotive parts manufactured for domestic and foreign-built automobiles. An MIS system performs many functions including inventory control, point-of-sale purchase ordering, accounts receivable, accounts payable, payroll, and general ledger, and aids the warehouse distributor or jobber in managing the business. 8. An electronic automotive parts catalog or electronics 1 5 3 1 9 2047 1791 192 53 94.866104 catalog is a database of aftermarket automotive part numbers that is searchable by make, model and year of car. An electronic catalog quickly and efficiently determines, with make, model and year of automobile information, which automotive part number, and hence, which automotive part is needed for a particular automobile. An electronic catalog is a very extensive database, containing millions of part numbers for domestic and foreign cars. 9. One relevant line of commerce within which to analyze the effects of CCI's acquisition of Triad is the market for electronic catalogs. There are no economic substitutes for electronic catalogs. Paper catalogs, the only possible substitute for an electronic catalog, are inadequate substitutes because paper catalogs are cumbersome and time consuming to use. The ability of warehouse distributors and jobbers to access information about parts availability and supply the required product is critical to their success, since the industry standard for same day repair service causes service dealers to require delivery of needed parts within 30 minutes. Electronic catalogs are sold as stand-alone products and as parts of integrated MIS systems. COOPERATIVE COMPUTING, INC. 1709 1706 Complaint 10. Another relevant line of commerce within which to analyze the effects of CCI's acquisition of Triad is the market for MIS systems integrated with an electronic catalog, An MIS integrated with an electronic catalog enables users to access the vast inventory of automotive part numbers of hundreds of automotive part manufacturers on the same computer terminal as the MIS. Customers often demand an MIS integrated with an electronic catalog to be able to electronically transfer automotive parts data from the electronic catalog to a purchase order in the MIS. This transfer of data is important because it saves time and eliminates any risk of human error during the process of rekeying automotive part numbers into purchase orders.

11. The relevant geographic market within which to analyze the effects of CCI's acquisition of Triad is either the United States or North America. Many automotive parts and part numbers are unique to the United States and Canada. While software is easily transported, there are no imports into the United States of either electronic catalogs or integrated MIS systems with electronic catalogs. D, CONCENTRATION 12. The relevant U.S. or North American markets for electronic catalogs and for MIS systems integrated with an electronic catalog are highly concentrated.

13. There are only a limited number of providers of electronic catalogs. In addition to CCI and Triad, there is only one other firm, Profit-Pro, Inc. ("Profit-Pro"), which develops and sells an electronic catalog for the independent automotive aftermarket. Triad sells both a stand- alone catalog and a catalog integrated with an MIS system, while CCI only sells its catalog integrated with an MIS system. CCI and Triad are, nonetheless, substantial, direct competitors. The electronic catalog offered by Profit Pro, Inc. is considered inferior compared to the CCI and Triad catalogs, in the size of its database, the accuracy of the part numbers in the database, and the speed with which it is updated. Profit-Pro is a weak, fringe competitor with a small market share.

14. One closed automotive aftermarket distribution network and one large automotive aftermarket retail chain of stores have their own, internally developed electronic catalog. These two electronic catalogs are not available to the independent automotive aftermarket. Moreover, these two electronic catalogs are designed to meet the SS a ey Complaint 123 F.T.C.

specific needs of those firms and therefore they have a very limited database of automotive parts compared to the electronic catalogs of CCI and Triad. Therefore, these two catalogs do not constrain the pricing of electronic catalogs by CCI or Triad. 15. Triad and CCI are the dominant providers of MIS systems integrated with an electronic catalog, together controlling approximately 70% of the market The merger of CCI and Triad would increase the Herfindahl-Hirschmann Index ("HHI") over 1200 points to over 3900. Aside from CCI and Triad, all other firms selling a MIS integrated with an electronic catalog rely upon Triad or Profit-Pro for their electronic catalog. These fringe firms do not constrain pricing nor in any other way substantially impact competition for the development and sale of MIS systems integrated with an electronic catalog.

E. CONDITIONS OF ENTRY 16. De novo entry or fringe expansion into the relevant markets which would be sufficient to deter or defeat reductions in competition resulting from the CCI acquisition of Triad would not be timely or likely. Developing an electronic catalog would require an expenditure of substantial sunk costs and would be time-consuming. Electronic catalog data must be entered manually into a database because the electronic parts data is received in a different format from each of hundreds of automotive parts manufacturers. Entry with a catalog covering only a fraction of available automotive parts would not be acceptable to most warehouse distributors and jobbers. F, EFFECTS OF THE PROPOSED ACQUISITION 17. The proposed acquisition by CCI of Triad may substantially lessen competition in the United States or North American markets for electronic catalogs and for MIS systems integrated with an electronic catalog by, among other things: a. Increasing concentration substantially in highly concentrated markets;

b. Eliminating substantial, direct head-to-head competition between CCI and Triad;

c. Substantially increasing the risk of unilateral exercise of market power;

COOPERATIVE COMPUTING, INC. 1711 1706 Decision and Order d. Increasing prices for electronic catalogs and MIS systems integrated with an electronic catalog; and e. Reducing service to customers of electronic catalogs and MIS systems integrated with an electronic catalog. G. VIOLATIONS CHARGED 18. The agreements described in paragraph three violate Section 5 of the Federal Trade Commission Act, as amended, 15 U.S.C. 45. 19. The acquisition of the outstanding shares of Triad by CCI, if consummated, would violate Section 7 of the Clayton Act, as amended, 15 U.S.C. 18, and Section 5 of the Federal Trade Commission Act, as amended, 15 U.S.C. 45. DECISION AND ORDER The Federal Trade Commission ("Commission"), having initiated an investigation of the proposed merger of Cooperative Computing, Inc. ("CCI"), and Triad Systems Corporation ("Triad"), and it now appearing that CCI, hereinafter sometimes referred to as the respondent, is willing to enter into an agreement containing an order to divest certain assets and providing for other relief, and respondent having been furnished with a copy of a draft complaint that the Bureau of Competition has presented to the Commission for its consideration and which, if issued by the Commission, would charge respondent with violations of the Clayton Act and Federal Trade Commission Act; and The respondent, its attorneys, and counsel for the Commission having thereafter executed an agreement containing a consent order, an admission by respondent of all the jurisdictional facts set forth in the aforesaid draft of complaint, a statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by respondent that the law has been violated as alleged in such complaint, and waivers and other provisions as required by the Commission's Rules; and The Commission, having thereafter considered the matter and having determined that it had reason to believe that the respondent has violated the said Acts, and that a complaint should issue stating its charges in that respect, and having thereupon accepted the executed, consent agreement and placed such agreement on the public record for a period of sixty (60) days, and having duly considered the comments received, now in further conformity with the procedure Decision and Order 123 F.T.C.

prescribed in Section 2.34 of its Rules, makes the following jurisdictional findings and enters the following order: 1. Respondent Cooperative Computing, Inc., is a corporation organized, existing, and doing business under and by virtue of the laws of the State of Texas, with its office and principal place of business located at 6207 Bee Cave Road, Austin, Texas. 2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondent, and the proceeding is in the public interest.

ORDER L It is ordered, That, as used in this order, the following definitions shall apply:

A. Respondent or CCI means Cooperative Computing, Inc., its directors, officers, employees, agents and representatives, predecessors, successors, and assigns; its subsidiaries, divisions, groups and affiliates controlled by Cooperative Computing, Inc., and the respective directors, officers, employees, agents and representatives, successors and assigns of each. B. Triad means Triad Systems Corporation, a corporation organized, existing, and doing business under and by virtue of the laws of the State of Delaware with its office and principal place of business located at 3055 Triad Plaza, Livermore, California. C. MacDonald means MacDonald Computer Systems, a corporation organized, existing, and doing business under and by virtue of the laws of the State of California with its office and principal place of business located at 25031 Avenue Stanford, Valencia, California.

D. The Acquisition means the purchase of shares of Triad common stock pursuant to the Offer to Purchase by CCI dated October 23, 1996.

E. Commission means the Federal Trade Commission. F. CCI5 1 8 6 1 3 978 2781 244 43 66.459915 Products”5 1 8 6 1 4 1268 2793 147 29 96.812851 means5 1 8 6 1 5 1464 2779 70 42 96.952652 thes 1 8 6 1 6 1584 2778 95 42 94.926834 CCI5 1 8 6 1 7 1728 2777 232 50 96.388832 Database,5 1 8 6 1 8 2012 2776 214 42 96.838165 Database4 1 8 6 2 0 623 2844 1603 59 -1 5 1 8 6 2 1 623 2850 295 53 95.303886 Technology,5 1 8 6 2 2 975 2849 84 42 95.303886 ands 1 8 6 2 3 1114 2846 374 51 95.637459 Documentation,5 1 8 6 2 4 1545 2845 83 43 96.968193 ands 1 8 6 2 5 1683 2845 56 41 96.190186 all5 1 8 6 2 6 1796 2844 214 43 96.365936 technical5 1 8 6 2 7 2066 2848 160 48 96.510536 system4 1 8 6 3 0 624 2910 1601 57 -1 5 1 8 6 3 1 624 2917 351 42 96.214836 documentation5 1 8 6 3 2 996 2916 83 42 96.708138 ands 1 8 6 3 3 1100 2929 99 29 96.708138 users 1 8 6 3 4 1219 2913 348 44 96.792099 documentation5 1 8 6 3 5 1586 2913 181 54 96.753662 relating5 1 8 6 3 6 1790 2912 177 50 96.750076 thereto,5 1 8 6 3 7 1992 2910 233 53 96.927490 including,4 1 8 6 4 0 623 2978 1606 60 -1 5 1 8 6 4 1 623 2985 77 41 96.182083 but5 1 8 6 4 2 723 2990 75 37 96.182083 not5 1 8 6 4 3 822 2985 167 42 96.294991 limited5 1 8 6 4 4 1010 2990 58 45 97.013680 to,5 1 8 6 4 5 1093 2998 25 28 96.986748 a5 1 8 6 4 6 1138 2982 261 56 96.965141 descriptions 1 8 6 4 7 1421 2982 54 42 96.873444 of5 1 8 6 4 8 1490 2982 57 41 96.810287 all5 1 8 6 4 9 1570 2982 97 41 96.828796 data5 1 8 6 4 10 1688 2981 211 42 96.810555 elements5 1 8 6 4 11 1923 2979 86 43 96.810555 ands 1 8 6 4 12 2031 2979 55 42 96.662720 all5 1 8 6 4 13 2109 2978 120 42 96.605568 other2 1 9 0 0 0 357 3064 1958 218 -1 3 1 9 1 0 0 357 3064 1958 218 -1 4 1 9 1 1 0 357 3064 1958 218 -1 5 1 9 1 1 1 357 3064 1958 218 95.000000 COOPERATIVE COMPUTING, INC. 1713 1706 Decision and Order information necessary for the Acquirer to use and operate the products.

G. CCI5 1 3 2 1 3 874 516 253 42 95.221725 Database means the CCI PartFinder® Electronic Catalog Database data current as of the date of delivery to the Acquirer, for all the product lines and data elements contained in the database as of the date of the Acquisition. H. Databases 1 3 3 1 3 992 786 296 54 79.254768 Technology means the API, Server Software, Support Software, and TIMDD. | I. API means CCI's J-CON® application program interface for the CCI PartFinder® Electronic Database, including all related documentation, current as of the date of the Acquisition. J. Servers 1 3 5 1 3 868 1126 236 55 94.405098 Software means the CCI software utilized to retrieve vehicle data from the CCI Database when a valid request is received from a user, including all related documentation, current as of the date of the Acquisition.

K. Supports 1 3 6 1 3 938 1397 235 55 93.206848 Software means the CCI software and all related documentation or data, including, but not limited to, all documentation current as of the date of the Acquisition, and utilized to distribute, maintain or support the CCI Database, including but not limited to, all software for data entry, data extraction, and media creation.

L. TIMDD means all Triad Integration Module data definitions current as of the date of the Acquisition. M. “Documentation” means all end user documentation associated with the CCI Products provided by CCI. N. Updates means all additions, deletions and modifications to the CCI Database, which shall include updated data and information made available by respondent to any of respondent's customers as part of the respondent's standard, commercially available electronic catalog product. Upon delivery of an update, such update shall be considered to be included in the term CCI5 1 3 9 6 9 1569 2415 253 44 96.547409 Database. O. VAR means a person or entity in the business of distributing hardware and/or software systems to warehouses, jobber/retail stores and/or service dealers in the automotive aftermarket but excludes any person or entity whose primary business is the distribution, sale, or installation of automotive parts and accessories. P. Acquirer means either MacDonald or the person or entity approved by the Commission to acquire the CCI Products pursuant to paragraph II.B of this order.

Decision and Order 123 F.T.C.

Q. Proprietary5 1 4 1 1 3 1150 378 180 54 95.732399 Rights means all patents, patent applications, trade secrets, copyrights, trademarks and service marks, know-how, confidential information and other proprietary rights. Il.

It is further ordered, That:

A. Respondent shall divest, absolutely and in good faith, at no minimum price, through a perpetual, royalty-free, transferable, assignable, and exclusive license with the right to use for any purpose, combine with other information, reproduce, modify, market and sublicense, the CCI Products in the United States and Canada. Provided, however, respondent may retain the right to sell, license or otherwise provide the CCI Products to customers of CCI MIS systems until such time as CCI is able to integrate the Triad electronic catalog database to CCI's MIS systems, but in no event for more than six (6) months from the date of delivery of the Database, and | provided, however, respondent may retain the right to utilize the CCI Database Technology and Documentation to update, support and maintain an electronic catalog database for any CCI customer licensed by CCI prior to the end of the aforementioned six (6) month period.

B. Respondent shall divest the CCI Products as set forth in paragraph I.A to MacDonald, in accordance with the License Agreement entered into between CCI and MacDonald, dated February 13, 1997 (the Licenses 1 6 2 4 6 1433 2099 316 55 95.425117 Agreement), no later than ten (10) days after the date on which this order is made final. Provided, however, that in the event respondent fails to divest the CCI Products to MacDonald because MacDonald, unilaterally and through no fault of respondent, breaches the License Agreement, respondent shall divest the CCI Products as set forth in paragraph II.A to an Acquirer that receives the prior approval of the Commission and only in a manner that receives the prior approval of the Commission, within sixty (60) days after the date on which this order is made final. The purpose of the divestiture of the CCI Products is to ensure the continued use of the CCI Products in the same business in which the CCI Products are used at the time of the Acquisition, in competition with respondent, and to remedy any lessening of competition resulting from the Acquisition as alleged in the Commission's complaint.

COOPERATIVE COMPUTING, INC. 1715 1706 Decision and Order C. Pending divestiture of the CCI Products, respondent shall take such actions as are necessary to maintain the viability and marketability of the CCI Products, including but not limited to updating the CCI Database on a regular schedule, and to prevent the destruction, removal, wasting, deterioration, or impairment of any of the CCI Products.

Il.

It is further ordered, That:

A. If respondent has not divested the CCI Products, as required by paragraph II of this order, the Commission may appoint a trustee to divest the CCI Products. In the event that the Commission or the Attorney General brings an action pursuant to Section 5(1) of the Federal Trade Commission Act, 15 U.S.C. 45(1), or any other statute enforced by the Commission, respondent shall consent to the appointment of a trustee in such action. Neither the appointment of a trustee nor a decision not to appoint a trustee under this paragraph shall preclude the Commission or the Attorney General from seeking civil penalties or any other relief available to it, including a courtappointed trustee, pursuant to Section 5(l) of the Federal Trade Commission Act, or any other statute enforced by the Commission, for any failure by the respondent to comply with this order. B. Ifa trustee is appointed by the Commission or a court pursuant to paragraph III.A of this order, respondent shall consent to the following terms and conditions regarding the trustee's powers, duties, authority, and responsibilities:

a. The Commission shall select the trustee, subject to the consent of respondent, which consent shall not be unreasonably withheld. The trustee shall be a person with experience and expertise in acquisitions and divestitures. If respondent has not opposed, in writing, including the reasons for opposing, the selection of any proposed trustee within ten (10) days after notice by the staff of the Commission to respondent of the identity of any proposed trustee, respondent shall be deemed to have consented to the selection of the proposed trustee.

b. Subject to the prior approval of the Commission, the trustee shall have the exclusive power and authority to divest the CCI Products.

Decision and Order 123 F.T.C.

c. Within ten (10) days after appointment of the trustee, respondent shall execute a trust agreement that, subject to the prior approval of the Commission and, in the case of a court-appointed trustee, of the court, transfers to the trustee all rights and powers necessary to permit the trustee to effect the divestiture required by this order.

d. The trustee shall have twelve (12) months from the date the Commission approves the trust agreement described in paragraph. III.B.c to accomplish the divestiture, which shall be subject to the prior approval of the Commission. If, however, at the end of the twelve-month period, the trustee has submitted a plan of divestiture or believes that divestiture can be achieved within a reasonable time, the divestiture period may be extended by the Commission, or, in the case of a court-appointed trustee, by the court; provided, however, the Commission may extend this period only two (2) times. e. The trustee shall have full and complete access to the personnel, books, records and facilities related to the CCI Products or to any other relevant information, as the trustee may request. Respondent shall develop such financial or other information as such trustee may request and shall cooperate with the trustee. Respondent shall take no action to interfere with or impede the trustee's accomplishment of the divestitures. Any delays in divestiture caused by respondent shall extend the time for divestiture under, this paragraph in an amount equal to the delay, as determined by the Commission or, for a court-appointed trustee, by the court. f. The trustee shall use his or her best efforts to negotiate the most favorable price and terms available in each contract that is submitted to the Commission, subject to respondent's absolute and unconditional obligation to divest at no minimum price. The divestiture shall be made in the manner and to the acquirer or acquirers as set out in paragraph II of this order; provided, however, if the trustee receives bona fide offers from more than one acquiring entity, and if the Commission determines to approve more than one such acquiring entity, the trustee shall divest to the acquiring entity or entities selected by respondent from among those approved by the Commission.

g. The trustee shall serve, without bond or other security, at the cost and expense of respondent, on such reasonable and customary terms and conditions as the Commission or a court may set. The trustee shall have the authority to empioy, at the cost and expense of COOPERATIVE COMPUTING, INC. 1717 1706 Decision and Order respondent, such consultants, accountants, attorneys, investment bankers, business brokers, appraisers, and other representatives and assistants as are necessary to carry out the trustee's duties and responsibilities. The trustee shall account for all monies derived from the divestiture and all expenses incurred. After approval by the Commission and, in the case of a court-appointed trustee, by the court, of the account of the trustee, including fees for his or her services, all remaining monies shall be paid at the direction of the respondent, and the trustee's power shall be terminated. The trustee's compensation shall be based at least in significant part on a commission arrangement contingent on the trustee's divesting the CCI Products.

h. Respondent shall indemnify the trustee and hold the trustee harmless against any losses, claims, damages, liabilities, or expenses arising out of, or in connection with, the performance of the trustee's duties, including all reasonable fees of counsel and other expenses incurred in connection with the preparation for, or defense of any claim, whether or not resulting in any liability, except to the extent that such liabilities, losses, damages, claims, or expenses result from misfeasance, gross negligence, willful or wanton acts, or bad faith by the trustee.

i. If the trustee ceases to act or fails to act diligently, a substitute trustee shall be appointed in the same manner as provided in paragraph III.A of this order.

j. The Commission or, in the case of a court-appointed trustee, the court, may on its own initiative or at the request of the trustee issue such additional orders or directions as may be necessary or appropriate to accomplish the divestiture required by this order. k. The trustee shall have no obligation or authority to operate or maintain the CCI Products.

l. The trustee shall report in writing to respondent and the Commission every sixty (60) days concerning the trustee's efforts to accomplish divestiture.

IV.

It is further ordered, That:

A. Respondent shall deliver the CCI Products to the Acquirer in machine-readable or other appropriate usable form. Decision and Order 123 F.T.C.

B. After the CCI Products have been divested, respondent shall not exercise any right it may have, whether at common law, in equity, or in bankruptcy or reorganization (including through obtaining any equity interest in a reorganized debtor) or otherwise, to terminate the license granted pursuant to this order or to seek to have such license terminated, or to require, or seek to require, the Acquirer or its successor or assignee to return the CCI Products. C. Respondent shall make no claim to ownership, title, or interest in any modifications of the CCI Products developed by Acquirer and any copies (in whole or part) thereof and any documentation developed by Acquirer relating thereto, and all Proprietary Rights therein, shall be the property of Atquirer. D. Respondent shall provide to the Acquirer, updates to the CCI Database ona monthly basis, no later than the time that respondent provides updates to any of respondent's customers, in accordance with the License Agreement, for no more than two (2) years. E. Upon reasonable notice to respondent from the Acquirer, respondent shall provide such assistance to the Acquirer as is reasonably necessary to ensure that the purpose of the divestiture of the CCI Products is accomplished. Such assistance shall include reasonable consultation with knowledgeable employees of respondent for a period of time sufficient to ensure that the Acquirer's personnel are adequately trained in the sources and processing of the data contained in the CCI Products. Respondent, however, shall not be required to continue providing such assistance for more than twelve (12) months from the date of the divestiture and for no more than three hundred and fifty (350) hours during that twelve month period of time. Respondent may not charge Acquirer for such assistance, except for documented, out-of-pocket expenses (such as food, travel and lodging) incurred by respondent, which shall be billed to Acquirer as they occur.

F. Respondent shall not, for a period of twenty-four (24) months from the date of the divestiture, enter into or enforce non-competition agreements that have the purpose or effect of interfering with the ability of Acquirer to recruit or employ respondent's employees whose primary responsibility at respondent is, or during the six months prior to the Acquisition was, the development, programming, input and/or support of the CCI Database or Database Technology, provided that respondent may enter into or enforce existing confidentiality agreements with any of its employees. COOPERATIVE COMPUTING, INC. 1719 1706 Decision and Order G. Respondent, for a period of eighteen (18) months from the date of the divestiture, (1) shall not enter into any agreement with a VAR to provide, in the United States or Canada, any electronic catalog database, unless such agreement permits the VAR to terminate such agreement during the thirty (30) day period immediately preceding the first anniversary of such agreement; and (2) shall permit any existing agreement with a VAR to provide in the United States or Canada, any electronic catalog database, to be terminated by such VAR during the thirty (30) day period immediately prior to the first anniversary of the effective date of the License Agreement. V.

It is further ordered, That within fifteen (15) days after the date this order is made final and every thirty (30) days thereafter until respondent has fully complied with the provisions of paragraph II of this order, and every sixty (60) days thereafter until respondent has fully complied with the provisions of paragraphs III and IV. A, D, E, F and G of this order, respondent shall submit to the Commission a verified written report setting forth in detail the manner and form in which it intends to comply, is complying, or has complied with this order. Respondent shall include in its compliance reports, among other things that are required from time to time, a full description of the efforts being made to comply with the order, including a description of all substantive contacts or negotiations for the divestiture and the identity of all parties contacted. Respondent shall include in its compliance reports copies of all written communications to and from such parties, all internal memoranda, and all reports and recommendations concerning divestiture. VI.

It is further ordered, That, for the purpose of determining or securing compliance with this order, and subject to any legally recognized privilege, upon written request and reasonable notice, respondent shall permit any duly authorized representative of the Commission:

A. Access, during normal office hours and in the presence of counsel, to inspect and copy all books, ledgers, accounts, correspondence, memoranda and other records and documents in the Decision and Order 123 E.T.C.

possession or under the control of respondent relating to any matters contained in this order; and B. Upon five (5) days' notice to the respondent, and without restraint or interference, to interview officers, directors, or employees of the respondent, who may have counsel present. VIL.

It is further ordered, That respondent shall notify the Commission at least thirty (30) days prior to any proposed change in the corporate respondent such as dissolution, assignment, sale resulting in the emergence of a successor corporation, or the creation or dissolution of subsidiaries or any other change in the corporations that may affect compliance obligations arising out of the order. THE STOP & SHOP COMPANIES, INC., ET AL. 1721 1721 Modifying Order