REGISTRATION RIGHTS AGREEMENT
(Including Restrictions on Transfer)
July 2, 1997
Xx. Xxx X. Xxxxxx
MSE Corporation
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000-0000
Dear Xx. Xxxxxx:
In connection with the Purchase Agreement dated July 2, 1997 (the "Purchase
Agreement"), between Analytical Surveys, Inc., a Colorado corporation ("ASI"),
and you (the "Shareholder"), ASI hereby covenants and agrees with the
Shareholder, and with any Permitted Transferee of the Restricted Stock (as
defined below), as follows:
1. Certain Definitions. The following terms have the following
respective meanings:
"Agreement" means this Registration Rights Agreement.
"Closing Date" means the date of this Registration Rights Agreement.
"Commission" means the Securities and Exchange Commission, or any
other federal agency at the time administering the Securities Act.
"Common Stock" means the shares of common stock, no par value, of
ASI, as constituted as of the date of this Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, or any similar federal statute, and the rules and regulations
of the Commission thereunder, all as the same are in effect at the
time.
"Permitted Transferees" means the Shareholder's spouse, lineal
descendants (by blood or adoption) or estate, the Shareholder's
spouse's lineal descendants, or trusts or other entities created for
the exclusive benefit of, or beneficially owned exclusively by, the
Shareholder and such persons or entities.
"Registration Expenses" means the expenses so described in
Section 9.
"Restricted Stock" means the shares of Common Stock issued to the
Shareholder pursuant to the Purchase Agreement and any additional
shares of Common Stock or other securities issued in respect of such
shares in connection with a stock dividend, stock split,
recapitalization, reclassification or other transaction affecting
ASI's outstanding Common Stock.
"Securities Act" means the Securities Act of 1933 or any similar
federal statute, and the rules and regulations of the Commission under
the Securities Act of 1933, all as the same are in effect at the time.
"Selling Expenses" means the expenses so described in Section 9.
"Transfer" means a sale, exchange, assignment, pledge or other
disposition of Restricted Stock or any interest therein, whether
voluntary or by operation of law, excluding a Transfer to a Permitted
Transferee.
2. Restrictive Legend. Each certificate representing Restricted Stock until
such legend is removed or such shares are sold in accordance with the other
provisions of this Agreement, will be stamped or otherwise imprinted with a
legend substantially in the following form:
"THE SHARES EVIDENCED BY THIS CERTIFICATE (A) HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF
ANY STATE, AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF
UNLESS THEY HAVE BEEN REGISTERED UNDER THAT ACT AND ALL APPLICABLE
STATE SECURITIES LAWS OR EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS
THEREOF AVAILABLE, AS ESTABLISHED TO THE SATISFACTION OF THE COMPANY,
BY OPINION OF COUNSEL OR OTHERWISE, AND (B) ARE SUBJECT TO CONTRACTUAL
RESTRICTIONS ON RESALE UNDER AN AGREEMENT BETWEEN THE HOLDER AND THE
COMPANY, A COPY OF WHICH IS AVAILABLE FOR INSPECTION AT THE OFFICES OF
THE COMPANY.
3. Restriction on Sale. The Shareholder will not Transfer any shares of the
Restricted Stock prior to the second anniversary of the Closing Date, except
pursuant to the exercise of Incidental Rights (as defined below) provided for in
Section 6(a)(i)) or to a Permitted Transferee as provided in Section 12.
4. Notice of Proposed Transfer. Prior to any proposed Transfer of any
Restricted Stock after the second anniversary of the Closing Date (other than
under the circumstances described in Sections 5 and 6 or to a Permitted
Transferee under Section 12), the Shareholder will give written notice to ASI of
his intention to effect such Transfer. Each such notice will describe the manner
of the proposed Transfer and, if requested by ASI, will be accompanied by an
opinion of counsel reasonably satisfactory to ASI to the effect that the
proposed Transfer of the Restricted Stock may be effected without registration
under the Securities Act and any state securities laws, at which point the
Shareholder will be entitled to Transfer such Restricted Stock in accordance
with the terms of its notice. Each certificate of Re- stricted Stock Transferred
as above provided will bear the legend set forth in Section 2, unless (i) such
Transfer is in accordance with the provisions of Rule 144 (or any other rule
permitting public sale without registration under the Securities Act) or (ii)
the opinion of counsel referred to above is to the further effect that the
transferee and any subsequent transferee would be entitled to Transfer such
securities in a public sale without registration under the Securities Act.
The foregoing restrictions on transferability of Restricted Stock will
terminate as to any particular shares of Restricted Stock when such shares have
been effectively registered under the Securities Act and sold or otherwise
disposed of in accordance with the intended method of disposition by the
Shareholder set forth in the registration statement concerning such shares, or
when the legend set forth in Section 2 is removed from the certificates
representing such shares in accordance with the immediately preceding sentence
of this Section 4. Whenever the Shareholder is able to demonstrate to the
reasonable satisfaction of ASI (and its counsel) that the provisions of Rule
144(k) of the Securities Act are available to him without limitation, the
Shareholder will be entitled to receive from ASI, without expense, a new
certificate not bearing the restrictive legend set forth in Section 2.
5. Demand Registration Rights.
(a) The Shareholder has the right to request registration of
Restricted Stock under the Securities Act (the "Demand Rights") with the
following restrictions: the Demand Rights may be exercised (i) once, with
respect to up to 462,500 shares of Restricted Stock (less the number of
shares of Restricted Stock sold by the Shareholder after the second
anniversary of the Closing Date under Rule 144 or privately), between the
second and third anniversaries of the Closing Date, and (ii) once, with
respect to up to all of the remaining shares of Restricted Stock, between
the third and sixth anniversaries of the Closing Date. The Shareholder may
not make a request to register fewer than 100,000 shares.
(b) ASI will use its best efforts to register under the Securities Act
for public sale in accordance with the method of disposition specified in
the initial written request from the Shareholder for registration of the
shares of Restricted Stock, subject to the limitations set forth below. If
such method of disposition is to be an underwritten public offering, ASI
may designate the managing underwriter of such offering, provided that such
managing underwriter is reasonably satisfactory to the Shareholder.
Notwithstanding anything to the contrary contained in this Agreement, the
obligation of ASI under this Section 5 will be deemed satisfied only when a
registration statement covering all shares of Restricted Stock specified in
the Shareholder's written request (subject to limitations set forth in
clause (a) of this Section), for sale in accordance with the method of
disposition specified by the Shareholder, has become effective and has
remained effective for the lesser of (i) 90 days or (ii) the period within
which all shares so registered have been sold; provided, however, that if
the Shareholder requests registration of Restricted Stock under this
Section 5 and later withdraws such request, whether or not a registration
statement had been filed at the time of such withdrawal, ASI will be deemed
to have satisfied its obligation hereunder with respect to that request, as
fully as if the shares of Restricted Stock specified therein had been
registered and sold, unless, within 30 days after receiving ASI's statement
therefor, the Shareholder reimburses ASI for all expenses incurred by ASI
in connection with such registration.
(c) Notwithstanding the grant of the Demand Rights, the Shareholder
will not have the right to require registration at any time that the
provisions of Rule 144(k) are available to the Shareholder with respect to
the sale of the Restricted Stock.
(d) Notwithstanding the grant of the Demand Rights, ASI, upon notice
to the Shareholder, may suspend the right of the Shareholder to exercise
the Demand Rights, for a period not to exceed 90 days (the Suspension
Period ), if and to the extent that ASI determines, in good faith, that the
filing of a registration statement by ASI reasonably could be expected to
have a material adverse effect on ASI and its shareholders and delivers a
certificate signed by the President of ASI to such effect. Such right may
be exercised only once in any 12-month period, and, if either period
described in clauses (i) or (ii) of Section 5(a) would otherwise end during
a Suspension Period, then the period described in clause (i) or (ii) of
Section 5(a) will be extended for a period equal to the Suspension Period
plus 30 days.
6. Incidental Registration Rights.
(a) The Shareholder has incidental registration rights as described in
Section 6(b) (the "Incidental Rights") with respect to all of the shares of
the Restricted Stock, beginning on the Closing Date and ending on the sixth
anniversary of the Closing Date, with the following limitations: (i) before
the second anniversary of the Closing Date the Incidental Rights are
limited to 10% of the primary shares of Common Stock offered and sold by
ASI in the offering as to which the Incidental Rights are being exercised,
and (ii) between the second and third anniversaries of the Closing Date,
the Incidental Rights are limited to 462,500 shares of the Restricted
Stock, less shares of the Restricted Stock previously sold by the
Shareholder by any method.
(b) Each time ASI proposes to register any of its equity securities
under the Securities Act (other than a registration effected solely to
implement an employee benefit or stock option plan or to sell shares
obtained under any employee benefit or stock option plan or a transaction
to which Rule 145 or any other similar rule of the Commission under the
Securities Act is applicable or a registration on any form which is not
available for the registration of Restricted Stock) ASI will give written
notice to the Shareholder of its intention to do so. The Shareholder may
give ASI a written request to register all or some of the Restricted Stock
in the registration described in the written notice from ASI, provided that
such written request is given within 20 days after receipt of any such
notice from ASI, with such request stating the number of shares of
Restricted Stock to be disposed of and the intended method of disposition
of such Restricted Stock. Upon receipt of such request, ASI will use its
best efforts to cause promptly all such shares of Restricted Stock intended
to be disposed of to be registered under the Securities Act so as to permit
their sale or other disposition in accordance with the intended methods set
forth in the request for registration; provided, however, that if the
registration relates to an underwritten offering, (i) the Shareholders
right to have shares of Restricted Stock included in the registration will
be contingent upon the Shareholder agreeing to include such Restricted
Stock in the offering and entering into an underwriting agreement as
provided in Section 8 and (ii) if the managing underwriter of such offering
determines reasonably and in good faith in writing that the inclusion of
all of the shares of Restricted Stock as to which the Shareholder has
requested registration would adversely affect the offering, the number of
shares to be registered for the account of the Shareholder will be reduced
to the extent necessary to reduce the total number of shares to be included
in such offering to the amount recommended by such managing underwriter.
Any reduction under clause (ii) will affect all persons including shares in
the registration pursuant to the exercise of incidental registration rights
like those granted to the Shareholders in this Section 6 proportionately in
accordance with the number of shares that each had requested the Company to
include in the registration. ASI's obligations under this section apply to
a registration to be effected for securities to be sold for the account of
ASI as well as a registration statement which includes securities to be
offered for the account of other holders of ASI equity securities.
7. Purchase in Lieu of Registration. If the Shareholder exercises Demand
Rights or Incidental Rights as to any shares of the Restricted Stock (a
Registration Notice ), then ASI will have the option (the Option ), which Option
may be exercised only to the extent not prohibited by Section 0-000-000, of the
Colorado Business Corporation Act, to purchase any or all of such shares, in
lieu of registering them, at the current market price determined as follows: as
to each share of Common Stock, the average of the daily closing prices for the
Common Stock for the 20 consecutive trading days before the day the Registration
Notice was received by ASI. The closing price for each day will be the last
reported sale price regular way, or, in case no such reported sale takes place
on such day, the reported closing price regular way, in either case on the
composite tape, or if the Common Stock is not quoted on the composite tape, on
the principal United States securities exchange registered under the Securities
Exchange Act of 1934, on which the Common Stock is listed or admitted to
trading, or if it is not listed or admitted to trading on any such exchange, the
closing sale price (or the average of the quoted closing bid and asked prices if
no sale is reported) as reported by the National Association of Securities
Dealers Automated Quotation System ("NASDAQ"), or any comparable system, or if
the Common Stock is not quoted on the NASDAQ, or any comparable system, the
average of the closing bid and asked prices quoted to the public by a person
then making a market in the Common Stock, and if no person is a market maker in
the Common Stock, then the average of the closing bid and asked prices furnished
by any member of the National Association of Securities Dealers, Inc. ASI may
exercise the Option at any time within 15 days after receiving the Registration
Notice by giving the Shareholder written notice of its election to exercise.
Such notice must specify the number of shares of the Restricted Stock that ASI
elects to purchase, the current market price as determined according to the
formula set forth above, and the date of payment for such shares, which will be
within 60 days after ASI's receipt of the Registration Notice. On the date fixed
for payment in ASI's notice of exercise, the Shareholder will deliver
certificates representing the shares of Restricted Stock that ASI has elected to
purchase, duly endorsed for transfer to ASI, free and clear of liens, claims and
encumbrances, to ASI at its principal executive offices against payment by ASI
of the purchase price for such shares. If ASI elects to purchase less than all
of the shares covered by a registration notice, it will be obligated to register
the balance of such shares, subject to the provisions of Section 5.
8. Registration Procedures and Expenses. As to any shares of the Restricted
Stock that are subject to a Registration Notice under the Demand Rights and as
to which ASI does not exercise the Option provided for in Section 7, ASI will:
(a) as expeditiously as is reasonably practicable after the expiration
of the period within which ASI may exercise the Option, prepare and file
with the Commission, a registration statement with respect to such
securities and use its best efforts to cause such registration statement to
become effective and to remain effective for 90 days;
(b) as expeditiously as is reasonably practicable, prepare and file
with the Commission such amendments and supplements to such registration
statement and the prospectus used in connection with such registration
statement as may be necessary to keep such registration statement effective
for the period specified in paragraph (a) above and to comply with the
provisions of the Securities Act with respect to the disposition of all
Restricted Stock covered by such registration statement in accordance with
the Shareholder's intended method of disposition set forth in such
registration statement for such period;
(c) as expeditiously as is reasonably practicable, furnish to the
Shareholder and to each underwriter such number of copies of the
registration statement and the prospectus included in the registration
statement (including each preliminary prospectus) as such persons may
reasonably request in order to facilitate the public sale or other
disposition of the Restricted Stock covered by such registration statement;
(d) use its best efforts to register or qualify the Restricted Stock
covered by such registration statement under the securities or blue sky
laws of such jurisdictions as the Shareholder or, in the case of an
underwritten public offering, the managing underwriter, reasonably request,
if such registrations are required by law;
(e) immediately notify the Shareholder and each underwriter, at any
time when a prospectus relating to such registration statement is required
to be delivered under the Securities Act, of the happening of any event as
a result of which the prospectus contained 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 in such prospectus or
necessary to make the statements in such prospectus not misleading in the
light of the circumstances then existing;
(f) use its best efforts (if the offering is underwritten) to furnish,
at the request of the Shareholder on the date that the Restricted Stock is
delivered to the underwriters for sale pursuant to such registration: (i)
an opinion dated such date of counsel representing ASI for the purposes of
such registration, addressed to the underwriters and to the Shareholder
stating that such registration statement has become effective under the
Securities Act and that (A) to the best knowledge of such counsel, no stop
order suspending the effectiveness of such registration statement has been
issued and no proceedings for that purpose have been instituted or are
pending or contemplated under the Securities Act, (B) the registration
statement, the related prospectus, and each amendment or supplement of each
of them, comply as to form in all material respects with the requirements
of the Securities Act and the applicable rules and regulations of the
Commission under the Securities Act (except that such counsel need express
no opinion as to financial statements and other financial and statistical
data contained in each of them) and (C) to such other effects as may
reasonably be requested by counsel for the underwriters or by the
Shareholder or its counsel, and (ii) a letter dated such date from the
independent public accountants retained by ASI, addressed to the under-
writers and to the Shareholder, stating that they are independent
public accountants within the meaning of the Securities Act and that, in
the opinion of such accountants, the financial statements of ASI included
in the registration statement or the prospectus, or any amendment or
supplement of such statement or prospectus, comply as to form in all
material respects with the applicable accounting requirements of the
Securities Act, and such letter will additionally cover such other
financial matters with respect to the registration in respect of which such
letter is being given as such underwriters may reasonably request;
(g) as expeditiously as is reasonably practicable, make available for
inspection by the Shareholder, and any attorney, accountant or other agent
retained by the Shareholder, all financial and other records, pertinent
corporate documents and properties of ASI, and cause ASI's officers,
directors and employees to supply all information reasonably requested by
the Shareholder or any such attorney, accountant or agent in connection
with such registration statement;
(h) as expeditiously as is reasonably practicable, cause all the
Restricted Stock covered by the registration statement to be listed on each
securities exchange on which similar securities of ASI are then listed; and
(i) provide a transfer agent and registrar for all the Restricted
Stock covered by the registration statement not later than the effective
date of such registration statement.
The provisions of Section 8(a) through (i) will also apply to all shares of
the Restricted Stock that are subject to a Registration Notice under the
Incidental Rights and as to which ASI does not exercise the Option provided for
in Section 7, except that ASI will be entitled to control the timing of the
registration process in all respects and may withdraw or terminate any such
registration at any time.
In connection with each registration under this Agreement, the Shareholder
will furnish to ASI in writing such information with respect to himself and the
proposed distribution by him as will be reasonably necessary in order to assure
compliance with federal and applicable state securities laws.
In connection with each registration pursuant to Sections 5 or 6 covering
an underwritten public offering, ASI and the Shareholder will enter into a
written agreement with the managing underwriter selected in the manner provided
above in such form and containing such provisions as are customary in the
securities business for such an arrangement between major underwriters and
companies of ASI's size and investment stature; provided, however, that such
agreement will not contain any such provision applicable to ASI or the
Shareholder which is inconsistent with the provisions of this Agreement and
provided, further, that the time and place of the closing under said agreement
will be as mutually agreed upon among ASI, such managing underwriter and the
Shareholder.
9. Expenses.
(a) All expenses incurred in complying with Sections 5 and 6,
including, without limitation, all registration and filing fees, printing
expenses, fees and disbursements of counsel and independent public
accountants for ASI, fees of the Commission and National Association of
Securities Dealers, Inc., transfer taxes and fees of transfer agents and
registrars, but excluding any Selling Expenses and fees and expenses of
counsel for the Shareholder or any other expenses of the Shareholder, are
referred to as "Registration Expenses". All underwriting discounts, selling
commissions applicable to the sale of the Restricted Stock, and any
customary and reasonable underwriter's expense allowances expressed on a
percentage of the proceeds of the offering, are referred to as "Selling
Expenses".
(b) ASI will pay all Registration Expenses in connection with each
registration statement filed pursuant to Section 6, and in connection with
the first registration statement filed pursuant to the Shareholder's
exercise of Demand Rights. The Shareholder will pay all customary and
reasonable Registration Expenses in connection with the second registration
statement filed pursuant to its exercise of Demand Rights, except that: (i)
the Shareholder will not be required to pay or reimburse ASI for the costs
of any audit of ASI's financial statements that would have been performed
in any event; (ii) the Shareholder will not have to pay or reimburse ASI
for the time of any ASI executives or other personnel involved in preparing
the registration statement; and (iii) if any other shareholders of ASI
participate in such registration, the Shareholder will be required to pay
only his pro rata portion of the Registration Expenses. All Selling
Expenses in connection with any registration statement filed pursuant to
Sections 5 and 6 will be borne by the Shareholder.
10. Indemnification. In the event of a registration of any of the
Restricted Stock under the Securities Act pursuant to Section 5 or 6, ASI will
indemnify and hold harmless the Shareholder and each underwriter of Restricted
Stock under the Securities Act and each other person, if any, who controls the
Shareholder or any underwriter within the meaning of the Securities Act, against
any losses, claims, damages or liabilities, joint or several, to which the
Shareholder or underwriter or controlling person may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect of such losses, claims, damages or
liabilities) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the registration statement
under which such Restricted Stock was registered, any preliminary prospectus or
final prospectus contained in such registration statement, or any amendment or
supplement of such registration statement, or arise out of or are based upon the
omission or alleged omission to state in such registration statement or
prospectus a material fact required to be therein or necessary to make the
statements therein not misleading, and will reimburse the Shareholder, each such
underwriter and each such controlling person for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that ASI will
not be liable in any such case if and to the extent that any such loss, claim,
damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission so made in conformity
with information furnished by the Shareholder, any underwriter or any
controlling person in writing specifically for use in such registration
statement or prospectus.
In the event of a registration of any of the Restricted Stock under the
Securities Act pursuant to Section 5 or 6, the Shareholder will indemnify and
hold harmless ASI and each person, if any, who controls ASI within the meaning
of the Securities Act, each officer of ASI who signs the registration statement,
each director of ASI, each underwriter and each person who controls any
underwriter within the meaning of the Securities Act, against all losses,
claims, damages or liabilities, joint or several, to which ASI or such officer
or director or underwriter or controlling person may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect of such losses, claims, damages or
liabilities) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the registration statement
under which such Restricted Stock was registered, any preliminary prospectus or
final prospectus contained in such registration statement or any amendment or
supplement of such registration statement, or arise out of or are based upon the
omission or alleged omission to state in such registration statement or
prospectus a material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse ASI and each such
officer, director, underwriter and controlling person for any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the Shareholder will be liable under this Agreement in any such case if and
only to the extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in reliance upon and in conformity with information
furnished in writing to ASI by the Shareholder specifically for use in such
registration statement or prospectus; provided, further, however, that the
liability of the Shareholder under this Agreement will be limited to the
proportion of any such loss, claim, damage, liability or expense which is equal
to the proportion that the public offering price of shares sold by the
Shareholder under such registration statement bears to the total public offering
price of all securities sold under such registration statement, but not to
exceed the proceeds received by the Shareholder from the sale of the Restricted
Stock covered by such registration statement.
Promptly after receipt by an indemnified party under this Agreement of
notice of the commencement of any action, such indemnified party will, if a
claim in respect of such action is to be made against the indemnifying party
under this Agreement, promptly notify the indemnifying party in writing of such
claim, but the omission so to notify the indemnifying party will not relieve it
from any liability which it may have to any indemnified party except to the
extent that the indemnifying party is prejudiced by such omission or delay. In
case any such action is brought against any indemnified party and it notifies
the indemnifying party of the commencement of such action, the indemnifying
party will be entitled to participate in and, to the extent it wishes, to assume
and undertake the defense of such action with counsel reasonably satisfactory to
such indemnified party, and, after notice from the indemnifying party to such
indemnified party of its election so to assume and undertake the defense of such
action, the indemnifying party will not be liable to such indemnified party
under this Section 10 for any legal expenses subsequently incurred by such
indemnified party in connection with the defense of such action other than
reasonable costs of investigation and of liaison with counsel so selected
(unless such indemnified party reasonably objects to such assumption on the
grounds that there are likely to be defenses available to it which are different
from or in addition to, and are in conflict with, the defenses available to such
indemnifying party, in which event the indemnified party will be reimbursed by
the indemnifying party for the reasonable expenses incurred in connection with
retaining its separate legal counsel, but only to the extent of such conflict).
The indemnifying party will lose its right to defend, contest, litigate and
settle a matter if it fails to contest such matter diligently. No matter will be
settled by an indemnifying party without the prior written consent of the
indemnified party, unless such settlement contains a full and unconditional
release of the indemnified party.
Notwithstanding the foregoing, any indemnified party has the right to
retain its own counsel in any such action, but the fees and disbursements of
such counsel will be at the expense of such indemnified party unless (i) the
indemnifying party fails to retain counsel for the indemnified person as
aforesaid or (ii) the indemnifying party and such indemnified party mutually
agree to the retention of such counsel. The indemnifying party will not, in
connection with any action or related actions in the same jurisdiction, be
liable for the fees and disbursements of more than one separate firm qualified
in such jurisdiction to act as counsel for the indemnified party. The
indemnifying party will not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there is a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment.
If the indemnification provided for in the first two paragraphs of this
Section 10 is unavailable or insufficient to hold harmless an indemnified party
under such paragraphs in respect of any losses, claims, damages or liabilities
or actions in respect of such losses, claims, damages or liabilities, then each
indemnifying party will in lieu of indemnifying such indemnified party
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities or actions in such proportion as
appropriate to reflect the relative fault of ASI, on the one hand, and the
underwriters and the Shareholder, on the other, in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or actions, as well as any other relevant equitable considerations.
ASI and the Shareholder agree that it would not be just and equitable if
contributions pursuant to this paragraph were determined by pro rata allocation
or by any other method of allocation which did not take account of the equitable
considerations referred to above in this paragraph. Notwithstanding the
provisions of this paragraph, the Shareholder will not be required to contribute
any amount in excess of the lesser of (i) the proportion that the public
offering price of shares sold by the Shareholder under such registration
statement bears to the total public offering price of all securities sold under
such registration statement, but not to exceed the proceeds received by the
Shareholder for the sale of the Restricted Stock covered by such registration
statement and (ii) the amount of any damages which it would have otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission. No person guilty of fraudulent misrepresentations (within the meaning
of Section 11(f) of the Securities Act), will be entitled to contribution from
any person who is not guilty of such fraudulent misrepresentation.
The indemnification of underwriters provided for in this Section 10 will be
on such other terms and conditions as are at the time customary and reasonably
required by such under- writers. The indemnification provided for under this
Agreement will remain in full force and effect regardless of any investigation
made by or on behalf of the indemnified party and will survive the transfer of
the shares of Restricted Stock.
11. Changes in Common Stock. If the Company should take any action to
change its outstanding shares of Common Stock into a greater or lesser number of
shares, whether by stock split, stock dividend or otherwise, all numbers of
shares given in this Agreement will automatically be proportionately adjusted.
12. Permitted Transferees.
(a) In order to Transfer Restricted Stock to a Permitted Transferee,
the Shareholder will submit the certificates representing the shares to the
Company together with (i) a written agreement satisfactory in form and
substance to ASI signed by the Permitted Transferee agreeing to be bound by
all of the terms and provisions of this Agreement applicable to the
Shareholder; (ii) such evidence as ASI may reasonably request that the
proposed transferee in a Permitted Transferee; (iii) an opinion of counsel
reasonably satisfactory to ASI that the proposed Transfer may be effective
without registration under the Securities Act and any state securities
laws. The certificate issued in the name of the Permitted Transferee will
bear the legend referred to in Section 2.
(b) Following any Transfer of Restricted Stock to a Permitted
Transferee, the Shareholder and all Permitted Transferees will be jointly
and severally liable for the performance of the obligations of the
Shareholder hereunder, and the rights of the Shareholder hereunder will be
exercised by a single representative of all holders of Restricted Stock. As
long as the Shareholder is alive and legally competent and continues to own
any share of Restricted Stock, the Shareholder shall be that
representative. Upon the death or incompetency of the Shareholder, his
execution or conservation will appoint a Permitted Transferee as successor
representative. Upon the Transfer by the Shareholder of all of his
Restricted Stock, if any Permitted Transferee will own Restricted Stock
after the Transfer, the Shareholder will appoint a Permitted Transferee as
successor representative. If any successor representative appointed by the
Shareholder or his executor or conservator resigns or ceases to own
Restricted Stock, the Permitted Transferees will appoint a successor
representative by majority vote of the shares of Restricted Stock then
owned by all Permitted Transferees. The Shareholder or other person or
persons appointing or electing a successor representative will give written
notice of such election or appointment to the Company, identifying the
successor representative. The Company will be entitled to rely without
inquiry on the instructions of the representative last identified to it as
provided above and may disregard any contrary claims or demands by any
other holder of Restricted Stock.
(c) After any Transfer to a Permitted Transferee, all provisions of
this Agreement will apply to all shares, transactions or actions of the
Shareholders and all Permitted Transferees in the aggregate. Without
limiting the generality of the foregoing, the number of shares as to which
the shares of the Restricted Stock Transferred by any Permitted Transferee
will be aggregated with the shares of the Restricted Stock Transferred by
the Shareholder for the purpose of determining the number of shares of the
Restricted Stock that may be sold by the Shareholder or any Permitted
Transferee pursuant to a Demand Right or an Incidental Right.
13. Miscellaneous.
(a) In order to make available to the Shareholder the benefits of
certain rules and regulations of the Commission which may permit the sale
of the shares of Restricted Stock to the public without registration, ASI
agrees that, when required by law, it will use its best efforts to: (i)
make and keep public information available, as those terms are understood
and defined in Rule 144 of the Commission, at all times; (ii) file with the
Commission in a timely manner all reports and other documents required of
ASI under the Securities Act and the Exchange Act; and (iii) so long as the
Shareholder owns any shares of Restricted Stock, furnish the Shareholder,
promptly after the Shareholder's request a written statement by ASI as to
its compliance with the reporting requirements of Rule 144.
(b) Subject to the restrictions on Transfer set forth herein, all
covenants and agreements contained in this Agreement by or on behalf of any
of the parties to this Agreement will bind and inure to the benefit of the
respective successors and assigns of the parties to this Agreement whether
so expressed or not.
(c) All notices, requests, demands, claims, and other communications
under this Agreement will be in writing. Any notice, request, demand,
claim, or other communication under this Agreement will be deemed duly
given only if it is sent by registered or certified mail, return receipt
requested, postage prepaid, or by courier, telecopy or facsimile, and
addressed to the intended recipient as set forth below:
(i) if to ASI, to it at: Analytical Surveys, Inc., 0000 Xxxxxxxx
Xxxxx, Xxxxx 000, Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000, Attention: Xxxxxx
X. Xxxxxx;
(ii) if to the Shareholder, to him at: Geo. S. Olive & Co. LLC,
700 Capital Center South, 000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxxxxxxxxx,
Xxxxxxx 00000, Attention: Xx. Xxxxxxx X. Xxxxxx, Telecopy: (317)
383-4200; and
(iii) if to any Permitted Transferee, to it at such address as
may have been furnished to ASI in writing by such holder;
Notices will be deemed given three days after mailing if sent by
certified mail, when delivered if sent by courier, and one business day
after receipt of confirmation by person or machine if sent by telecopy or
facsimile transmission. Any party may change the address to which notices,
requests, demands, claims and other communications under this Agreement are
to be delivered by giving the other parties notice in the manner set forth
in this Agreement.
(d) This Agreement will be governed by and construed in accordance
with the laws of the State of Indiana.
(e) This Agreement constitutes the entire agreement of the parties
with respect to the subject matter of this Agreement and may not be
modified or amen- ded except in writing.
(f) This Agreement may be executed in two or more counterparts, each
of which will be deemed an original, but all of which together will
constitute one and the same instrument.
(g) All references in this Agreement to Sections refer to the
pertinent provision of this Agreement unless provided otherwise.
Please indicate your acceptance of the foregoing by signing and
returning the enclosed counterpart of this Agreement, whereupon this
Agreement will be a binding agreement between ASI and you.
Very truly yours,
Analytical Surveys, Inc.
By: /s/ Xxx X. Xxxxxx
----------------------------
Title: Chief Executive Officer
----------------------------
AGREED TO AND ACCEPTED
as of the date first
above written.
/s/ Xxx X. Xxxxxx
-----------------
Xxx X. Xxxxxx
