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 Restricted
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 underwriters
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 attor-
ney, accountant or agent in connection with such registra-
tion 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 Sec-
tion 10 will be on such other terms and conditions as are at the
time customary and reasonably required by such underwriters. 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: (000) 000-0000; 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 ac-
cordance 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 amended except in writing.
(f) This Agreement may be executed in two or more counter-
parts, 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.
\s\ X. X. Xxxxxx
By: Xxxxxx X. Xxxxxx
Title: Chairman and Chief Executive Officer
AGREED TO AND ACCEPTED
as of the date first
above written.
\s\ Xxx X. Xxxxxx
Xxx X. Xxxxxx
