UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934, as amended
ANALYTICAL SURVEYS, INC.
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(Name of Issuer)
Common Stock, no par value
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(Title or Class of Securities)
032683302
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(CUSIP Number)
Larry D. Lieberman
GODFREY & KAHN, S.C.
780 North Water Street
Milwaukee, Wisconsin 53202
(414) 273-3500
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
December 22, 1995
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a
statement on Schedule 13G to report the
acquisition which is the subject of this
Schedule 13D, and is filing this schedule
because of Rule 13d-1(b)(3) or (4), check the
following box [ ].
* The remainder of this cover page shall
be filled out for a reporting person's
initial filing on this form with respect to
the subject class of securities, and for any
subsequent amendment containing information
which would alter disclosures provided in a
prior cover page.
The information required on the remainder of
this cover page shall not be deemed to be
"filed" for the purpose of Section 18 of the
Securities Exchange Act of 1934 ("Act") or
otherwise subject to the liabilities of that
section of the Act but shall be subject to
all other provisions of the Act.
<PAGE>
Schedule 13D
CUSIP No. 032683302
1 NAME OF REPORTING PERSON
A. William Huelsman
S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
###-##-####
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS
00
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
[ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
7 SOLE VOTING POWER 0
8 SHARED VOTING POWER 268,800
9 SOLE DISPOSITIVE POWER 0
10 SHARED DISPOSITIVE POWER 268,800
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
268,800
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES
[ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN (11)
5.5%
14 TYPE OF REPORTING PERSON
IN
<PAGE>
Schedule 13D
CUSIP NO. 032683302
ITEM 1. SECURITY AND ISSUER.
This Statement relates to 268,800 shares (the
"Shares") of Common Stock, no par value ("Common
Stock") of Analytical Surveys, Inc., a Colorado
corporation (the "Company").
The principal executive offices of the
Company are located at 1935 Jamboree Drive, Colorado
Springs, Colorado 80920.
ITEM 2. IDENTITY AND BACKGROUND.
The following information is provided for the
Reporting Person:
(a) Name. This Schedule 13D is being filed
for A. William Huelsman
(the "Reporting Person").
(b) Address. The address for the Reporting
Person is 235 West Broadway, Suite 40,
Waukesha, Wisconsin, 53186.
(c) Present Principal Occupation. Property
Manager/Real Estate Developer.
(d) Criminal Proceedings. None
(e) Civil proceedings. None
(f) Citizenship. The Reporting Person is a
citizen of the United States of America.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
The Shares were acquired by the Reporting
Person in connection with the sale to the Company of
substantially all of the assets of Intelligraphics,
Inc.
ITEM 4. PURPOSE OF TRANSACTION.
The Reporting Person currently has no plans
or proposals of the type enumerated in (a)-(j) of
Item 4 of Schedule 13D; however, the Reporting Person
reserves the right to purchase or sell common stock of
the Company at any time or from time to time.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) Number of Shares/Percentage of Class
Beneficially Owned. The Reporting Person
beneficially owns an aggregate of 268,800 shares
of the Company's Common Stock, representing
approximately 5.5% of the total number of the
issued and outstanding shares of Common Stock
(based on the information contained in the
Company's quarterly report on Form 10-QSB for the
period ending June 30, 1996).
<PAGE>
CUSIP NO. 032683302
(b) Nature of Ownership. The Reporting
Person shares the power to direct the disposition
and voting of the Shares with the Voting Trustees
(as defined in Item 6(c), below).
(c) Recent Transactions. The Reporting
Person has not effected any transactions relating
to the Shares within the past sixty days.
(d) Rights to Dividends or Proceeds. See Item 6.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR
RELATIONSHIPS WITH RESPECT TO SECURITIES OF
THE COMPANY.
(a) Pursuant to an Asset Purchase Agreement
by and among the Company, Intelligraphics, Inc. (the
"Seller") and the Reporting Person, dated December 22,
1996, the Company agreed to purchase substantially all
of the assets of the Seller in exchange for certain
cash consideration and 345,000 restricted shares of
Common Stock of the Company. The Reporting Person
acquired 268,800 of the 345,000 shares of Common Stock
issued in the transaction.
(b) Pursuant to a Lock Up Agreement dated
December 22, 1995 by and among the Reporting Person,
Gary Miller, William Nantell, David Coates, David
Kroes, Randy Vanek and Hamid Akharan (collectively, the
"Shareholders"), and the Company, the Shareholders
have agreed that no Shareholder may transfer any of the
Common Stock or any interest in the Common Stock until
December 22, 1999, except in the following situations:
transfers to family members (as defined in the Lock Up
Agreement); transfers pursuant to the Registration
Rights Agreement (referred to in Item 6(e), below);
transfers in connection with shareholder approved
transactions; and transfers of greater than 5,000
shares of the Common Stock in which the Company is
given a right of first refusal.
(c) Pursuant to a Voting Trust Agreement
dated December 22, 1995 among the Company, the
Shareholders and John A. Thorpe, Sidney V. Corder,
William M. Hudson, Richard P. MacLeod, James T. Roth,
Robert M. Keeley and Willem M.J. Anderson, members of
the Board of Directors of the Company (collectively,
the "Voting Trustees"), the Shareholders created a
voting trust and appointed the Voting Trustees to
administer the trust. The Reporting Person has
assigned the Shares to the Voting Trustees. The trust
terminates on December 22, 1997. The Voting Trustees
have the right to vote the Shares, except in the
following situations in which the Voting Trustees must
vote according to the Shareholders' written
instructions: the sale or other disposition of all or
substantially all of the assets of the Company that
under applicable law requires a vote of the
shareholders of the Company; a merger or consolidation
in which the Company is not the continuing or surviving
corporation or in which a change of control of the
Company would occur; a substantial recapitalization of
the Company that under applicable law requires a vote
of the shareholders of the Company and pursuant to
which a change of control of the Company would occur;
and a liquidation, dissolution or "going private"
transaction that under applicable law requires a vote
of the shareholders of the Company. The terms of the
trust also instruct the Voting Trustees to distribute
the proceeds of any sale of the Shares owned by the
Reporting Person during the term of the trust directly
to Bank One, Milwaukee, N.A. (the "Bank") and all
stock certificates for shares owned by the Reporting
Person to the Bank unless the Voting Trustees receive
notice from the Bank that the Reporting Person is no
longer indebted to the Bank.
(d) Pursuant to an Escrow Agreement dated
December 22, 1995 among Bank One, Colorado, N.A. (the
"Escrow Agreement"), the Company, the Seller and the
Reporting Person, the parties agreed to deposit, and
the Escrow Agent (the "Agent") has agreed to accept on
deposit 105,000 shares of Common Stock. The
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CUSIP NO. 032683302
Escrow Agreement agrees to hold and distribute such
stock according to the letter of instruction. The
letter instructs the Agent to distribute certain of
the Shares to the Company upon delivery by December
22, 1996 of notice of breach of representation,
warranty or covenant of the Seller or the Reporting
Person to the Escrow Agent, and the remainder to the
Voting Trustees. After December 22, 1996, the Escrow
Agent is to deliver the remaining Shares, if any, to
the Voting Trustees, unless otherwise notified in
writing by all parties to the Escrow Agreement.
(e) Pursuant to a Registration Rights
Agreement by and among the Company, the Seller and the
Shareholders, dated December 22, 1996, the Company
agrees that if prior to December 22, 1997 the Company
registers any of its Common Stock under the Securities
Act of 1933, as amended, in an underwritten public
offering, then upon written notice by the Shareholders
it will use its best efforts to register the Common
Stock to the extent permitted by law, subject to other
conditions.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
(1) Asset Purchase Agreement dated December 22, 1995.
(2) Lock Up Agreement dated December 22, 1995.
(3) Voting Trust Agreement dated December 22, 1995.
(4) Escrow Agreement dated December 22, 1995.
(5) Registration Rights Agreement dated December 22, 1995.
SIGNATURE
After reasonable inquiry and to the best of
my knowledge and belief, I certify that the information
set forth in this statement is true, complete and
correct.
October 16, 1996 /s/ A. William Huelsman
- ---------------- -----------------------
A. William Huelsman
ASSET PURCHASE AGREEMENT
THIS AGREEMENT is made and entered into as of
December 22, 1995, by and among ANALYTICAL SURVEYS,
INC., a Colorado corporation ("Buyer"),
INTELLIGRAPHICS, INC., a Wisconsin corporation
("Seller"), and A. WILLIAM HUELSMAN ("Huelsman").
Certain of the capitalized terms used in this Agreement
are defined as set forth in Paragraph 2.
RECITALS:
A. Buyer desires to purchase from Seller, and
Seller desires to sell to Buyer, substantially all of
the assets of Seller used in the conduct of its data
conversion business (the "Business") in accordance with
the terms and conditions hereinafter set forth.
B. Huelsman is the majority shareholder of Seller
and will benefit financially from the transactions
contemplated hereby.
NOW, THEREFORE, in consideration of the mutual
promises hereinafter contained, and other good and
valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereby agree
as follows:
1. Purchase of Assets.
1.1. Assets to be Purchased. Subject to the
terms and conditions set forth in this Agreement, Buyer
hereby agrees to purchase from Seller and Seller hereby
agrees to sell, assign and deliver to Buyer, at
Closing, except for the Excluded Assets (described
below), all of the assets of Seller owned or used in
connection with the Business, as the same may exist as
of the date of Closing, including, but not limited to,
the following:
(a) all Fixed Assets;
(b) all supplies, packaging materials,
marketing and sales literature, consumable
materials and other miscellaneous items of similar
character of Seller on hand as of Closing relating
to the Business, wherever located;
(c) all work in process, unbilled services
and other billable charges of the Business;
(d) the Accounts Receivable;
(e) all sales, manufacturing, supplier and
customer lists and records, personnel and payroll
records, accounting records, purchasing and sale
records, and all other records of the Business
(except Seller's corporate minute and stock books)
and the other business records of Seller listed on
attached Exhibit 1.1(e);
(f) all product specifications, Patents and
Data, Related Information, formulae, designs,
copyright registrations and applications therefor,
whether issued or pending, relating to the
Business and all improvements, and other similar
interests relating to the Business to which Seller
has any right of ownership, use or otherwise;
(g) all of Seller's right, title and
interest in and to the name "Intelligraphics,
Inc.," and "Intelligraphics International, Inc."
or any other name, including any derivations or
abbreviations of any name under which Seller is
now doing or has done business in the past;
(h) all of Seller's right, title and
interest in, to and under the Customer Contracts
and the Leases and those other contracts,
licenses, permits, purchase orders, sales orders,
service contracts and other agreements of the
Business existing as of Closing, including without
limitation, those listed on attached Exhibit
1.1(h) (the "Assumed Contracts");
(i) all Software; and
(j) the goodwill, if any, of the Business.
All of the assets being purchased by Buyer
described in this Paragraph 1.1 are hereinafter
referred to as the "Assets." Buyer acknowledges that
Huelsman is a partner in both Center City Plaza, a
Wisconsin general partnership, and Center City Leasing
LLC, a Wisconsin limited liability company
(collectively, the "Business Enterprises"), that Seller
leases certain office space and equipment from the
Business Enterprises, and that the Assets shall not
include any assets which are set forth on attached
Exhibit 2.2 (the "Excluded Assets").
1.2. Purchase Price. As consideration for the
Assets, Buyer shall pay to Seller the following (the
"Purchase Price"):
(a) An amount equal to Three Million Four
Hundred Fifty Thousand Dollars ($3,450,000.00)
plus or minus the amount, if any, by which the Net
Current Asset Value (as defined below) exceeds or
is less than, as the case may be, One Million
Dollars ($1,000,000) (the "Cash Payment"); and
(b) Two Hundred Thirty Thousand (230,000)
shares of the Common Stock (subject to the
restrictions contained in the Voting Trust,
Investor Letters, and Lock Up Agreement of even
date herewith), appropriately adjusted for any
stock splits, reverse stock splits, stock
dividends, or other similar events occurring
between the date of this Agreement and the Closing
(the "Subject Shares"). Good and marketable title
to the Subject Shares shall be transferred to
Seller at the Closing, free and clear of all
liens, claims and encumbrances, except the
encumbrances provided for in the terms of this
Agreement or the agreements executed pursuant to
this Agreement.
1.3. Payment of Estimated Cash Payment and the
Subject Shares. At the Closing, Buyer shall:
(a) Pay to Bank One, Milwaukee, N.A. by wire
transfer an amount equal to $3,490,000 (the
"Estimated Amount"), which represents the parties'
estimate of the amount set forth in Paragraph
1.2(a) above (which is $3,507,000), less $17,000
as a "cushion" and less $250,000 (the "Escrowed
Amount"), pursuant to Paragraph 1.3(b) below;
(b) Deliver to the Escrow Agent by wire
transfer the Escrowed Amount and 70,000 of the
Subject Shares both of which shall be held by the
Escrow Agent under the terms of the Escrow
Agreement, as follows:
(i) $170,000 shall be paid by the Escrow
Agent in accordance with the terms of the Escrow
Agreement upon Seller's delivery to the Escrow
Agent, on or before February 28, 1996, of a signed
Consent by Electronic Data Systems, Inc. ("EDS"),
assigning Seller's $5,000,000 Contract with EDS to
Buyer in form and substance satisfactory to Buyer;
(ii) $80,000 shall be paid in accordance
with the terms of the Escrow Agreement by Escrow
Agent upon Buyer's delivery to Escrow Agent of
eight (8) signed Consents, in the form set forth
under Exhibit 1.3(b)(ii). If fewer than eight (8)
signed Consents are delivered by Buyer, Escrow
Agent shall pay $10,000 per signed Consent
delivered on or before February 28, 1996. Any
funds remaining in the Escrowed Amount by reason
of Buyer's failure to deliver the signed Consents
pursuant to (i) and (ii) above shall be paid by
Escrow Agent to Buyer on February 29, 1996.
Seller will cooperate with Buyer's efforts to
obtain the Consents, provided that, direct contact
with the parties to the contracts for which the
Consents are necessary will be limited to William
Nantell and Sidney Corder; and
(iii) the Subject Shares shall be held in
escrow pursuant to the terms of Paragraph 1.8
below.
(c) Deliver to the Trustee under the Voting
Trust, of even date herewith, a certificate, in
the name of the Trustee, for the balance (160,000)
of the Subject Shares, which shares shall be held
by the Trustee under the terms of the Voting
Trust. As provided in the Voting Trust, the
Trustee shall deliver to the Beneficiaries their
respective voting trust certificates.
Prior to Closing, Buyer and Seller and their
respective accounting firms shall use reasonable good
faith efforts to estimate the Net Current Asset Value
and, based upon the estimate of the Net Current Asset
Value, the Cash Payment. For purposes of this
Agreement, the Cash Payment as so estimated shall be
referred to in this Agreement as the "Estimated
Amount."
1.4. Post-Closing Adjustments. As promptly as is
practicable and in any event within sixty (60) days
following the Closing, Seller will prepare and deliver
to Buyer a balance sheet dated as of the Closing Date
(the "Final Balance Sheet") and a statement setting
forth the proposed calculation on the Net Current Asset
Value (the "Statement"), reviewed by BDO Seidman. The
Final Balance Sheet and Statement shall be prepared in
accordance with GAAP and on a basis consistent with the
audited balance sheet of Seller as at December 31, 1994
and shall be reviewed by BDO Seidman. Buyer shall
permit Seller and BDO Seidman access to all of the
accounting records of the Business in Buyer's
possession as may be necessary for the preparation and
certification of such balance sheet and statement.
Seller shall permit Buyer and its independent certified
public accountant to review all accounting records and
all work papers and computations used in the
preparation of the Final Balance Sheet and Statement.
If Buyer does not notify Seller within thirty (30) days
of receiving the Final Balance Sheet and Statement that
Buyer disagrees with the calculation of the Net Current
Asset Value reflected therein, then the Net Current
Asset Value shall be the amount reflected in the
Statement. If Buyer notifies Seller that Buyer
disagrees with such calculation within such thirty (30)
day period, Seller and Buyer shall negotiate in good
faith to resolve the dispute. If, within fifteen (15)
days from the date notice of dispute is given, Seller
and Buyer cannot agree on the resolution of the
dispute, then the dispute shall be resolved a "Big 6"
accounting firm (other than KPMG Peat Marwick) chosen
by Seller and Buyer, provided that, in the event that
Seller and Buyer cannot agree on a firm, Seller and
Buyer will each choose two of the firms referenced
previously in this sentence and a firm will be chosen
from those four by a random draw.
1.5. Payment of Adjustment Amount. If the
adjustment provided in Section 1.2(a) requires a
payment by Buyer to Seller (after taking into account
the cushion provided for in Section 1.3(a), then within
ten (10) days of the final determination of the Net
Current Asset Value, Buyer shall pay to Bank One,
Milwaukee, N.A. an amount equal to such adjustment (the
"Adjustment Amount"); provided, that in no event shall
the Adjustment Amount payable by Buyer exceed $35,000
(taking into account the cushion). If the adjustment
provided for in Section 1.2(a) requires a payment by
Seller to Buyer (after taking into account the
cushion), then within ten (10) days of such final
determination, Seller and Huelsman, jointly and
severally, shall wire transfer to Buyer an amount equal
to such adjustment.
1.6. Allocation of Purchase Price. The Purchase
Price shall be allocated among the Assets based on
their respective fair market values as set forth on
attached Exhibit 1.6.
1.7. Assumption of Liabilities. As of the
Closing Date, Buyer shall assume and hereby agrees to
pay and perform when due (i) all liabilities which
accrue and which are based on performance obligations
arising from and after the Closing Date under the
Assumed Contracts, and (ii) all current liabilities of
Seller considered in the final calculation of the Net
Current Asset Value, including, without limitation, (a)
trade accounts payable, (b) total payroll taxes and
withholding, (c) accrued wages and salary, (d) accrued
FICA taxes, (e) accrued property taxes, (f) trade
accounts payable to related parties, (g) billings in
excess of costs and estimated earnings, (h)
unemployment compensation taxes, and (i) in addition to
total payroll taxes and withholding, any employee
withheld amounts, in each case as reflected on the
Final Balance Sheet except that Buyer need not assume
any liability reflected on the Final Balance Sheet that
is unliquidated or is not fixed in amount or involves
an obligation other than the payment of money, if
Buyer, on or prior to the date specified in Section 1.5
for the payment of adjustments, identifies such
liability by notice to Seller and pays to Bank One,
Milwaukee, N.A. cash in an amount equal to the amount
of the liability reflected on the Final Balance Sheet.
The liabilities so assumed by Buyer are referred to as
the "Assumed Liabilities." Except for the Assumed
Liabilities, Buyer shall assume no obligations or
liabilities of Seller and Seller covenants and agrees
to pay, perform and discharge all liabilities and
obligations of Seller which are not specifically
assumed by Buyer hereunder.
1.8. Escrow of Subject Shares. Unless a claim is
timely made under the terms of the Escrow Agreement,
the Escrow Agent shall transfer the certificate for the
Subject Shares held under the Escrow Agreement to the
Trustee of the Voting Trust on the first anniversary of
the Closing Date, to be held under the terms of the
Voting Trust. If a claim is timely made under the
Escrow Agreement, the Subject Shares shall be disbursed
in accordance with the terms of the Escrow Agreement.
As provided in the Voting Trust, the Trustee shall
issue voting trust certificates to the Beneficiaries
and Bank One Milwaukee, N.A. for any such Subject
Shares disbursed by the Escrow Agent to the Trustee.
2. Definitions. As used herein, the following
terms shall have the following meanings, respectively:
"Accounts Receivable" shall mean all accounts
receivable of Seller on hand as of the Closing
Date.
"Assets" shall be defined as set forth in
Paragraph 1.1.
"Assumed Contracts" shall be defined as set
forth in Paragraph 1.1(h).
"Assumed Liabilities" shall be defined as set
forth in Paragraph 1.7.
"Audited Financial Statements" shall be
defined as set forth in Paragraph 3.3.
"BDO Seidman" shall mean the Milwaukee,
Wisconsin office of the independent certified
public accounting firm of BDO Seidman.
"Beneficiaries" shall be defined as set forth
in the Voting Trust.
"Claiming Party" shall be defined as set
forth in Paragraph 6.3(a).
"Closing" shall be defined as set forth in
Paragraph 11.1.
"Closing Date" shall mean December 22, 1995,
or such other date as may be mutually agreed by
the parties as provided in Paragraph 11.1.
"Code" shall mean the Internal Revenue Code
of 1986, as amended.
"Common Stock" shall mean the authorized no
par value Common Stock of Buyer.
"Customer Contracts" shall mean those written
contracts between Seller and any person, firm or
corporation for the provision by Seller of
products and/or services related to the Business
(i) entered into at or prior to the Closing Date
as to which Seller has not completed performance
as of the Closing Date or (ii) received and to be
completed after the Closing Date, including only
those contracts listed on Exhibit 1.1(h) between
Seller and its customers.
"ERISA" shall mean the Employee Retirement
Income Security Act of 1974, as amended, and the
rules and regulations promulgated thereunder.
"Escrow Agent" shall mean Bank One, Colorado,
NA, Denver, Colorado.
"Escrow Agreement" shall mean the Escrow
Agreement in the form attached to this Agreement
as Exhibit 2-1 to be entered into among Buyer,
Seller and the Escrow Agent at the Closing.
"Excluded Assets," if any, shall mean those
assets listed as being specifically excluded on
attached Exhibit 2-2.
"Final Balance Sheet" shall be defined as set
forth in Paragraph 1.4.
"Fixed Assets" shall mean all fixed assets of
Seller on hand as of Closing of every kind and
description, wherever located, including without
limitation, machinery, equipment, hardware,
computers, office equipment, furniture,
furnishings, fixtures, tools, automobiles, trucks,
other vehicles, racks, supplies, leasehold
improvements, and other fixed assets of Seller
utilized in any manner by Seller in connection
with the Business.
"GAAP" shall mean generally accepted
accounting principles consistently applied.
"Indemnifying Party" shall be defined as set
forth in Paragraph 6.3(a).
"Knowledge of Seller" or similar phrases such
as "Seller's Knowledge" or to the "best of
Seller's knowledge" means matters known to any of
Huelsman, William Nantell, David Coates and David
Kroes and matters which would come to any of their
attention in the normal course of due diligence to
verify the warranties and representations set
forth in Paragraph 3.
"Leases" shall mean all of the leases for
equipment and facilities under which Seller is
lessee, utilized by Seller in the Business,
including without limitation, those leases listed
on attached Exhibit 1.1(h).
"Market Price" shall mean the average of the
closing bid and asked prices for the Common Stock
on the applicable date as reported on the National
Market System of NASDAQ (or, if the NASDAQ is
closed on such date, on the next preceding date on
which the NASDAQ is operated).
"NASDAQ" shall mean the National Market
System of the National Association of Securities
Dealers Automated Quotation System.
"Net Current Asset Value" shall mean the sum
of the book value of the trade accounts
receivable, work in progress, unbilled work,
prepaid expenditures and other current assets of
Seller as reflected on the Final Balance Sheet
(excluding any current assets included among the
Excluded Assets), minus the sum of the trade
accounts payable, accrued expenses, billings in
excess of charges, and other current liabilities
of Seller as reflected on the Final Balance Sheet,
in all cases determined in accordance with GAAP.
"Obligations" shall mean all obligations
under the Assumed Contracts and the Assumed
Liabilities.
"Patents and Data" shall mean such of the
following in which Seller has any right, title or
interest: patents or applications for patents
(domestic or foreign) and trade secrets with
respect to such patents or applications for
patents and trade secrets, as well as all
technical know-how and knowledge, discoveries,
inventions, processes, secret processes, machines,
manufacture or compositions of matter or any other
similar information, conversion data, and all
documents pertaining to such patents or
applications for patents and trade secrets
(including both written and oral recordings or
representations).
"Plan" or "Plans" shall be defined as set
forth in Paragraph 3.30.
"Related Information" shall mean such of the
following in which Seller has any right, title or
interest: trademarks, trademark registrations,
applications for trademark registrations, trade
names, copyrights, copyright applications, license
agreements (as licensee), technical reports,
vendor and customer lists, and all other documents
and business records of Seller.
"Required Consents" shall be defined as set
forth in Paragraph 8.7.
"Shareholders" shall mean A. William
Huelsman, Gary Miller, William Nantell, David
Coates, David Kroes, Randy Vanek and Hamid
Akhavan.
"Software" shall mean all software in which
Seller or Huelsman have any rights and which is
utilized by Seller in any manner in the Business,
whether or not said software is fully developed or
in the process of development, and including, but
not limited to, any enhancements or modifications
to said software and all software licenses and all
source codes therefor which may be in Seller's
possession or control.
"Statement" shall be defined as set forth in
Paragraph 1.4.
"Subject Shares" shall be defined as set
forth in Paragraph 1.2(b).
"Trustee" shall be defined as set forth in
Paragraph 11.5.
"Uncollected Receivables" shall be defined as
set forth in Paragraph 7.
"Voting Trust" shall be defined as set forth
in Paragraph 11.5.
3. Representations and Warranties of Seller and
Huelsman. Except as set forth in the schedule attached
to this Agreement (the "Schedule of Exceptions"),
Seller and Huelsman jointly and severally covenant,
represent and warrant as follows, each of which is true
and correct as of the date of this Agreement and shall
be true and correct on the Closing Date and each of
which shall survive the Closing Date and the
transactions contemplated hereby, to the extent set
forth in Paragraph 15.16.
3.1. Corporate Existence, Qualifications and
Power of Seller. Seller is a corporation duly
organized and validly existing under the laws of the
State of Wisconsin. Seller has the corporate power and
authority to own and use its properties and to transact
the Business, and is licensed or qualified as a foreign
corporation in all jurisdictions in which such
licensing or qualification is required and where the
failure to be so licensed or qualified could reasonably
be anticipated to have a material adverse effect on the
Business. Seller has the corporate power to enter into
and consummate the transactions contemplated by this
Agreement. Seller does not have any subsidiaries or
any interest or investment in any partnership, joint
venture, corporation or other entity, except as
disclosed on attached Exhibit 3.1.
3.2. Authorization of Agreement by Seller. The
execution and delivery of this Agreement do not, and,
subject to the receipt of the consents referred to in
Paragraph 8.7, the consummation of the transactions
contemplated by this Agreement will not, violate or
conflict with any provisions of applicable law or the
Articles of Incorporation or Bylaws of Seller or result
in a breach of, or constitute a default under, or
result in the acceleration of, any obligation or loans
under any agreement or instrument to which Seller or
Huelsman is a party or by which either of them is bound
or violate any order, judgment, award or decree to
which either of them is a party or by which either of
them is subject, which violation, conflict, breach or
default could have a material adverse effect on (i) the
Business, the Assets, or the Obligations or (ii) the
consummation of the transactions contemplated hereby.
The execution and delivery of this Agreement and the
consummation by Seller of the transactions contemplated
herein have been approved by the Board of Directors and
shareholders of Seller, which constitutes all action
required by applicable law and the Articles of
Incorporation and Bylaws of Seller to authorize and
approve the execution, delivery and performance of this
Agreement by Seller and the consummation by it of the
transactions contemplated herein.
3.3. Financial Statements. Seller has delivered
to Buyer an audited balance sheet of Seller as of
December 31, 1994, audited financial statements of
Seller for its fiscal year ended December 31, 1994, and
audited financial statements of Seller for the period
from January 1, 1995 to September 30, 1995
(collectively, the "Audited Financial Statements").
The Audited Financial Statements have been prepared
based upon the accounting records of Seller in
accordance with the normal and customary practices of
Seller in the preparation of audited financial
statements and in the ordinary course of its business,
and on a consistent basis. In addition to the Final
Balance Sheet to be delivered pursuant to Paragraph
1.4, Seller not later than February 29, 1996 will also
cause to be prepared and delivered to Buyer an audited
statement of earnings for the period from January 1,
1995, through the Closing Date (the "Final Statement of
Income"). The Final Statement of Income will be
reviewed by BDO Seidman and will be prepared in
accordance with GAAP.
3.4. Full Disclosure. Neither this Agreement nor
any other agreement, document, certificate or statement
furnished or to be furnished to Buyer or to any other
party in connection with the transactions contemplated
hereby, contains any untrue statement of a material
fact or omits to state a material fact necessary in
order to make the statements contained herein or
therein, in light of the circumstances under which they
were made, not misleading.
3.5. Events Subsequent to Non-Binding Term Sheet.
Since September 15, 1995, except as set forth on
attached Exhibit 3.5 hereto, there has been no (i)
change in the condition of the Assets or liabilities of
Seller or the Business (other than changes in the
ordinary course of business, none of which individually
has or cumulatively have had a material adverse effect
on any of the Assets, the Obligations, or the Business)
or (ii) damage, destruction or loss, whether covered by
insurance or not, which individually or cumulatively
have had a material adverse effect on any of the
Assets, the Obligations or the Business.
3.6. Accounts Receivable. Except as set forth on
attached Exhibit 3.6, the Accounts Receivable will be
(a) valid and subsisting, (b) subject to no known
defenses, offsets or counterclaims, and (c) good and
collectible within six (6) months of the Closing Date
in the ordinary course of business at the aggregate
amounts of the Accounts Receivable, net of the reserves
therefor reflected on the Final Balance Sheet.
3.7. Undisclosed Liabilities. Except as set
forth on attached Exhibit 3.7, Seller does not have,
and through the Closing Date will not have, any
material liabilities, fixed or contingent, liquidated
or accrued, primary or secondary, by agreement or by
operation of law, including, without limitation,
liabilities for federal, state, local or foreign taxes
or liabilities to customers or suppliers for which
adequate provisions have not been made on the Final
Balance Sheet (other than liabilities incurred in the
ordinary course of business, none of which individually
or in the aggregate will have a material adverse effect
on the Business).
3.8. Tax Returns and Audit. Seller has filed, or
caused to be filed, with the appropriate federal, state
and local agencies, all tax returns and tax reports
required by law to be filed by them. All income,
profits, franchise, sales, use, ownership, occupation,
property, excise, ad valorem, and any other taxes due
have been fully paid, or adequate reserves have been
established for the same and are reflected on the
Audited Financial Statements, except for such as may
have accrued or been incurred in the ordinary course of
business since September 30, 1995, and there exist no
liens, and to the knowledge of Seller, there are no
facts or circumstances which could reasonably be
anticipated to result in any liens for unpaid or
delinquent taxes, except for liens for current taxes
not yet due.
3.9. Title to Assets. Seller has good and
marketable title to all Assets, free and clear of any
liens, mortgages, pledges, encumbrances, claims,
charges of any kind, except (i) liens shown on the
Audited Financial Statements or incurred in the normal
course of business since September 30, 1995 and
reflected on the Final Balance Sheet as securing
specified liabilities, (ii) liens for current taxes not
yet due, (iii) minor imperfections of title and
encumbrances, if any, which are not substantial in
amount, do not detract from the value of the property
subject thereto or impair the operations of the
Business and have arisen only in the ordinary course of
business and consistent with past practice, and (iv) as
identified on attached Exhibit 3.9.
3.10. Patents and Data, Software and Related
Information. Set forth on attached Exhibit 3.10 is a
list and brief description of each patent, application
for patent, trademark, service mark, trade name and
copyright included within (but not comprising the whole
of) the Patents and Data, Software, and the Related
Information, including (as appropriate) where such
items are filed, issued and/or registered. Except as
set forth on attached Exhibit 3.10, title to all such
items is held by Seller, free and clear of all adverse
claims, liens, security interests, restrictions and
other encumbrances, and there are no interferences,
proceedings or infringement suits pending or, to the
knowledge of Seller, threatened, and neither Seller nor
Huelsman has received any notice that Seller is
infringing upon the right of any other person under any
other intellectual property, copyright, patent,
trademark, service mark or trade name in the conduct of
the Business. Neither Seller nor Huelsman has received
any notice in writing of any claim, lien, security
interest, restriction or encumbrance adversely
affecting Seller's rights to all other items comprising
the Patents and Data and Related Information. Huelsman
has no interest in any of the Patents and Data and the
Related Information. Seller has the right (subject to
the rights of any third parties set forth on attached
Exhibit 3.10) to use the intellectual property,
software, patents, trademarks, service marks, trade
names and copyrights upon the products or with respect
to the services upon or in respect of which they have
been or are currently being used by Seller. Except as
listed on attached Exhibit 3.10, there are no claims,
demands or proceedings instituted, pending (or to the
best knowledge of Seller, threatened) nor does Seller
have actual knowledge of any facts and circumstances
which could reasonably be anticipated to result in any
claims, demands or proceedings, pertaining to or
challenging the right of Seller to obtain, maintain or
use any such intellectual property, patents,
trademarks, service marks, trademarks or copyrights, or
any application or registration therefor, or any
copyrighted or trade secret material, or any invention,
process, machine, manufacture or composition of matter
included in the Patents and Data, Software or Related
Information. Except for rights granted pursuant to the
Customer Contracts or as listed on attached Exhibit
3.10, Seller has not granted any licenses, sublicenses
or other rights under any of the patents (or any
applications or registrations therefor), software,
trade secrets, inventions, copyrights, trade names or
trademark (or any applications or registrations
therefor), service marks (or any applications or
registrations therefor), know-how or other intellectual
property owned by or licensed to Seller and including
the Patents and Data, Software and the Related
Information.
3.11. Necessary Property. The Assets constitute
all of the assets, property and contracts used in the
operation of the Business in the manner and to the
extent operated by Seller, as of September 30, 1995.
Neither Huelsman nor any of the officers, directors or
employees of Seller have any rights of ownership, use
or any other rights with respect to any of the Assets.
3.12. Leases. Set forth on Exhibit 3.12 is a
list of each lease for real or personal property
involves payments by Seller aggregating in excess of
$1,000 annually. The property covered by the terms of
the leases is currently occupied or used by Seller as
lessee under the terms of said leases for the Business,
and, in particular, in the case of any leases for real
property, Seller is entitled, by the terms of said
leases, to use any leased premises for the purposes for
which and in the manner in which they are currently
being used by Seller, and such use complies in all
material respects with all applicable zoning and
building code ordinances and any other applicable
ordinances, laws or regulations, including those that
relate to the use, storage, and disposal of hazardous
materials. Except as set forth on attached Exhibit
3.12, all rentals due under the Leases have been paid
and there exists no default by Seller under any of the
Leases which would have a material adverse effect on
the operation of the Business which cannot be cured
without material penalty to Seller under the terms of
said Leases and no event has occurred which, with the
passage of time or the giving of notice, or both, would
result in any event of default thereunder by Seller or
prevent Seller, currently, or Buyer, after consummation
of the transactions contemplated hereunder, from
exercising or obtaining the benefits thereunder.
Except as noted on attached Exhibit 3.12, all of the
Leases are valid and in full force and effect.
3.13. Customer Contracts. Set forth on attached
Exhibit 3.13 is a list of all of the Customer Contracts
and of all customers who have generated any revenue for
Seller from and after January 1, 1992. Each of the
Customer Contracts is valid and subsisting, has not
been subsequently amended (except as set forth on
Exhibit 3.13) and is currently in full force and effect
according to the terms of such Customer Contract; and
Seller has not assigned any rights thereto, except for
liens listed on attached Exhibit 3.13. Except as set
forth on attached Exhibit 3.13, (i) there exists no
event of default under any Customer Contract by Seller
or, to the knowledge of Seller, by the other party
thereto, and (ii) no event of default by Seller has
occurred and is continuing which would prevent Buyer
from exercising or obtaining the benefits thereunder
(including any options contained therein), would cause
the acceleration of any obligation of Seller under any
of such contracts, or would cause the creation of a
lien or encumbrance upon any of the Assets which are
material to the Business.
3.14. Contracts and Commitments. Except as set
forth on attached Exhibit 3.13, Seller does not have
outstanding:
(a) Any single contract, including
consulting contracts providing for an expenditure
in excess of $1,000, or contracts in the aggregate
providing for expenditures in excess of $1,000 for
the purchase, leasing or licensing of any real
property, machinery, equipment, software or other
items which are in the nature of a capital
investment, or for consulting services.
(b) Any loan agreement, indenture,
promissory note, mortgage, conditional sales
agreement, guaranty, surety agreement, installment
debt agreement or other similar type agreement.
(c) Any contract for sale or purchase of
materials, products, or supplies which contains an
escalator, renegotiation or redetermination clause
or which establishes a commitment for sale or
purchase for a fixed term, except for those
contracts which (A) are cancelable by Seller on
thirty (30) days notice or less without penalty or
(B) involve payments by Seller of less than $5,000
per year.
(d) Any other material contract or
commitment (other than the Customer Contracts)
which is not cancelable on thirty (30) days notice
or less without penalty.
3.15. Use and Condition of Property. Except as
set forth on Exhibit 3.15, to the Knowledge of Seller,
all of the Fixed Assets are suitable for the uses for
which they are intended, in good operating condition
and repair, and free from any known defects except
normal wear and tear. Except as set forth in any
Exhibit attached hereto, to the Knowledge of Seller the
Business is in compliance with applicable laws, rules
or regulations relating to the Fixed Assets or any
improvements thereto.
3.16. No Breach of Statute, Decree, Order or
Contract. Seller is not in default under, or in
violation of the provisions of (a), any provisions of
its Articles of Incorporation or Bylaws or (b) any
provision of any franchise or license or of any
promissory note, indenture or any evidence of
indebtedness or security therefor, any lease, contract,
purchase or other commitment or any other agreement by
which it or any of its property is bound, which in any
such case as to matters described in (b) could
materially adversely affect the consummation of the
transactions contemplated in this Agreement, the
Business, the Assets or the Customer Contracts, nor is
Seller in violation of any applicable statute, law,
ordinance, decree, order, rule or regulation of any
governmental body which may reasonably be anticipated
to result in any material adverse effect on the
transactions contemplated by this Agreement, the
Business, the Assets or the Customer Contracts.
3.17. Approvals and Consents. Except as set
forth on attached Exhibit 3.17, no authorization,
consent, permit, license or approval of, or
declaration, registration or filing with, any person or
governmental, quasi-governmental or regulatory
authority or agency is necessary for the execution and
delivery by Seller or Huelsman of this Agreement and
the other agreements required to be executed in
connection with the transactions contemplated by this
Agreement.
3.18. Litigation. There is no suit, claim,
action or proceeding now pending before any court,
administrative or regulatory body, or any governmental
agency, or to Seller's Knowledge, any threatened claim
which may result in any judgment, order, decree,
liability or other determination which will, or could,
have a material adverse effect upon the Business, the
Assets or the Customer Contracts or the consummation of
the transactions contemplated hereby. Seller is not
subject to any such judgment, order, decree, liability
or other determination which has, or could reasonably
be expected to have such effect.
3.19. Discrimination, Occupational Safety and
other Statutes and Regulations. No person or party
(including, but not limited to, governmental agencies
of any kind) has any claim against Seller pending
before any court or administrative agency, and, to
Seller's Knowledge, no claim of such nature has been
threatened against Seller arising out of any statute,
ordinance or regulation relating to discrimination in
employment or employment practices or occupational
safety and health standards (including, but without
limiting the foregoing, the Fair Labor Standards Act,
Title VII of the Civil Rights Act of 1964, or the Age
Discrimination in Employment Act of 1967, all as
amended, where applicable).
3.20. Employees. Set forth on attached Exhibit
3.20 is a list of all employees of Seller as of the
date of this Agreement and their respective base rates
of pay during Seller's fiscal year ended December 31,
1994 (including all incentives, bonuses, commissions
and similar cash payments, all identified separately
from the employee's base rate of pay), and all
employees of Seller retained since January 1, 1995,
together with their respective rates of compensation
and the actual amounts, if any, paid to each such
employee through November 25, 1995.
3.21. Environmental Matters. Seller's ordinary
course business activities have no material
environmental impact. Seller has not violated, is not
violating and neither Seller nor Huelsman has received,
with respect to the Seller or the Business, a notice or
charge asserting any violation by Seller of the Federal
Solid Waste Disposal Act, the Federal Clean Air Act,
the Federal Clean Water Act, the Federal Resource
Conservation Recovery Act of 1976 ("RCRA"), the Federal
Comprehensive Environmental Responsibility Clean-Up and
Liability Act of 1980 ("CERCLA"), the Toxic Substance
Control Act of 1976 or any other federal, state, local
or foreign laws including rules and regulations
thereunder, regulating or otherwise affecting the
environment ("Environmental Laws") as the same may have
been amended prior to the date of this Agreement.
Except as set forth on Exhibit 3.21, no asbestos, PCBs,
urea formaldehyde or polychlorinated biphenyls are
present on the premises utilized by Seller in operation
of the Business (the "Leased Premises"). None of the
equipment or machinery of Seller employed in the
Business is required to be upgraded or modified to be
in compliance with Environmental Laws. During Seller's
use of the Leased Premises, neither Seller nor any
third party has disposed of any substance in any manner
on the Leased Premises and the improvements thereon in
violation of any Environmental Laws. With respect to
Seller and the Business, no environmental claims have
been asserted and none have been threatened or are
anticipated to be asserted against Seller, Huelsman,
the Assets or the
3.22. No Additional Liabilities. Other than the
obligations specifically assumed by ASI at Closing, ASI
is not assuming and will not be responsible or liable
for any liabilities (including but not limited to
warranty liability or product liability on any
products) relating to Seller or the Business being
transferred because of this Agreement, or the Assets.
3.23. Complete Business. Except for the Excluded
Assets, the Assets are all of the assets used by Seller
in connection with the Business being transferred
hereby and, with the exception of working capital, no
other assets are needed to continue to conduct the
Business as it is currently being conducted.
3.24. No Limitation of Representations or
Warranties. Any inspection or investigation by or on
behalf of Buyer shall not limit or affect any of the
representations or express or implied warranties of
Seller and Huelsman which are contained herein, except
that, notwithstanding any provision of this Agreement
to the contrary, in the event that Seller or Huelsman
can prove that Buyer had actual knowledge (which in
this context is intended to mean that Buyer had actual
knowledge of a fact or condition and that the
significance of such fact or condition was or should
have been apparent to a person not involved in the
business on a day-to-day basis), of a breach of any
covenant, representation or warranty of Seller or
Huelsman set forth in this Agreement or any agreement
or instrument executed pursuant hereto, then neither
Seller nor Huelsman shall be liable hereunder for any
loss to the extent that such loss results from or
arises out of any such breach.
3.25. Insurance. Attached Exhibit 3.25 contains
a true and correct list of all policies of insurance in
respect to the Business (including the amounts) in
which Seller is named as the insured party. Seller
will continue to maintain the present coverage afforded
by such policies in full force and effect up to and
including the Closing Date.
3.26. Licenses, Etc. Attached Exhibit 3.26
contains a true and correct list setting forth all
licenses, rights and authorities issued by the State of
Wisconsin and other states, the United States, and any
municipality, foreign or domestic governmental or quasi-
governmental agency or administrative body, and any and
all applications for same, which authorize Seller to
conduct the Business. Except as set forth in attached
Exhibit 3.26, such licenses, rights, and authorities to
Buyer. In addition, attached Exhibit 3.26 contains a
detailed summary of any and all claims and actions
asserted against Seller by notice in writing to Seller
within the past five (5) years by any of the above
referenced governmental bodies on account of any
alleged violation of any such license, right or
authority.
3.27. Ongoing Business. Seller shall (a) keep
the operations and business of the Business intact
until the Closing Date, (b) use reasonable efforts to
keep available to Buyer the services of the present
employees of the Business, and (c) preserve the
business relations of the subcontractors and customers
of Seller and the business relations of others with
whom Seller and Huelsman have business relations in
respect of the Business.
3.28. Access to Seller. Seller will, and will
cause its employees and agents (including bankers,
in-house and other accountants, attorneys and insurance
representatives) to, allow the officers, employees and
authorized representatives of Buyer free and full
access during normal business hours to the plants,
properties, books and records of Seller, including,
without limitation, the right to perform environmental
liability audits, contact customers, employees,
suppliers, bankers, accountants, attorneys, insurance
representatives, state and federal regulatory agencies
and others, and will from time to time promptly furnish
Buyer with such additional financial and operating data
and other information as to the business and properties
of Seller as may from time to time be requested by
Buyer. Huelsman hereby agrees to cause Seller to
fulfill its obligation under this Paragraph 3.28.
3.29. Labor Controversies. With respect to the
employees of the Business, Seller is in compliance in
all material respects with all federal, foreign, state
and local laws, rules and regulations relating to the
employment of labor, employment discrimination,
employee welfare and labor standards which are
applicable to it. No proceedings are pending before
any court, government agency or instrumentality or
arbitrator relating to labor matters, and to the
knowledge of Seller, there is no pending investigation
by any governmental agency or threatened claim by any
such agency or other person with respect to Seller
relating to labor or employment matters. Seller is not
a party to any agreement or contract with any union,
labor organization, employee group, or other entity or
individual which affects the employment of employees of
the Business, including but not limited to, any
collective bargaining agreements or labor contracts.
3.30. ERISA.
(a) Attached Exhibit 3.30 lists all profit
sharing, pension or retirement plans, programs,
arrangements or agreements, and each other
employee benefit plan, program or agreement
maintained or contributed to or required to be
contributed to for the benefit of any employee or
terminated employee of the Business, whether
formal or informal (the "Plan" or "Plans").
Seller does not have any formal plan or
commitment, whether legally binding or not, to
create any additional Plan or modify or change any
existing Plan that would affect any employee or
terminated employee of the Business.
(b) No Plans are covered by Title IV of
ERISA, nor has Seller ever maintained any Plan
covered by Title IV of ERISA with respect to
employees or former employees of the Business.
With respect to each Plan, the Seller and each
such Plan is, and at all times has been, in
compliance in all material respects with all
applicable laws including, without limitation, the
Code and ERISA. All contributions, premiums or
other payments required by the Plans have been
made on or before their due dates. There are no
pending or threatened claims under, by or on
behalf of any of the Plans, by any employee or
beneficiary covered by any such Plan, or otherwise
involving any such Plan (other than routine claims
for benefits), nor have there been any "prohibited
transactions" within the meaning of ERISA or the
Code. Each Plan that is intended to qualified
under Section 401(d) or Section 401(k) of the Code
has received a favorable determination letter from
the Internal Revenue Service to that effect, and
no fact or event has occurred from the date
thereof which would adversely affect the qualified
status of such Plans. The 401(k) Plan maintained
by Seller is not "top heavy" within the meaning of
Section 416(g) of the Code.
3.31. Vyas Consulting Services.
(a) The Service Agreement between Seller,
Interra Technologies (India) PVT. Ltd. ("Interra-
India") and Interra Technologies, Inc. ("Interra")
dated December 1, 1995 (the "Services Agreement")
is currently on a month to month basis and is in
full force and effect according to its terms.
(b) There exists no event of default
(including any payment default) by Seller under
the agreement in effect immediately prior to the
Services Agreement or under the Services Agreement
and to the knowledge of Seller, there exists no
event of default by Interra and Interra-India.
(c) To the knowledge of Seller, no dispute
exists between Seller, Interra and Interra-India
under the agreement in effect immediately prior to
the Services Agreement or under the Services
Agreement.
(d) No authorization, consent, permit,
license or approval of, or declaration,
registration or filing with, any person or
governmental, quasi-governmental or regulatory
authority or agency is required of Seller, or to
the knowledge of Seller, of Interra or Interra-
India, in connection with the execution, delivery
or performance of the Services Agreement by
Seller, Interra and Interra-India, respectively.
(e) No authorization, consent, permit,
license or approval of, or declaration,
registration or filing with, any person or
governmental, quasi-governmental or regulatory
authority or agency would be required of Buyer,
Interra or Interra-India in connection with any
assignment of the Services Agreement to Buyer and,
if so assigned, the performance of the Services
Agreement by Interra, Interra-India and Buyer.
4. Representations and Warranties of Buyer.
Buyer hereby makes the following representations and
warranties, each of which is true and correct as of the
date of this Agreement and as of the Closing Date and
shall survive the Closing Date and the transactions
contemplated hereby, to the extent set forth in
Paragraph 15.16.
4.1. Corporate Status. Buyer is a corporation
duly organized and validly existing under the laws of
the State of Colorado, and has the corporate power and
the authority to own and use its properties and to
transact the business in which it is engaged. Buyer
has the corporate power and authority to enter into and
consummate the transactions contemplated by this
Agreement.
4.2. Authorization of Agreement. The execution
and delivery of this Agreement does not, and the
compliance with and the fulfillment of, and the
consummation of the transactions contemplated by, this
Agreement will not violate or conflict with any
provisions of the Articles of Incorporation or Bylaws
of Buyer or result in a breach of, or constitute a
default under, or result in the acceleration of, any
obligation under any agreement or instrument to which
Buyer is a party or by which it is bound, or violate
any order, judgment, award or decree to which it is a
party or to which it is subject which could have a
material adverse effect on (i) Buyer or its assets or
(ii) the consummation of the transactions contemplated
hereby. The execution and delivery of this Agreement
and the consummation by Buyer of the transactions
contemplated herein have been approved by the Board of
Directors of Buyer, which constitutes all action
required by law, Buyer's Articles of Incorporation, its
Bylaws or otherwise to authorize and approve the
execution, delivery and performance of this Agreement
by Buyer and the consummation by it of the transactions
contemplated herein.
4.3. Litigation. There is no suit, claim, action
or proceeding now pending or, to the knowledge of
Buyer, threatened before any court, administrative or
regulatory body, or any governmental agency which may
result in any judgment, order, decree, liability or
other determination which will, or could, have a
material adverse effect of any kind upon (i) Buyer or
its assets or (ii) the consummation of the transactions
contemplated hereby. Buyer is not subject to any such
judgment, order, decree, liability or other
determination which has or reasonably could be expected
to have such effect.
4.4. Shares. The Subject Shares to be issued by
Seller to Buyer hereunder, have been duly and validly
authorized and, when issued as provided herein, will be
duly and validly issued and fully paid and non-
assessable, free and clear of all liens, claims, and
encumbrances except those in favor of Buyer as
specifically provided in this Agreement.
4.5. Capitalization. Buyer has delivered true
and complete copies of its Articles of Incorporation
and Bylaws to Seller. The Authorized capital stock of
Buyer consists of 100,000,000 shares of Common Stock
and 2,500,000 shares of preferred stock, no par value
("Preferred Stock"). As of the date of this Agreement,
(i) 2,832,349 shares of Common Stock are issued and
outstanding, (ii) no shares of Preferred Stock are
issued and outstanding, and (iii) 711,275 shares of
Common Stock are subject to issuance pursuant to stock
options, warrants or similar agreements. Except as set
forth in clause (iii) above, as of the date of this
Agreement, there are no options, warrants or other
rights of any character obligating Buyer to issue or
sell any shares of its capital stock. None of the
issued and outstanding shares of Common Stock were, and
none of the Subject Shares will be, issued in violation
of any preemptive rights.
4.6. SEC Documents.
(a) Buyer has filed all forms, reports and
documents required to be filed with the Securities
and Exchange Commission (the "SEC") since
September 30, 1994, and as of the date of this
Agreement has delivered to Seller in the form
filed with the SEC (i) its Annual Report on Form
10-KSB for the fiscal year ended September 30,
1994, (ii) its Quarterly Reports on Form 10-QSB
for the periods ended December 31, 1994, March 31,
1995 and June 30, 1995, (iii) the definitive Proxy
Statement for any meeting of shareholders of Buyer
held since September 30, 1994, (iv) all Current
Reports on Form 8-K filed since September 30,
1994, (v) all registration statements filed with
the SEC since September 30, 1994, and (vi) all
amendments and supplements filed with the SEC to
all such reports and registration statements
(collectively, the "Buyer SEC Reports").
(b) The Buyer SEC Reports, and all reports
filed by Buyer with the SEC after the date of this
Agreement and on or prior to the Closing, (i) were
or will be prepared in accordance with applicable
rules and regulations in all material respects,
and (ii) did not at the time they were filed,
contain any untrue statement of a material fact or
omit to state a material fact required to be
stated therein or necessary in order to make the
statements therein, in light of the circumstances
under which they were made, not misleading.
(c) Since the date of the last Buyer SEC
Report filed prior to the date of this Agreement,
there has not been any change in the financial
condition, results of operations, or business of
Buyer which has a material adverse effect on
Buyer.
4.7. Securities Act Compliance. The issuance of
the Subject Shares will comply with all applicable
federal and state securities laws.
4.8. NASDAQ. Seller will comply with any
applicable NASDAQ requirements regarding the Subject
Shares.
5. Opinions of Counsel.
5.1. Opinions of Counsel of Seller. Buyer shall
have received as of the Closing Date, an opinion from
Seller's counsel, Godfrey & Kahn, S.C., dated as of the
Closing in the form attached to this Agreement as
Exhibit 5.1.
5.2. Opinion of Counsel of Buyer. Seller shall
have received as of the Closing Date, opinions from
Buyer's counsel, Daniel P. Edwards, P.C., and from
Sherman & Howard L.L.C., dated as of the Closing Date,
in the form attached to this Agreement as Exhibits 5.2
and 5.2.1, respectively.
6. Indemnification.
6.1. Indemnification of Buyer.
(a) Seller and Huelsman jointly and
severally agree to indemnify Buyer and Buyer's
officers, directors, shareholders, agents and
employees and to hold them harmless from and
against any and all damages, losses, deficiencies,
actions, demands, judgments, costs and expenses
(including reasonable attorneys' and accountants'
fees) (collectively, "Losses") of or against Buyer
resulting from (i) any misrepresentation or breach
of warranty on the part of Seller or Huelsman in
this Agreement or in any document or agreement
executed and/or delivered by Seller or Huelsman in
connection herewith; (ii) any nonfulfillment of
any agreement or covenant contained herein or in
any certificate, documents, agreement or
instrument delivered hereunder on the part of
Seller or Huelsman; and/or (iii) any failure of
Seller or Huelsman to pay and/or perform any
liability or obligation of Seller, Huelsman or the
Business other than the Assumed Liabilities; and
(iv) any loss, liability, or expenses, including
reasonable attorneys' fees and costs, incurred by
Buyer in pursuing a claim against Intelligraphics,
Inc. of Texas for infringement of the name
"Intelligraphics"; provided for this purpose, the
parties acknowledge that Godfrey & Kahn, S.C. has
been retained to pursue such claim and will
continue to be the counsel which will pursue the
matter subsequent to the Closing.
(b) Notwithstanding anything in this
Agreement to the contrary, Seller and Huelsman
shall not be obligated to indemnify, defend or
hold harmless Buyer pursuant to Paragraph
6.1(a)(i) of this Agreement, in respect of any
breach of any representation or warranty made in
this Agreement or any document executed in
connection herewith unless, the aggregate Losses
for which Buyer is entitled to indemnification
under said Paragraph 6.1(a)(i) shall exceed twenty-
five thousand dollars ($25,000.00) (in which event
the entire loss will be payable), and in no event
shall Seller's and Huelsman's aggregate liability
to indemnify Buyer in respect of all Losses under
said Paragraph 6.1(a)(i) exceed $4,300,000.
Notwithstanding the foregoing, no Loss arising
from a breach of a representation and warranty in
Sections 3.8, 3.9 or the second sentence of
Section 3.10 will be subject to the $25,000
"basket" provided for above; that is, any such
Loss will be payable by Seller and Huelsman
without dilution or effect against the $25,000
"basket.".
(c) Seller and Huelsman may satisfy their
obligations under Paragraph 6.1(a) of this
Agreement by transferring Subject Shares to Buyer
except with respect to any claim by Buyer relating
to the failure to obtain Consents specified in
Section 1.3(b)(1) and (ii), which shall be paid in
cash to Buyer. Such shares shall be valued at
fifty percent (50%) of the Market Price of the
Common Stock as of the most recent business day
preceding the date of transfer. If applicable,
Seller and Buyer shall direct the Escrow Agent to
transfer to Buyer such number of Subject Shares as
Seller may designate in accordance with the
provisions of this Paragraph 6.1(c).
6.2. Indemnification of Seller and Huelsman.
(a) Buyer agrees to indemnify Seller and
Huelsman and to hold each of them harmless from
and against any and all Losses of or against
Seller or Huelsman resulting from (i) any
misrepresentation or breach of warranty or
representation on the part of Buyer in this
Agreement or in any document or agreement executed
and/or delivered by Buyer in connection herewith;
(ii) any nonfulfillment of any agreement or
covenant contained herein or in any certificate,
document or instrument delivered hereunder on the
part of Buyer; and/or (iii) any failure of Buyer
to pay and/or perform when due any of the Assumed
Liabilities.
(b) Notwithstanding anything in this
Agreement to the contrary, Buyer shall not be
obligated to indemnify, defend or hold harmless
Seller or Huelsman pursuant to Paragraph
6.2(a)(i), in respect of any breach of any
representation or warranty made in this Agreement
or any document executed in connection herewith
unless, and only to the extent, the aggregate
Losses for which Seller and Huelsman are entitled
to indemnification under said Paragraph 6.1(a)(i)
shall exceed twenty-five thousand dollars
($25,000.00) and in no event shall Buyer's
aggregate liability to indemnify Seller and
Huelsman in respect of all Losses under said
Paragraph 6.2(a)(i) exceed the purchase price set
forth in Section 1.2 above.
6.3. Procedure Relative to Indemnification.
(a) In the event that any party hereto shall
claim that it is entitled to be indemnified
pursuant to the terms of this Paragraph 6, it or
he (the "Claiming Party") shall so notify the
party or parties against which the claim is made
(the "Indemnifying Party") in writing of such
claim within forty-five (45) days after receipt of
a notice of such claim or notice of any claim of a
third party that may reasonably be expected to
result in a claim by such party against the party
to whom such notice is given. Such notice shall
specify the breach of representation, warranty or
agreement claimed by the Claiming Party and the
liability, loss, cost or expense incurred by, or
imposed upon, the Claiming Party on account of any
such liability, loss, cost or expense. Failure to
give such notice will not relieve Indemnifying
Party of its indemnification obligation, except to
the extent the defense of the Indemnifying Party
against such claim was prejudiced. If such
liability, loss, cost or expense is liquidated in
amount, the notice shall so state and such amount
shall be deemed the amount of the claim of the
Claiming Party. If the amount is not liquidated,
the notice shall so state and in such event a
claim shall be deemed asserted against the
Indemnifying Party on behalf of the Claiming
Party, but the amount of the claim of the Claiming
Party shall be deemed undetermined.
(b) If such claim shall involve a suit,
claim or demand of a third party, the Indemnifying
Party shall, upon receipt of such written notice
and at its expense, defend such claim in its own
name or, if necessary, in the name of the Claiming
Party; provided, however, that if the proceeding
involves a matter solely of concern to the
Claiming Party in addition to the claim for which
indemnification under this Paragraph 6 is being
sought, such matter of sole concern shall be
within the sole responsibility of the Claiming
Party and its counsel. The Claiming Party will
cooperate with and make available to the
Indemnifying Party such assistance and materials
as may be reasonably requested of it, and the
Claiming Party shall have the right, at its
expense, to participate in the defense. The
Indemnifying Party shall have the right to settle
and compromise such claim only with the consent of
the Claiming Party (which consent shall not be
unreasonably withheld; provided, that such consent
can be reasonably withheld if the party from which
such consent is requested is not fully released by
the settlement).
(c) In the event the Indemnifying Party
shall notify the Claiming Party that it disputes
any claim made by the Claiming Party and/or it
shall fail to undertake a defense against such
claim, then the Claiming Party shall have the
right to conduct a defense against such claim and
shall have the right to settle and compromise such
claim upon five (5) days notice to, but without
the consent of, the Indemnifying Party. Once the
amount of such claim is liquidated and the claim
is finally determined, the Claiming Party shall be
entitled to pursue each and every remedy available
to it at law or in equity to enforce the
indemnification provisions of this Paragraph 6
and, in the event it is determined, or the
Indemnifying Party agrees, that it is obligated to
indemnify the Claiming Party for such claim, the
Indemnifying Party agrees to pay all costs,
expenses and fees, including all reasonable
attorneys' fees which may be incurred by the
Claiming Party in its efforts to enforce
indemnification under this Paragraph 6, whether
the same shall be enforced by suit or otherwise.
7. Accounts Receivable. After the Closing Date,
all payments collected for those accounts which were
included within the Accounts Receivable on the Final
Balance Sheet shall, unless otherwise designated for
payment of a specific invoice by the account debtor,
first be applied against outstanding invoices in the
order of issuance (i.e., against the oldest invoices
first). Buyer agrees to use normal and customary
efforts in collecting the Accounts Receivable; provided
that nothing contained herein shall be construed as
requiring Buyer to file suit, employ the services of a
collection agency or commence any other official
proceeding in order to collect any delinquent accounts
included with the Accounts Receivable. Buyer will
provide Seller with written progress reports as
reasonably requested by Seller as to the status of the
collection of the Accounts Receivable. If at the end
of six (6) months from the Closing Date hereunder there
remain any Accounts Receivable which are uncollected
(over and above the amount of the reserves as reflected
on the Final Balance Sheet), Buyer shall give written
notice to Seller within fifteen (15) days of the
expiration of said six (6) month period stating such
fact and setting forth the amount of the Account
Receivable uncollected (the "Uncollected Receivables")
after deducting any applicable reserves, and by
delivering such notice Seller will be deemed to have
made a claim (an "Accounts Receivable Claim") for such
amount. Within fifteen (15) days of the delivery by
Buyer of any such notice to Seller, Seller shall pay
the amount of such Accounts Receivable Claim to Buyer,
in cash, or from the Subject Shares escrowed pursuant
to Section 1.8 above. Seller's obligation to pay any
Accounts Receivable Claim hereunder shall be subject to
any specific rights Seller may have hereunder or may
have in general at law to dispute the amount or
propriety of any such Accounts Receivable Claim. Upon
payment to Buyer by Seller of an Accounts Receivable
Claim, Buyer shall be deemed to have assigned to Seller
(or its designee) all such Uncollected Receivables. In
the event that Buyer should receive payment for any
such Uncollected Receivables, any amounts so received
by Buyer shall promptly be paid over to Seller (or its
designee).
7.1. Remedies Cumulative. Except as herein
expressly provided, the remedies provided herein shall
be cumulative and shall not preclude assertion by any
party hereto of any other rights or the seeking of any
other remedies against any other party hereto, provided
they are consistent with this Agreement.
8. Conditions Precedent to Buyer's Obligation to
Close. All obligations of Buyer to complete the
transaction contemplated under this Agreement are
subject to the satisfaction by Seller and Huelsman or
waiver by Buyer, prior to or at Closing, of each of the
following conditions, with respect to which Seller
agrees to use its good faith efforts to fulfill on or
before Closing:
8.1. Continued Validity of Representations and
Warranties. All representations and warranties made by
Seller and Huelsman contained in this Agreement shall
be true at and as of the Closing as though such
representations and warranties were made at and as of
such time, except for those waived as provided below.
8.2. Performance Conditions and Completion of
Agreements. Seller shall have performed and complied
with all agreements and conditions required by this
Agreement to be performed or complied with by it prior
to or at Closing.
8.3. Satisfaction with Financial Condition.
There shall have been no material adverse change in the
Assets or in the financial condition or prospects of
the Business since September 30, 1995.
8.4. Delivery of Documents. Prior to or at the
Closing, true and complete copies of all documents
listed on any Exhibit hereto shall have been delivered
to Buyer in a form acceptable to Buyer and Buyer's
counsel.
8.5. Employment Agreements. Buyer shall have
entered into employment agreements and non-competition
agreements with William Nantell, David Kroes and David
Coates in substantially the form attached hereto as
Exhibits 8.5-1, 8.5-2 and 8.5-3, respectively
(collectively, the "Executive Employment Agreements"),
and with the additional employees listed in Exhibit
8.5-4 attached hereto. Seller, Buyer and Huelsman
shall cooperate fully in arranging for such executive
employment agreements.
8.6. Other Agreements. Seller and Huelsman shall
have entered into a Voting Trust Agreement in the form
attached hereto as Exhibit 8.6-1; an Arbitration
Agreement in the form attached hereto as Exhibit 8.6-2,
an Investor Letter in the form attached hereto as
Exhibit 8.6-3, a Lock Up Agreement in the form attached
hereto as Exhibit 8.6-4, and any other agreements
reasonably required by counsel for Buyer, in addition
to that required under Paragraph 8.7 below, to
substantiate, to Buyer's satisfaction, the relationship
among Seller, INTERRA, and Manesh P. Vyas.
8.7. Consents Obtained. Except for those
Customer Contracts listed on Exhibit 8.7, all consents
to the consummation of the transaction contemplated in
this Agreement to the leases between Seller and
Business Enterprises and shall remain in full force and
effect at and as of the Closing (the "Required
Consents").
8.8. No Action. No suit, action, investigation,
inquiry or other legal or administrative proceeding by
any governmental authority or other person shall have
been instituted or threatened which seeks to enjoin,
restrain or prohibit, or which questions the validity
or legality of, the transactions contemplated hereby or
which otherwise seeks to affect or could affect the
transactions contemplated hereby or the Assets or
impose damages or penalties upon any party hereto if
such transactions are consummated.
8.9. Name Change. Intelligraphics shall have
taken all requisite action to change its corporate name
to a name which is not in any way similar to
Intelligraphics and shall have transferred to Buyer all
rights to any such names.
8.10. Termination Statements. Seller shall have
delivered UCC-3 termination statements in form and
substance acceptable for filing with the applicable
Wisconsin authorities, to terminate and release all
prior UCC filings with respect to the Assets, as of the
Closing Date.
9. Conditions Precedent to Seller's Obligation to
Close. The obligations of Seller and Huelsman to
consummate the transactions contemplated under this
Agreement are subject to the following conditions:
9.1. Continued Validity of Representations and
Warranties. All representations and warranties of
Buyer contained in this Agreement shall be true at and
as of the Closing as though such representations and
warranties were made at such time.
9.2. Performance Conditions and Completion of
Agreements. Buyer shall have performed and complied
with all agreements and conditions required by this
Agreement to be performed or complied with by it prior
to or at Closing.
9.3. Delivery of Documents; Purchase Price.
Prior to or at the Closing, true and complete copies of
all documents required to be delivered by Buyer to
Seller hereunder shall have been delivered to Seller in
a form acceptable to Seller and Seller's counsel, and
Buyer shall have delivered the Estimated Amount to
Seller by wire transfer and shall have transferred the
Subject Shares to the Escrow Agent and the Trustee as
provided in Paragraph 1.3.
9.4. No Action. No suit, action, investigation,
inquiry or other legal or administrative proceeding by
any governmental authority or other person shall have
been instituted or threatened which seeks to enjoin,
restrain or prohibit, or which questions the validity
or legality of, the transactions contemplated hereby or
which otherwise seeks to affect or could affect the
transactions contemplated hereby or the Assets or
impose damages or penalties upon any party hereto if
such transactions are consummated.
10. No Additional Liabilities. Other than any
obligations specifically assumed by ASI at Closing.
ASI is not assuming and will not be responsible or
liable for any liabilities relating to Intelligraphics
or Huelsman or the Business being transferred because
of this Agreement, or the Assets transferred pursuant
hereto, and Intelligraphics and Huelsman hereby agree
to indemnify and hold harmless ASI against any such
unassumed obligations or claims against ASI arising
from such obligations, under the terms of Paragraph
6.3.
11. Closing.
11.1. Closing. Subject to the satisfaction or
waiver of all conditions to the obligation of the
parties hereto to close as set forth herein, the
closing of the transaction provided for in this
Agreement ("Closing") shall take place at the offices
of Sherman & Howard L.L.C., in Denver, Colorado on
December 22, 1995 at 8:00 A.M. MST, or at such other
date, time and place as may be mutually agreed by the
Buyer and Seller, after all Required Consents have been
obtained as designated by Buyer by written notice given
to Seller and Huelsman five (5) days in advance of
Closing, unless Buyer and Seller agree otherwise. For
purposes hereof, the Closing shall be deemed to have
occurred effective 12:01 A.M., MST, on December 22,
1995.
11.2. Deliveries by Seller. Seller and Huelsman
agree to execute and deliver to Buyer or cause to be
delivered to Buyer, at the Closing, the following:
(a) A certificate executed by a duly
authorized officer of Seller and by Huelsman to
the effect that all warranties and representations
of Seller and Huelsman contained in this
Agreement, as supplemented pursuant to Paragraph
16.19, are true and correct in all material
respects at and as of the Closing and all
conditions precedent to the obligations of Buyer
to consummate the transaction contemplated herein
not waived by Buyer have been fulfilled by Seller
and Huelsman;
(b) An opinion of Godfrey & Kahn, S.C.,
legal counsel for Seller and Huelsman, as
described in Paragraph 5.1;
(c) To the extent available prior to
Closing, certificates of taxes due from each
jurisdiction in which Seller conducts business;
(d) A general warranty bill of sale and
other appropriate instruments of assignment and
conveyance, in form and substance satisfactory to
Buyer, dated as of the Closing Date, conveying to
Buyer good and marketable title to the Assets,
free and clear of all encumbrances, security
interests, liens, contracts of sale and matters of
record;
(e) General warranty assignments (and such
other documents as may be satisfactory to Buyer)
of the Customer Contracts and the other Assumed
Contracts and the Required Consents;
(f) Copies (dated as of the Closing Date) of
the resolutions of Seller's Board of Directors and
shareholders authorizing and approving this
Agreement and the consummation of each and every
transaction contemplated by this Agreement,
together with a certificate of incumbency,
certified by Seller's Secretary;
(g) New Employment Agreements or letters,
containing non-competition agreements and
confidentiality agreements, in form and content
satisfactory to Buyer, from those former employees
of Seller, as set forth on Exhibit 11.2(g),
including, but not limited to acknowledgment of
their termination of employment by Seller, their
subsequent employment by Buyer, and a release of
Buyer from any liabilities arising under their
employment with Seller;
(h) The Executive Employment Agreements duly
executed by William Nantell, David Kroes and David
Coates;
(i) Those additional agreements set forth in
Paragraph 8.6;
(j) The Escrow Agreement duly executed by
Seller and the Escrow Agent;
(k) The Required Consents as set forth in
Paragraph 8.7;
(l) The Confidentiality Agreements as set
forth in Paragraph 14.2;
(m) Evidence satisfactory to Buyer that
Intelligraphics has changed its corporate name and
evidence satisfactory to Buyer that Buyer shall
have all rights to any such names.
(n) UCC-3 termination statements, to
terminate all prior UCC filings in connection with
the Assets; and
(o) Such other documents or instruments as
Buyer or its counsel may reasonably request.
11.3. Buyer's Delivery. Subject to the
performance by Seller and Huelsman of their obligations
hereunder, at the Closing Buyer shall deliver to
Seller:
(a) A certificate executed by a duly
authorized officer of Buyer to the effect that all
warranties and representations of Buyer contained
in this Agreement are true and correct in all
material respects at and as of the date of Closing
and all conditions precedent to the obligations of
Seller to consummate the transaction contemplated
herein have been fulfilled by Buyer or waived by
Seller and Huelsman;
(b) Opinions of Daniel P. Edwards, P.C., and
Sherman & Howard L.L.C., legal counsel for Buyer,
as described in Paragraph 5.2;
(c) The Estimated Amount, by wire transfer,
and certificates for the Common Stock in the name
of the Voting Trustee (as defined below), and
subject to the Escrow Agreement;
(d) The Executive Employment Agreements,
duly executed by Buyer; and
(e) An assumption in form attached as
Exhibit 11.3(e), and to Buyer and its legal
counsel, under which Buyer shall assume all
executory obligations under the Assumed Contracts.
11.4. Escrow Agreement. At the Closing, Buyer,
Seller and the Escrow Agent shall enter into the Escrow
Agreement. Furthermore, Buyer shall at the Closing
execute and deliver to the Escrow Agent a certificate
for the Subject Shares to be held in escrow by the
Escrow Agent under the terms of the Escrow Agreement as
provided in Paragraph 1.3(b).
11.5. Voting Trust Agreement. Buyer, Seller,
Huelsman and those persons listed on Exhibit 11.5-1
(the "Additional Holders") shall enter into a Voting
Trust Agreement in the form attached hereto as Exhibit
8.6-1 and, together with the members of the board of
directors of Buyer who are voting trustees under the
Voting Trust Agreement, as Trustee ("Trustee"), a
Voting Trust (the "Voting Trust") for the Subject
Shares referred to in Paragraph 1.3(c). Furthermore,
Buyer shall execute and deliver to the Trustee a
certificate for the Subject Shares to be held by the
Trustee under the terms of the Voting Trust with
respect to the Subject Shares transferred to the Voting
Trust. As provided in the Voting Trust, appropriate
voting trust certificates shall be issued to the
beneficiaries of the Voting Trust. As a condition to
the delivery of the voting trust certificates, Seller
and Huelsman shall arrange for the execution of such
agreements by the Additional Holders. Buyer
acknowledges and agrees to permit the transfer of the
voting trust certificates as contemplated in the Voting
Trust.
12. Termination. The Agreement may be terminated
prior to Closing only as follows:
(a) by mutual written consent of all parties
hereto;
(b) by any party hereto if the Closing has
not occurred on or before December 31, 1995,
provided that the failure of the Closing to occur
is not due to any breach of this Agreement by the
terminating party;
(c) by Buyer in the event of a substantial
loss of or damage to the Assets or the Business
prior to Closing as the result of theft, fire,
flood, explosion or other casualty, act of God or
otherwise, whether or not covered by insurance, or
a material adverse change in the Business prior to
Closing; or
(d) by Buyer, in the event of a material
breach of any covenant, agreement, warranty, or
representation of Seller, or in the event of a
material change of any representation or warranty,
as set forth in Paragraph 15.19.
Any such termination under the foregoing
paragraphs shall not preclude the terminating party
from seeking any legal or equitable remedy which may be
available as a result of the breach of any warranty,
representation or covenant in this Agreement.
13. Brokers Indemnification; Fees and Expenses.
13.1. Brokers; Indemnification. Buyer represents
and warrants to Seller and Huelsman and Seller and
Huelsman, jointly and severally, represent and warrant
to Buyer, that neither of them has employed any broker
or finder in connection with the transactions
contemplated by this Agreement, except as expressly set
forth below. Seller and Huelsman hereby agree that
they will indemnify and save Buyer harmless, and Buyer
hereby agrees it will indemnify and save Seller and
Huelsman harmless, from any claim for a commission,
finder's fee or other obligation as a result of anyone
claiming a commission as a broker or finder for the
transactions contemplated by this Agreement, based on
the respective acts of the other.
13.2. Fees and Expenses. Seller and Buyer agree
that they will each bear their own costs and expenses,
including, without limitation, fees and expenses of
counsel, financial advisors, accountants and other
experts in connection with the discussions, due
diligence investigations, negotiations, documentation
concerning this proposed transaction, the preparation
of this Agreement and related documentation and the
consummation of the transaction contemplated herein.
Seller and Huelsman have engaged Resource Financial
Corporation to act in investment banking and financial
advisory capacities with respect to this transaction.
Buyer, on its part, has retained Hanifen, Imhoff Inc.
to render certain financial advisory services in
connection with the proposed transaction. It is agreed
that neither party will be responsible for the fees,
commissions, or expenses payable to either investment
banking firm by the other by reason of this proposed
transaction, and each agrees to indemnify the other
against any such fees, commissions and expenses due and
payable to their respective investment banking firms by
reason of consummation of the transactions contemplated
in this Agreement.
14. Seller's Employees and Benefit Plans.
14.1. On the Closing Date, Seller will terminate
the employment of all of the employees of Seller.
Buyer presently intends, after the Closing Date, to
hire substantially all of the employees employed by
Seller in the Business prior to the Closing Date, but
it is totally within the discretion of Buyer to decide
which (if any) of Seller's current employees will be
offered continued employment and upon what terms and
conditions.
14.2. It is understood by the parties that Buyer
does not guarantee that it will carry over or establish
retirement, savings, health insurance, life insurance,
fringe benefit or other plans or personnel policies or
practices similar or identical to those maintained for
Seller's employees prior to the Closing Date.
15. General Matters.
15.1. Access to Books and Records and Employee
Services. For a period of five (5) years after the
Closing Date, Seller, Huelsman and Buyer agree that
prior to the destruction of disposition of any books or
records of or to the Business in its possession or
control, such party shall provide not less than ninety
(90) days prior written notice to the other party of
any such proposed destruction or disposal. If such
other party desires to obtain any of such documents, it
may do so by notifying such party in writing at any
time prior to the scheduled date for such destruction
or disposal. Such notice must specify the documents
which such party wishes to obtain. The parties shall
then promptly arrange for the delivery of such
documents. All out-of-pocket costs associated with the
delivery of the requested documents shall be paid by
the receiving party. In addition, the parties agree
that for a period of six months after the Closing,
Buyer will provide Seller with reasonable access to the
services of David Kroes for the purposes of preparing
tax returns, tax reports and other reports, provided
that such access shall not interfere with Buyer's
business and shall be provided at mutually agreeable
times.
15.2. Best Efforts. The parties covenant,
promise and agree that they will use their best efforts
to consummate the transactions contemplated by this
Agreement, including, without limitation, removing all
conditions precedent to the other party's obligations
at the Closing, and obtaining any and all approvals and
consents, and executing and delivering all documents,
certificates, schedules, exhibits, consents and other
instruments necessary to effect the transfer of the
Assets from Seller to Buyer.
15.3. Binding Effect and Assignment. This
Agreement shall inure to the benefit of and be binding
upon the parties hereto, their successors and
assignees. Neither party shall, without the written
consent of the other party, assign or transfer any of
the rights, benefits, obligations, or other interest
under this Agreement to any other party, which consent
shall not unreasonably be withheld; provided that Buyer
may, at its sole election, assign to a wholly owned
subsidiary its rights to purchase the Assets hereunder,
but in that event Buyer shall not be relieved of its
obligations to perform hereunder.
15.4. Confidentiality. The parties hereto agree
to maintain the confidentiality of the transactions
contemplated hereby and the information contained
herein and in the Exhibits and Schedules attached
hereto and that no disclosure related thereto will be
made other than in order to comply with applicable laws
or other than to such officer, employees and
professional advisors of the parties to the extent
necessary in order for such persons to carry out their
duties with respect to consummation of the transaction
contemplated hereby. All parties acknowledge Buyer, as
a publicly owned company, listed on NASDAQ, and
reporting to the SEC, must comply with applicable SEC
disclosure rules.
15.5. Construction and Representation by Counsel.
The parties hereto represent that in the negotiation
and drafting of this Agreement they have been
represented by and relied upon the advice of counsel of
their choice. The parties affirm that their counsel
had a substantial role in the drafting and negotiation
of this Agreement and, therefore, the rule of
construction to the effect that any ambiguities are to
be resolved against the drafting party shall not be
employed in the interpretation of this Agreement or any
Exhibit or Schedule attached hereto.
15.6. Counterparts. This Agreement may be
executed in two or more counterparts, each of which
shall be deemed an original, but all of which together
shall constitute one and the same instrument.
15.7. Enforcement of Agreement. In the event of
any lawsuit to enforce the provisions of this
Agreement, the prevailing party shall be entitled to an
award of reasonable attorneys' fees.
15.8. Entire Agreement. This Agreement (and the
other agreements required hereby to be executed and
delivered) embodies the entire agreement of the parties
hereto relating to the subject matter of this Agreement
expressly replacing the non-binding term sheet dated
September 15, 1995, between the parties, except the
Confidentiality Agreement between Seller and Buyer,
which shall terminate if, as and when the Closing
occurs. No amendment or modification of this Agreement
shall be valid or binding upon Buyer unless made in
writing and signed by a duly authorized officer of
Buyer, or upon Seller unless made in writing and signed
by a duly authorized officer of Seller, or upon
Huelsman unless made in writing and signed by Huelsman.
15.9. Further Assurances. From time to time, at
the request of Seller or Huelsman or Buyer and without
further consideration, Seller or Buyer, as appropriate,
will execute and deliver to the other such documents
and take such other action as the other may reasonably
request in order to consummate more effectively the
transactions contemplated hereby. Without limiting the
foregoing, Seller and Huelsman agree, at any time and
from time to time after the Closing, upon request by
Buyer, to do, execute, acknowledge, and deliver, or to
cause to be done, executed, acknowledged, and
delivered, all such further acts, deeds, assignments,
transfers, conveyances, powers of attorney and
assurances as may be reasonably required for the better
assigning, granting, transferring, conveying, assuring
and confirming to Buyer, or to its successors and
assigns, or for aiding and assisting in collecting and
reducing to possession, any or all of the Assets to be
sold to Buyer pursuant to this Agreement.
15.10. Governing Law. This Agreement shall be
construed, interpreted and enforced, both as to
substance and remedies, in accordance with the internal
laws of Colorado.
15.11. Notices. All notices, consents, approvals
or other notifications required to be sent by one party
to the other party hereunder shall be in writing and
shall be deemed given to and received by the other
party in all respects when delivered by hand or sent by
reputable overnight delivery service or when
transmitted via facsimile and actually received by the
receiving equipment or two (2) days after the date sent
by United States registered or certified mail, postage
prepaid, with return receipt requested, in each case
addressed to such other party at the address set below,
or the last address of such party as shall have been
communicated to the other party. If a party changes
its address, such party shall give written notice
promptly to the other parties of the new address.
15.12. Notification. Upon the occurrence of any
event, whether by omission, commission or acquiescence,
which causes any of the representations and warranties
contained herein to no longer be true, or which will
prevent any party from performing its covenants or
satisfying the conditions contained herein, the party
whose representation and warranty is no longer true
will give prompt notification in writing to the other
party describing the relevant circumstances in detail.
15.13. Risk of Loss. All risk of loss relating
to the Assets shall remain upon Seller and Huelsman
through the delivery of the Assets to Buyer at Closing,
in accordance with the terms of this Agreement, at and
after which time Buyer shall bear such risk.
15.14. Paragraph Headings. The parties agree
that the section and article headings are inserted only
for ease of reference, shall not be construed as part
of this Agreement, and shall have no effect upon the
construction or interpretation of any part of this
Agreement.
15.15. Severability. A determination that any
portion of this Agreement is unenforceable or invalid
shall not affect the enforceability or validity of any
of the remaining portions of the Agreement or of this
Agreement as a whole. In the event that any part of
any of the covenants, sections or provisions herein may
be determined by a court of law to be overly broad
thereby making such covenants, sections or provision
invalid or unenforceable, the parties hereto agree, and
it is their desire that, such court shall substitute a
reasonable and judicially enforceable limitation in
place of the invalid and unenforceable part of such
covenants, section or provisions, and that, as so
modified, the covenants, sections or provisions shall
be as fully enforceable as if set forth herein by the
parties themselves in the modified form. If, however,
any court of law shall delete any covenants, sections
or provisions of this Agreement and shall refuse to
substitute any reasonable and judicially enforceable
provisions in their place, the parties shall attempt to
reach agreement with respect to a valid and enforceable
substitute for the deleted provisions, which shall be
as close in its intent and effect as possible to the
deleted portion.
15.16. Survival of Representations and
Warranties. The representations and warranties
contained herein or in any schedule or other
certificate or letter (including letters referred to
herein) delivered by, or on behalf of, any of the
parties pursuant to this Agreement and the transactions
contemplated hereby shall be deemed representations and
warranties by the party by whom, or on whose behalf,
the same is delivered, and all representations and
warranties made by the parties in this Agreement, or
delivered pursuant hereto, are incorporated in and
constitute a part of this Agreement and shall survive
the Closing Date as follows:
(a) The warranties and representations of
Buyer in Paragraphs 4.4 and 4.5 of this Agreement
and of Seller and Huelsman in Paragraph 3.9 will
survive forever.
(b) All warranties and representations of
Seller and Huelsman in Paragraphs 3.8, 3.21 and
3.30 will survive for the applicable statute of
limitation, plus thirty (30)days.
(c) All other warranties and representations
of the parties herein or in any agreement or
instrument executed in connection herewith shall
terminate on December 31, 1997.
(d) Notwithstanding the limitations
described in subsections (b) and (c) above, if a
Claiming Party has a reasonable basis for the
belief that a claim for indemnification exists or
will arise and notice regarding such claim is
received in writing by the Indemnifying Party
describing in reasonable detail the facts or
circumstances with respect to the subject matter
of such claim on or before the date on which the
representation, warranty, covenant or agreement on
which such claim or action is or will be based
ceases to survive as set forth in this Section
15.16, such claim will survive irrespective of
whether the subject matter of such claim or action
shall have occurred before, on or after such date.
15.17. Taxes. The parties hereto agree that any
federal, state or local sales or other similar transfer
taxes, levies or assessments (including interest and
penalties relating thereto) resulting from the
consummation of the transactions contemplated hereby
shall be the liability or responsibility of Seller.
15.18. Waiver. The failure of any party to
exercise any of its rights hereunder or to enforce any
of the terms or condition of this Agreement on any
occasion shall not constitute or be deemed a waiver of
that party's rights thereafter to exercise any rights
hereunder or to enforce each and every term and
condition of this Agreement.
15.19. Supplementary Disclosures; Waiver. The
parties acknowledge and agree that all exhibits or
schedules delivered to Buyer by Seller or Huelsman or
warranties or representations made by Seller or
Huelsman herein on or prior to the date of this
Agreement may be amended or supplemented in writing by
Seller or Huelsman, but not later than five (5)
business days prior to the Closing Date; provided, that
if such amendment or supplementation constitutes a
material change, in Buyer's opinion, Buyer may
terminate the Agreement, and will be reimbursed by
Seller upon demand for Buyer's expenses and reasonable
attorneys fees incurred to the date of termination in
connection with this transaction. Buyer shall be
deemed to have accepted such amended or supplemented
exhibit, schedule, warranty or representation unless
Buyer notifies Seller prior to the Closing Date of its
objection to such amendment or supplement. Unless
Buyer so notifies Seller, Buyer shall be deemed to have
waived (i) its rights under Paragraph 12.1 to terminate
this Agreement, and (ii) any claim against Seller or
Huelsman based on any exhibit, schedule, warranty or
representation as it existed prior to being amended or
supplemented in accordance with the provisions of this
Paragraph 15.19.
16. Dispute Resolution. All disputes arising out
of or related to this Agreement, including any claims
that all or any part of this Agreement is invalid,
illegal, voidable, or void, will be settled by
arbitration, pursuant to an Arbitration Agreement
between Buyer, Seller, the Shareholders, the members of
the board of directors of the Company who are voting
trustees under the Voting Trust Agreement and Bank One,
Colorado, NA dated December 22, 1995.
IN WITNESS WHEREOF, the parties hereto, by and
through their duly authorized representatives have
executed this Agreement, as of the day and year first
above written.
Address for notice: INTELLIGRAPHICS, INC.,
741 N. Grand Avenue
Waukesha, WI 53186
Fax: (414) 544-4201 By:/s/ A. William Huelsman
Attn.: A William Huelsman --------------------------
A. William Huelsman, Chairman
and Chief Executive Officer
Address for notice: A. WILLIAM HUELSMAN
235 W. Broadway
Suite 40
Waukesha, WI 53186 /s/ A. William Huelsman
Fax: (414) 521-2490 -----------------------
Address for notice: ANALYTICAL SURVEYS, INC.,
1935 Jamboree Drive
Suite 100
Colorado Springs, CO 80920 By: /s/ Sidney V. Corder
Fax: (719) 528-5093 ---------------------
Attn: Scott Benger Sidney V. Corder, President
and Chief Executice Officer
LOCK-UP AGREEMENT
This Lock-Up Agreement ("Agreement") is made as of
December 22, 1995, by and among A. William Huelsman,
Gary Miller, William Nantell, David Coates, David
Kroes, Randy Vanek and Hamid Akhavan (each a
"Shareholder" and collectively, the "Shareholders"),
and Analytical Surveys, Inc., a Colorado corporation
(the "Company"). Any transferee of a Shareholder that
is a "family member" (as defined below) of such
Shareholder, will for all purposes of this Agreement be
deemed a Shareholder.
Recitals
A. The Company, Intelligraphics, Inc.
("Intelligraphics") and A. William Huelsman
("Huelsman") have entered into an Asset Purchase
Agreement dated as of December 22, 1995 (the "Purchase
Agreement") pursuant to which the Company will purchase
substantially all of the assets of Intelligraphics in
exchange for approximately $3,450,000 in cash, as
adjusted, and 230,000 restricted shares of Company
common stock (the "Shares"). Certain of the Shares
will be distributed to Huelsman in partial satisfaction
of certain loans Huelsman has made to Intelligraphics.
The remainder of the Shares will be distributed to key
management personnel of Intelligraphics in
consideration for their services to Intelligraphics.
Pursuant to an Escrow Agreement dated December 22, 1995
between the Company, Intelligraphics, Huelsman and Bank
One, Colorado, NA, the Company will transfer $250,000
and 70,000 Shares directly into escrow.
B. The Shareholders own the Shares as follows:
Shareholder Number of Shares
A. William Huelsman 179,200 shares
Gary Miller 6,769 shares
William Nantell 13,537 shares
David Coates 10,187 shares
Randy Vanek 6,769 shares
David Kroes 6,769 shares
Hamid Akhavan 6,769 shares
C. The Shares are subject to a Voting Trust
Agreement dated December 22, 1995, between the
Shareholders, the Company and certain individuals who
are members of the board of directors of the Company,
as trustee (the "Voting Trust Agreement") which governs
the voting rights of the Shares, including without
limitation, the provisions of Section 18 of the Voting
Trust Agreement which requires the delivery of the
Shares or proceeds from the sale of Shares by Huelsman
in certain circumstances to Bank One, Milwaukee, N.A.
D. The Shareholders and the Company have entered
into a Registration Rights Agreement dated December 22,
1995 (the "Registration Rights Agreement" pursuant to
which the Shareholders have been granted "piggy-back"
registration rights.
E. The parties desire to limit the transfer of
the Shares in the manner set forth in this Agreement.
Agreement
In consideration of the mutual promises contained
in this Agreement, and other good and valuable
consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:
1. General Restriction on Transfer. From the
date of this Agreement to, and including, December 22,
1999 (the "Term"), except as expressly provided in this
Agreement, no Shareholder may transfer any of the
Shares or any interest in the Shares. For purposes of
this Agreement, "transfer" includes any sale, gift,
pledge, or other disposition, by voluntary act of a
Shareholder or by operation of law, as a result of
which any person acquires or obtains a right to acquire
any interest in or rights in respect of the Shares.
2. Transfers to Family Members.
a. During the Term, any Shareholder may
transfer any or all of his Shares to a "family
member." For purposes of this Agreement, "family
member" means such Shareholder's spouse, ancestor,
descendant (whether by blood or adoption), spouse
of any such descendant, or any trust for the sole
benefit of any one or more of such individuals.
b. Any family member may transfer any or all
of his or her Shares to another family member of
the Shareholder who owned such Shares as of the
date of this Agreement.
c. A transfer to a family member is not
effective until such family member executes a
document in the form of Exhibit A to this
Agreement by which such family member agrees to be
bound by the terms of this Agreement and the
Voting Trust Agreement.
3. Shareholder Piggyback Registration Rights.
During the period beginning the date of this Agreement
and ending December 22, 1997, each Shareholder may
transfer his Shares pursuant to the terms of the
Registration Rights Agreement.
4. Transfers in Connection with Shareholder
Approved Transactions. During the Term, a Shareholder
may transfer any or all of his Shares in connection
with a transaction approved by a vote of the
shareholders of the Company, or if a majority of
shareholders of the Company tender their shares to the
Company in connection with a tender offer accepted by
the Company, the Shareholders may tender their Shares
to the Company in connection with such tender offer.
5. Offers to Sell.
a. From the period beginning December 22,
1997, through the remainder of the Term (the
"Permitted Sales Period"), a Shareholder may
transfer Shares under the provisions of this
Section 5.
b. If a Shareholder desires to sell Shares
during the Permitted Sales Period, the Shareholder
will first offer such Shares to the Company. The
offer will be in writing and will specify the
number, class (if applicable) and price of the
Shares being offered. The purchase price per
share will be the average of the closing bid and
asked prices for one share of common stock of the
Company, as reported on the National Market System
of NASDAQ for the twenty business days preceding
the date the offer to sell is made (the "Notice
Date"). If, on the Notice Date, the Shares are
not traded on NASDAQ, the board of directors of
the Company will determine a substantially
equivalent method for determining the purchase
price for the Shares. The Shareholder or
Shareholders who make the offer (whether one or
more, the "Offering Shareholder") will send the
offer to the Company, and the Company will have a
period of ten business days after the receipt of
the offer from the Offering Shareholder to accept
the offer by giving notice of acceptance to the
Offering Shareholder (the "Acceptance Period").
Each acceptance will indicate the number of Shares
as to which the offer is accepted (which may be
less than or equal to the number of Shares that
the Offering Shareholder initially proposes to
sell). If the Company does not accept the offer
in a timely manner, the Company will be deemed to
have rejected the offer. If the Company accepts
the offer as to less than all of the Shares that
the Company had the right to purchase, the Company
will be deemed to have rejected the offer with
respect to the balance of such Shares.
c. If the Offering Shareholder's offer is
accepted with respect to any or all of the offered
Shares, the closing of the sale will occur at the
principal offices of the Company, at a time and
date specified by the Company, but, in any event,
such closing will occur within sixty days after
the end of the Acceptance Period. At the closing,
the Offering Shareholder will deliver certificates
representing the Shares to be sold, free of any
lien, claim, encumbrance or restriction, other
than restrictions imposed by this Agreement or the
Voting Trust Agreement, against payment of the
purchase price by the Company by cashier's check
or other means acceptable to the Offering
Shareholder.
d. If any of the offered Shares are not
purchased by the Company as provided above, the
Offering Shareholder will be free to sell any or
all of the remaining offered Shares to a third
party for a period of sixty days, after which
period the procedures of this Section 5 must be
reinitiated for any sale of Shares by such
Offering Shareholder.
e. The provisions of this Section 5 will not
apply to the extent that sales of Shares by a
Shareholder (aggregated with all sales of Shares
made by all family members of such Shareholder and
the Shareholder) are less than 5,000 Shares in any
ninety day period. If the foregoing restriction
applies, the restriction will apply to the first
attempted sale of Shares in excess of 5,000
Shares.
6. Sale Volume Limitations. During the Permitted
Sales Period, except for sales by a Shareholder to a
family member of such Shareholder or a sale by a
Shareholder pursuant to the Registration Rights
Agreement, but including any sales of Shares to the
Company under Section 5, the number of Shares sold by a
Shareholder in any ninety day period may not exceed the
greater of the following:
a. one percent of the shares of common stock
of the Company outstanding as shown by the most
recent report or statement published by the
Company; or
b. the average weekly reported volume of
trading of common stock of the Company on all
national securities exchanges and/or reported
through the automated quotation system of a
registered securities association during the four
calendar weeks preceding the Notice Date; or
c. the average weekly reported volume of
trading of common stock of the Company reported
through the consolidated transaction reporting
system, contemplated by Rule 11Aa3-1 under the
Securities Exchange Act of 1934, as amended,
during the four calendar weeks preceding the
Notice Date.
All sales within the applicable period by all family
members of a Shareholder will be included in the
calculation of Shares sold by such Shareholder.
7. Endorsement on Stock Certificates. All stock
certificates representing Shares will bear the
following legend:
"The stock represented by this
certificate is transferable only in
compliance with a Lock-Up Agreement dated
December 22, 1995, which is on file with the
Company. Any transferee of the stock
represented by this certificate must, as a
condition to the effectiveness of the
transfer, comply with that Agreement as to
such transfer and agree to be bound by that
Agreement thereafter."
8. Sale of Assets, Redemption or Liquidation.
Nothing contained in this Agreement will limit the
Company's ability, in accordance with applicable law,
to sell or otherwise dispose of all or substantially
all of its assets, to redeem all or any part of the
stock held by any Shareholder, or to liquidate, either
partially or completely.
9. Notices. Any notice to the Shareholders or
the Company required under this Agreement will be
deemed to have been given to the respective party if
delivered personally, or upon receipt of such notice
mailed first class, postage prepaid, registered or
certified mail, return receipt requested, to the
Shareholders and to the Company as set forth below:
To the Shareholders: A. William Huelsman
235 West Broadway, Suite 40
Waukesha, WI 53186
Gary Miller
4865 Cedar Circle
Dousman, WI 53186
William Nantell
523 W23124 Broadway
Waukesha, WI 53186
David Coates
W316 55740 Lakecrest Drive
Mukwonago, WI 53149
Randy Vanek
560 Bolson Drive, #D
Oconomowoc, WI 53066
David Kroes
4182 Raymir Circle
Wauwatosa, WI 53222
Hamid Akhavan
2040 Gallway Road
Hartford, WI 53027
To the Company: Analytical Surveys, Inc.
1935 Jamboree Drive
Colorado Springs, Colorado 80921
Attn: Scott Benger
with a copy to: Daniel P. Edwards, P.C.
Suite 310
128 South Tejon
Colorado Springs, Colorado 80903
or to such other address as each party may designate by
notice in writing to the other parties as provided
above.
10. Dispute Resolution. All disputes arising out
of or related to this Agreement, including any claims
that all or any part of this Agreement is invalid,
illegal, voidable, or void, will be settled by
arbitration, pursuant to an Arbitration Agreement
between the Company, Intelligraphics, the Shareholders,
Joanne Huelsman, James Carpenter, the members of the
board of directors of the Company who are voting
trustees under the Voting Trust Agreement and Bank One,
Colorado, NA dated December 22, 1995.
11. General Provisions.
(a) Entire Agreement. This Agreement
constitutes the entire agreement among the parties
with respect to the subject matter of this
Agreement and supersedes all other prior
agreements and understandings, both written and
oral, between the parties with respect to the
subject matter of this Agreement.
(b) Benefit. This Agreement will be binding
upon and inure to the benefit of the parties,
their personal representatives, successors and
assigns.
(c) Amendment. This Agreement may be
amended at any time and from time to time by a
written instrument signed by all of the parties to
this Agreement.
(d) Governing Law. The laws of the State of
Colorado will govern this Agreement and the
construction of any of its terms.
(e) Original. This Agreement will be signed
in one original, which will be deposited with the
Company at its registered office.
(f) Photocopies. A photocopy of this
Agreement will be delivered to the Company and to
each Shareholder.
(g) Transfer to Bank One, Milwaukee, N.A.
The parties to this Agreement acknowledge and
agree that Huelsman may transfer his Shares or any
interest in the Shares to Bank One, Milwaukee,
N.A. (the "Bank") and hereby consent to such
transfer upon the Bank's execution of an agreement
satisfactory to the parties to this Agreement
pursuant to which the Bank agrees to be bound by
the terms of this Agreement.
SHAREHOLDERS
/s/ A. Willliam Huelsman
------------------------
A. William Huelsman
/s/ Gary Miller
------------------------
Gary Miller
/s/ Willliam Nantell
------------------------
William Nantell
/s/ Randy Vanek
------------------------
Randy Vanek
/s/ David Coates
------------------------
David Coates
/s/ David Kroes
------------------------
David Kroes
/s/ Hamid Akhavan
------------------------
Hamid Akhavan
COMPANY
ANALYTICAL SURVEYS, INC.
By: /s/ S.V. Corder
Title: President and Chief Executive
Officer
EXHIBIT A
Document To Be Signed By Transferee
The undersigned, being a transferee of shares of
the common stock of Analytical Surveys, Inc. (the
"Company"), hereby agrees to be bound by all of the
terms of a Lock-Up Agreement (the "Agreement") dated
December 22, 1995, between the Company and the
Shareholders (as defined in the Agreement) and a Voting
Trust Agreement dated December 22, 1995, between the
Company, the Shareholders and certain individuals who
are members of the board of directors of the Company,
as trustee (the "Voting Trust Agreement"). The
undersigned acknowledges that he or she will for all
purposes be deemed a "Shareholder" (as defined in the
Agreement) and that the Agreement and the Voting Trust
Agreement will apply to all Shares of the Company now
owned or hereafter acquired by the undersigned. The
undersigned's address and FAX number for purposes of
Section 9 of the Agreement are set forth below:
-------------------------
(Type or Print Name)
-------------------------
(Street Address)
--------------------------
(City, State and Zip Code)
--------------------------
(Facsimile Number)
-------------------------
(Signature)
-------------------------
(Date)
VOTING TRUST AGREEMENT
This Voting Trust Agreement ("Agreement") is
entered into as of December 22, 1995, between
Analytical Surveys, Inc., a Colorado corporation (the
"Company"), A. William Huelsman, Gary Miller, William
Nantell, David Coates, David Kroes, Randy Vanek and
Hamid Akhavan (each a "Shareholder" and collectively
the "Shareholders") and John A. Thorpe, Sidney V.
Corder, William H. Hudson, Richard P. MacLeod, James T.
Rothe, Robert H. Keeley and Willem H. J. Andersen (each
an "Individual Trustee" and collectively, the
"Trustee").
Recitals
A. The Company, Intelligraphics, Inc.
(Intelligraphics") and A. William Huelsman ("Huelsman")
have entered into an Asset Purchase Agreement dated as
of December 22, 1995 (the "Purchase Agreement")
pursuant to which the Company will purchase
substantially all of the assets of Intelligraphics in
exchange for $3,450,000 in cash, as adjusted, and
230,000 restricted shares of Company common stock (the
"Shares"). Certain of the Shares will be distributed
to Huelsman in partial satisfaction of certain loans
Huelsman has made to Intelligraphics, and the remainder
of the Shares will be distributed to key management
personnel of Intelligraphics in consideration for their
services to the Intelligraphics, as set forth on
Exhibit A. Pursuant to an Escrow Agreement dated
December 22, 1995 between the Company, Intelligraphics,
Huelsman and Bank One, Colorado, NA, the Company will
transfer $250,000 and 70,000 Shares directly into
escrow.
B. The Company, Shareholders and the Trustee
desire to set forth in writing the terms and conditions
under which the Trustee will hold and dispose of the
Shares.
Agreement
For good and valuable consideration, the parties
agree as follows:
1. Creation of Voting Trust. The Trustee is
hereby appointed as trustee under the voting trust
created by this Agreement (the "Trust"). During the
term of this Agreement, the Trustee will act as voting
trustee in respect of the Shares with all the powers,
rights and privileges and subject to all the terms set
forth in this Agreement.
2. Acceptance of Trust. The Trustee accepts the
Trust created by this Agreement in accordance with all
of the terms contained in this Agreement.
3. Composition of the Trustee. The parties to
this Agreement agree that: (a) if, after the date of
this Agreement, an Individual Trustee ceases to be a
member of the board of directors of the Company (the
"Board"), such person will no longer be an Individual
Trustee, effective the date that such person ceases to
be a member of the Board, and (b) if, after the date of
this Agreement, a person becomes a member of the Board,
such person will become an Individual Trustee effective
upon the execution of a document in the form of Exhibit
B to this Agreement, by which such person agrees to be
an Individual Trustee and to be bound by the terms of
this Agreement.
4. Transfer of Stock. Simultaneously with the
signing of this Agreement, the Shareholders have
assigned the Shares to the Trustee and have deposited
with the Trustee the stock certificates for such
Shares, duly endorsed in blank or accompanied by a
proper instrument of assignment duly executed in blank.
5. Voting Trust Certificates. Simultaneously
with the transfer of the Shares to the Trustee, the
Trustee will deliver to each Shareholder a voting trust
certificate ("Certificate") for the number of Shares
transferred by such Shareholder, in the form of Exhibit
C. Each Certificate will have the following legend
stamped, typed or otherwise legibly placed on its face
or reverse side:
"Sale, pledge or other disposition or
transfer of this Certificate and the shares
of common stock of Analytical Surveys, Inc.
represented by this Certificate is restricted
by the terms of the Voting Trust Agreement
dated as of December 22, 1995, which may be
examined at the offices of the Company in
Colorado Springs, Colorado."
6. Issuance of Stock Certificates to Trustee.
All stock certificates for Shares transferred and
delivered to the Trustee pursuant to this Agreement
will be surrendered by the Trustee to the Company and
cancelled, and new stock certificates will be issued by
the Company to and in the name of the Trustee. The
Trustee is authorized and empowered to cause any
further transfers of the Shares to be made which may
become necessary through the occurrence of any change
of persons holding the office of the Trustee. Such new
stock certificates will be endorsed by the Company with
a legend to the effect that they are issued pursuant to
this Agreement and a similar notation will appear in
the appropriate place in the transfer books of the
Company.
7. Transfer of Shares. The Shares owned by a
Shareholder are not transferable during the life of the
Trust except in accordance with the Lock-Up Agreement
dated the same date as this Agreement (the "Lock-Up
Agreement"). Any transferee of transferred Shares who
is a "family member" (as defined in the Lock-Up
Agreement) of a Shareholder, will take such Shares
subject to this Agreement, and the voting rights of
such transferred Shares will be exercised by the
Trustee in accordance with the Trust.
8. Term. This Agreement will remain in effect
until December 22, 1997. Upon termination of this
Agreement, the Trust will terminate and the Trustee
will deliver to the Company the stock certificates
representing the Shares owned by the Shareholders then
held by the Trustee under this Agreement, the Company
will issue new certificates for such Shares in the name
of each Shareholder (or such Shareholder's successors
and assigns), and each Shareholder will deliver to the
Trustee for cancellation the Certificates of such
Shareholder issued under this Agreement.
Notwithstanding anything to the contrary in this
Agreement or in any other document or agreement, upon
termination of this Agreement or the Trust, the parties
agree that until the Trustee has received notice from
Bank One, Milwaukee, N.A. (the "Bank") that Huelsman is
no longer indebted to the Bank, the Company will
deliver new certificates for Huelsman's Shares directly
to the Bank.
9. Replacement of Mutilated or Lost Certificates.
In case any Certificate is mutilated, destroyed, lost
or stolen, the registered holder will immediately
notify the Trustee, who, subject to the following
sentence, will issue and deliver to such holder a new
Certificate of like tenor and denomination in exchange
for and upon cancellation of the Certificate so
mutilated, or in substitution for the Certificate so
destroyed, lost or stolen. The applicant for such
substituted Certificate will furnish proof reasonably
satisfactory to the Trustee of such destruction, loss
or theft, and, upon request, will furnish indemnity
(including indemnifying the Trustee individually)
reasonably satisfactory to the Trustee and will comply
with such other reasonable requirements as such Trustee
may prescribe.
10. Trustee Voting Rights. The Trustee is
granted the right to exercise (or refrain from
exercising) all of the Shareholders' voting rights with
respect to the Shares, and the Trustee will vote the
Shares proportionately for and against any issue
brought before the shareholders of the Company for a
vote in the same percentage as all other voted shares
of the Company are voted; except that, in the case of
any of the following matters, the Trustee will vote the
Shares of any Shareholder in accordance with the
written instructions from such Shareholder: (a) the
sale or other disposition of all or substantially all
of the assets of the Company that under applicable law
requires a vote of the shareholders of the Company; (b)
a merger or consolidation in which the Company is not
the continuing or surviving corporation or in which a
change of control of the Company would occur; (c) a
substantial recapitalization of the Company that under
applicable law requires a vote of the shareholders of
the Company and pursuant to which a change of control
of the Company would occur; and (d) a liquidation,
dissolution or "going private" transaction that under
applicable law requires a vote of the shareholders of
the Company. Notwithstanding the foregoing, if any
written voting instructions received by the Trustee
regarding (a) through (d) above are either (i)
ambiguous or unclear or (ii) received by the Trustee
fewer than five business days prior to the date that
such vote is required to be cast, then the Trustee will
vote the Shares proportionately for and against any
issue in the same percentage as all other voted shares
of the Company are voted. Whether a vote is required
"under applicable law," as set forth in (a), (c) and
(d) above will be determined by the Trustee in reliance
upon an opinion of counsel to the Company under the
standards set forth in Section 16.
11. Action by Trustee. A quorum at any meeting
of the Individual Trustees is at least three Individual
Trustees (or such lesser number of Individual Trustees
as are then in place), represented in person or by
telephone. If a quorum is present, the affirmative
vote of a majority of the Individual Trustees
represented at the meeting is the act of the Trustee.
Any action of the Trustee that can be taken at a
meeting of Individual Trustees may be taken without a
meeting if the action is evidenced by one or more
written consents describing the action taken, signed by
a :majority of the total number of Individual Trustees
as are then in place.
12. Resignation. An Individual Trustee may
resign at any time by delivering his resignation in
writing to the Company, to take effect immediately,
whereupon all powers, rights and obligations of the
resigning Individual Trustee under this Agreement will
cease and terminate, except to the extent provided in
Sections 14 and 15 of this Agreement.
13. Vacancies. If any vacancy occurs in the
position of an Individual Trustee by reason of the
resignation, death, incapacity or inability to act of
the Individual Trustee, such vacancy will be filled by
appointment of the board of directors of the Company,
subject to the provisions of Section 3 of this
Agreement. If, notwithstanding the above provisions,
there is at any time no Trustee capable of acting under
this Agreement, it is understood that the holders of
the Certificates may not exercise the voting power of
the stock evidenced by such Certificates until the
termination of the Trust pursuant to the provisions of
this Agreement and that said voting power will
accordingly remain suspended during such vacancy.
14. Expenses, Etc. The Company will pay to the
Trustee and any agent of the Trustee all reasonable
expenses, including counsel fees, and discharge all
liabilities incurred by the Trustee in connection with
the proper exercise of its powers and performance of
its duties under this Agreement.
15. Indemnification. The Shareholders jointly
and severally indemnify and hold the Trustee and each
Individual Trustee harmless from and against any and
all joint or several liabilities in connection with or
growing out of the administration of the Trust created
by this Agreement or the exercise of any powers or the
performance of any duties by the Trustee as provided or
contemplated in this Agreement, including, without
limitation, any action taken or omitted to be taken
pursuant to Section 11 of this Agreement, except such
liability as arises from the willful misconduct or
gross negligence of the Trustee.
16. Reliance on Advice of Counsel. The Trustee
may consult with counsel concerning any question which
may arise with reference to the Trustee's duties or
authority under this Agreement or any of the provisions
of this Agreement or any matter relating to this
Agreement, and the opinion of such counsel will be a
full and complete authorization and protection in
respect to any action taken or omitted to be taken by
the Trustee under this Agreement in good faith and in
accordance with such opinion of counsel, and the
Trustee will not be liable for any damages sustained as
a result of such good faith reliance.
17. Holders of Certificates Bound; Waiver of
Claims Against Trustee. Every registered holder of a
Certificate, and every bearer of a Certificate properly
endorsed in blank or properly assigned, by the
acceptance or holding of the Certificate (a) will be
deemed conclusively for all purposes to have assented
to this Agreement and to all of its terms, conditions
and provisions and will be bound thereby with the same
force and effect as if such holder or bearer had
executed this Agreement, and (b) severally agrees to
waive and by such act does waive any and all claims of
every kind and nature that hereafter each such holder
or bearer may have against the Trustee, and agrees to
release and by such act does release the Trustee, the
Trustee's heirs, legal representatives, executors,
administrators and assigns, from any liability
whatsoever arising out of or in connection with the
exercise of the Trustee's powers or the performance of
the Trustee's duties under this Agreement, except
liability for the gross negligence or willful
misconduct of the Trustee.
18. Dividends and Distributions. During the term
of this Agreement, all dividends and other
distributions with respect to the Shares received by
the Trustee will immediately be distributed to the
Shareholders (or their successors and assigns) in
accordance with the number of Shares represented by
their respective Certificates. Notwithstanding the
previous sentence, the Trustee will receive and hold,
subject to the terms of this Agreement, any stock
dividends issued by the Company to the Shareholders (or
their successors and assigns) by reason of any capital
reorganization, stock split, combination or the like
and will issue and deliver to the holders of the
Certificates additional voting trust certificates
issued in connection with the foregoing transactions.
In addition, notwithstanding anything to the contrary
in this Agreement or in any other document or
agreement, the parties agree that until the Trustee has
received written notice from the Bank, that Huelsman no
longer is indebted to the Bank, the Trustee will: (i)
distribute the proceeds of any sale of Shares owned by
Huelsman during the term of this Agreement directly to
the Bank and (ii) upon termination of this Agreement,
deliver all stock certificates for Shares owned by
Huelsman directly to the Bank. For purposes of this
Section, any deliveries to the Bank will be made to the
attention of Rusty Long at 111 East Wisconsin,
Milwaukee, Wisconsin 53202. The Trustee shall have no
duty to collect funds due for any sale of Shares by
Huelsman.
19. Notice, Etc. Each Shareholder acknowledges
that the Trustee may have direct or indirect financial
interests in the Company and further agrees and
acknowledges that such interests are expressly
authorized under this Agreement and will not be deemed
to impair the Trustee's independence of action in the
exercise of its voting power as provided in Section 9.
Any notice to the Trustee, the Shareholders or the
Company required under this Agreement will be deemed to
have been given to the respective party if delivered
personally, or upon receipt of such notice mailed first
class, postage prepaid, registered or certified mail,
return receipt requested, to the Shareholders at their
respective addresses set forth on Exhibit A, and to
each Individual Trustee and the Company as set forth
below:
Individual Trustee: c/o Analytical Surveys, Inc.
1935 Jamboree Drive
Colorado Springs, Colorado 80921
Company: Analytical Surveys, Inc.
1935 Jamboree Drive
Colorado Springs, Colorado 80921
Attn: Scott Benger
With a copy to: Daniel P. Edwards, P.C.
Suite 310
128 South Tejon
Colorado Springs, Colorado 80903
or to such other address as each party may designate by
notice in writing to the other parties as provided
above.
20. Dispute Resolution. All disputes arising out
of or related to this Agreement, including any claims
that all or any part of this Agreement is invalid,
illegal, voidable, or void, will be settled by
arbitration, pursuant to an Arbitration Agreement
between the Company, Intelligraphics, Inc., the
Shareholders, Joanne Huelsman, James Carpenter, the
Trustee and Bank One, Colorado, NA dated December 22,
1995.
21. General Provisions.
(a) Entire Agreement. This Agreement
constitutes the entire agreement among the parties
with respect to the subject matter of this
Agreement and supersedes all other prior
agreements and understandings, both written and
oral, between the parties with respect to the
subject matter of this Agreement.
(b) Benefit. This Agreement will be binding
upon and inure to the benefit of the parties,
their personal representatives, successors and
assigns.
(c) Amendment. This Agreement may be
amended at any time and from time to time by a
written instrument signed by all of the parties to
this Agreement.
(d) Governing Law. The laws of the State of
Colorado will govern this Agreement and the
construction of any of its terms.
(e) Original. This Agreement will be signed
in one original, which will be deposited with the
Company at its registered office.
(f) Photocopies. A photocopy of this
Agreement will be delivered to the Trustee and to
each Shareholder.
The parties have signed this Agreement, and by
their respective signatures, the Trustee acknowledges
receipt of the certificate(s) representing the Shares
and acceptance of the Trust, and each Shareholder
acknowledges receipt of the its respective Certificate,
all to be effective as of the date set forth above.
ANALYTICAL SURVEYS, INC.
/s/ S.V. Corder
----------------------------
By: Sidney V. Corder
Title: President and Chief Executive Officer
SHAREHOLDER:
/s/ A. Willliam Huelsman
-----------------------------
A. William Huelsman
SHAREHOLDER:
/s/ Gary Miller
------------------------------
Gary Miller
SHAREHOLDER:
/s/ Willliam Nantell
------------------------------
William Nantell
SHAREHOLDER:
/s/ David Coates
-------------------------------
David Coates
SHAREHOLDER:
/s/ David Kroes
--------------------------------
David Kroes
SHAREHOLDER:
/s/ Randy Vanek
---------------------------------
Randy Vanek
SHAREHOLDER:
/s/ Hamid Akhavan
----------------------------------
Hamid Akhavan
TRUSTEE
/s/ John Thorpe
-----------------------------------
John Thorpe
/s/ Sidney Corder
-----------------------------------
Sidney Corder
/s/ William Hudson
----------------------------------
William Hudson
----------------------------------
Richard MacLeod
/s/ James Rothe
----------------------------------
James Rothe
/s/ Robert Keeley
----------------------------------
Robert Keeley
/s/ Willem Andersen
----------------------------------
Willem Andersen
EXHIBIT A
Shareholder Shares
A. William Huelsman 179,200
Suite 40
235 W. Broadway
Waukesha, WI 53186
Gary Miller 6,769
4865 Cedar Circle
Dousman, WI 53118
William D. Nantell 13,537
523 W23124 Broadway
Waukesha, WI 53186
David R. Coates 10,187
W316 57740 Lake Crest Drive
Mukwonago, WI 53149
David Kroes 6,769
4182 Raymir Circle
Wauwatosa, WI 53222
Randy Vanek 6,769
560 Bolson Drive, #D
Oconomowoc, WI 53066
Hamid Akhavan 6,769
2040 Galloway Road
Hartford, WI 53027
EXHIBIT B
The undersigned is a member of the board of
directors of Analytical Surveys, Inc. (the "Company"),
and agrees to be bound by all of the terms of a Voting
Trust Agreement (the "Agreement") dated December 22,
1995 between the Company, A. William Huelsman, Gary
Miller, William Nantell, David Coates, David Woes,
Randy Vanek, Hamid Akhavan and the Trustee (as defined
in the Agreement). The undersigned acknowledges that
he or she will for all purposes be deemed an
"Individual Trustee" (as defined in the Agreement).
The undersigned's address and FAX number for purposes
of Section 19 of the Agreement are set forth below:
__________________________________________
(Type or Print Name)
__________________________________________
(Street Address)
__________________________________________
(City, State and Zip Code)
__________________________________________
(Facsimile Number)
__________________________________________
(Signature)
__________________________________________
(Date)
EXHIBIT C
VOTING TRUST CERTIFICATE
No. ___ _______ Shares
This certifies that _____________ is entitled to
all of the benefits and burdens arising from the
deposit of stock certificate no. ____ for ________
shares of the common stock of ANALYTICAL SURVEYS, INC.
("Company") with certain individuals who are members of
the board of directors of the Company, as a group,
acting as Trustee under the Voting Trust Agreement,
dated December 22, 1995 (the "Agreement"), for such
shares.
The original of the Agreement, which has been
deposited with the Company at its registered office, is
subject to examination by each Shareholder, either in
person or by agent or attorney, at any reasonable time
for any proper purpose.
In general, the Agreement provides that each
Shareholder's voting rights are vested in the Trustee
during the term of the Agreement. The Agreement, which
is incorporated by this reference, should be consulted
for its specific terms.
The stock in the Company represented by this
voting trust certificate is transferable only in
accordance with the terms of the Agreement and is
subject to additional restrictions set forth in a Lock-
Up Agreement dated December 22, 1995, a copy of which
also has been deposited with the Company at its
registered office.
The Trustee has executed this Voting Trust
Certificate on December 22, 1995.
__________________________________________
John A. Thorpe
__________________________________________
Sidney V. Corder
__________________________________________
William H. Hudson
__________________________________________
Richard P. MacLeod
__________________________________________
Willem Andersen
__________________________________________
James T. Rothe
__________________________________________
Robert H. Keeley
BANK ONE, COLORADO, NA
1125 SEVENTEENTH STREET
DENVER, CO 80202
ESCROW AGREEMENT
This escrow agreement entered into by and between
Bank One, Colorado, NA, as Escrow Agent, and Analytical
Surveys, Inc., Intelligraphics, Inc. and A. William
Huelsman. These instructions may be supplemented,
altered, amended, modified or revoked by writing only,
signed by all of the parties hereto, and approved by
the Escrow Agent, upon payment of all fees, costs and
expenses incident thereto.
No assignment, transfer, conveyance or
hypothecation of any right, title or interest in and to
the subject matter of this Escrow shall be binding upon
the Escrow Agent unless written notice thereof shall be
served upon the Escrow Agent and all fees, costs and
expenses incident thereto have been paid and then only
upon the Escrow Agent's assent thereto in writing.
Any notice required or desired to be given by the
Escrow Agent to any party to this Escrow may be given
by mailing he same addressed to such party at the
address give below the signature of such party or the
most recent address of such party shown on the records
of the Escrow Agent, and notice so mailed shall for all
purposes hereof be as effectual as though served upon
such party in person at the time of depositing such
notice in the mail.
The Escrow Agent may receive any payment called
for hereunder after the due date thereof unless
subsequent to the due date of such payment and prior to
the receipt thereof the Escrow Agent shall have been
instructed in writing to refuse any such payment.
The Escrow Agent shall not be personally liable
for any act it may do or omit to do hereunder as such
agent, while acting in good faith and in the exercise
of its own best judgment, and any act done or omitted
by it pursuant to the advice of its own attorneys shall
be conclusive evidence of such good faith.
The Escrow Agent is hereby expressly authorized to
disregard any and all notices or warnings given by any
of the parties hereto, or by any other person, firm or
corporation excepting only orders of process of court,
and is hereby expressly authorized to comply with and
obey any and all process, orders, judgments, or decrees
of any court and in case the Escrow Agent obeys or
complies with any such process, order, judgment or
decree of any court it shall not be liable to any of
the parties hereto or to any other person, firm, or
corporation by reason of such compliance,
notwithstanding any such process, order, judgment or
decree be subsequently reversed, modified, annulled,
set aside or vacated, or found to have been issued or
entered without jurisdiction.
In consideration of the acceptance of the escrow
by the Escrow Agent, the undersigned agrees, jointly
and severally, for themselves, their heirs, legal
representatives, successors and assigns, to pay the
Escrow Agent its charges hereunder and to indemnify and
hold it harmless as to any liability by it incurred to
any other person, firm or corporation by reason of its
having accepted the same, or its carrying out any of
the terms thereof, and to reimburse it for all its
expenses, including, among other things, counsel fees
and court costs incurred in connection herewith; and
that the Escrow Agent shall have a first and prior lien
upon all deposits made hereunder to secure the
performance of said agreement of indemnity and the
payment of its charges and expenses, hereby expressly
authorizing the Escrow Agent, in the event payment is
not received promptly from the undersigned, to deduct
such charges and expenses, without previous notice,
from any funds deposited hereunder, shall be as written
above the Escrow Agent's signature at the time of
acceptance hereof.
The Escrow Agent shall be under no duty or
obligation to ascertain the identity, authority or
rights of the parties executing or delivering or
purporting to execute or deliver these instructions or
any documents or papers or payments deposited or called
for hereunder, and assumes no responsibility or
liability for the validity or sufficiency of these
instructions or any documents or papers or payments
deposited or called for hereunder.
The Escrow Agent shall not be liable for the
outlawing of any rights under any Statute of
Limitations or by reason of laches in respect to the
instructions or any documents or papers deposited.
In the event of any dispute between the parties
hereto as to the facts of default, the validity or
meaning of these instructions or any other fact or
matter relating to the transaction between the parties,
the Escrow Agent is instructed as follows:
(a) See Section 6 of Addendum to Escrow Agreement.
(b) That it shall be under no obligation to act,
except under process or order of court, or until it has
been adequately indemnified to its full satisfaction,
and shall sustain no liability for its failure to act
pending such process or court order of indemnification.
If the deposits hereunder are not withdrawn before
___________________ the Escrow Agent may mail the same
as follows:
In the event of non-delivery as specified above,
the Escrow Agent is authorized and directed to close
this account and place all documents in their closed
files.
The provisions of these instructions shall be
binding upon the legal representatives, heirs,
successors and assigns of the parties hereto.
IN WITNESS WHEREOF, the undersigned have hereunto
affixed their signatures as of this date 12/22/95.
Name: /s/ S.V. Corder Name: /s/ A. William Huelsman
-------------------- -----------------------
Analytical Surveys, Inc. Intelligraphics, Inc.
Address: 1935 Jamboree Drive Address: 741 N.Grand Avenue
Colorado Springs, CO 80920 Waukesha, WI 53186
No. of copies signed 5
Accepted
Bank One, Colorado, NA, as Escrow Agent
/s/ A. William Huelsman By /s/ Tom Connors
- ----------------------- ----------------
A. William Huelsman
Address: Suite 40
235 Broadway
Waukesha, WI 53186
EXHIBIT A
Acceptance Fee $1,000
Recurring Fees:
Annual Administration $1,000
Each deposit/withdrawal $20
Each wire $25
Each check $20
ADDENDUM TO ESCROW AGREEMENT
1. Exculpation and Indemnification of Escrow Agent
(a) The Escrow Agent shall have no duties or
responsibilities other than those expressly set
forth herein. The Escrow Agent shall have no duty
to enforce any obligation of any person to make
any payment or delivery or to direct or cause any
payment or delivery to be made, or to enforce any
obligation of any person to perform any other act.
The Escrow Agent shall be under no liability to
any party hereto or to anyone else by reason of
any failure on the part of any party hereto or any
make, guarantor, endorser or other signatory of
any document or any other person to perform such
person's obligations under any such document.
Except for amendments to this Agreement referred
to in Section 5(b) of this Addendum and except for
instruction given to the Escrow Agent by the other
party hereto relating to the Escrow Account, the
Escrow Agent shall not be obligated to recognize
any agreement between any or all of the persons
referred to herein, notwithstanding that
references thereto may be made herein and whether
or not it has knowledge thereof.
(b) The Escrow Agent shall not be liable to any other
party hereto or to anyone else for any action
taken or omitted by it, or any action suffered by
it to be taken or omitted, in good faith and in
the exercise of its own best judgment except for
fraud, negligence, or willful misconduct. The
Escrow Agent may rely conclusively and shall be
protected in acting upon any order, notice,
demand, certificate, opinion or advice of counsel
(including counsel chosen by the Escrow Agent),
statement, instrument, report or other paper or
document (not only as to its due execution and the
validity and effectiveness of its provisions, but
also as to the truth and acceptability of any
information therein contained) that is believed by
the Escrow Agent to be genuine and to be signed or
presented by the proper person or persons. The
Escrow Agent shall not be bound by any notice or
demand, or any waiver, modification, termination
or rescission of this Agreement or any of the
terms hereof, unless evidenced by a writing
delivered to the Escrow Agent signed by the proper
party or parties and, if the duties or rights of
the Escrow agent are affected, unless it shall
give its prior written consent thereto.
(c) The Escrow Agent shall not be responsible for the
sufficiency or accuracy of the form of, or the
execution, validity, value or genuineness of, any
document or property received or held by it
hereunder, or of any signature or endorsement
thereon, or for any lack of endorsement thereon,
or for any description therein, nor shall the
Escrow Agent be responsible or liable to the other
parties hereto or to anyone else in any respect on
delivering or purporting to execute or deliver any
document or property or this Agreement, other than
on behalf of or in the name of the Escrow Agent.
The Escrow Agent shall have no responsibility with
respect to the use or application of any funds or
other property paid or delivered by the Escrow
Agent pursuant to the provision hereof. Except as
provided in Section 1(b) above, the Escrow Agent
shall not be liable to any other party hereto or
to anyone else for any loss that may be incurred
by reason of any investment of any monies that it
holds hereunder.
(d) The Escrow Agent shall have the right to assume,
in the absence of written notice to the contrary
from the proper person or persons, that a fact or
an event by reason of which an action would or
might be taken by the Escrow Agent does not exist
or has not occurred, without incurring liability
to the other parties hereto or to anyone else for
any action taken or omitted, or any action
suffered by it to be taken or omitted, in good
faith and in the exercise of its own best
judgment, in reliance upon such assumption;
provided, however, that the Escrow Agent shall be
liable for any such liability resulting from its
own fraud, negligence or willful misconduct.
(e) To the extent that the Escrow Agent becomes liable
for the payment of taxes, including withholding
taxes, in respect of income derived from the
investment of funds held hereunder or any payment
made hereunder, and held harmless against any
liability for taxes and for any penalties or
interest in respect of taxes, on such investment
income or payments in the manner provided in
Section 1(f).
(f) The Escrow Agent shall be indemnified and held
harmless from and against any and all expenses,
including reasonable counsel fees and
disbursements, or loss suffered by the Escrow
Agent in connection with any action, suit or other
proceeding involving any claim, or in connection
with any claim or demand, that in any way,
directly or indirectly, arises out of or relates
to this Agreement, the services of the Escrow
Agent hereunder, the monies or other property held
by it hereunder or any income earned from
investment of such monies, provided, however, that
if the Escrow Agent has been determined to be
guilty of fraud, negligence or willful misconduct,
the Escrow Agent shall not be entitled to
indemnification hereunder. Promptly after the
receipt by the Escrow Agent of notice of any such
action, suit or other proceeding, the Escrow Agent
shall, if a claim in respect thereof is to be made
against any of the other parties hereto, notify
such other parties thereof in writing; the failure
by the Escrow Agent to give such notices shall
relieve such other parties from any liability that
such parties may have to the Escrow Agent under
this Section 1 (f) as the particular item for
which indemnification is being sought, but not
from any other liability that any of them may have
to the Escrow Agent. Each of the other parties
hereto will be entitled to participate in the
defense of any action, suit or proceeding for
which indemnification is sought hereunder and, to
the extent any of them so desires, jointly with
any of the other parties hereto, to assume such
defense, with counsel who shall be reasonably
satisfactory to the Escrow Agent, and after notice
from any of the other parties hereto to the Escrow
Agent of such parties' election so to assume such
defense, none of the other parties hereto will be
liable to the Escrow Agent under this Section 1
(f) for any legal or other expense subsequently
incurred by the Escrow Agent in connection with
such defense other than reasonable costs of
investigation.
2. Compensation of Escrow Agent
The Escrow Agent shall be entitled to reasonable
compensation for the services rendered by it
hereunder, as set forth on Exhibit A. The Escrow
Agent shall also be entitled to reimbursement for
all expenses (pre-approved) paid or incurred by it
in the administration of its duties hereunder,
including, but not limited to, all counsel
advisors' and agents' fees and disbursements and
all taxes or other governmental charges.
3. Termination of Agreement and Resignation of Escrow
Agent
(a) This Agreement shall terminate on the final
disposition of the monies and property held in
escrow hereunder, provided that the rights of the
Escrow Agent and the obligations of the other
parties hereto under Sections 1 and 2 shall
survive the termination hereof.
(b) The Escrow Agent may resign at any time and be
discharged from its duties as Escrow Agent
hereunder by giving the other parties hereto at
least 60 days' notice thereof. The Escrow Agent
may be removed at any time by giving to the other
parties hereto at least 30 days' notice hereof.
As soon as practicable after its resignation or
removal, the Escrow Agent shall turn over to a
successor escrow agent appointed by the other
parties hereto all monies and property held
hereunder (less such amount as the Escrow Agent is
entitled to retain pursuant to Section 1(e)) upon
presentation of the document appointing the new
escrow agent and its acceptance thereof. If no
new escrow agent is so appointed within the 60-day
period following such notice of resignation or the
30-day period following such notice of removal,
the Escrow Agent may deposit the aforesaid monies
and property with any court in the State of
Colorado, it deems appropriate. If the Escrow
Agent is removed, it shall be entitled to (i) the
full payment of its flat fee, (ii) compensation
for services rendered prior to such removal and
(iii) pre-approved out-of-pocket expenses incurred
prior to such removal, all as set forth on Exhibit
A.
4. Notices
All notices, requests, demands and other
communications provided for herein shall be in
writing, shall be delivered by hand, first-class
mail or overnight express, shall be deemed given
when received and shall be addressed to the
parties hereto at their respective addresses
listed below or to such other persons or addresses
as the relevant party shall designate as to itself
from time to time in writing delivered in like
manner.
5. Miscellaneous
(a) All amounts referred to herein are expressed in
United States dollars and all payments by the
Escrow Agent shall be made in such dollars.
(b) This agreement shall be binding upon and inure to
the benefit of each party's respective successors,
heirs and permitted assigns. No other person
shall acquire or have any rights under of by
virtue of this Agreement. This Agreement may not
be changed orally or modified, amended or
supplemented without an express written agreement
executed by the Escrow Agent and the other parties
hereto.
(c) This Agreement shall be governed by and construed
in accordance with the laws of the State of
Colorado. The representations and warranties
contained in this Agreement shall survive the
execution and delivery hereof and any
investigation made by any party. The headings in
this Agreement are for purposes of reference only
and shall not limit or otherwise affect any of the
terms hereof.
6. Dispute Resolution.
All disputes arising out of or related to this
Agreement, including any claims that all or any
part of this Agreement is invalid, illegal,
voidable, or void, will be settled by arbitration,
pursuant to an Arbitration Agreement between the
Analytical Surveys, Inc. (the "Company"),
Intelligraphics, Inc., and certain former
employees of Intelligraphics, the members of the
board of directors of the Company who are voting
trustees under the Voting Trust Agreement, Joanne
Huelsman, James Carpenter, and Bank One, Colorado,
NA dated December 22, 1995.
December 22, 1995
VIA HAND DELIVERY
Bank One, Colorado, NA
1125 Seventeenth Street
Denver, CO 80202
Attn: Ms. Deborah M. Rayman
Re: Escrow of $250,000 and 70,000
shares of common stock of Analytical
Surveys, Inc. ("ASI") in connection with
an Asset Purchase Agreement between ASI,
Intelligraphics, Inc. ("Intelligraphics")
and A. William Huelsman ("Huelsman") dated
December 22, 1995 (the "Purchase Agreement")
Dear Ms. Rayman:
Pursuant to sections 1.3 and 1.8 of the
Purchase Agreement, ASI has delivered to Bank One,
Colorado, NA (the "Escrow Agent") $250,000 and 70,000
shares of ASI common stock (the "Escrow Stock").
The $250,000 delivered by ASI to the Escrow
Agent is comprised of two parts: (i) $170,000 related
to the delivery of a consent to assignment of a
Subcontractor Agreement between Electronic Data
Systems, Inc. ("EDS") and Intelligraphics (the "EDS
Consent Funds") and (ii)$80,000 in connection with the
delivery of eight consents to assignment for eight
contracts of Intelligraphics that ASI will assume
pursuant to the Purchase Agreement (the "Contract
Consent Funds").
A. The EDS Consent Funds will be
distributed by the Escrow Agent as
follows:
1. On or before February 28, 1996, if
ASI receives either (i) a Subcontractor Agreement
between ASI and EDS or (ii) a document in the form of
Exhibit A to this letter executed by EDS (for purposes
of this Section A, either document the "EDS Document"),
then within three business days after receipt of the
EDS Document, ASI will deliver a copy of the EDS
Document to the Escrow Agent. Upon receipt of the EDS
Document, the Escrow Agent is instructed to pay to Bank
One, Milwaukee, N.A. the EDS Consent Funds.
2. On or before February 28, 1996, if
Huelsman reasonably believes that ASI has received the
EDS Document, then Huelsman may notify the Escrow Agent
(the "EDS Notice"). Within five business days after
receipt of the EDS Notice, the Escrow Agent will
provide a copy of the EDS Notice to ASI. If ASI does
not object to the EDS Notice by written notice to the
Escrow Agent within five business days after receipt of
the EDS Notice, then the Escrow Agent is instructed to
pay to Bank One, Milwaukee, N.A. the EDS Consent Funds.
Notwithstanding the foregoing, if within five business
days of receipt after the EDS Notice, ASI objects to
the EDS Notice by written notice to the Escrow Agent,
then the Escrow Agent will deposit the EDS Consent
Funds with the American Arbitration Association and the
matter will be submitted to arbitration pursuant to
Section 6 of the Addendum to Escrow Agreement between
ASI, Huelsman, Intelligraphics and the Escrow Agent
(the "Escrow Agreement").
3. On February 29, 1996, the Escrow
Agent will pay to ASI the EDS Consent Funds not
previously delivered under the terms of this Section A,
except for EDS Consent Funds for which the procedures
of this Section A have been initiated.
B. The Contract Consent Funds will be
distributed by the Escrow Agent only when the following
conditions have been met:
1. On or before February 28, 1996, if
ASI receives an executed document in the form of
Exhibit A to this letter (for purposes of this Section
B, a "Consent") from a party listed on Exhibit B to
this letter ("Owner"), then within three business days
after receipt of the Consent, ASI will deliver a copy
of the Consent to the Escrow Agent. Upon receipt of
the Consent, the Escrow Agent is instructed to pay to
Bank One, Milwaukee, N.A. $10,000 of the Contract
Consent Funds.
2. On or before February 28, 1996, if
Huelsman reasonably believes that ASI has received a
Consent, then Huelsman may notify the Escrow Agent (the
"Consent Notice") (identifying the Owner to which the
Consent applies). Within five business days after
receipt of a Consent Notice, the Escrow Agent will
provide a copy of the Consent Notice to ASI. If ASI
does not object to the Consent Notice within five
business days after receipt of the Consent Notice, the
Escrow Agent is instructed to pay to Bank One,
Milwaukee, N.A. $10,000 of the Contract Consent Funds.
Notwithstanding the foregoing, if within five business
days after receipt of the Consent Notice, ASI objects
to the Consent Notice by written notice to the Escrow
Agent, then the Escrow Agent will deposit the $10,000
with the American Arbitration Association and the
matter will be submitted to arbitration pursuant to
Section 6 of the Addendum to the Escrow Agreement.
3. On February 29, 1996, the Escrow
Agent will pay to ASI Contract Consent Funds not
previously delivered under the terms of this Section B,
except for funds for which the procedures of this
Section B have been initiated.
4. The procedures of this Section B
will be commenced and acted upon separately for each
Consent.
C. The Escrow Stock will be distributed by
the Escrow Agent only when the following conditions
have been met:
1. On or before December 22, 1996, if
the Escrow Agent receives a notice from ASI regarding
payment due under the indemnification provisions of the
Purchase Agreement in connection with a breach of a
representation, warranty or covenant of Intelligraphics
or Huelsman (the "Breach Notice") then within five
business days after receipt of a Breach Notice, the
Escrow Agent will provide a copy of the Breach Notice
to Huelsman. If Huelsman does not object to the Breach
Notice by written notice to the Escrow Agent within
five business days after receipt of the Breach Notice,
the Escrow Agent is instructed to transfer Escrow Stock
equivalent in value to the amount referenced in the
Breach Notice (the "Payment Stock") to ASI. For
purposes of determining such value, the Escrow Stock
will be valued at a per share price of 50% of the
Market Price of such Escrow Stock. The Market Price
shall mean the average of the closing bid and asked
prices for the ASI common stock on the date of transfer
as reported on the National Market System of NASDAQ
(the National Association of Securities Dealers
Automated Quotation System("NASDAQ"), or (If NASDAQ is
closed on such date, on the next preceding date on
which the NASDAQ is operated), as conclusively
determined in a written notice delivered to the Escrow
Agent by the Denver office of Hanifen, Imhoff, Inc.
Notwithstanding the foregoing, if within five business
days after receipt of a Breach Notice, Huelsman objects
to the Breach Notice by written notice to the Escrow
Agent, then the Escrow Agent will deposit the Payment
Stock with the American Arbitration Association and the
matter will be submitted to arbitration pursuant to
Section 6 of the Addendum to Escrow Agreement.
2. On December 23, 1996, the Escrow
Agent is instructed to deliver to the Trustee (as
defined in the Purchase Agreement) all Escrow Stock
which has not previously been delivered under the
foregoing terms of this Section C, except for Escrow
Stock for which the procedures of this Section C have
been initiated.
D. Notwithstanding the foregoing
provisions, the Escrow Agent will deliver the Escrow
Consent Funds, EDS Funds and the Escrow Stock to any
other party as may be specified by a written notice
executed by each of ASI, Intelligraphics and Huelsman
and delivered to the Escrow Agent, provided, however,
that any portion of the Contract Consent Funds, the EDS
Consent Funds or the Escrow Stock to be received by
Huelsman will be delivered directly to Bank One,
Milwaukee, N.A.
Any notice given to the Escrow Agent, ASI,
the Trustee (care of ASI) or Huelsman under this letter
will be given in accordance with the provisions for
notice set forth in the Escrow Agreement and will be
given also to Bank One, Milwaukee, N.A. at the
following address:
Bank One, Milwaukee, N.A.
111 E. Wisconsin Avenue
Milwaukee, WI 53202
Attn: Jack Bastian.
ANALYTICAL SURVEYS, INC.
By /s/ S. V. Corder
-----------------------
Its President and Chief
Executive Officer
INTELLIGRAPHICS, INC.
By /s/ A. William Huelsman
--------------------------
Its Chairman and Chief Executive
Officer
/s/ A. William Huelsman
------------------------
A. WILLIAM HUELSMAN
EXHIBIT A
Consent of Owner
In connection with the contract dated _______________
(the "Contract") between ___________________________ ("Owner") and
Intelligraphics, Inc., ("Intelligraphics"), Owner consents to Intelligraphics'
assignment of its rights and obligations under the Contract to Analytical
Surveys, Inc. ("ASI") or any wholly-owned subsidiary of ASI, effective as of
the consummation of the Asset Purchase Agreement between Intelligraphics, ASI
and A. William Huelsman dated December __, 1995. As of the date of this
Consent, to the knowledge of Owner, Intelligraphics is not in breach of any
provision of the Contract. The execution of this Consent by Owner does not
relieve Intelligraphics from any of its obligations under the Contract.
Dated as of _____________________
OWNER:
By:_______________________________
Title:____________________________
EXHIBIT B
1. American Electric Power for work being conducted
for Appalachian Power Company under contract dated
1/19/94 and for work being conducted for Indiana
Michigan Power under contract dated 8/28/95.
2. Electronic Data Systems for contract dated 8/17/95
for BellSouth Tele-Communications Work.
3. British Telecom for contract dated 12/19/94.
4. China Power and Light Company, Limited for
contract dated 9/26/94.
5. Iowa-Illinois Gas & Electric for contract dated
9/19/94.
6. Intergraph Corporation for contract dated 4/18/95.
7. Wisconsin Electric Power Company for contract
dated 3/9/94.
8. Michigan Consolidated Gas Company for contract
dated 9/16/93.
REGISTRATION RIGHTS AGREEMENT
December 22, 1995
TO THE PERSONS LISTED ON THE
ATTACHED DISTRIBUTION LIST
Dear Sirs:
This will confirm that in connection with the
Asset Purchase Agreement dated December 22, 1995 (the
"Purchase Agreement") between Analytical Surveys, Inc.
("ASI"), Intelligraphics, Inc. ("Intelligraphics") and
A. William Huelsman, the Investor Representation Letter
dated December 22, 1995 executed by A. William
Huelsman, William D. Nantell, David R. Coates, David
Kroes, Gary Miller, Andy Vanek and Hamid Akhavan (each
a "Shareholder" and collectively, the "Shareholders"),
and related transfer documents, ASI has transferred
230,000 shares of Common Stock of ASI (the "Shares") as
follows: (i) 160,000 shares of Common Stock of ASI to
the Voting Trust, and (ii) 70,000 shares of Common
Stock of ASI into escrow pursuant to an Escrow
Agreement dated December 22, 1995 between ASI,
Intelligraphics, and Bank One, Colorado, NA. As an
inducement to you to enter into the Purchase Agreement,
ASI covenants and agrees with each of you, and with
each subsequent holder of the Shares, as follows:
1. Certain Definitions. As used in this
Registration Rights Agreement, the following terms will
have the following respective meanings:
"Agreement" will mean this Registration
Rights Agreement.
"Commission" will mean the Securities and
Exchange Commission, or any other federal agency
at the time administering the Securities Act.
"Common Stock" will mean the shares of common
stock, no par value, of ASI, as constituted as of
the date of this Agreement.
"Exchange Act" will mean the Securities
Exchange Act of 1934, as amended, or any similar
federal statute, and the rules and regulations of
the Commission under the Exchange Act, all as the
same will be in effect at the time.
"Registration Expenses" will mean the
expenses so described in Section 4 of this
Agreement.
"Restricted Stock" will mean any Shares owned
by any Shareholder and any subsequent holders.
"Securities Act" will mean the Securities Act
of 1933, as amended or any similar federal
statute, and the rules and regulations of the
Commission under the Securities Act, all as the
same will be in effect at the time.
"Selling Expenses" will mean the expenses so
described in Section 4 of this Agreement.
2. Incidental Registration. If ASI at any time
prior to the second anniversary of this Agreement
proposes to register any of its Common Stock under the
Securities Act in an underwritten public offering,
whether for its own account or for the account of other
security holders or both (except with respect to
registration statements on Form S-4, Form S-8 or
another form not available for registering the
Restricted Stock for sale to the public), it will give
written notice at such time to all holders of
outstanding Restricted Stock of its intention to do so.
Upon the written request of any such holder, given
within 10 days after receipt of any such notice by ASI,
to register any of its Restricted Stock (which request
will state the intended method of disposition of such
Restricted Stock), ASI will use its best efforts to
cause the Restricted Stock as to which registration
will have been so requested, to be included in the
securities to be covered by the registration statement
proposed to be filed by ASI, all to the extent required
to permit the sale or other disposition by the holder
(in accordance with its written request) of such
Restricted Stock so registered under federal law and
under the laws of any state in which ASI chooses to
conduct the underwritten public offering, except that
ASI is under no obligation to the holders of Restricted
Stock to cause a registration statement under this
Section 2 to become effective or to keep a registration
statement under this Section 2 effective for any
period. Any request by a holder pursuant to this
Section 2 to register Restricted Stock will be deemed
to be such holder's agreement to sell such shares
exclusively in such offering on the same terms and
conditions as the shares of Common Stock otherwise
being sold through underwriters under such
registration. The number of shares of Restricted Stock
to be included in such an underwriting may be reduced
pro rata among the requesting holders of Restricted
Stock based upon the number of shares so requested to
be registered if and to the extent that the managing
underwriter reasonably and in good faith determines
that such inclusion would adversely affect the
marketing of the securities to be sold by ASI in such
underwriting.
Notwithstanding anything to the contrary contained
in this Section 2, if there is a firm commitment
underwritten public offering of securities of ASI
pursuant to a registration covering Restricted Stock
and a holder of Restricted Stock does not elect to sell
his Restricted Stock to the underwriters of ASI's
securities in connection with such offering, such
holder will refrain from selling such Restricted Stock
during the period of distribution of ASI's securities
by such underwriters and the period in which the
underwriting syndicate participates in the after
market; provided, however, that such holder will, in
any event, be entitled to sell its Restricted Stock
commencing on the 90th day after the effective date of
such registration statement if not otherwise prohibited
from doing so under any other agreement.
3. Registration Procedures. In connection with
each registration under this Agreement, the selling
holders of Restricted Stock will furnish to ASI in
writing such information with respect to themselves and
the proposed distribution by them as will be reasonably
necessary in order to assure compliance with federal
and applicable state securities laws.
4. Expenses. All expenses incurred by ASI in
complying with Section 2 of this Agreement, including,
without limitation, all registration and filing fees,
printing expenses, fees and disbursements of counsel
and independent public accountants for ASI, fees of the
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 sellers of Restricted
Stock, are called "Registration Expenses." All
underwriting discounts and selling commissions
applicable to the sale of Restricted Stock are called
"Selling Expenses."
All Selling Expenses and Registration Expenses in
connection with any registration statement filed
pursuant to Section 2 of this Agreement will be borne
by the participating sellers in proportion to the
number of shares sold by each.
5. Indemnification. In the event of a
registration of any of the Restricted Stock under the
Securities Act pursuant to Section 2 of this Agreement,
ASI will indemnify and hold harmless each seller of
such Restricted Stock under such registration and each
underwriter of Restricted Stock under such registration
and each other person, if any, who controls such seller
or underwriter within the meaning of the Securities
Act, against any losses, claims, damages or
liabilities, joint or several, to which such seller 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 any 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 any registration statement under
which such Restricted Stock was registered under the
Securities Act pursuant to Section 2, any preliminary
prospectus or final prospectus contained in such
registration statement, or any amendment or supplement
of such registration statement or prospectus, 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 in
such registration statement or necessary to make the
statements in such registration statement or prospectus
not misleading, and will reimburse each such seller,
each such underwriter and each such controlling person
for 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 such seller, such underwriter or such
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 2 of this Agreement, each seller of such
Restricted Stock under such registration statement,
severally and not jointly, 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 any 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 under the Securities Act pursuant
to Section 2, 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 in such registration statement or
prospectus or necessary to make the statements in such
registration statement 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 such seller 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
pertaining to such seller, as such, furnished in
writing to ASI by such seller specifically for use in
such registration statement or prospectus; provided,
further, however, that the liability of each seller
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 number of
shares sold by such seller under such registration
statement bears to the total number of all securities
sold under such registration statement, but not to
exceed the proceeds received by such seller from the
sale of 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, notify the
indemnifying party in writing of such action, but the
omission so to notify the indemnifying party will not
relieve it from any liability which it may have to any
indemnified party other than under this Section 5 and
such omission so to notify the indemnifying party in
any event will not relieve it from liability under this
Section 5, except to the extent that such failure
prejudiced the rights of the indemnifying party. In
case any such action will be brought against any
indemnified party and such indemnified party 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 5 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; provided, however, that, if the
defendants in any such action include both the
indemnified party and the indemnifying party and the
indemnified party reasonably concludes that there are
likely to be reasonable defenses available to it which
are different from or additional to those available to
the indemnifying party, or if the interests of the
indemnified party reasonably are deemed to be in
conflict with the interests of the indemnifying party,
the indemnified party will have the right to select a
separate counsel and to assume such legal defenses and
otherwise to participate in the defense of such action,
with the expenses and fees of such separate counsel and
other expenses related to such participation to be
reimbursed by the indemnifying party as incurred.
Notwithstanding the foregoing, any indemnified
party will have 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. It is
understood that 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 to act as
counsel for the indemnified party (in addition to the
fees of local counsel in any jurisdiction where such
separate firm is not so qualified, but the fees and
expenses of such local counsel will be limited to the
making of appearances of record). 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 5 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 any of
such losses, claims, damages or liabilities referred to
in such paragraphs, 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 sellers of
such Restricted Stock, 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.
The relative fault will be determined by reference to,
among other things, whether the untrue or alleged
untrue statement of a material fact relates to
information supplied by ASI, on the one hand, or the
underwriters and the sellers of such Restricted Stock,
on the other, and to the parties' relative intent,
knowledge, access to information and opportunity to
correct or prevent such statement or omission. ASI and
each of you agree that it would not be just and
equitable if contributions pursuant to this paragraph
were determined by pro rata allocation (even if all of
the sellers of such Restricted Stock were treated as
one entity for such purpose) or by any other method of
allocation which did not take account of the equitable
considerations referred to above in this paragraph.
The amount paid or payable by an indemnified party as a
result of the losses, claims, damages or liabilities or
actions in respect of any of such losses, claims,
damages or liabilities, referred to above in this
paragraph, will be deemed to include any legal or other
expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of
this paragraph, no seller under this Agreement will be
required to contribute any amount in excess of the
lesser of (i) the proportion that the number of shares
sold by such seller under such registration statement
bears to the total number of all securities sold under
such registration statement, but not to exceed the
proceeds received by such seller for the sale of
Restricted Stock covered by such registration statement
and (ii) the amount of any damages which they 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 5 will be on such other terms and
conditions as are at the time customary and reasonably
required by such underwriters, and in that event the
indemnification of the sellers of Restricted Stock in
such underwriting will at the sellers' request be
modified to conform to such terms and conditions.
6. Changes in Common Stock. If, and as often as,
there are any changes in the Common Stock by way of
stock split, stock dividend, combination or
reclassification, or through merger, consolidation,
reorganization or recapitalization, or by any other
means, appropriate adjustment will be made in the
provisions of this Agreement, as may be required, so
that the rights and privileges granted by this
Agreement will continue with respect to the Common
Stock as so changed.
7. Miscellaneous.
(a) 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.
(b) All notices, requests, consents and
other communications under this Agreement will be
in writing and will be mailed by first class
registered mail, postage prepaid, addressed as
follows:
(i) if to ASI, to it at: 1935 Jamboree
Drive, Colorado Springs, Colorado 80920,
Attention: Scott Benger;
(ii) if to a Shareholder, at the
address for notice set forth opposite such
Shareholder's signature below;
(iii) if to any subsequent holder of
Restricted Stock, to it at such address as
may have been furnished to ASI in writing by
such holder;
or, in any case, at such other address or
addresses as will have been furnished in writing
to ASI (in the case of a holder of Restricted
Stock) or to the holders of Restricted Stock (in
the case of ASI).
(c) This Agreement will be governed by and
construed in accordance with the laws of the State
of Colorado.
(d) 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.
(e) 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.
(f) All disputes arising out of or related
to this Agreement, including any claims that all
or any part of this Agreement is invalid, illegal,
voidable, or void, will be settled by arbitration,
pursuant to an Arbitration Agreement dated
December 22, 1995, between the Company,
Intelligraphics, Inc., the Shareholders, the
members of the board of ASI who are voting
trustees under the Voting Trust Agreement and Bank
One, Colorado.
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.
Please indicate your acceptance of the foregoing
by sighing and returning the enclosed counterpart of
this letter, whereupon this letter (sometimes called
"this Agreement") will be a binding agreement between
ASI and you.
Very truly yours,
ANALYTICAL SURVEYS, INC.
By: /s/ S.V. Corder
--------------------
Title: President and
Chief Executive Officer
AGREED TO AND ACCEPTED ADDRESS FOR NOTICE:
as of the date first
above written.
/s/ A. William Huelsman
- ----------------------- Suite 40
A. William Huelsman 235 West Broadway
Waukesha, WI 53186
/s/ William Nantell
- ----------------------- 523 W23124 Broadway
William Nantell Waukesha, WI 53186
/s/ David Coates
- ----------------------- W316 57740 Lake Crest Drive
David Coates Mukwonago, WI 53149
/s/ Gary Miller
- ----------------------- 4865 Cedar Circle
Gary Miller Dousman, WI 53118
/s/ Randy Vanek
- ----------------------- 560 Bolson Drive, #D
Randy Vanek Oconomowoc, WI 53066
/s/ Hamid Akhavan
- ----------------------- 2040 Galloway Road
Hamid Akhavan Hartford, WI 53027
/s/ David Kroes
- ----------------------- 4182 Raymir Circle
David Kroes Wauwatosa, WI 53222
DISTRIBUTION LIST
A. William Huelsman
235 West Broadway, Suite 40
Waukesha, WI 53186
Mr. William D. Nantell Mr. David R. Coates
523 W23124 Broadway W316 57740 Lake Crest
Drive
Waukesha, WI 53186 Mukwonago, WI 53149
Mr. David P. Kroes Mr. Gary Miller
4182 Raymir Circle 4865 Cedar Circle
Wauwatosa, WI 53222 Dousman, WI 53118
Mr. Randy Vanek Mr. Hamid Akhavan
560 Bolson Drive, #D 2040 Galloway Road
Oconomowoc, WI 53066 Hartford, WI 53027
