UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 1)*
Government Technology Services, Inc.
(Name of Issuer)
Common Stock, par value $.005 per share
(Title of Class of Securities)
383750106
(CUSIP Number)
Carter Strong
Arent Fox
1050 Connecticut Avenue, N.W., Washington, D.C. 20036-5339
(202) 857-6252
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
Various
(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
[ ].
Check the following box if a fee is being paid with this statement
[ ]. (A fee is not required only if the reporting person: (1) has a previous
statement on file reporting beneficial ownership of more than five percent of
the class of securities described in Item 1; and (2) has filed no amendment
subsequent thereto reporting beneficial ownership of five percent or less of
such class). (See Rule 13d-7.)
Note. Six copies of this statement, including all exhibits, should be
filed with the Commission. See Rule 13d-1(a) for other parties to whom copies
are to be sent.
* 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 (however, see
the Notes).
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Schedule 13D
CUSIP No. 383750106
1) Names of Reporting Persons/S.S. or I.R.S. Identification Nos. of Above
Persons
M. Dendy Young
2) Check the Appropriate Row if a Member of a Group*
(a) [ ]
N/A (b) [ ]
3) SEC Use Only
4) Source of Funds*
PF, OO
5) Check if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e) [ ]
N/A
6) Citizenship or Place of Organization
United States of America
Number of 7) Sole Voting Power 29,730
Shares Bene- (not including certain shares subject
ficially to option)
Owned by
Each 8) Shared Voting Power N/A
Reporting
Person With 9) Sole Dispositive Power 29,730
(not including certain shares subject
to option)
10) Shared Dispositive Power N/A
11) Aggregate Amount Beneficially Owned by Each Reporting Person
669,730 (including 640,000 shares subject to options exercisable
within 60 days)
12) Check box if the Aggregate Amount in Row (11) Excludes Certain Shares*
[ ]
13) Percent of Class Represented by Amount in Row (11)
9.1%
14) Type of Reporting Person*
IN
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7 (INCLUDING
EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
This Amendment No. 1 to Schedule 13D filed by M. Dendy Young, with
respect to the common stock, par value $.005 per share ("Common Shares"), of
Government Technology Services, Inc., a Delaware corporation (the "Issuer"),
amends the Schedule 13D filed by Mr. Young on December 29, 1995 (the
"Statement"). All capitalized terms used and not defined herein shall have the
meanings ascribed to them in the Statement.
Because this is the first electronic amendment to a paper format
Schedule 13D, in accordance with Rule 101(a)(2)(ii) of Regulation S-T the
textual portion of the original Schedule 13D (without exhibits or signature
pages) is also being filed herewith electronically as Exhibit 3 to this
Amendment No. 1.
Item 3. Source and Amount of Funds or Other Consideration.
Item 3 is supplemented as follows:
Mr. Young purchased a total of 27,530 Common Shares in the NASD
National Market System between February 21, 1996 and September 4, 1996, as
follows:
Date Number of Shares Price per Share
2/21/96 750 $3.75
2/21/96 1,000 $3.50
2/22/96 2,000 $3.50
2/23/96 2,000 $3.50
2/27/96 3,600 $3.50
2/28/96 1,400 $3.50
3/4/96 430 $4.875
5/23/96 5,000 $5.50
8/5/96 1,250 $5.5625
8/28/96 100 $5.125
9/4/96 10,000 $5.375
These shares were purchased with Mr. Young's personal funds, with the exception
of the 430 Common Shares purchased on March 4, 1996. Such shares were purchased
with the proceeds of an account containing the personal funds of Mr. Young and
two of his minor children on whose behalf Mr. Young holds such shares as
custodian. See Item 5(d) below.
Item 5. Interest in Securities of the Issuer.
Item 5 is amended as follows:
(a) Mr. Young beneficially owns 669,730 Common Shares (of which 640,000
Common Shares represent that portion of the Options which are exercisable within
60 days of the date hereof), representing approximately 9.1% of the outstanding
Common Shares, based on the outstanding shares as of November 1, 1996.
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(b) Mr. Young has the sole power to vote and dispose of 29,730 Common
Shares. Mr. Young would have the sole power to vote and dispose of the 640,000
Common Shares that represent that portion of the Options which are currently
exercisable within 60 days of the date hereof if such Shares were acquired upon
the exercise of the Options.
(c) No transactions in Common Shares were effected by Mr. Young during
the 60 days prior to the date of this Amendment No. 1.
(d) Mr. Young holds 430 Common Shares as custodian for two of his
minor children. Except with respect to such Shares, no other person has the
right to receive dividends from, or the proceeds from the sale of, the Common
Shares owned by Mr. Young.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or
Relationships with Respect to Securities of the Issuer.
Item 6 is hereby supplemented to reflect that a definitive nonstatutory
stock option agreement with respect to the 1995 Option was executed as of
December 18, 1995 (the "1995 Option Agreement"). A copy of the 1995 Stock
Option Agreement is attached hereto as Exhibit 4 and incorporated herein by this
reference.
Item 7. Material to be Filed as Exhibits.
Exhibit 3 Schedule 13D, as filed on December 29, 1995.
Exhibit 4 1995 Stock Option Agreement.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this Amendment is true, complete and
correct.
Date: December 12, 1996
/s/ M. DENDY YOUNG
__________________
M. Dendy Young
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. TITLE PAGE
3 Schedule 13D, as filed on December 29, 1995.
4 1995 Stock Option Agreement.
Exhibit 3
Item 1. Security and Issuer.
This Statement relates to the common stock, par value $.005 per share
("Common Shares"), of Government Technology Services, Inc., a Delaware
corporation (the "Issuer"). The principal executive offices of the Issuer are
located at 4100 Lafayette Center Drive, Chantilly, Virginia 22021.
Item 2. Identity and Background.
(a) and (b) This Statement is filed by M. Dendy Young, a natural person
whose business address is 4100 Lafayette Center Drive, Chantilly, Virginia
22021.
(c) Mr. Young is president, chief executive officer, a director and
employee of the Issuer.
(d) and (e) Mr. Young has not been the subject of any criminal
proceeding (excluding traffic violations or similar misdemeanors) during the
past five years, nor has Mr. Young been a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction within the past five
years as a result of which he was or is subject to a judgment, decree or final
order enjoining future violations of, or prohibiting or mandating activities
subject to, federal or state securities laws or finding any violation with
respect to such laws.
(f) Mr. Young is a citizen of the United States of America.
Item 3. Source and Amount of Funds or Other Consideration.
On December 12 and 15, 1995, Mr. Young purchased 2,100 Common Shares
and 100 Common Shares, respectively, in the NASD National Market System at a
price of $3.50 per share. Mr. Young used his personal funds to acquire the 2,200
Common Shares.
Pursuant to an Employment Agreement dated as of December 18, 1995
between the Issuer and Mr. Young, a copy of which is attached hereto as Exhibit
1 and incorporated herein by this reference (the "Employment Agreement"), the
Issuer agreed to issue to Mr. Young a nonstatutory stock option to purchase up
to 700,000 Common Shares (the "1995 Option"). Mr. Young also holds a
nonstatutory stock option to purchase 100,000 Common Shares (the "1994 Option")
which was issued on August 16, 1994 pursuant to the terms of a Consulting and
Noncompetition Agreement dated August 16, 1994 between Mr. Young and the Issuer
(the "Consulting Agreement"). Terms of the 1994 Option and the 1995 Option
(collectively, the "Options") are set forth in response to Item 5 hereof.
Item 4. Purpose of Transaction.
Mr. Young acquired the above-mentioned 2,200 Common Shares and Options
for investment purposes. Mr. Young reserves the right to purchase additional
securities of the Issuer
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or to sell some or all of any Common Shares owned by him at any time in private
or market transactions depending on market conditions, his evaluation of
the Issuer's business, prospects and financial condition, the market for the
Common Shares, other opportunities available to Mr. Young, general economic
conditions, money and stock market conditions and other further developments.
Except as described herein, and except for plans or proposals of the
Issuer in which Mr. Young may participate in his capacity as an officer and
director of the Issuer, Mr. Young has no plans or proposals which relate to or
would result in:
(a) The acquisition by any person of additional securities of the
Issuer, or the disposition of securities of the Issuer;
(b) An extraordinary corporate transaction, such as a merger,
reorganization or liquidation involving the Issuer or any of its subsidiaries;
(c) A sale or transfer of a material amount of assets of the Issuer or
of any of its subsidiaries;
(d) Any change in the present Board of Directors (the "Board") or
management of the Issuer, including any plans or proposals to change the number
or term of directors or to fill any existing vacancies on the Board;
(e) Any material change in the present capitalization or dividend
policy of the Issuer;
(f) Any other material change in the Issuer's business or corporate
structure;
(g) Changes in the Issuer's charter or bylaws or other actions
which may impede the acquisition of control of the Issuer by any person;
(h) Causing a class of securities of the Issuer to be delisted from a
national securities exchange or to cease to be authorized to be quoted in an
inter-dealer quotation system of a registered national securities association;
(i) A class of equity securities of the Issuer becoming eligible for
termination of registration pursuant to Section 12(g)(4) of the Securities
Exchange Act of 1934, as amended; or
(j) Any action similar to any of those enumerated above.
Item 5. Interest in Securities of the Issuer.
(a) Mr. Young beneficially owns 372,200 Common Shares (of which 370,000
Common Shares represent that portion of the Options which are exercisable within
60 days of the date
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hereof), representing approximately 5.3% of the outstanding Common Shares,
based on the outstanding shares as of September 30, 1995.
(b) Mr. Young has the sole power to vote and dispose of 2,200 Common
Shares. Mr. Young would have the sole power to vote and dispose of the 370,000
Common Shares that represent that portion of the Options which are currently
exercisable within 60 days of the date hereof if such Shares were acquired upon
the exercise of the Options.
(c) Except as disclosed above, no transactions in Common Shares were
effected by Mr. Young during the 60 days prior to the date of this Statement.
(d) No other person has the right to receive dividends from, or the
proceeds from the sale of, the Common Shares owned by Mr. Young.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings and Relationships with
Respect to Securities of the Issuer.
Pursuant to the Consulting Agreement, Mr. Young and the Issuer entered
into a Nonstatutory Stock Option Agreement dated August 16, 1994 (the "1994
Option Agreement") pursuant to which the Issuer granted the 1994 Option to Mr.
Young. The 1994 Option entitles Mr. Young to purchase up to 100,000 Common
Shares for a per share purchase price of $10.50, vests and is exercisable
cumulatively in five equal annual installments commencing August 16, 1995 and
expires on August 16, 2004. The 1994 Option Agreement also provides Mr. Young
with certain demand and piggyback registration rights and permits the Issuer to
file a registration statement on Form S-8 with respect to the Common Shares
underlying the 1994 Option. A copy of the 1994 Option Agreement is attached
hereto as Exhibit 2 and incorporated herein by this reference.
Pursuant to the Employment Agreement, the Issuer granted the 1995
Option to Mr. Young as of December 18, 1995. The 1995 Option entitles Mr. Young
to purchase up to 700,000 Common Shares for a per share purchase price of $3.75
and vests and becomes exercisable as follows: (i) 350,000 Common Shares as of
December 18, 1995, (ii) 250,000 Common Shares as of December 18, 1996 and (iii)
100,000 Common Shares as of December 18, 1997. The 1995 Option expires on
December 18, 2005 and is otherwise subject to the same terms and conditions,
including registration rights, as the 1994 Option. A definitive nonstatutory
stock option agreement with respect to the 1995 Option is expected to be
executed after the date hereof.
Except as described herein, Mr. Young does not have any contract,
arrangement, understanding or relationship (legal or otherwise) with any person
with respect to any securities of the Issuer, including but not limited to the
transfer of any of the Common Shares owned by
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him, finder's fees, joint ventures, guarantees of profits, division of profits
or loss, or the giving or withholding of proxies.
Item 7. Material to be Filed as Exhibits.
Exhibit 1 -- Employment Agreement.
Exhibit 2 -- 1994 Option Agreement.
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<PAGE>
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.
Date: December 29, 1995 /s/ M. Dendy Young
--------------------
M. Dendy Young
[Government Technology Services, Inc. Logo]
GOVERNMENT TECHNOLOGY SERVICES, INC.
Nonstatutory Stock Option Agreement
Government Technology Services, Inc., a Delaware corporation (the
"Company"), hereby grants to M. Dendy Young (the "Optionee") an option (the
"Option") to purchase a total of 700,000 shares of Common Stock (the "Shares")
of the Company, at the price and on the terms set forth herein.
Nature of the Option. This Option is intended to be a nonstatutory
stock option and is not intended to be an incentive stock option within the
meaning of Section 442A of the Internal Revenue Code of 1986, as amended (the
"Code"), or otherwise to qualify for any special tax benefits to the Optionee.
1. Definitions. As used herein, the following definitions shall
apply:
(a) "Board" shall mean the Board of Directors of the
Company.
(b) "Common Stock" shall mean the Common Stock, $.005 par
value, of the Company.
(c) "Eligible Common Stock" shall mean the Optioned
Stock which the Optionee shall have exercised his right to acquire in accordance
with Section 5.
(d) "Exchange Act" shall mean the Securities Exchange Act
of 1934, as amended, and the rules and regulations thereunder.
(e) "Optioned Stock" shall mean the Common Stock subject
to this Option.
(f) "Person" shall mean any individual,
partnership, corporation, trust or unincorporated organization, or a government
or agency or political subdivision thereof.
(g) "Prospectus" shall mean the prospectus included
in a Registration Statement, including any preliminary prospectus, and any
such prospectus as amended or supplemented by any prospectus supplement with
respect to the terms of the offering of the Common Stock covered by the
Registration Statement, and by all other amendments, and in each case including
all material incorporated by reference therein.
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(h) "Registration Statement" shall mean any
registration statement of the Company on Form S-8 under the Securities Act and
all amendments and supplements to such registration statement, including
post-effective amendments, in each case including the Prospectus contained
therein, all material incorporated by reference therein and all exhibits
thereto.
(i) "SEC" shall mean the Securities and Exchange
Commission.
(j) "Securities Act" shall mean the Securities Act of
1933, as amended, and the rules and regulations thereunder.
(k) "Subsidiary" shall mean a subsidiary corporation,
whether now or hereafter existing, as defined in Sections 425(f) and (g) of the
Code.
3. Date of Grant; Term of Option. This Option is granted as of
December 18, 1995 (the "Grant Date"), and it may not be exercised later than
December 18, 2005 (the "Termination Date").
4. Option Exercise Price. The Option exercise price is $3.75 per
Share.
5. Exercise of Option. This Option shall be exercisable during
its term only as follows:
(a) Right to Exercise. This Option shall vest and be
exercisable cumulatively as follows: 350,000 Shares on the Grant Date,
250,000 Shares on the first anniversary of the Grant Date, and 100,000
Shares on the second anniversary of the Grant Date; provided, however, that
in the event of termination by the Company of that certain Employment
Agreement dated December 18, 1995 between the Company and the Optionee (the
"Employment Agreement") pursuant to Section 8(a)(ii) thereof, or upon the
occurrence of a Change of Control (as defined therein) and subsequent
employment termination pursuant to Section 8(c)(ii) thereof, all previously
unvested installments of this Option shall immediately and cumulatively vest
and be exercisable; and provided, further, that if the Employment Agreement
is terminated by the Company for Cause (as defined therein) all previously
unvested installments of this Option shall not vest and this Option shall not
be exercisable with respect to the Shares of Optioned Stock covered by such
installments.
(b) Method of Exercise. This Option shall be exercisable
from time to time as to all or any portion of the Shares as to which this Option
is then exercisable by written notice in the form of Attachment A attached
hereto (the "Notice"). The Notice shall be signed by the Optionee and shall
be delivered in person or by certified mail to the Secretary of the Company
or such other person as may be designated by the Company. The Notice shall be
accompanied by payment of the aggregate Option exercise price. Such payment
of the aggregate Option exercise price shall be by cash or check or by tender
of shares of Common Stock, which shares shall be valued at the price at which
the Common Stock was last traded on the National Association of Securities
Dealers, Inc. Automated Quotation System on the day before such tender. The
certificate or certificates for the Shares as to which this Option shall be
exercised shall be registered in the name of the Optionee and shall be
registered as required under Section 15 hereof.
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<PAGE>
(c) Restrictions on Exercise. This Option may not be
exercised for a fraction of a Share.
(d) Effect of Exercise. Exercise of this Option in any
manner shall result in a decrease in the number of Shares which thereafter
may be available for sale under this Option by the number of Shares as to
which this Option is exercised.
6. No Rights as Stockholder. Until this Option is properly
exercised in whole or in part in accordance with the terms of Section 5 hereof,
no right to vote or receive dividends or any other rights as a stockholder shall
exist with respect to the Optioned Stock. No adjustment shall be made for a
dividend or other right for which the record date is prior to the date this
Option is exercised, except as provided in Section 10 hereof.
7. Delivery of Share Certificates. As soon as practicable after
any proper exercise of this Option, the Company shall, without transfer or issue
tax to the Optionee, deliver to the Optionee at the principal executive office
of the Company or such other place as shall be mutually agreed upon between the
Company and the Optionee, a certificate or certificates representing the Shares
for which this Option shall have been exercised. The time of issuance and
delivery of the certificate(s) representing the Shares for which this Option
shall have been exercised may be postponed by the Company for such period as may
be required by the Company, with reasonable diligence, to comply with any
applicable listing requirements of any national or regional securities exchange
or any law or regulation applicable to the issuance or delivery of such Shares.
8. Termination of Option. To the extent that the Optionee was not
entitled to exercise this Option at the date of termination, or to the extent
this Option is not exercised within the time specified herein, this Option shall
terminate. Notwithstanding the foregoing, this Option shall not be exercisable
after the expiration of the term set forth in Section 3 hereof.
9. Nontransferability of Option. This Option may not be sold,
pledged, assigned, hypothecated, gifted, transferred or disposed of in any
manner either voluntarily or involuntarily by operation of law, other than by
will or by the laws of descent or distribution, and may be exercised during the
lifetime of the Optionee only by the Optionee. Subject to the foregoing, the
terms of this Option shall be binding upon the executors, administrators, heirs,
successors and assigns of the Optionee.
10. Adjustment Upon Changes in Capitalization.
(a) Subject to any required action by the stockholders of
the Company, the number of Shares covered by this Option, as well as the
exercise price per Share of the Shares covered by this Option, shall be
proportionately adjusted for any increase or decrease in the number of issued
shares of Common Stock resulting from a stock split or combination or the
payment of a stock dividend (but only on the Common Stock) or any other
increase or decrease in the number of issued shares of Common Stock effected
without receipt of consideration by the Company (other than stock bonuses to
employees or directors); provided, however, that the conversion of any
convertible securities of the
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<PAGE>
Company shall not be deemed to have been effected without the receipt of
consideration. Such adjustment shall be made by the Board, whose determination
in that respect shall be final, binding and conclusive. Except as expressly
provided herein, no issuances by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, shall affect, and no
adjustment by reason thereof shall be made with respect to, the number or price
of Shares subject to this Option.
(b) In the event of the proposed dissolution or
liquidation of the Company, or in the event of a proposed sale of all or
substantially all of the assets of the Company (other than in the ordinary
course of business), or the merger or consolidation of the Company with or
into another corporation as a result of which the Company is not the surviving
and controlling corporation, the Board shall (i) make provision for the
assumption of this Option by the successor corporation or (ii) declare that
this Option shall terminate as of a date fixed by the Board which is at least
30 days after the notice thereof to the Optionee and shall give the Optionee
the right to exercise this Option as to all or any part of the Optioned Stock,
including Shares as to which the Option would not otherwise be exercisable,
provided such exercise does not violate Section 5 hereof.
(c) No fractional shares of Common Stock shall be
issuable on account of any action aforesaid, and the aggregate number of
shares into which Shares then covered by this Option, when changed as the
result of such action, shall be reduced shall be the largest number of whole
shares resulting from such action, unless the Board, in its sole
discretion, shall determine to issue scrip certificates in respect to any
fractional shares, which scrip certificates, in such event, shall be in a
form and have such terms and conditions as the Board in its discretion shall
prescribe.
11. Reservation of Shares. The Company covenants and agrees that
during the term of this Option the Company will at all times have authorized and
reserved for the purpose of the issue upon exercise of this Option at least the
maximum number of shares of Common Stock issuable upon the exercise of this
Option.
12. Continuation of Employment. This Option shall not confer upon
the Optionee any right to be employed by or continue in the employment of the
Company or any of its Subsidiaries.
13. Withholding. The Company reserves the right to withhold,
in accordance with any applicable laws, from any consideration payable to
Optionee any taxes required to be withheld by federal, state or local law as a
result of the grant or exercise of this Option or the sale or other
disposition of the Shares issued upon exercise of this Option. If the amount
of any consideration payable to the Optionee is insufficient to pay such taxes
or if no consideration is payable to the Optionee, upon the request of the
Company, the Optionee shall pay to the Company an amount sufficient for the
Company to satisfy any federal, state or local tax withholding requirements
it may incur as a result of the grant or exercise of this Option or the sale or
other disposition of the Shares issued upon the exercise of this Option.
14. Common Stock Subject to Registration Rights. All Eligible
Common Stock will cease to be Eligible Common Stock when (i) a Registration
Statement covering such Eligible Common Stock has been declared effective by
the SEC and such Eligible Common Stock has been
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<PAGE>
disposed of pursuant to such effective Registration Statement, (ii) it is
distributed to the public pursuant to Rule 144 (or any similar provision
then in force) under the Securities Act or (iii) it has otherwise been
transferred and it may be resold by such transferee without subsequent
registration under the Securities Act and without restriction under Rule 144.
15. Registration Rights.
(a) At any time after the Optionee shall have exercised
his right to acquire Optioned Stock as provided in Section 5 and up until
and including the Termination Date, the Optionee shall have the right to
make written requests (each a "Demand") on the Company to cause the Company to
use its best reasonable efforts to effect the filing of a Registration
Statement with respect to the Eligible Common Stock. Each Demand shall
set forth the number of shares of Eligible Common Stock proposed to be sold by
the Optionee.
(b) At any time on or after the first anniversary of the
Grant Date up until and including the Termination Date, if the Company shall
have filed a Registration Statement covering any of its Common Stock, and
such Registration Statement shall be effective under the Securities Act,
the Company shall use its best reasonable efforts to effect the registration
of the Eligible Common Stock by including such Eligible Common Stock in such
Registration Statement.
(c) Notwithstanding the foregoing, the Corporation at its
own initiative may cause a Registration Statement on Form S-8 to be filed
with the SEC with respect to the Optioned Stock.
16. Registration Procedures. In connection with the Company's
registration obligations pursuant to Section 15 hereof, the Company will use its
best reasonable efforts to effect the registration of the Eligible Common Stock
in accordance with the intended method or methods or distribution thereof, and
pursuant thereto to the Company shall:
(a) prepare and file with SEC, as soon as practicable
after receipt of a Demand, a Registration Statement relating to the Eligible
Common Stock with respect to which a Demand has been received in accordance
with the intended method or methods of distribution thereof and shall include
all financial statements and other information required by the SEC to be
filed therewith, and use its best reasonable efforts to cause such Registration
Statement to become effective;
(b) prepare and file with the SEC such amendments to the
Registration Statement as may be necessary to keep the Registration
Statement effective until the distribution of the Eligible Common Stock under
the Registration Statement is complete; cause the Prospectus to be
supplemented by any required prospectus supplement; and comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such Registration Statement;
(c) notify the Optionee promptly (i) when the
Registration Statement has become effective and when any post-effective
amendment or supplement thereto becomes effective and (ii) of the issuance by
the SEC of any stop order suspending the effectiveness of the Registration
Statement; (iii) of the receipt by the Company of any notification with respect
to the suspension of
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the qualification of the Eligible Common Stock for sale in
any jurisdiction or the initiation or threatening of any proceeding for such
purpose and (iv) of the happening of any event which makes any statement made in
the Registration Statement untrue or which requires the making of any changes in
the Registration Statement or the Prospectus or any document incorporated
therein by reference to make the statements therein not misleading;
(d) make reasonable efforts to obtain the withdrawal of
any order suspending the effectiveness of the Registration Statement at the
earliest possible time:
(e) deliver to the Optionee as many copies of the
Prospectus and any amendment or supplement thereto as the Optionee may
reasonably request; the Company consents to the use of the Prospectus or any
amendment or supplement thereto by the Optionee in connection with the
offering and sale of the Eligible Common Stock covered by the Prospectus or any
amendment or supplement thereto;
(f) prior to any public offering of Eligible Common
Stock, make reasonable efforts to register or qualify or cooperate with the
Optionee, in connection with the registration or qualification of such
Eligible Common Stock for offer and sale under the securities or blue sky laws
of such jurisdictions as the Optionee reasonably requests in writing and do
any and all other acts or things necessary or advisable to enable the
Optionee to consummate the disposition in such jurisdictions of the
Eligible Common Stock covered by the Registration Statement; provided
that the Company will not be required to (i) qualify generally to do
business in any jurisdiction where it is not then so qualified; (ii) subject
itself to taxation in any such jurisdiction; or (iii) take any action which
would subject it to general service of process in any such jurisdiction
where it is not then so subject;
(g) cooperate with the Optionee and the managing
underwriters, to facilitate the timely preparation and delivery of certificates
representing the Eligible Common Stock to be sold and not bearing any
restrictive legends; and enable such Eligible Common Stock to be in such
denominations and registered in such names as the Optionee may request at least
two business days prior to any sale of the Eligible Common Stock;
(h) as promptly as practicable following the occurrence
of any event contemplated by Section 16(c)(iv) hereof, make reasonable efforts
to prepare a supplement or post-effective amendment to the Registration
Statement or the related Prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter
delivered to the purchasers of the Eligible Common Stock, the Prospectus will
not contain an untrue statement or a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; and
(i) make reasonable efforts to cause all the Eligible
Common Stock covered by the Registration Statement to be listed on each
securities exchange or automated quotation system, if any, on which similar
securities issued by the Company are then listed if requested by the Optionee.
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<PAGE>
The Company may require the Optionee to furnish to the Company such information
regarding the distribution of the Eligible Common Stock as the Company may from
time to time reasonably request in writing.
The Optionee agrees that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 16(c)(iv) hereof, the
Optionee will forthwith discontinue the offering and disposition of Eligible
Common Stock until the Optionee's receipt of the copies of the supplemented or
amended Prospectus contemplated by Section 16(h) hereof, or until it is advised
in writing (the "Advice") by the Company that the use of the Prospectus may be
resumed, and has received copies of any additional or supplemental filings which
are incorporated by reference in the Prospectus, and, if so directed by the
Company, the Optionee will deliver to the Company (at the Company's expense) all
copies, other than permanent file copies then in the Optionee's possession, of
the Prospectus covering such Eligible Common Stock current at the time of
receipt of such notice.
17. Registration Expenses. All expenses incident to the Company's
performance of or compliance with this Agreement, including SEC registration and
filing fees, fees and expenses of compliance with state securities, or blue sky,
laws and the fees and expenses incurred in connection with the listing of the
securities to be registered on each securities exchange on which similar
securities issued by the Company are then listed in connection with the Demand
Registration will be borne by the Company.
18. Action by the Company. The existence of this Option shall not
affect in any way the right or power of the Company or its stockholders to make
or authorize any or all adjustments, recapitalizations, reorganizations or other
changes in the Company's capital structure or its business, or any merger or
consolidation of the Company, or any issue of bonds, debentures, preferred or
prior preference stocks ahead of or affecting the Common Stock or the rights
thereof, or the dissolution or liquidation of the Company, or any sale or
transfer of all or any part of its assets or business, or any other corporate
act or proceeding.
19. Interpretation. As a condition to the granting of this Option,
the Optionee and each person who succeeds to the Optionee's rights hereunder,
agrees that any dispute or disagreement which shall arise under or as a result
of or pursuant to this Option shall be determined by the Board in its good faith
sole discretion, and that any such determination or interpretation of the terms
of this Option by the Board shall be final, binding and conclusive.
20. Notices. Any notice to be given to the Company pursuant to
this Option shall be addressed to the Company in care of its Corporate Secretary
(or such other person as the Company may designate from time to time) at its
principal office, and any notice to be given to the Optionee shall be delivered
personally or addressed to him at the address given beneath his signature set
forth below, or at such other address as the Optionee may hereafter designate in
writing to the Company. Any such notice shall be deemed duly given when enclosed
in a properly sealed envelope or wrapper addressed as aforesaid, registered or
certified, and deposited, postage and registry or certification fee prepaid, in
a post office or branch post office regularly maintained by the United States
Postal Service.
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21. Invalid Provisions. In the event that any provision of this
Option is found to be invalid or otherwise unenforceable under any applicable
law, such invalidity or unenforceability shall not be construed as rendering any
other provisions contained therein as invalid or unenforceable, and all such
other provisions shall be given full force and effect to the same extent as
though the invalid or unenforceable provision were not contained herein.
22. Governing Law. This Option shall be governed by and construed
in accordance with the laws of the State of Delaware.
This Agreement is dated as of December 18, 1995.
Government Technology Services, Inc. M. Dendy Young
By: /s/ Worth D. MacMurray Signature: /s/ M. Dendy Young
Name: Worth D. MacMurray Address: 6204 Elmwood Road
-------------------------------- ------------------
Title: General Counsel Chevy Chase, MD 20815
------------------------------- -----------------------
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[Government Technology Services, Inc. Logo]
GOVERNMENT TECHNOLOGY SERVICES, INC.
NOTICE OF EXERCISE OF STOCK OPTION
(Please print legibly or type)
I, M. Dendy Young ("Optionee"), hereby agree, represent and warrant to
Government Technology Services, Inc. (the "Company") as follows:
1. On December 18, 1995, I was granted a Stock Option (the "Option")
pursuant to an Employment Agreement between myself and the Company dated
December 18, 1995 (the "Employment Agreement").
2. Pursuant to the Option, I was granted the right to purchase 700,000
shares of the Company's Common Stock, subject to adjustment in accordance with
the Employment Agreement (the "Optioned Shares").
3. I am eligible to exercise the Option to the extent that I am
exercising the Option.
4. I hereby elect to exercise the Option to purchase __________ of such
Optioned Shares (the "Shares") under the Stock Option Agreement evidencing said
Option at $3.75 per Share, for an aggregate purchase price of $_________.
5. This Notice of Exercise of Stock Option is accompanied by payment in
full for the Shares and withholding tax in cash or check or by tender of shares
of Common Stock as set forth in the Option.
6. In connection with my exercise of the Option, I have reviewed a copy
of the Company's Registration Statement on Form S-8 relating to the Common Stock
issuable pursuant to the Option.
Dated: ______________________ _______________________________
Signature of Optionee
______________________________ _______________________________
Social Security Number Address
_______________________________
City, State, Zip
Received on behalf of Government Technology Services, Inc. on _________________.
Signature: _______________________
Print Name: ______________________
