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Exhibit 10.2
STOCK PURCHASE AGREEMENT
FOR
MICROSTRATEGY INCORPORATED
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THIS STOCK PURCHASE AGREEMENT ("Agreement"), by and between MICROSTRATEGY
INCORPORATED, a Delaware corporation (the "Corporation") and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ of
New Castle County, Delaware, ("▇▇▇▇▇") is being entered into on 11 October,
1992.
WHEREAS, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ("▇▇▇▇▇▇") of New Castle County, Delaware has
caused the Corporation to be formed for the purpose of being a full service
provider of strategy system software, support and service and related activities
and any other lawful business as determined by the Board of Directors of the
Corporation; and
WHEREAS, ▇▇▇▇▇ wishes to become a shareholder in the Corporation subject to
the terms and conditions of this Agreement;
NOW THEREFORE, for the mutual promises, covenants, understandings,
representations, warranties and benefits contained herein, the parties hereto
agree as follows:
1. Subscription for Shares. ▇▇▇▇▇ agrees to subscribe to such number of
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shares of the authorized stock of the Corporation at such price as is more
particularly described in Exhibit A attached hereto.
2. Payment for Shares. Concurrent with the execution of this Stock
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Purchase Agreement, ▇▇▇▇▇ shall pay into the Corporation, as paid in capital
and/or surplus, in
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exchange for the capital stock of the Corporation, the total subscription price
as more particularly described in Exhibit A.
3. Shareholders Buy/Sell Agreement. ▇▇▇▇▇ agrees to execute and be bound
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by a Shareholders Buy/Sell Agreement with respect to all the outstanding shares
of the Corporation ("Shares") in the form substantially similar to that attached
hereto as Exhibit B.
4. Representations of ▇▇▇▇▇. ▇▇▇▇▇ represents and warrants as follows:
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(a) That he has received and carefully read this Agreement including all
of its attachments.
(b) That he is purchasing the Shares in the Corporation without being
furnished any offering literature or prospectus other than this Agreement.
(c) That he recognizes that the Shares have not been registered under the
Securities Act of 1933, as amended (the "Act"), or under the securities laws of
any state and, therefore, cannot be resold unless they are registered under the
Act and applicable state securities laws or unless an exemption from
registration is available. ▇▇▇▇▇ recognizes that he has no rights to require
such registration. He also recognizes that no public agency has passed upon the
accuracy or adequacy of the information contained in this Agreement or the
fairness of the terms of the subscription.
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(d) That he is acquiring the Shares for his own account for a long term
investment and not with a view toward resale, fractionalization, division, or
distribution thereof. The parties do not presently have any reason to anticipate
any change in his circumstances, financial or otherwise, or any particular
occasion or event which would necessitate or require the sale or distribution of
the Shares. No one other than the parties hereto have any beneficial interest in
the Shares.
(e) That he recognizes the transfer of the Shares is subject to a
Shareholders Buy/Sell Agreement which agreement severely restricts his ability
to sell or otherwise dispose of the Shares, and among other provision, provides
further, under certain circumstances, for the mandatory sale of his Shares to
the Corporation and/or its remaining Shareholder.
(f) That he recognizes the Corporation is in the development stage, has
no history of operations or earnings, is a speculative venture, and that the
total amount of funds tendered to purchase the Shares, including any debt of the
Corporation guaranteed by him, is placed at the risk of the business and may be
completely lost.
(g) That he has been provided with access to all information requested
in addition to the Agreement for evaluating his purchase of Shares, none of
which was contrary to the information contained in this Agreement.
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(h) That he has been presented with and has acted upon the opportunity
to ask questions and receive answers from the offeror relating to the terms and
conditions of the purchase of the Shares, to consult with legal counsel and to
obtain any additional information necessary to verify the accuracy of the
information made available to him.
(i) That ▇▇▇▇▇ recognizes he is a minority Shareholder in the
Corporation and that, as such, pursuant to the General Corporation Law of the
State of Delaware ("GCL"), his rights to control, operate, and manage the
Corporation are limited, and that as the majority Shareholder, ▇▇▇▇▇▇, by virtue
of his ability to elect directors as provided by the GCL and by virtue of his
ability to vote his Shares pursuant to the GCL, has substantial control over the
operations, management and activities of the Corporation.
5. Indemnification. ▇▇▇▇▇ agrees to indemnify and hold harmless the
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Corporation and its affiliates, and ▇▇▇▇▇▇ from any and all damages, losses,
costs and expenses (including reasonable attorneys' fees) any of which may be
incurred by reason of the failure of the representations and warranties made by
him in this Agreement, or in any document provided by him to Microstrategy or to
its affiliates.
6. Applicable Law. This Agreement shall be deemed to have been made in
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the State of Delaware, shall become valid when executed and accepted by the
parties, and shall be governed and construed in accordance with the laws
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of such State, which laws shall prevail in the event of any conflict of laws.
7. Severability. If, for any reason, any portion of this Agreement is
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held to be invalid, contrary to or in conflict with any applicable present or
future law or regulation in a final, unappealable ruling issued by any court,
agency or tribunal of competent jurisdiction in a proceeding to which the
Corporation and ▇▇▇▇▇ are a party, that ruling shall not impair the operation
of, or having any effect upon, such other portions of this Agreement as may
remain otherwise enforceable, which shall continue to be given full force and
effect and bind the parties hereto, although any portion held to be invalid
shall be deemed not be a part of this Agreement when the time for appeal
expires, or upon the receipt, by either party, of notice of nonenforcement
thereof.
8. Binding Effect. This Agreement is binding upon the parties hereto
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and their respective executors, administrators, heirs, assigns and successors in
interest.
9. Construction. The preambles are a part of this Agreement and are
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expressly incorporated herein.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year aforesaid.
ATTEST MICROSTRATEGY INCORPORATED
[SIGNATURE APPEARS HERE] By: [SIGNATURE APPEARS HERE] [SEAL]
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Secretary President
WITNESS: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
[SIGNATURE APPEARS HERE] /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ [SEAL]
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EXHIBIT A
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SUBSCRIPTION OF SHARES
OF
MICROSTRATEGY INCORPORATED
Total
Price Subscription
Name Shares Per Share Price
---- ------ --------- -----
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ 100 $1.00 $100.00
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ 28 $1.00 $28.00
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ 18 $1.00 $18.00
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ 5 $1.00 $5.00
▇▇▇▇▇ ▇▇▇▇▇▇ 3 $1.00 $3.00
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EXHIBIT B
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MICROSTRATEGY INCORPORATED
SHAREHOLDERS BUY/SELL AGREEMENT
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THIS AGREEMENT, made this _____ day of __________ 1992, by and among
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, party of the first part ("▇▇▇▇▇▇"), and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇,
party of the second part ("▇▇▇▇▇"), both of which parties and any successors
shall collectively be referred to as "Shareholders," and MICROSTRATEGY
INCORPORATED, a Delaware corporation, party of the third part ("Corporation").
WITNESSETH:
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WHEREAS, the Shareholders are the owners of all of the issued capital stock
of Corporation (together with any capital stock issued hereafter, the "Shares")
as follows: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ -- 100 Shares and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ -- 28 Shares and
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ -- 18 Shares and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ -- 5 Shares and ▇▇▇▇▇ ▇▇▇▇▇▇
-- 3 Shares; and
WHEREAS, the parties to this agreement believe that it is in their mutual
best interests to provide continuity in the management and policies of the
Corporation. Accordingly, the purpose of this agreement is to impose certain
restrictions and obligations with respect to the disposition of the Shares by
any Shareholder and to provide for the purchase by the Corporation of a deceased
Shareholder's Shares therein.
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NOW, THEREFORE, in consideration of the premises and the mutual
covenants and conditions herein contained, and for other good and valuable
consideration, receipt of which is hereby acknowledged, the parties hereto,
intending to be legally bound hereby, mutually covenant and agrees follows:
1. RIGHT OF FIRST PURCHASE:
(a) Restriction:
Each Shareholder agrees that during his lifetime he will not sell,
give, encumber, pledge or otherwise transfer, assign, or dispose of either
voluntarily or involuntarily, or by operation of law, all or any part of the
Shares which he now owns or may hereafter acquire (except as otherwise permitted
herein) without first offering in writing such Shares to the Corporation and to
the other Shareholder for a Total Purchase Price determined in accordance with
paragraph 5 hereof, and on the terms provided therein.
(b) Period of Rights:
The Corporation shall promptly notify the other Shareholder of the
receipt of such offer and its contents, and the Corporation shall have a period
of thirty (30) days from the date of receipt of such offer to exercise or waive
its right to purchase all of the Shares so offered. If the Corporation waives or
fails to exercise its rights within said period, the Corporation shall thereupon
notify the Shareholder of such a fact in writing and such other Shareholder
shall have a period of thirty (30) days from the receipt of such notice or from
the expiration of said thirty (30) day period, whichever is the
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earlier, to exercise or waive the right to purchase all of the Shares so offered
at the Total Purchase Price determined in accordance with paragraph 5 of this
agreement, and on the terms as provided therein.
It is understood and agreed that neither the Corporation nor the other
Shareholder shall have the right to buy any less than all of the Shares so
offered by the selling Shareholder.
(c) Failure to Exercise Right:
In the event neither the Corporation nor the other Shareholder shall
elect to purchase all of the Shares so offered within the proper period, or
shall waive such rights, then the offering Shareholder shall be free to sell
such Shares so offered to any person or entity provided that such person or
entity shall, upon the purchase of such Shares, agree to be bound by the terms
and conditions of this agreement. Any of the offered Shares not so sold within a
period of ninety (90) days after any offer under subparagraphs 1(a) and 1(b)
hereof to the Corporation and the Shareholder has expired, shall again become
subject to the terms of this agreement and may not thereafter be sold to any
other party without first offering them to the Corporation and the other
Shareholders in accordance with the terms and conditions of this agreement.
2. TERMINATION OF EMPLOYMENT:
If any Shareholder's employment with the Corporation is terminated for
any reason, other than by reason of death, said terminated or retiring employee
shall, within ninety (90)
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days thereof, offer for sale all of his Shares to the Corporation at a Total
Purchase Price determined in accordance with paragraph 5 of this agreement, and
of the terms contained therein, and the Corporation shall purchase the aforesaid
Shares in accordance therewith.
3. INSURANCE:
(a) To the extent that life insurance is owned on the lives of
certain Shareholders, all such policies of insurance subject hereto shall be
listed in Schedule "A ," attached hereto and made a part hereof. It is agreed
that further or substituted policies of insurance may from time to time be made
subject to the provisions hereof, or that policies subject hereto may be
withdrawn herefrom by the Shareholders and the Corporation. The description of
the policies so added or withdrawn shall be included in said Schedule "A."
(b) The premiums that shall be payable upon the said policies
shall be paid by the Corporation.
(c) Any dividends that may be payable upon the said policies
shall be disposed of as directed in the application for said policies or as
afterward directed by the Corporation.
(d) Any provisions of the policy contracts notwithstanding, it is
agreed that all of the rights, benefits, privileges, and options pertaining to
the said policies, including but not limiting the generality of the above
classification, the right to change the dividend option, the right to borrow on
the said policies of insurance for any
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purpose whatsoever, the right to surrender any policy for its cash surrender
value, and the right to assign any policy or to change the beneficial interest
thereunder shall be exercised only by the Corporation.
4. DEATH OF A SHAREHOLDER:
(a) Each Shareholder hereby agrees that if he shall be the first to
die of the Shareholders, all of his Shares shall be offered for sale to the
Corporation at a Per Share Price determined in accordance with subparagraph 5(b)
of this agreement and on the terms contained in this paragraph (and not on the
terms contained in subparagraph 5(a) of this agreement).
(b) The Corporation hereby agrees that following the death of the
first to die of the Shareholders, it shall forthwith purchase the Shares of the
then deceased Shareholder at a Per Share Price determined in accordance with
subparagraph 5(b) of this agreement and on the terms contained in this
paragraph.
(c) Upon the death of any Shareholder the Corporation shall forthwith
submit proof of claim with respect to any and all policies of insurance issued
upon the life of said deceased Shareholder that were payable to the Corporation
upon the death of said Shareholder. Said Corporation shall receive, use and
apply all proceeds received under said policies in trust for the uses and
purposes herein set forth.
(d) In the event that the amount of insurance proceeds paid to the
Corporation shall be in excess of the purchase price of the Shares of the
deceased Shareholder, such
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excess of proceeds over purchase price shall be paid over forthwith to the
Corporation to be held by it free from all of the provisions hereof. The
Corporation shall forthwith pay over the balance of the proceeds (equal in
amount to said purchase price) to the executors or administrators of the
deceased Shareholder. Thereupon the Corporation shall receive as the owner
thereof the Shares of the deceased Shareholder.
(e) In the event that the amount of insurance proceeds paid to the
Corporation shall be equal to the purchase price of the Shares of the deceased
Shareholder, the Corporation shall forthwith pay over all of the said proceeds
to the executors or administrators of the deceased Shareholder. Thereupon the
Corporation shall receive as the owner thereof the Shares of the deceased
Shareholder.
(f) In the event that the said proceeds of the said policy are less than
the purchase price of the Shares being purchased as determined in the manner
hereinbefore set forth, the Corporation shall pay all of said proceeds to the
executors, or administrators of the deceased Shareholder, and in addition the
Corporation shall pay an amount equal to the amount by which the purchase price,
as determined in the manner herein set forth, exceeds the said proceeds of the
said policies issued upon the life of the deceased Shareholder. In such case, or
in the event that there is no insurance policy in effect on the life of the
deceased Shareholder, the payment shall be made to the said executors or
administrators in two (2) equal annual installments with interest at the rate of
nine percent (9%) per
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annum on the unpaid balance. In connection therewith, it is understood and
agreed that the Corporation at any time or from time to time may prepay in part
or in full said remaining balance due without penalty or premium. Further, in
connection therewith, upon payment of the initial sum due the estate of the
deceased Shareholder, together with the execution of a judgment note, upon the
terms contained in this subparagraph, in favor of the estate of the deceased
Shareholder for the unpaid balance, the said estate shall duly endorse and
deliver all of the Shares of the deceased Shareholder to the Corporation.
5. PURCHASE PRICE:
(a) The "Total Purchase Price" with respect to any Shares being
purchased pursuant to paragraphs 1, 2 or 9 of this agreement shall be the sum of
four separate payments (each an "Annual Purchase Price Payment") to be paid in
cash by the purchaser to the seller as provided herein, each payment to be
computed as follows:
Each Annual Purchase Price Payment shall be the Per Share Price
as defined and determined for that year (assuming that the Shares being
purchased were still issued and outstanding) pursuant to subparagraph (b) of
this paragraph, multiplied by the total number of Shares being purchased,
divided by four (4).
The first Annual Purchase Price Payment shall be paid within
thirty (30) days of the acceptance of any offer to sell or notification of any
requirement to purchase any Shares pursuant to paragraphs 1, 2 or 9 of this
agreement, at which
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time the seller shall duly endorse and deliver all of his Shares to the
purchaser. Each of the remaining three Annual Purchase Price Payments as
determined pursuant to this subparagraph shall be a general obligation, as it
becomes due, of the purchaser and paid in cash annually thereafter.
Selling Shareholder may, at his option, require that 3/4 of the shares
being sold be pledged or placed in escrow. As each "Annual Purchase Price
Payment" is made, 1/4 of the total number of shares being sold will be removed
from escrow. The number of shares placed and removed from escrow will be rounded
to the nearest whole number of shares. For example if the shareholder initially
has 18 shares, 14 shares will be placed in escrow. After the second payment 1/2
of the total shares will remain in escrow (9 shares). After the third payment 5
shares will remain in escrow. After the fourth payment 0 shares will remain in
escrow.
Should any Annual Purchase Price Payment be due and payable in
any calendar year prior to the time in such calendar year that the Per Share
Price has been defined and determined pursuant to subparagraph (b) of this
paragraph, then and in that case the Per Share Price shall be the Per Share
Price as determined for the previous calendar year, and the Annual Purchase
Price Payment shall be paid in accordance with this agreement, subject, however,
to the following adjustment: at such time during the said calendar year that the
Per Share Price shall be finally defined and determined for that calendar year,
the Annual Purchase Price Payment paid for that year shall be
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re-calculated accordingly and an amount equal to any excess in the re-calculated
Annual Purchase Price Payment for that year over the Annual Purchase Price
Payment already paid by the purchaser shall be paid by the purchaser to the
seller forthwith. Should the re-calculated Annual Purchase Price Payment for the
said year be less than the Annual Purchase Price Payment already paid, then and
in that case, an amount equal to the difference between the Annual Purchase
Price Payment already paid by the purchaser to the seller and the re-calculated
Annual Purchase Price Payment shall be refunded by the seller to the purchaser
forthwith.
(b) The Per Share Price for the purposes of this agreement shall
be the amount endorsed on Schedule "B." The parties agree, at on or before March
31, of each year, they shall mutually agree upon the Per Share Price as of
December 31 of the preceding calendar year and shall duly endorse Exhibit "B"
with said Per Share Price and the date thereof. The initial Per Share Price for
the purpose of this agreement shall be fixed by the Shareholders immediately
upon the execution of this agreement and shall be duly endorsed on Schedule "B."
This means that whenever the number of shares outstanding changes, the Price Per
Share will be recalculated immediately based upon the new number of shares, and
this Price Per Share will be used to calculate the value of any Annual Purchase
Price Payment coming due following the change in the number of shares
outstanding.
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The shareholders will determine the valuation of the shares (once per
year, or whenever the number of shares outstanding changes) by exercising the
following formula in good faith:
Per Share Price = Total Business Valuation / Total Shares Outstanding
CASE Formula Business Valuation greater than (Gross Receipts or Sales) * Two
(2) THEN Total Business Valuation= (Gross Receipts or Sales) * Two (2)
CASE Formula Business Valuation less than (Gross Receipts or Sales) * One-Half
(.5) THEN Total Business Valuation= (Gross Receipts or Sales) *One-Half
(.5)
CASE (Gross Receipts or Sales) * One-Half (.5) less than Formula Business
Value less than (Gross Receipts or Sales) * Two (2) THEN
Total Business Valuation= Formula Business Valuation
Formula Business Valuation=Adjusted After Tax Earnings/Cost Of Capital
Adjusted After Tax Earnings=After Tax Earnings + Principals Salary
Adjustment
After Tax Earnings= Earnings (or loss) after operating expenses
and taxes as reported to the IRS for tax purposes.
Principals Salary Adjustment= (Principal's Combined Salary -
Principals Salary Allowance)* (1-Corporate Income Tax Rate)
Principals Combined Salary= sum of non-dividend related, taxable
compensation from the corporation for all shareholders
Principal's Salary Allowance= Number of Principals * Nominal
Principal Salary
(Definition of a Principal: any shareholder with more than
2.5% ownership of the company's stock)
Nominal Principal Salary= $50,000/year in 1990
Escalating at Consumer Price Index + 5%
Cost Of Capital= Long Term Risk Free Interest Rate + Risk Premium Long
Term Risk Free Interest Rate= 30 Year U.S. Treasury ▇▇▇▇ Rate
Risk Premium = 5%
Each year, every shareholder will be granted the above information in order to
calculate the valuation of the firm using this formula. If, within forty-five
(45) days after March 31 of each year, a shareholder has reason to believe that
the firm is being undervalued based upon this information, he may upon written
demand to the other Shareholders require that the
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Per Share Price be fixed by arbitration. The arbitrator will then seek to value
the firm in the spirit of the original agreement while taking into account any
business irregularities.
In the event of arbitration, the accountant for the
Corporation shall retain the accounting firm of Price Waterhouse (or its
successor) to act as arbitrator.
Said arbitrator shall, within one hundred twenty (120) days
of said demand for arbitration determine, without right of appeal therefrom, the
Per Share Price which shall be, in the opinion of the arbitrator, the fair
market value of the Corporation as a going concern divided by the total number
of Shares outstanding. The said valuation so determined by arbitration shall be
endorsed on this agreement by the Corporation's accountant and shall be binding
for the then current calendar year. In the event that the valuation returned by
the arbitrator is more than 5% higher than that set by the corporation, the
corporation shall pay for the audit process. In the event that the valuation
returned by the auditor is 5% lower than that set by the corporation, the
protesting shareholder shall pay for the audit. If the arbitrator's valuation of
the firm is within 5% of the value set by the corporation, the cost of the audit
will be split between the protesting shareholder and the corporation equally
(50% to be paid by each party).
For purposes of this paragraph, "Shareholder" shall include any former
Shareholder who shall have received at least one, but
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not all, of his four Annual Purchase Price Payments due pursuant to this
paragraph.
6. SALE OF A MAJORITY OF SHARES OF THE CORPORATION
(a) In the case of a proposed sale by a Shareholder ("Controlling
Shareholder") to a third party of a majority of the total Shares outstanding and
the failure of both the Corporation and the other Shareholder to exercise their
respective rights of first purchase pursuant to paragraph 1 of this agreement,
the remaining Shareholder ("Minority Shareholder") shall have the right to
require the Corporation to purchase all of his Shares by notifying the
Corporation, within thirty (30) days of his receipt of notice pursuant to
subparagraph 1(b) of this agreement, of his desire to sell his Shares and the
Corporation shall purchase, for a Total Purchase Price as defined in
subparagraph 5(a) of this agreement, all such Shares in accordance with
subparagraph (c) of this paragraph.
(b) In the case of the sale by any Controlling Shareholder to a
third party of Shares representing a majority of the Shares outstanding, should
the Minority Shareholder have previously sold his Shares to the Corporation
pursuant to paragraphs 1, 2 or 9 of this agreement and not have received, at the
time of the aforesaid sale of Shares by the Controlling Shareholder, the entire
Total Purchase Price, then in that case the Per Share Price for computing all
succeeding Annual Purchase
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Price Payments shall be adjusted in accordance with subparagraph (c) of this
agreement and paid in accordance therewith.
(c) For purposes of this paragraph, the Per Share Price used to
compute the Total Purchase Price or any succeeding Annual Purchase Price Payment
shall be the selling price of each of the Shares being sold by the Controlling
Shareholder, the provisions of subparagraph 5(b) of this agreement to the
contrary notwithstanding.
In the case of a sale of a majority of Shares outstanding by the
Controlling Shareholder pursuant to this paragraph, any and all payments due to
the Minority Shareholder as a result of either subparagraph (a) or (b) of this
paragraph shall be due and payable as follows: one half paid to the Minority
Shareholder contemporaneously with the sale of the Shares by the Controlling
Shareholder to a third party, and the remaining one half due and payable one
year thereafter, the payment provisions of subparagraph 5(a) of this agreement
to the contrary notwithstanding.
7. PURCHASE OF INSURANCE POLICIES ON WITHDRAWAL OF PARTY:
In the event that any Shareholder shall cease to be a party to
this agreement, such Shareholder shall have the right to purchase from the
Corporation the insurance policies on his life, if any, listed in Schedule "A"
for a price equal to the cash surrender value of the policies at the date of the
offer of sale. The right to purchase shall be exercised and the price paid
contemporaneously with the payment of the price for the
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Shares purchased from such Shareholder. The Corporation shall deliver the
policies to the Shareholder and shall execute any necessary instruments of
transfer. In the event any policies of insurance subject to the foregoing option
are not so purchased, such policies shall be released from the terms of this
agreement.
8. NOTIFICATION OF STOCK (EQUITY) ISSUANCE:
In the event that the corporation decides to issue stock to a
party not mentioned herein, the corporation will provide 30 days advance written
notice to the shareholders detailing the identity of the new shareholder, the
number of shares to be issued, and the conditions leading to the granting of
equity.
9. ANTIDILUTION PROVISIONS:
▇▇▇▇▇▇ and the Corporation both agree that they will not issue or
cause to be issued any Shares sufficient to make the number of Shares owned by
▇▇▇▇▇ thereafter less than Two and One Half percent (2.5%) of the total number
of Shares issued and outstanding, without first offering to purchase all of
▇▇▇▇▇'▇ Shares for a Total Purchase Price determined in accordance with
paragraph 5 of this agreement and on the terms and conditions as provided
therein. Should ▇▇▇▇▇ accept, within thirty (30) days, such offer to purchase
his Shares, the Corporation shall thereafter purchase the aforesaid Shares in
accordance with the terms contained in paragraph 5 of this Agreement. Should
▇▇▇▇▇ not, within thirty (30) days, accept the aforesaid offer to purchase his
Shares, the Corporation
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shall be free to issue any and all Shares permitted by law without regard to
this paragraph.
10. SUB-CHAPTER S ELECTION:
(a) Prior to making any transfer of the Shares under this
agreement, the transferring Shareholder shall obtain from the Corporation a
written certification that neither such transfer nor any transaction
contemplated with respect to such transfer (including, without limitation, the
foreclosure of any lien or encumbrance or, the case of a transfer in trust, the
termination of such trust or the taking of any action by any beneficiary of such
trust) will or may result in the termination of the Corporation's Sub-Chapter S
Election should such election be then in effect ("S Election"). The Corporation
may require, as a condition to any such certification to be provided by the
Corporation under this agreement, a legal opinion of counsel of its choice as to
the matters to be contained in such certification, satisfactory in form and
substance to the Corporation, and arrangements satisfactory to the Corporation
to ensure that any transferee shall take any actions necessary to maintain the
Corporation's S Election (including, without limitation, with respect to any
transfer in trust, the timely filing of an election to treat such trust as a
qualified subchapter S trust ("QSST") under Section 1361(d) of the Internal
Revenue Code, if applicable). Should it be necessary for the corporation to
obtain legal opinion concerning the impact of a Shareholder's actions on the
corporation's S Election status, the corporation will conclude its legal
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analysis within 30 days after receiving the request from the Shareholder.
(b) No Shareholder shall take any action which would result in the
termination of the Corporation's S Election without the prior written consent of
persons holding a majority of the Shares.
(c) If any Shareholder makes any transfer or takes any other action that
causes termination of the Corporation's S Election, the Board of Directors may
direct the appropriate officers of the Corporation to attempt to obtain a waiver
from the Internal Revenue Service of the terminating event on grounds of
inadvertency or to commence the appropriate procedure to obtain approval from
the Internal Revenue Service to file a new election to be treated as an S
corporation before the 5-year waiting period after termination of an S Election
has expired.
(d) Nothing in this agreement shall be construed to prevent the Corporation
or persons holding a majority of the Shares from terminating the Corporation's S
Election, if the Corporation's directors or such persons determine that such
termination is desirable.
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11. ENDORSEMENT ON STOCK CERTIFICATES:
Upon the execution of this agreement, the certificates of stock
subject hereto shall be surrendered to the Corporation and endorsed as follows:
This certificate is transferable only upon compliance with the
provisions of an agreement dated 15 Dec, 1992, between ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and MicroStrategy Incorporated, a copy of
which together with all amendments thereto is on file in the office
of the Secretary of the Corporation.
After endorsement the certificates shall be returned to the
Shareholders who shall, subject to the terms of this agreement, be entitled to
exercise all rights of ownership of the Shares.
All shares of stock of the Corporation hereafter issued to any
Shareholder shall be deemed to be "Shares" as defined in this agreement, shall
be subject to all of its terms and conditions, and bear the same or similar
endorsement.
12. TERMINATION OF AGREEMENT:
(a) This agreement shall terminate upon the occurrence of any
of the following events:
(i) Dissolution of the Corporation.
(ii) The voluntary agreement of all parties who are then
bound by the terms hereof.
(b) Upon the termination of this agreement, each Shareholder
shall surrender to the Corporation the certificate for his stock and the
Corporation shall issue to
25
him in lieu thereof new certificates for an equal number of Shares without the
endorsement set forth in paragraph 10.
13. TRANSFER OF SHARES IN VIOLATION OF THE AGREEMENT:
Any transfer of Shares or attempted transfer of Shares in
violation of this agreement shall be deemed null and void, and, at the election
of the Corporation or any Shareholder, be deemed to be an offer to sell the
Shares according to the provisions and procedures of paragraphs 1 and 5 of this
agreement.
14. ENFORCEMENT:
Since the parties will suffer irreparable harm and damage in the
event this agreement is not exactly carried out, it is stipulated:
(a) If any dispute arises concerning the transfer of Shares, an
injunction may be issued restraining any transfer pending determination of the
dispute; and
(b) If any dispute arises concerning the right or duty to buy
or sell, then the rights or duty shall be enforceable in a court of equity by a
decree of specific performance after the determination of the dispute.
These remedies, however, shall be cumulative and not exclusive and
shall be in addition to any other remedy which the parties may have.
15. BINDING UPON:
This agreement shall be for the benefit of and binding upon the
parties hereto, their heirs, administrators, executors,
26
successors and assigns, and the parties hereto do covenant and agree that they,
themselves, and their heirs, executors, administrators, successors and assigns,
will execute any and all instruments, releases, assignments and consents that
may be required of them in accordance with the provision of this agreement.
16. MISCELLANEOUS:
(a) All offers, acceptances, notifications and other
communications contemplated by this agreement shall be sent, by Registered Mail
return receipt requested, to the appropriate party at the then current address
contained in the files of the Corporation, and shall be effective upon delivery
or upon refusal.
(b) Any shareholder who either desires or is required to sell
his Shares pursuant to this agreement shall duly endorse and deliver all of the
Shares upon receipt of any initial payment.
17. CONSTRUCTION:
This agreement shall be construed under the laws of the State of
Delaware.
18. PRIOR AGREEMENT.
To the extent that any prior agreements may have existed covering
the same subject matter, the said prior agreements are hereby terminated and
declared null and void.
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IN WITNESS WHEREOF, the parties, for themselves, their heirs,
executors, administrators, successors and assigns, have hereunto set their hands
and seals the day and date first above written.
WITNESS:
/s/ ▇▇▇▇▇▇ ▇. Angeloui
--------------------------------
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (SEAL)
---------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (SEAL)
---------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
MICROSTRATEGY INCORPORATED
By:
------------------------------
ATTEST: By: [SIGNATURE APPEARS HERE]
------------------------------
Secretary
[CORPORATE SEAL]
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SCHEDULE A
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LIFE INSURANCE POLICIES
[None as of 1/1/90]